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Menu engineering

How and why are spas streamlining their treatment menus?

By Katie Barnes | Published in Spa Business 2012 issue 1


Until recently, the length of a treatment menu was synonymous with the quality of a spa facility. Operators were in competition with each other to come up with the most elaborate therapies to capture customer attention and the more treatments and choice they could offer their guests the better.

Now, however, reality is beginning to set in with the understanding that more therapies mean more time and money spent on training, not to mention the stocking of extra products. In addition, many are discovering that long, fancy treatment menus can be confusing and off putting for a customer – especially if they’re first-timers.

With this in mind, shrewd operators are embarking on treatment menu engineering processes. They’re streamlining their offer to make it easier and more financially viable for themselves, and more palatable and enticing to clients. But just what does this engineering process involve?

Considering the cost and popularity of a treatment is obviously key, but where should the line be drawn? A few years ago, Disney overhauled its gift shops to only include the best-selling items, cutting out expensive extras such as Persian ‘magic carpet’ rugs that customers never bought. Yet following the exercise, sales plummeted as customers liked to have the choice and that type of environment to buy in regardless of not purchasing items like the rug. Might the same apply to treatment menu engineering? How can operators reduce their offering, yet also ensure that they have got enough interesting therapies to keep customers booking?

And how can operators choose which treatments to keep on the menu and which ones to cut? Afterall, low treatment sales could be down to lack of trained therapists or something as simple as a poorly written description. Or perhaps the treatment is buried so deep in the menu that customers never get round to reading it before they make their decision.

We ask some experts about what operators should focus on and how frequently you should undertake menu engineering.



Sheila McCann Corporate Director of Spa Brand quality Shangri-La Hotels & Resorts

 

Sheila McCann
 

The number of treatments we offer varies with the location – resorts have a slightly larger menu with an increased number of packages. It also depends on the age of the property as we open with a smaller menu and build on this over time. Too many treatments, however, can be a recipe for mediocre quality.

Menu engineering is important because it enables you to keep pace with the market and to keep your offer fresh.

While we do take profitability of treatments into consideration, it is not our major driver. We look at what sells, but we also like to maintain a wide-enough range of choices. A good menu ensures a variety for guests and therapists. Everyone has their ‘favourites’ and the ‘anticipation factor’ of the spa experience means that menu deletions can be disappointing for regular guests who we strongly value.

That said, we have developed a framework of core menu treatments across different resorts to enable therapists to move between locations if necessary.

A treatment description is important. When we launched CHI, The Spa [Shangri-La’s in-house brand], we used ethereal language for some therapies as that was part of the concept. While these remain very evocative of the ambience we want to create, we’ve refined some of the language to include details about the technique, pressure, benefits and how a guest might feel afterwards. If a spa-goer can link the description to their own needs, the treatments will have greater appeal. It also helps us to overcome cultural barriers – massage is just one word but an individual’s expectations of techniques differ according to their background. We think about the order of the menu.

We used to place the most expensive packages first, but now put the most popular treatments upfront to make it more accessible for guests.

It can be tricky to cut down treatment menus, especially local treatments. Spa directors, in-house trainers and therapists often research and contribute to the refinement of local treatments. If they’re enthusiastic about a treatment, they take great pride in them and are more likely to suggest them to a customer and to give a really passionate treatment.

The key is to re-craft with a combination of old favourites and new, interesting items. But my advice would be to plan a least six months to a year ahead. New treatments require adequate training, you need to think about order cycles and delivery times and stock levels need to be considered to avoid waste.

McCann has over 30 years experience in the service industry and oversees 35 spas globally at Shangri-La. Details: www.shangri-la.com


We have developed a framework of core menu treatments across different resorts to enable therapists to move between locations if necessary



Lynsey Hughes Spa Director Mandarin Oriental Hong Kong

 

Lynsey Hughes
 

As a city spa with eight treatment rooms, we normally offer 25 treatments and no more than 30. If you get up to 40-50 treatments, it becomes confusing for the guests to choose.

