Hotel spa bookings, revenue on upswing in Middle East

DUBAI Revenues for hotel spas in Dubai are rapidly increasing and have risen by 45.5% in the first quarter, a new report by Ernst & Young says.

Confirming that operational and business process improvement are an increased focus for spas this year, Revenue per Available Treatment Room Hour (RevPATH) in the first quarter came in at Dhs77, a 5.5% increase over the Dhs73 RevPATH a year ago. Year-to-date use of treatment room hours also increased to 25%, up a percentage point from the first quarter of 2009.

In the first quarter, 61% of Dubai spa treatments were booked by hotel guests while non-hotel guests or day spa visitors booked only 39%. On a monthly basis, the percentage of hotel guests visiting spas ranged between 60% and 62%, which is higher than the 48% to 58% range witnessed during all the months in 2009.

“The increasing share of hotel guest visitors to spas, combined with the increase in aggregate spa revenues, is a positive trend as it points towards the fact that hotel guests’ propensity to spend on spa services appears to be returning,” says Nikita Sarkar, spa industry specialist at Ernst & Young MENA. “Dubai hotel spa operators may now have the opportunity to create more effective marketing and promotion programs and move away from price-based discounting of last year.”

Ernst & Young’s survey results highlight the importance of effectively integrating spa and fitness offerings at hotels, Sarkar says. “In addition, other charges including day usage fees and rental fees can be expanded via membership and loyalty programs that induce repeat visitation. Through these, spas have the potential to maximize revenue generation from typically non-revenue producing areas of the spa—steam, sauna, lounges, etc.—without necessitating customer spend on high price point spa treatments,” Sarkar says.