Wellness is a new consumer priority, especially at this time of year. With stress-relieving spa treatments becoming part of busy people’s routines and men becoming more interested in health treatments, the UK spa industry is poised to take advantage. So which companies are doing well?
Thanks to a growing trend among consumers to manage, reduce and relieve stress, look good, lose weight and take a more proactive and holistic approach towards their health the spa industry has become an important contributor to the UK economy.
There are around 800 day, residential, leisure club and hotel spas in the UK. And the sector has shown consistent, healthy growth in the last 15 years according to the trade body for the industry in Great Britain and Ireland, the Spa Business Association (SpaBA).
Research firm SRI International says the global spa industry is worth $60bn (£39bn) and the latest figures available to Mintel reveal that spas have become much more attractive to a mainstream audience in the UK with more than 35 million Brits a year spending £5.2bn on services and treatments. The substantial growth in the hotel spa market segment, and the entry of leisure club operators such as Bannatyne, Virgin Active and Center Parcs, have helped bring spas to a much wider audience.
But the industry is by no means immune to the credit crunch. As Suki Kalirai, chairman of SpaBA and director at beauty and spa therapy training business the Carlton Institute, confirms, growth in 2012 may be closer to “flat” than the double digits it has experienced for the past few years. And the risk of recession this year and high unemployment levels are likely to affect consumers’ ability and desire to spend money on spa treatments.
Looking to the future, however, there are huge opportunities for the UK spa sector, driven by a growing interest from people who want to change the way they take care of themselves – what has loosely been described as the “wellness trend”.
SRI International says the global wellness industry, which encompasses spas, complementary and alternative medicine, healthy eating, workplace wellness, fitness and anti-ageing therapy is worth $1.9trn (£1.2trn).
The good news is that the UK sector is poised to take advantage of the wellness trend and come out of the other side of the downturn looking healthy.
As Kalirai observes: “There’s innovation in both product and service that has driven growth.” Previously, he adds, people saw spas as a luxury but now he believes there’s a large percentage of the population who see treatments as a routine to help them relax, switch off and deal with the stress.
Tracey Stapleton, who launched The Spa PR Company in 2003 to take advantage of growth in the sector, says that she has seen demand for spas boosted by the introduction of gift vouchers. “Vouchers make up about seven per cent of sales, while online promotions are working well and bookings are up about 30 per cent.”
Spa visitors are a loyal market, says Stapleton, “and with a 75 per cent return rate I anticipate that wellbeing will continue to be an important aspect of modern-day life, particularly as work becomes more stressful and the working day longer”. She adds that day spas are experiencing growth approaching 25 per cent year on year.
Steady as you go
So how are companies within the UK spa sector dealing with the downturn, meeting the demands of consumers and preparing for the future? David Hamdorff, managing director of destination spa Ragdale Hall in Leicestershire, has been in the spa trade for 21 years and seen turnover at Ragdale rise every year. Having survived the recession in the early 1990s he’s stoic about the new challenges. “I’d like to think that as a mature business we know how to deal with this sort of situation,” he says.
What Ragdale has done to protect itself is reinvest heavily in the business and its staff. “If we look after our employees well they look after our guests,” explains Hamdorff. “As the business has done well over the last couple of decades we’ve invested in expertise, the facilities… Where many businesses were busy downsizing
we did the opposite.”
The spa industry has changed, he concedes. People want to relax and get away from it all. “If you’d been talking to me 20 years ago people were in denial about stress, nobody would admit to it. If you were stressed you were ill and needed to see a doctor. Now people want to be relaxed and looked after.”
Describing August 2011 as their worst trading period in five years, Vim Patel, co-owner with Amo Khan of Hydrohealing spa in London, says it’s a tough industry. “Demand has fallen, people haven’t got any money… We’re in a luxury industry and we’re the first thing to be cut,” he claims. “But we’ve developed a good client base of 11,500 people, we have A-listers and the local population – our bread and butter.”
Patel, a trained pharmacist, says his business has a key differentiator that he hopes will give the £520,000 turnover company a competitive edge. “In our industry everyone calls themselves a spa but if you peel the layers off a lot of it is the same – there’s no science, it’s a bit wishy washy. So we came up with an angle: deliver a therapeutic service but have an element of luxury as well.” All the science-led treatments at Hydrohealing use mineralised water directly or indirectly to promote health and wellbeing, he explains.
Patel agrees with Hamdorff that the greatest growth within the industry is “wellness” and that men are increasingly buying into the concept. “We’ve seen more men undergoing colonic irrigation. They’re not prudish anymore. We’re trying to piggyback off that mentality for men to look smarter, exercise more and eat better.”
New business opportunity
Seizing a gap in the market has given new and award-winning business Blythswood Square a real “wow” factor, says its spa director, Leon Trayling. Explaining that it was chairman Peter Taylor’s vision to open a full-service, high-end spa in central Glasgow, he says Blythswood has garnered huge interest. “Many cities around the world don’t have full-service spas like this. It’s grown quickly in the year since we opened: we deal with 60 people a day.”
Taylor invested £3m in the 10,000 sq ft spa. “There was no bedding-in period. You have to generate a lot of treatment revenue and get a return on investment quite quickly,” says Trayling. “They had a stressful time opening this one, in this climate. There were a lot of delays and complications. But there’s a desire for it. We’re not cheap, but we’re getting repeat bookings. Twenty thousand guests have used the spa and our therapist utilisation for the year is 79 per cent. That’s high, especially for a new business.”
