US Spa Market

(Skin care, facials, massage, waxing, depilation, hair removal, beauty, nails, tanning, therapies, treatments, modalities, professional, brands, treatment and product categories, spa concepts, market leaders, market segmentation, United States of America)

TABLE OF CONTENTS

Table of contents 2
REPORT STRUCTURE 10
SECTION 1 SUMMARY REPORT DATA 13
TABLE 1 Spa market size - value and volume and % variation 13
TABLE 2 Spa segmentation (%) day, hotel, and medspas 13
TABLE 3 Spas revenue sources (%) treatment categories, and product retail 14
Summary market challenges 14
Methodology 15
Date publication 15
Currency 15
SECTION 2 MARKET SIZE - USA SPA MARKET 16
Introduction / summary 16
TABLE 4 Spa market size - units and sales 16
What is included in the spa count? 16
TABLE 5 Spa concepts and categories (day spas, hotel spas, medspas) 17
Spa market and hyper-differentiation 17
Definitions used determine what is counted 17
SECTION 3 MARKET TRENDS - CURRENT AND FORECAST 19
Introduction / summary 19
TABLE 6 Spa revenue variations –– historical, current, and forecast 19
Not just a decline, a disaster –– the phones stopped ringing (quotes) 19
TABLE 7 Consumer changes in the frequency of spa visits (examples) 20
Closures and churn in the spa market 20
“Great deals out there … if you have the finance” 20
SECTION 4 SPA INDUSTRY STRUCTURE –– SEGMENTATION (ABC) 22
Introduction / summary 22
TABLE 8 Spa market segments (ABC), % distribution of units and revenues 22
US spa market not unique (concentration of revenues) 22
Segment A spas quantified and qualified 22
Segment B spas quantified and qualified 23
Segment C spas quantified and qualified 23
TABLE 9 Spa market segments (ABC) “typical” revenues per unit 23
TABLE 10 Spa business benchmark data, selected chains 24
Regulations can specify a minimum size for spas and salons 24
Federal government designation of “small business” ($ revenues) 24
SECTION 5 SPA INDUSTRY STRUCTURE –– GEOGRAPHY, OWNERSHIP, NUMBERS OF MULTIPLES 25
Introduction / summary 25
TABLE 11 The % of spas in top five states, top ten states, and other forty 25
The top ten states for spas 25
TABLE 12 Distribution of day spas and hotel spas, selected states 26
Sources used for the regional distribution of spas 26
TABLE 13 Distribution of spas (%) of single unit and multi unit companies 27
Massage and sole operators 27
New type of spa multiple? 27
When is a multiple a multiple? 27
Spas and types of business entities 27
SECTION 6 SPA MARKET BUSINESS ACTUALITIES - REVENUES BY CATGORY OF SERVICES / PRODUCTS 28
Introduction / summary 28
TABLE 14 Spa revenues (%) from treatments, and from product retail 28
US spa market not unique (income from services) 28
TABLE 15 Spa revenues (%) by treatment category 29
Demand for the basics and the exotics in spas 29
Changes in consumers’ demands since 2008 29
The revenue generating spa services 29
TABLE / GRAPH 16 The spectrum of spa offerings 30
TABLE 17 Spa distribution (%) of units by menu of treatments on offer 30
Findings consistent in different data sources 31
SECTION 7 SPA MARKET BUSINESS ACTUALITIES - MASSAGE 32
Introduction / summary 32
TABLE 18 Spa massage market, summary of data 32
The top massage therapy 32
Massage estimated market value 33
Massage treatment fees and products 33
Massage an unbranded category 33
Drivers, issues, threats for spa massage 33
Only professional, no DIY massage 33
The iconic status of the three stones 34
Regular lifestyle or occasional indulgence? 34
How mice and monitors can drive massage 34
Hands stressed, but work is non manual 34
Power of human touch, DIY and automated 34
Easy availability, more competitive 35
