Successful Spa Strategies
In an economy this sour, who can afford $140 for a 50-minute massage? But $99, with a mini-pedicure tossed in? Now you’re talking.
Casino-resort spas are riding out the recession with some clever strategies and sweet deals on treatments.
The $99 deal at Morongo Casino Resort Spa is just one of many such offers.
Agua Caliente Casino Resort Spa, one of the newest additions to an already-busy spa scene in Southern California’s Coachella Valley, opened in spring 2008 with an aggressively priced, 50-minute massage for $89, with a manicure, pedicure or wash-and-style thrown in for an additional $20. The goal was to create some buzz around a new property.
As the economy headed south, Agua Caliente opted to maintain the $89 special price, at least for the time being. The strategy seems to have worked. The spa is making money, if not hand over fist.
“We would rather do volume than be stubborn and keep the pricing high,” said Bob Maloney, director of hotel operations at Agua Caliente. “It’s the old analogy: Would you rather sell three Dodge Neons or sit on a Mercedes?”
A key element to the strategy is up-selling, Maloney said. The $89 price gets clients in the door, where the front desk staff tries to sell a more expensive treatment. About half the time, the client purchases an up-sell. “We like to present the front desk people as not order takers but salespeople,” Maloney added.
Elemis Spa at Mohegan Sun in Connecticut is slashing prices but also slashing treatment times. Bruce Pine, senior vice president for Mandara Spa, the division of Steiner Leisure Limited that operates Elemis, called these shorter treatments “tasters.”
“Instead of spending $140 on a basic massage, you can come in for $59 and get a 30- or 40-minute experience,” Pine said. “We also add in a secondary service free of charge. If you get a massage, you can get a complementary scalp massage or a hand massage. For $59, you won’t keep them out of the spa.”
Pine said tasters are successful at keeping the spa busy but marginal in terms of profitability. However, the revenue-generating potential is there. Customers tell their friends, who tell their friends, who may end up buying a more expensive treatment. Tasters also bring traffic into the retail store, an integral part of most resort-casino spas these days.
Morongo Casino Resort Spa was offering a 50-minute massage or facial followed by an “express” pedicure or manicure, all for $99. At a price point that low, the spa wasn’t turning much of a profit. But the goal was less to generate revenue than to build exposure and generate future bookings, said Thomas Mueller, Morongo’s director of hotel operations.
“We wow them with a great service and great price point, and they think, ‘What a deal. We’ve got to come back,’” Mueller said. The spa staff’s goal is to make the booking for a future treatment before the client leaves the spa.
At Orleans Casino & Hotel in Las Vegas, the days are long gone when the average hotel guest would automatically schedule a spa treatment.
In addition to shaving 10 percent to 15 percent off the price of treatments, the Orleans was marketing the spa much more aggressively than in the past. The restaurant ad in the backlit display in the elevator was switched out for a spa ad. The reception desk made sure to hand each guest a 20 percent-off coupon for the spa at check-in. Guests found a spa brochure in their room. Plans were under way for new guestroom keys featuring a pitch for the spa.
“We want them to hear the spa name or see some sort of literature for the spa three or four times while they’re here,” said Shelley Essex, the Orleans’ director of hotel operations.
Many resort casinos were offering spa-hotel packages. The IP Casino Resort Spa offered two, $20 spa credits as part of a $79.99 room package.
Agua Caliente’s sister property, the Spa Resort Casino in downtown Palm Springs, was resisting the temptation to cut prices, even as some competitors dropped prices from $160 to $99 specials. The spa’s signature, 50-minute Swedish massage remained $115 and the 80-minute massage went for $180.
Instead, the spa offered clients a little more for their money, said Linda Richey, director of spa operations. A stuffed-camel giveaway during a Morocco-themed promotion was a big hit, she said. “People were clamoring for that camel,” she said.
Richey said that the headcount of clients has not dropped off much, but customers tended to spend fewer dollars.
At Pala Casino Spa Resort, Director of Spa Operations Amy Lopez said the poor economy has affected the spa, but it’s not feeling the hurt as badly as non-casino-hotel spas.
“With the casino we’ve been able to drive business using direct mailers and database marketing using the Privileges Card [the casino-hotel’s loyalty card] and things of that nature,” Lopez said. “That’s really helped to maintain our business levels.”