Every year, I go through a treatment menu engineering process as it’s essential to make sure we don’t offer treatments that the guest doesn’t want. You don’t want your therapist spending time on a treatment that isn’t profitable and only gets booked twice a month. It’s also a good opportunity for a spa director to ensure they’ve positioned their price point correctly within the market place as competitors may increase their price or new spas may have opened with a competitive price.

For our menu engineering, we use CRASE – Cornell’s Restaurant Administration Simulation Exercise. The system was initially used to analyse food menus and it covers sales versus the profit margin of items. The result is a quadrant grid that plots your treatment Stars (high sellers, high profit), Plow Horses (high sellers, low profit), Dogs (low sellers, low profits) and Puzzles (low sellers, high profits).

Directors can use this method to look at performance month by month or by categories such as massages versus facials. What I tend to do, however, is to analyse it per activity so that you can really see how well you’re doing treatment to treatment.

Our top three Star treatments are our oriental essence, therapeutic and aromatherapy massages. They’re popular and profitable because they only require oils, unlike facials which require gels, creams and serums.

A Plow Horse is an example of a treatment that isn’t booked as often as our massages and works out less profitable. But we like them because they give our menu depth and set us apart from our competitors. As the therapist is with a guest for up to three hours, the customer receives a thorough, bespoke treatment and there’s less wear and tear on the facility.

Puzzles are treatments that need tweaking. Our Oriental Harmony – a four-handed massage – could be an example of this as it involves two therapists and is costly. Similarly, a Dog might be a shirodhara treatment that uses up two litres of high-quality oil which literally ends up down the drain. Yet just because a treatment falls into the bottom two quadrants, it doesn’t mean that you automatically cut it out. In these two examples, you could raise the price point to cover costs.

While the CRASE diagram is a useful tool, you shouldn’t use it in isolation and you need to look at the business as a whole. If a treatment isn’t selling, it may be that you don’t have enough therapists trained, or maybe you do but they’re not on the right shifts.

I would avoid making too many changes in one go as you wouldn’t want your regular guests to feel that they can no longer get what they want. The maximum number of treatments I’ve ever changed or taken off in one reprint of a brochure is three.

Hughes has worked in Mandarin Oriental spas for more than 11 years. Details: www.mandarinoriental.com/hongkong




Judith Singer President and co-founder Health Fitness Dynamics Inc (HFD Spa)

 

Judith Singer
 

Each spa needs a menu with descriptions and photos that capture its DNA. However, more is not better – long treatment menus can be hard on the staff as there are too many procedures, products and retail items to learn; financially draining due to the professional and retail inventory and training; and a hardship on the facility because of storage space required.

Guests get too stressed reading ‘an encyclopedia of worldwide treatments’ and research consistently shows that they typically only go for the basic four – massages, facials, manicures and pedicures.

In this case, it may be better to be service-orientated than quantity-orientated. Rather than over-complicate a menu and list variations on facials, massages etc, a service provider could offer the basic four at 30, 60 and 90-minute segments at a flat rate. This would empower the therapists to use whatever techniques they feel necessary to personalise the treatment, rather than restrict them to a step-by-step process. It would be interesting to see if a spa would be gutsy enough to take this approach.

That said, there needs to be some variety and operators could add more bath and body services. It’s good to also offer packages – a mix of themed and customised ones (where guests can select a certain number of treatments for a fixed fee) – as long as operators don’t fall into the trap of thinking the more they offer, the more marketable they are.

We think it’s better not to start the menu with the most popular treatment because guests might not read the rest. Tell your story and concept and then describe the treatments and how they’ll be of benefit. Think about reversing the order by listing bath and body services, followed by manicures, pedicures, facials and massages.

Cost analysis is important in menu engineering. This should include the cost of labour, products and consumable supplies as well as the desired profit margin. There may be some loss leader treatments that a spa needs to offer because they are part of the concept and the market wants them.

Before finalising the price, the spa needs to look at what competition is charging and its position in the market place. Mass market spas may be more focused on volume than profit margins, whereas an up-scale spa might focus on fewer people paying more.