Massage therapies an entry point to spa market 35
Competition / churn in the massage sector 35
Spa operators, brands 35
Spa massage menus and changes 36
Massage standards, claims, and proven outcomes 36
Relaxing massage versus therapeutic and insurer reimbursed massage 36
Massage rituals and etiquette to reduce consumer fears/inhibitions 37
Spa massage … threats and opportunities 37
SECTION 8 SPA MARKET BUSINESS ACTUALITIES (REVENUES BY CATGORY OF SERVICES / PRODUCTS) - SKINCARE 38
Introduction / summary 38
TABLE 19 Summary skincare business in spas 38
Skincare value estimate and forecasts 38
Drivers, issues, and threats for spa skincare 39
Facial skincare because face is visible 39
Spa services hard to duplicate at home 39
Skincare a retail driver 39
Spas the catalyst for new skincare categories 40
Companies and brands in spa skincare (summary) 40
Spa skincare - threats 40
Spa skincare - threat from tanning clinics? 40
Spa skincare - retailers 41
Spas’ demands of skincare products 41
Spa skincare demands and different body parts 41
TABLE 20 Top spa skincare treatment protocols 42
Manual and mechanical / European and American 42
Skin peels, dermabrasion, and dermaplaning 42
TABLE 21 Consumers’ skin problems 43
Other beauty services (eyebrows and lashes) 43
SECTION 9 SPA MARKET BUSINESS ACTUALITIES - HAIR REMOVAL AND OTHER BEAUTY 44
Introduction / summary 44
TABLE 22 Summary hair removal business in spas 44
Hair removal value and changes 44
Hair removal drivers, issues and threats 44
Men and waxing 45
Threat of competition worsens, the threaders 45
Hair removal and high volumes (quotes) 46
Brands and spa hair removal 46
TABLE 23 Hair removal, face and body parts treated 46
Waxing protocols 46
Intimate waxing 47
Estheticians upskill 47
Reluctance to wax some body parts 47
Other beauty services (eyebrows and lashes) 47
SECTION 10 SPA PRODUCTS MARKET - VALUE AND TRENDS, ACTUALITIES OF PRODUCT RETAIL
48 Introduction / summary 48
Methods used to quantify value of spa products market 48
TABLE 24 Estimates of value of spa products market (purchases and retail) 49
Buying power could be concentrated 49
Value of spa product retail ($) 49
Spa mark ups on retail 49
Retail sales trends in 2010 49
Any switch from treatment to retail? 50
The “product pushing” services 50
Retail spending variations and the impact of airline luggage restrictions 50
Drivers, issues and threats for spa retail 50
Spa exclusivity 51
Dilute exclusivity 51
Dilute margins 51
Spa David and retail Goliath 51
Retailers stealth services 52
TABLE 25 Spas sampled revenues (%) services, retail and gift 52
SECTION 11 BRANDS – NAMES AND NUMBERS HANDLED 53
Introduction / summary 53
TABLE 26 Spas and numbers brands handled (average per spa) 53
Retail, the numbers of brands and own labels 53
TABLE 27 The best known brands in spas 54
Spas launch pad for new brands 54
Only “spa brands” 54
SECTION 12 SPA PRODUCTS / BRANDS – NEW BRANDS AND THE UNBRANDED SPA CATEGORIES 55
Introduction / summary 55
TABLE 28 Spa categories - branded and unbranded 55
An unbranded luxury market? 55
The unbranded from hotels? 56
Bring your own? 56
Unbranded entry point – imports and new 56
Brands - own label 56
SECTION 13 SPA PRODUCTS / BRANDS - CONSUMER BEHAVIOR CREATES NEW PRODUCT CATEGORIES- 57
Introduction / Summary 57
Spa brand market characteristics 57
TABLE 29 Spa market - the new concepts, nature or science? 57
Scientific a new category in spas 58
Organic / green formulations in spas 58
Beauty formulations in spas 58
Spas engine of new direction for personal care products 59
Diagonal Reports forecasts accurate 59
Spas more demanding, organic certification looked for 59
