In the face of diminishing corporate and transient business, urban hotel and resort spas are wooing locals to maintain profitability. Many hotel spas are offering incentives to local residents like reduced admission fees and discounts on services. The bargains at these high-end properties will create even more pressure on strapped day spas located in urban areas or resort destinations. Luxury hotels have been dealing with both reduced occupancy and discretionary spending. The bottom has fallen out of the corporate meetings marketing at luxury properties across the United States. A decrease in transient bookings due to the global recession has compounding the trouble. To create demand, hotels are offering bundled packages that include food & beverage, spa and golf, as well as issuing credits that guests can use during their stay.
Revenues and occupancies for hotels and hotel spas march in lockstep," says Jan Freitag, Vice President of STR. "When less people frequent the hotel, less people frequent the spa." PKF's report on hotel spas also projected decreased revenues and occupancies for 2009 and advises urban hotel spas to "maintain relationships with their local community."