NEWS
Revenue management for spas — a win-win for spa operators and guests
POSTED 19 Jul 2016 . BY Frank Pitsikalis
Like many sectors of the travel industry, spas have perishable inventory, says Frank Pitsikalis, founder and CEO of ResortSuite, but yet most don’t employ a revenue management system. In an exclusive Thought Leader column for Spa Opportunities, Pitsikalis suggests using dynamic availability can offer a solution that doesn’t mean changing your spa menu – and can be a win-win situation for everyone.

The airline industry, hotels and car rental companies would not dream of operating without revenue management as a core business practice.

Like the spa industry, they all have perishable inventory. If a day goes by and a hotel doesn’t sell a room, that revenue opportunity is gone forever. If a plane takes off with a seat unfilled, it is a lost revenue opportunity — the plane’s fixed costs to operate are still the same and the variable cost to fill one more seat is very low.

These are perfect candidates for revenue management and these industries do it masterfully. But why not the spa industry? Every hour that goes by where a treatment room is unfilled is a lost revenue opportunity.

The spa industry, like the others mentioned, has periods of variable demand. Sometimes the spa is empty, and at other times, the demand is so high that even if the spa had triple the number of treatment rooms, they could fill them all.

Yet the spa industry, with very few exceptions, continues to book all the services that they offer – at the same price – during their high-demand periods.

My philosophy is that people in the spa industry immediately think, “we have a published menu and it would be unethical to change the price” (known as dynamic pricing), and they dismiss the strategy before any further consideration.

But what if you could use dynamic availability instead? An example might be shortening your menu (to higher margin services) or not offering 90-minute or longer services during peak times – you will serve more guests in the spa, creating more retail opportunities, and likely earning more profit per minute on a shorter service than a longer one. You can do all this with the same published menu you have today.

The time has absolutely come that we reach our financial potential as an industry. The ironic thing is that airlines now serve a much wider demographic than before revenue management. So you can do right by your business and do the right thing for your guests too.
 


ADVERTISE . CONTACT US

Leisure Media, Portmill House, Portmill Lane,
Hitchin, Hertfordshire SG5 1DJ Tel: +44 (0)1462 431385

©Cybertrek 2018

ABOUT LEISURE MEDIA
LEISURE MEDIA MAGAZINES
LEISURE MEDIA HANDBOOKS
LEISURE MEDIA WEBSITES
LEISURE MEDIA PRODUCT SEARCH
PRINT SUBSCRIPTIONS
FREE DIGITAL SUBSCRIPTIONS
 
Spa Opportunities: - Revenue management for spas — a win-win for spa operators and guests...
Sign up for FREE ezine
Spa Jobs spa Industry News spa training spa oppportunities magazine spa opportunities blog spa-kit.net spa industry products Submit your news Advertise on Spa Opportunities Contact us at Leisure Media Follow us on Twitter Like us on Facebook

Jobs Search





joblink

Latest operator jobs
Celtic Manor Resort
Sofitel London Heathrow
To advertise call
+44 (0)1462 431385


traininglink

  Training Directory
Train as a Les Mills Instructor
To advertise call
+44 (0)1462 431385


diarydates

  Powered by leisurediary.com
24-26 Sep 2018
ISPA Conference and Expo 2018
Phoenix Convention Center, Phoenix, United States
25-26 Sep 2018
International Wellness Conclave (IWC2018)
Radisson Blu Plaza Delhi Airport, Delhi, India

spa-kit
suppliers news


Elemental Herbology launches new Coconut Shell Cream Body Scrub Treatment

Elemental Herbology is delighted to announce a new, full-body exfoliating treatment designed to gently buff and polish, for healthy, glowing skin.

beauty-kit


Laurie Nicoll Nord and Julio Lamberty partner to launch new skincare company
Veteran skincare professionals Julio Lamberty and Laurie Nicoll Nord have joined forces to launch Luxury Wellness International, a new skincare company that aims to create 'clean' results-driven, professional skincare.


 
latest spa jobs
1 to 2 of 2 Jobs
Spa Sales and Reservationist
The Bulgari Hotel London
Salary: Competitive Salary & Benefits
Job location: London, UK More>>
 


The Wave - Spa Manager
CV Life
Salary: Competitive Salary & Benefits
Job location: Coventry, UK More>>
 