If the spa director created the menu, he/she may have a hard time making changes and while it’s nice to ask staff for feedback, this is another point of subjectivity. It’s important to monitor what’s happening and make decisions based on reality – if the guests don’t want it, the staff don’t like it and it doesn’t make money, why offer it?

Sometimes it can be financially difficult to make changes because of reprinting, website changes, too much existing stock and a small training budget. But if a spa doesn’t properly understand and analyse what it’s doing – and make adjustments – it may not be doing it for long.

HFD is a full-service spa advisory service that Singer co-founded in 1983 with the aim of helping to create marketable and profitable spas. Details: www.hfdspa.com.


It would be interesting to see if a spa would be gutsy enough to offer the basic four services – massage, facial etc – at 30, 60 and 90-minute segments at a flat rate



Noella Gabriel Director of sales, product and
treatment development
Elemis

 

Noella Gabriel
 

The days of most people having a high disposable income to pay a high price to visit a spa and pamper themselves at any cost are few and far between.

There’s no doubt that we’re getting people through the door, but we’re now doing it at a lower price entry – where operators used to charge £85 (us$133, €102) for a ‘day spa pass’ to use facilities, they’re now asking for £45 (us$70, €54). So you can’t expect someone who’s paying that to then spend £70+ (us$109, €84) on a facial.

We supply to more than 1,200 spas worldwide and we have found that these spas were full for usage of their general facilities, but that no one was booking treatments, which consequently had an impact on retail.

In order to capitalise on these non-treatment-spenders we decided against changing our existing treatment menu and instead to create a menu that entices the current non-spending spa-goer to spend a little at a time. If you lower prices you’re devaluing your brand and it will be harder to charge that same amount in the future. So, back in January 2010, I created an A La Carte style menu for those time and money conscious customers to sit alongside our existing offer in order to add extra choice.

This new menu consisted of a selection of 16 high-performance facials, massages and hands and feet treatments; the majority of which last only 15 or 30 minutes. These bite-size treatments incorporate the best part of each full-length treatment – so only a brush up on skills is needed rather than full training – and two can be added together to create a package. The prices range from £25-45 (us$39-70, €30-54) and we put great thought into this. From our personal experience, a comfortable spend is under £50 (us$78, €60).

We’ve introduced this menu to 25 per cent of our spa operators and it really has been successful – around 75 per cent of customers have tried a treatment from it. It’s been revolutionary because we now have people booking 30-minute treatments and up-grading their spa experience, plus importantly, we’re treating more guests per day which widens the opportunity for retail.

Although some people can afford top prices, they’re in the minority and our A La Carte menu bridges the gap by offering more options to people who may then become repeat clients. It’s made a huge difference to our business. Spa operators can’t be precious if they want to survive the recession.

Gabriel’s been the driving force behind Elemis’ products and treatments since its launch in 1990. She took on the role of overseeing sales two years ago. Details: www.elemis.com


FEATURED SUPPLIERS

Metawell: unlocking the possibilities in a new era of wellness
A decade ago, the Gharieni Group began pioneering the integration of advanced wellness technologies into its spa and treatment beds. This innovative approach has since become one of the industry's most significant disruptions and groundbreaking trends. [more...]

Introducing Oslo: MSpa's revolutionary portable rigid spa
As a leading brand in the portable spa industry, MSpa boasts more than 20 years of experience. [more...]
+ More featured suppliers  
COMPANY PROFILES
Universal Companies

The ultimate spa and wellness resource, Universal Companies is an international distributor of produ [more...]
Sothys Paris

Founded in 1946, Sothys is owned by the Mas family. Chief executive Christian Mas oversees the com [more...]
+ More profiles  
CATALOGUE GALLERY
 

+ More catalogues  

DIRECTORY
+ More directory  
DIARY

 

22-22 Jun 2024

World Bathing Day

Worldwide,
22-24 Jun 2024

IECSC Las Vegas

Las Vegas Convention Center, Las Vegas, United States
+ More diary  
 
ABOUT LEISURE MEDIA
LEISURE MEDIA MAGAZINES
LEISURE MEDIA HANDBOOKS
LEISURE MEDIA WEBSITES
LEISURE MEDIA PRODUCT SEARCH
 
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SPA OPPORTUNITIES
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©Cybertrek 2024
Uniting the world of spa & wellness
Get Spa Business and Spa Business insider digital magazines FREE
Sign up here ▸
News   Products   Magazine   Subscribe
Everyone's talking about...
Menu engineering

How and why are spas streamlining their treatment menus?