Spas brands are ethical 60
SECTION 14 SPAS AND PRODUCT PURCHASING CRITERIA 61
Introduction / summary 61
TABLE 30 Spas and product purchasing criteria 61
Change in criteria since downturn? 61
Assortment of products required 61
In spa and retail as a criterion 62
Attitudes to “spa” brands 62
The brand you use defines your spa (quotes) 62
How brands can lose spa status 62
TABLE 31 Product purchasing criteria spas (practical) 63
Technical support 63
Size of order 63
Size of products / units 63
SECTION 15 GOING FORWARD - CHANGES IN CONSUMER BEHAVIOR (DO RECESSIONS CAST A LONG SHADOW?) 64
Introduction / summary 64
Impact on different treatment categories? 64
Compact (and convenient) treatments 64
Redundant spa treatments 64
Unknowable, unpredictable, unprecedented 65
Erratic behavior by consumers 65
Too soon in “new” year to tell 65
Factors complicate analysis of current consumer behavior 66
Free services can obscure usage rates 66
Could consumers’ “recession habits” outlast the recession? 66
Might previous spa spending become one of the scapegoats? 66
Not see “2007 numbers” any time soon (quotes) 66
TABLE 32 Timeline of the downturn 67
Why spas delay responding to new behavior 67
How spas responded to changed consumer behavior 68
The new behavior of consumers and of spas (quotes) 68
Downturn exacerbates existing fault lines 69
Rates of 600% 69
Cost basis required revision 69
Adjustment difficult - labor 69
Oversupply detected by Diagonal Reports 70
Historical precedent for how recession changes behavior 70
Lifestyle driven shift, long term 70
The growth drivers of the past 70
SECTION 16 GOING FORWARD - OPPORTUNITIES AND CHALLENGES 72
Introduction / summary spa products 72
Massage and hair removal virgin territory. 72
Spa own label brands 72
Spa market generates product innovation 72
The male market 73
Market changes open other opportunities 73
Market threats, challenges, and unknowns 73
Ethnic diversification 73
Challenge of the scope of licensing 74
Snake oil and sleaze 74
Spa consumer complaints (editor picks) 74
SECTION 17 SPA BUSINESS CONCEPTS DESCRIBED, WITH EXAMPLES OF TYPES 75
TABLE 33 Spa concepts introduction / summary list 75
Spa concept - hotel spas 75
Niche day spa concepts 75
TABLE 34 The most popular names and terms for day spas 76
TABLE 35 Spa niche green spas names of companies (6 names) 76
TABLE 36 Spa niche mobile - names of companies (12 names) 77
Spa concept - airport 77
Spa concept – the mini spa 77
Spa concept - the new spas, multiples and membership based 77
Consumer convenience 78
Unwarranted disparagement? 78
Not unique to USA 79
Not new in Asia 79
Prices in new spas 79
Making the spa less scary 79
SECTION 18 NAMES OF SPA OPERATORS AND SPA COMPANIES, AND SPAS NAMED AS BEST IN THEIR CLASS 80
Introduction / summary 80
Criteria that distinguish best of class spas (any type) 80
Staff training in best of class spas 80
The spa elite, hotel or day? 81
The (very) best in class spas 81
Other best in class hotel spas 81
Best in class spas, resort / hotel (quotes) 82
TABLE 37 Spas identified as “best in class” day spas (10 names) 82
Comments on some best of class spas 82
SECTION 19 NAMES OF COMPANIES AND BRANDS IDENTIFIED AS BEING USED IN SPAS 84
Introduction / summary 84
TABLE 38 Brands in spas, some “organic” concepts (16 names) 84
TABLE 39 Brands in spas, some “scientific” concepts (12 names) 85
TABLE 40 Brands in spas in skincare treatments (5 names) 85
Premium level brands in spa skincare (4 names) 85
Spas’ comments on brands (selected) 86
SECTION 20 SPA PRICING AND PRICES (SELECTED ONLY) 87
Introduction spa pricing methods 87
TABLE 41 Spa charges and taxes increase client bill 87