Spa Therapist
Sofitel London Heathrow
Salary: Competitive Salary & Benefits
Job location: Longford, UK More>>
 


Spa Therapist

GLL

Salary: Up to £19,707 per annum
Job location:
Old Street, East London More>>
Spa Therapist

GLL

Salary: £19,707 per annum
Job location:
Bethnal Green, East London More>>

Senior Spa Therapist
The Bulgari Hotel London
Salary: Competitive Salary & Benefits
Job location: London, UK More>>
 


Casual Spa Therapist
Sofitel London Heathrow
Salary: Competitive Salary & Benefits
Job location: Longford, UK More>>
 


Spa Therapist
The Bulgari Hotel London
Salary: Competitive Salary & Benefits
Job location: London, UK More>>
 


Jobs page: 1


 
latest spa news

19 Jul 2016

Revenue management for spas — a win-win for spa operators and guests

BY Frank Pitsikalis

Frank Pitsikalis is founder and CEO of ResortSuite

Like many sectors of the travel industry, spas have perishable inventory, says Frank Pitsikalis, founder and CEO of ResortSuite, but yet most don’t employ a revenue management system. In an exclusive Thought Leader column for Spa Opportunities, Pitsikalis suggests using dynamic availability can offer a solution that doesn’t mean changing your spa menu – and can be a win-win situation for everyone.


The airline industry, hotels and car rental companies would not dream of operating without revenue management as a core business practice.

Like the spa industry, they all have perishable inventory. If a day goes by and a hotel doesn’t sell a room, that revenue opportunity is gone forever. If a plane takes off with a seat unfilled, it is a lost revenue opportunity — the plane’s fixed costs to operate are still the same and the variable cost to fill one more seat is very low.

These are perfect candidates for revenue management and these industries do it masterfully. But why not the spa industry? Every hour that goes by where a treatment room is unfilled is a lost revenue opportunity.

The spa industry, like the others mentioned, has periods of variable demand. Sometimes the spa is empty, and at other times, the demand is so high that even if the spa had triple the number of treatment rooms, they could fill them all.

Yet the spa industry, with very few exceptions, continues to book all the services that they offer – at the same price – during their high-demand periods.

My philosophy is that people in the spa industry immediately think, “we have a published menu and it would be unethical to change the price” (known as dynamic pricing), and they dismiss the strategy before any further consideration.

But what if you could use dynamic availability instead? An example might be shortening your menu (to higher margin services) or not offering 90-minute or longer services during peak times – you will serve more guests in the spa, creating more retail opportunities, and likely earning more profit per minute on a shorter service than a longer one. You can do all this with the same published menu you have today.

The time has absolutely come that we reach our financial potential as an industry. The ironic thing is that airlines now serve a much wider demographic than before revenue management. So you can do right by your business and do the right thing for your guests too.



Connect with
Spa Opportunities
Magazine:
View latest issue
Sign up:
Instant Alerts/zines

Print edition
 

Six Senses Krabey Island to include expansive spa with meditation cave
Dr Marilyn Glenville to lead two-day wellness retreat at Gaia Spa at Boringdon Hall
Massive Turkish wellness project includes three hotels, thermal baths, residences
Multi-million pound investment transforms St Michaels Falmouth into luxury resort
Jenna Laramee joins WTS International
Laurie Nicoll Nord and Julio Lamberty partner to launch new skincare company
 
Catalogue gallery



Featured supplier




Invest in your employees – and your company – with FH Joanneum’s MBA in spa management

The FH Joanneum University of Applied Sciences offers a unique MBA programme in International Hospitality and Spa Management, and for the first time, is offering substantial financial grants for students who begin the course this year.


Company profile



Amac offer fully-accredited training courses which are recognised nationally by employers. Fitness education is our area of expertise and the quality of our teaching remains unrivalled by any other provider.
View full profile>>

spa directory

Spa furniture

Brand consulting

Spa equipment and treatment products

Skincare

Hydrotherapy / spa fragrances

Computer solutions

Consultancy & management

Skincare

Consultancy & management

Lockers



Published by The Leisure Media Company Ltd Portmill House, Portmill Lane, Hitchin, Herts SG5 1DJ. Tel: +44 (0)1462 431385 | Contact us | About us | © Cybertrek Ltd