By Katie Barnes | Published in Spa Business 2012 issue 1


Until recently, the length of a treatment menu was synonymous with the quality of a spa facility. Operators were in competition with each other to come up with the most elaborate therapies to capture customer attention and the more treatments and choice they could offer their guests the better.

Now, however, reality is beginning to set in with the understanding that more therapies mean more time and money spent on training, not to mention the stocking of extra products. In addition, many are discovering that long, fancy treatment menus can be confusing and off putting for a customer – especially if they’re first-timers.

With this in mind, shrewd operators are embarking on treatment menu engineering processes. They’re streamlining their offer to make it easier and more financially viable for themselves, and more palatable and enticing to clients. But just what does this engineering process involve?

Considering the cost and popularity of a treatment is obviously key, but where should the line be drawn? A few years ago, Disney overhauled its gift shops to only include the best-selling items, cutting out expensive extras such as Persian ‘magic carpet’ rugs that customers never bought. Yet following the exercise, sales plummeted as customers liked to have the choice and that type of environment to buy in regardless of not purchasing items like the rug. Might the same apply to treatment menu engineering? How can operators reduce their offering, yet also ensure that they have got enough interesting therapies to keep customers booking?

And how can operators choose which treatments to keep on the menu and which ones to cut? Afterall, low treatment sales could be down to lack of trained therapists or something as simple as a poorly written description. Or perhaps the treatment is buried so deep in the menu that customers never get round to reading it before they make their decision.

We ask some experts about what operators should focus on and how frequently you should undertake menu engineering.



Sheila McCann Corporate Director of Spa Brand quality Shangri-La Hotels & Resorts

 

Sheila McCann
 

The number of treatments we offer varies with the location – resorts have a slightly larger menu with an increased number of packages. It also depends on the age of the property as we open with a smaller menu and build on this over time. Too many treatments, however, can be a recipe for mediocre quality.

Menu engineering is important because it enables you to keep pace with the market and to keep your offer fresh.

While we do take profitability of treatments into consideration, it is not our major driver. We look at what sells, but we also like to maintain a wide-enough range of choices. A good menu ensures a variety for guests and therapists. Everyone has their ‘favourites’ and the ‘anticipation factor’ of the spa experience means that menu deletions can be disappointing for regular guests who we strongly value.

That said, we have developed a framework of core menu treatments across different resorts to enable therapists to move between locations if necessary.

A treatment description is important. When we launched CHI, The Spa [Shangri-La’s in-house brand], we used ethereal language for some therapies as that was part of the concept. While these remain very evocative of the ambience we want to create, we’ve refined some of the language to include details about the technique, pressure, benefits and how a guest might feel afterwards. If a spa-goer can link the description to their own needs, the treatments will have greater appeal. It also helps us to overcome cultural barriers – massage is just one word but an individual’s expectations of techniques differ according to their background. We think about the order of the menu.

We used to place the most expensive packages first, but now put the most popular treatments upfront to make it more accessible for guests.

It can be tricky to cut down treatment menus, especially local treatments. Spa directors, in-house trainers and therapists often research and contribute to the refinement of local treatments. If they’re enthusiastic about a treatment, they take great pride in them and are more likely to suggest them to a customer and to give a really passionate treatment.

The key is to re-craft with a combination of old favourites and new, interesting items. But my advice would be to plan a least six months to a year ahead. New treatments require adequate training, you need to think about order cycles and delivery times and stock levels need to be considered to avoid waste.

McCann has over 30 years experience in the service industry and oversees 35 spas globally at Shangri-La. Details: www.shangri-la.com


We have developed a framework of core menu treatments across different resorts to enable therapists to move between locations if necessary



Lynsey Hughes Spa Director Mandarin Oriental Hong Kong

 

Lynsey Hughes
 

As a city spa with eight treatment rooms, we normally offer 25 treatments and no more than 30. If you get up to 40-50 treatments, it becomes confusing for the guests to choose.