Recent promotions at the hotel-casino spa near Temecula, Calif., have included buy-one, get-one-free coupons for spa treatments; a free plush robe with purchase of a spa treatment; and special deals on spa product purchases.
The offers are working, she said. “We’re getting a pretty big response. I would say our coupon usage is definitely up year over year,” as customers seek out the best value for their dollar, Lopez said. “We’ve really seen those coupons drive incremental cash business to the property.”
The spa is an important component of the Pala property, she said. “What we typically see at this spa is normally you have a player who comes to the property and a guest of the player who comes to the property, a spouse or a significant other who might not necessarily be a gambler. The spa gives the guest of the player something to do while the player is at the tables or playing the slots. “
The spa also has reached out to the local area to woo their business as well, she said.
And recently the spa launched its own signature spa amenity line, including items such as shampoo, conditioner, hand lotion and bath salts, and is cross-promoting it with the hotel by using the products in each hotel guest room.
Having something tangible to take home can help entice return visits, Lopez said, envisioning a customer recalling a pleasant spa visit while donning the plush robe at home or sniffing the spa’s signature scent – cucumber-melon – as she smoothes on hand lotion.
The Atlantis Casino Resort Spa in Reno, Nev., recently unveiled a lavishly redesigned and expanded spa that is twice the size of its predecessor. A recession doesn’t seem like an auspicious time to open doors on what is essentially a new business, but the Atlantis is looking on the positive side. “We have a philosophy that we have to keep moving forward,” said Atlantis spokesman Ben McDonald. “We had these plans in place long before there was any talk of a recession and our spa will be here long after this passes.”
The Atlantis doesn’t plan on cutting prices to bring feet through the door. McDonald said the spa expects clients will book treatments based on the spa “experience,” which will include the ancient Arabic mud treatments known as Rasul, and pantai luar massages, which involves hot oil and sachets filled with coconut lime, ginger, lemon grass and various herbs.
The Lexington, Ky.-based International Spa Association predicts that clients will be looking for shorter and less expensive treatments in 2009.
The association also sees consumers moving away from trendy menu items in favor of tried-and-true treatments. At the Spa Resort Casino in Palm Springs, the cookie-dough treatment, which wasn’t selling particularly well, is off the menu. “We feel the menu is valuable real estate, so we want to have items on there that sell well,” Richey said.
Still, spas, like most businesses, are still on the lookout for the latest and greatest. The IP in Biloxi offers a paprika cellulite treatment and a blueberry body wrap. Elemis Spa at Mohegan Sun was poised to introduce a gold-leaf facial designed to extract impurities from the skin. Pine said the facial would definitely be "ultra high end."
Pine said that Elemis at Mohegan Sun is looking into adding Restalyne and Botox treatments to the menu. Steiner Leisure has been beta testing the cosmetic injections on cruise ships and the treatments have been "doing very well.”
Pine said that cosmetic injections tend to be an impulse purchase, which makes them ideally suited to the resort-casino environment, where the typical stay is two days to a week.
"It's so convenient. You're already "With that in mind if you had somebody who is medically trained in five minutes eliminate the wrinkles on your forehead at a similar price to what you would pay your local (doctor), why not?"
LED light therapy, microdermabrasion and teeth whitening are on the spa menu at the IP Casino Resort Spa in Biloxi, Miss. Because spa employees are not licensed to practice dentistry, clients make their own dental impressions during the spa appointment; the trays and whitening gel arrive in the mail about a week later. Norton said the whitening service is popular, at least in part because it costs significantly less than clients would pay in a dental office.
Still, the body treatment remains the bread and butter for resort-casino spas.
“Our number one treatment is still the massage,” Norton said.
Mohegan Sun’s Elemis Spa replaced its client questionnaire with a much shorter version. The idea was to get clients into the treatment room as quickly as possible, Pine said.
Clients at casino-resort spas appear to be doubling their fun. Couples treatments have never been hotter. The IP Casino Resort Spa in Biloxi has a couple’s suite with side-by-side massage tables, a Jacuzzi for two, and a double chaise lounge.
Despite the economy, some spa-aholics who refuse to give up their weekly massage. “That core group is much more significant than I thought,” Pine said.