TABLE 42 Spa prices by market segment (60 minute facial) 87
The discount spas packages 88
SECTION 21 SPA MARKET SEASONALITY OF SALES 89
Introduction / summary - seasonality and spa business 89
TABLE 43 Spa business seasons, best and worst 89
TABLE 44 Spa calendar “Big Days” 89
Spa business - impact of geography and climate 89
Winter and skincare, summer and hair removal 90
Spa hours in hotels 90
SECTION 22 SPA MENUS - DETERMINATES OF SPA OFFER 91
Introduction / summary 91
Business practicalities 91
Avoid license infringement 91
Insurers 92
Advice about how to describe service 92
Menus descriptions that confuse consumers 92
TABLE 45 Spa treatment menus in chains (examples) 93
SECTION 23 SPA INDUSTRY DATA - ESTIMATES IN CIRCULATION AND DEFINITIONS 94
Introduction / summary 94
TABLE 46 Salon/spa universe quantified (major reports and surveys) 94
Spa industry data, according to BLS and NACCAS 94
Spa industry data, according to ISPA 94
TABLE 47 Spa market quantified (ISPA) 2002 - 2008 95
Industry debate - “what is a spa”? 95
Spa definitions by major industry organizations (ISPA, SpaFinder, Global Spa Economy Report) 95
TABLE 48 Spa “must haves” and “optional” services (DSA) 96
TABLE 49 SOC codes and occupational titles, relevant for spa industry 96
TABLE 50 Employment in the spa industry – categories and numbers 97
Licensing systems as guide to numbers 97
Independent contractors, booth renters and spas (numbers) 97
Numbers can be a product of IRS interest 98
The spa industry - the micros (the spalets), and the noncompliant 98
Home based spas 98
TABLE 51 Spa market estimate distribution of the compliant units 99
Noncompliance varies by area, and category 99
Noncompliant can be technical breach 99
Estimated size of sleaze? 99
SECTION 24 SPA MARKET REGULATORY AND LICENSING FRAMEWORKS 100
Introduction / summary 100
Licensing systems as data source 100
Spa segments licensed/compliant 100
Licensing of spas, including EIN 101
Insurers’ requirements 101
SECTION 25 METHODOLOGY, DATA SOURCES, SAMPLE REPRESENTIVITY 102
Sources consulted and methodology 102
Sources’ confidentiality 102
Spa experts represent upper end of the market 102
Criterion used to select market experts 102
Breadth of experts’ expertise 103
TABLE 52 Spa experts - numbers of and distribution by spa type operated 103
TABLE 53 Spa experts - numbers of units operated 103
TABLE 54 Spa experts - numbers of and distribution by spa type operated 104
TABLE 55 Spa experts - distribution by location (states represented) 104
Experts’ distribution reflects spa distribution in the USA 104
Affiliations, awards and recognition 105
Professional support and development, print and online 105
Profile of businesses operated by spa experts (per location) 105
SECTION 26 USA COUNTRY DATA 106
TABLE 57 Country data summary 106
TABLE 58 USA population projections (2011-2020) 106
TABLE 59 USA population - current and projections - racial and ethnic demographics (2008 and 2050) 106
ABBREVIATIONS AND GLOSSARY 107
Symbols 107
AIG effect 107
Backbar 107
Beauty maintenance services and quality of life services 107
Cosmeceutical 107
Eyelash extenders 107 Exclusivity / professional exclusivity / spa exclusivity 108
Dermabrasion and dermaplaning 108
Facials, European and the American facial 108
Intimate waxing 108
Medicare 108
Medical beauty services 108
Peels (skin) 108
Revenues in spas 108
Smaller price and smaller time packages 109
Swedish massage 109
Threading / Threaders 109
INDEX OF COMPANIES, BRANDS, SELECTED PUBLICATIONS, AND ORGANIZATIONS 110
DIAGONAL REPORTS STATEMENT 113
Summary of US Spa Market
Beauty Report Series
Buying Spa Market Reports