He says spas are “definitely” becoming more popular with men and it’s an area where there’s opportunity for growth. “I spoke to a customer who travels 200,000 air miles a year. He needs his weekly massage. When it’s got a purpose, that’s when they find it convincing. It makes sense if it’s a stress reliever or helps them sleep or gets rid of the knots in their back. Men have a much more pragmatic approach to spas.”
Move with market demand
In an industry where there’s “a hell of a lot of competition”, innovation and being fleet of foot are key to survival, says Simon Lowe, owner of destination spa Grayshott in Surrey. “From the middle of the recession we’ve taken a new turn. We’ve been experimenting and have created a new division: Grayshott Health,” he explains.
“The basis is that it’s a need not a want. It’s not a pampering thing that you can go and have everywhere else. We have five major initiatives and that’s how we’re pulling ourselves away from the competition and adapting to the current economy.”
Focusing on weight management, sleep, burnout, the menopause and recuperation, Lowe says: “It’s always a question in business of seeing the opportunities, the pitfalls and how you can adapt. This is not something you can adapt to quickly – you have to plan it. We saw the writing on the wall and started moving in this direction.”
After five years of steady growth except for 2011, Lowe says the business is six per cent down on sales. “But we’re not much down on profit by virtue of intelligent cutbacks. The most important thing is we’re still giving great satisfaction to our clients and our  staff are happy to be with us.”
While men aren’t “beating down the door” to use the spa, he reckons there’s been a steady increase over the years. “I’d include myself in that. They don’t talk about it as much as women but the fact is that men can have problems sleeping, get a bit overweight and get stressed out. We want to help guys feel great and relaxed: it’s important.”
The digital revolution
Describing the spa industry as poorly represented online, Lopo Champalimaud left Lastminute.com to start wellness site Wahanda.com to match what other sectors had done for years. “I thought, how is it that there are hundreds of websites to help people book hotels, flights and holidays but nothing for health and beauty?”
He says the sector needed three things online: a comprehensive database, a consumer vetting process and a way for customers to find good deals or do price comparisons. “What we talk about is searching, sharing and saving.”
Champalimaud launched the business three-and-a-half years ago with funding from “some great people” including Lastminute’s Brent Hoberman. What did they see in his start-up? “White space – a huge market which hasn’t really been developed properly online yet,” says Champalimaud. “We’ve built traction.?We’ve grown quickly in a short period of time, largely organically through word of mouth, and the comprehensiveness of what we have is amazing. We have 250,000 businesses, we’ve got 6,000 reviews and we’re closing in on almost one million visitors a month coming to the site. The business more than tripled last year and we’re pleased with how it’s going.”
He thinks the big trend is results-driven treatment. “Our fastest-growing category is spa breaks. People are thinking more holistically about what they’re doing. People are looking for an escape for a shorter period of time but they don’t want to spend money on flights. UK spa breaks are cost-effective and accessible.”
Spa industry in numbers
£1.2trn … the value of the global wellness sector, which includes spas, alternative medicine and fitness
£39bn … what the global spa industry is worth
£5.2bn … is spent in the UK on spa services and treatments
800 … the number of spas in Britain
Six to visit in 2012
Eco spa Titanic, Yorkshire
The UK’s first eco spa located on the edge of the Pennines, Titanic is a destination spa set within a traditional textile mill. Facilities include extensive heat and ice experience areas, an Egyptian mud chamber and a hammam. The spa was built to combine a passion for beauty and wellness with a desire to protect the planet. Designed to appeal to both men and women, it offers a calm environment away from the stresses of everyday life.
Day spa Dolphin Square, London
As soon as you enter you feel you’re in a relaxing Moroccan riad. Dolphin Square spa fuses ancient therapies and contemporary spa philosophies using ultra-modern products Comfort Zone and Aromatherapy Associates. They centre on four principles: cleansing and purifying; relaxation and balance; wellness and integrated health; and prescriptive maintenance and repair. Treatments include the Moroccan Majorelle, which ends with an invigorating massage.
Spa break Pennyhill Park, Surrey
Set amid 123 acres of lush woods and parkland, this three-storey spa is a haven of relaxation. With 10 pools, a mix of thermal and steam rooms, a tepidarium with heated ceramic beds, Li’Tya spa treatments based on Aboriginal plant wisdom, rituals for face, hands and feet, body wraps, exfoliations and spa water therapy, you’ll never want to leave. It also has a golf course and a stylish restaurant.
Health spa Beyond MediSpa, Harvey Nichols, London and Edinburgh
Full-time doctors and medical aestheticians offer the latest treatments and technologies as well as “pampering” to help you feel good. Treatments include medi-facials to strengthen and defend the skin against environmental stresses. The Visia Skin Complexion Analysis involves taking a series of three-dimensional digital and ultraviolet images of your face to reveal your skin’s health and any underlying problems beneath the surface.
Executive restoration spa Champneys, various locations
The grande dame of British spas, Champneys now offers a new programme for executives wanting to learn how to lead a more healthy lifestyle. With sessions including “You may look interesting, but what shape is your body in for business?” and “Hunter-gatherers in the corporate jungle: The need to know on executive nutrition”, the aim is to help customers restore their vigour and drive and build a personal plan to improve energy.
Hotel spa Lucknam Park, Wiltshire
The ideal place to leave everyday life behind, Lucknam Park is unspoilt, five-star country house living at its best. Using wood, marble and glass to reflect the seasonal hues of the estate’s 500-acre parkland, the spa has nine state-of-the-art therapy rooms, a 20-metre indoor pool, two hydrotherapy pools, five thermal cabins, and a saltwater plunge pool. Treatments include the soothing shoulder, scalp and foot therapy, a healing treatment to soothe away stress.