Every year, I go through a treatment menu engineering process as it’s essential to make sure we don’t offer treatments that the guest doesn’t want. You don’t want your therapist spending time on a treatment that isn’t profitable and only gets booked twice a month. It’s also a good opportunity for a spa director to ensure they’ve positioned their price point correctly within the market place as competitors may increase their price or new spas may have opened with a competitive price.

For our menu engineering, we use CRASE – Cornell’s Restaurant Administration Simulation Exercise. The system was initially used to analyse food menus and it covers sales versus the profit margin of items. The result is a quadrant grid that plots your treatment Stars (high sellers, high profit), Plow Horses (high sellers, low profit), Dogs (low sellers, low profits) and Puzzles (low sellers, high profits).

Directors can use this method to look at performance month by month or by categories such as massages versus facials. What I tend to do, however, is to analyse it per activity so that you can really see how well you’re doing treatment to treatment.

Our top three Star treatments are our oriental essence, therapeutic and aromatherapy massages. They’re popular and profitable because they only require oils, unlike facials which require gels, creams and serums.

A Plow Horse is an example of a treatment that isn’t booked as often as our massages and works out less profitable. But we like them because they give our menu depth and set us apart from our competitors. As the therapist is with a guest for up to three hours, the customer receives a thorough, bespoke treatment and there’s less wear and tear on the facility.

Puzzles are treatments that need tweaking. Our Oriental Harmony – a four-handed massage – could be an example of this as it involves two therapists and is costly. Similarly, a Dog might be a shirodhara treatment that uses up two litres of high-quality oil which literally ends up down the drain. Yet just because a treatment falls into the bottom two quadrants, it doesn’t mean that you automatically cut it out. In these two examples, you could raise the price point to cover costs.

While the CRASE diagram is a useful tool, you shouldn’t use it in isolation and you need to look at the business as a whole. If a treatment isn’t selling, it may be that you don’t have enough therapists trained, or maybe you do but they’re not on the right shifts.

I would avoid making too many changes in one go as you wouldn’t want your regular guests to feel that they can no longer get what they want. The maximum number of treatments I’ve ever changed or taken off in one reprint of a brochure is three.

Hughes has worked in Mandarin Oriental spas for more than 11 years. Details: www.mandarinoriental.com/hongkong




Judith Singer President and co-founder Health Fitness Dynamics Inc (HFD Spa)

 

Judith Singer
 

Each spa needs a menu with descriptions and photos that capture its DNA. However, more is not better – long treatment menus can be hard on the staff as there are too many procedures, products and retail items to learn; financially draining due to the professional and retail inventory and training; and a hardship on the facility because of storage space required.

Guests get too stressed reading ‘an encyclopedia of worldwide treatments’ and research consistently shows that they typically only go for the basic four – massages, facials, manicures and pedicures.

In this case, it may be better to be service-orientated than quantity-orientated. Rather than over-complicate a menu and list variations on facials, massages etc, a service provider could offer the basic four at 30, 60 and 90-minute segments at a flat rate. This would empower the therapists to use whatever techniques they feel necessary to personalise the treatment, rather than restrict them to a step-by-step process. It would be interesting to see if a spa would be gutsy enough to take this approach.

That said, there needs to be some variety and operators could add more bath and body services. It’s good to also offer packages – a mix of themed and customised ones (where guests can select a certain number of treatments for a fixed fee) – as long as operators don’t fall into the trap of thinking the more they offer, the more marketable they are.

We think it’s better not to start the menu with the most popular treatment because guests might not read the rest. Tell your story and concept and then describe the treatments and how they’ll be of benefit. Think about reversing the order by listing bath and body services, followed by manicures, pedicures, facials and massages.

Cost analysis is important in menu engineering. This should include the cost of labour, products and consumable supplies as well as the desired profit margin. There may be some loss leader treatments that a spa needs to offer because they are part of the concept and the market wants them.

