Wellness a growing niche for the hospitality sector

1. Wellness a growing niche for the hospitality sector Mag. Susanne Kraus- Winkler

2. Wellness – Is there a definition ? „Wellness“ „Spa“ Acronym of the Latin phrase „Sanus per aquam“ (Health through water) Dr. Halbert Dunn, USA 1950: „High level wellness“(well-being + fitness)

3. Why are we talking about wellness, as a growing niche for the hospitality sector? Content • Why is wellnessan attractive niche? • Wellness/spa today • Facts about the spa industry • Example: LOISIUM – wine & spa resort - Vienna region/Austria • Example: Hotel Ystads Saltsjobad - Ystad / Sweden • Consumer travel trends – Factors driving spa growth

4. Why is wellness anattractive niche? • Spa services are inspiring • Spa culture is ‘positive’ – associated with wellness and affluence • Spa culture acts as a glamorous ‘ambassador’ for a destination • Spa: a way of life whose ‘time has come’

5. Wellness/Spas today • Various types of spas Day spas, resort/hotel spas, medical spas, destination spas, etc. • Spa establishments Continuous growth in number in all types • Spa industry A major trend for the hospitality industry International SPA Association, Hospitality Inside 2006

6. Facts about the spa industryAverage rates - Spa hotels Average room rate in hotels with spa offers Spa hotels Business hotels Holiday resorts Quelle: HotelBenchmark Survey von Deloitte 2004

7. Facts about the spa industry (2)Occupancy -Spa hotels Average occupancy rate Average length of stay Quelle: Survey ghh consult 2004

8. Facts about the spa industry (3)Average spa area Average proportion of the several areas of the total Spa area Aqua Sauna Fitness Treatments Others (outdoor) Spa hotels Business hotels Holiday resorts Quelle: Survey ghh consult 2004

9. Facts about the spa industry (4)Investment costs Evaluation of the investment costs of the wellness area in different hotel types Average investment costs per m² of the several spa areas Quelle: Survey ghh consult 2004

10. Facts about the spa industry (5)Revenue/Cost Average spa revenue in total hotel revenue Average spa costs in total hotel costs Percentage of the hotels Spa hotels Business hotels Holiday resorts Percentage of the hotels Spa hotels Business hotels Holiday resorts Operating profit of the spa department Quelle: Survey ghh consult 2004

11. LOISIUM – wine & spa resort Vienna Region / Austria • 82 rooms, 4-star hotel, Design: Steven Holl • Opening October 2005 • AVEDA destination SPA • Vinotherapy treatments • 12 treatment cabins, 4 sauna, cardio zone, • All-season heated outdoor pool (5m x 20m) surrounded by vineyards • Room occupancy 1st year of operation 57 % • Average room rate € 98.- • Net revenue per room sold € 245.-

12. LOISIUM

13. Hotel Ystads Saltsjobad / Sweden 2004 2006 forecast (without Spa) (after opening Spa) • Room occupancy 41% 55% • Average room rate € 101.- € 117.- • Revenue split • Rooms 63% 49% • F/B 37% 35% • SPA - 19% • Net revenue/Room sold € 255.- €302.- Spa area: 800m² gym, indoor pool area, relax room, jacuzzi, steam sauna, sauna, 11 treatmentrooms and SPA bar/café

14. Consumer travel trends – Factors driving spa growth Main Markets: Europe, North America, Japan, Australia/NZ • Modern society: increasing pressure & stress. Leisure time & relaxation increasingly important • Importance of travel as a lifestyle option: an affordable indulgence • Consumers: more sophisticated, experienced & self confident regarding needs and rights. More critical of the price-quality ratio • Demand for authenticity • Ageing demographics = increasing demand for quality, convenience, security, ease of access & “luxury” • Health consciousness is increasing • Demand for wellness products increasing, including spas, fitness centres and fully-fledged medical tourism

15. Thank You Mag. Susanne Kraus- Winkler