Before finalising the price, the spa needs to look at what competition is charging and its position in the market place. Mass market spas may be more focused on volume than profit margins, whereas an up-scale spa might focus on fewer people paying more.

If the spa director created the menu, he/she may have a hard time making changes and while it’s nice to ask staff for feedback, this is another point of subjectivity. It’s important to monitor what’s happening and make decisions based on reality – if the guests don’t want it, the staff don’t like it and it doesn’t make money, why offer it?

Sometimes it can be financially difficult to make changes because of reprinting, website changes, too much existing stock and a small training budget. But if a spa doesn’t properly understand and analyse what it’s doing – and make adjustments – it may not be doing it for long.

HFD is a full-service spa advisory service that Singer co-founded in 1983 with the aim of helping to create marketable and profitable spas. Details: www.hfdspa.com.


It would be interesting to see if a spa would be gutsy enough to offer the basic four services – massage, facial etc – at 30, 60 and 90-minute segments at a flat rate



Noella Gabriel Director of sales, product and
treatment development
Elemis

 

Noella Gabriel
 

The days of most people having a high disposable income to pay a high price to visit a spa and pamper themselves at any cost are few and far between.

There’s no doubt that we’re getting people through the door, but we’re now doing it at a lower price entry – where operators used to charge £85 (us$133, €102) for a ‘day spa pass’ to use facilities, they’re now asking for £45 (us$70, €54). So you can’t expect someone who’s paying that to then spend £70+ (us$109, €84) on a facial.

We supply to more than 1,200 spas worldwide and we have found that these spas were full for usage of their general facilities, but that no one was booking treatments, which consequently had an impact on retail.

In order to capitalise on these non-treatment-spenders we decided against changing our existing treatment menu and instead to create a menu that entices the current non-spending spa-goer to spend a little at a time. If you lower prices you’re devaluing your brand and it will be harder to charge that same amount in the future. So, back in January 2010, I created an A La Carte style menu for those time and money conscious customers to sit alongside our existing offer in order to add extra choice.

This new menu consisted of a selection of 16 high-performance facials, massages and hands and feet treatments; the majority of which last only 15 or 30 minutes. These bite-size treatments incorporate the best part of each full-length treatment – so only a brush up on skills is needed rather than full training – and two can be added together to create a package. The prices range from £25-45 (us$39-70, €30-54) and we put great thought into this. From our personal experience, a comfortable spend is under £50 (us$78, €60).

We’ve introduced this menu to 25 per cent of our spa operators and it really has been successful – around 75 per cent of customers have tried a treatment from it. It’s been revolutionary because we now have people booking 30-minute treatments and up-grading their spa experience, plus importantly, we’re treating more guests per day which widens the opportunity for retail.

Although some people can afford top prices, they’re in the minority and our A La Carte menu bridges the gap by offering more options to people who may then become repeat clients. It’s made a huge difference to our business. Spa operators can’t be precious if they want to survive the recession.

Gabriel’s been the driving force behind Elemis’ products and treatments since its launch in 1990. She took on the role of overseeing sales two years ago. Details: www.elemis.com


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Metawell: unlocking the possibilities in a new era of wellness
A decade ago, the Gharieni Group began pioneering the integration of advanced wellness technologies into its spa and treatment beds. This innovative approach has since become one of the industry's most significant disruptions and groundbreaking trends. [more...]

Introducing Oslo: MSpa's revolutionary portable rigid spa
As a leading brand in the portable spa industry, MSpa boasts more than 20 years of experience. [more...]
+ More featured suppliers  
COMPANY PROFILES
Universal Companies

The ultimate spa and wellness resource, Universal Companies is an international distributor of produ [more...]
+ More profiles  
CATALOGUE GALLERY
+ More catalogues  

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+ More directory  
DIARY

 

22-22 Jun 2024

World Bathing Day

Worldwide,
22-24 Jun 2024

IECSC Las Vegas

Las Vegas Convention Center, Las Vegas, United States
+ More diary  
 


ADVERTISE . CONTACT US

Leisure Media
Tel: +44 (0)1462 431385

©Cybertrek 2024

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