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Recap: The 2008  Global Spa Summit

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by Bernard Burt, May 27, 2008
(Special to Spa Management Journal)

The global spa economy is estimated to be over $255 billion, according to a major report unveiled at the 2008  Global Spa Summit in New York attended by more than 220 industry leaders last May.

Prepared by SRI International on behalf of The Global Spa Summit, the first-ever Global Spa Economy Report represents the most comprehensive effort yet to quantify the rapidly expanding global spa industry. According to study sponsor Pete Ellis, CEO of SpaFinder, the data shows investors, policymakers, and spa industry leaders the economic and business benefits of the spa industry.

The report's estimate, which looked at the year 2007, includes $60.3 billion in  core spa industry revenues, such as spa facilities, capital investments, education, consulting, media, associations, and events, and $194 billion in spa-related hospitality, tourism, and real estate.

When broader spa-related industries such as beauty, nutrition, and fitness were factored into the equation, last year's global health and wellness market exceeded $1 trillion, according to the report. This one-year snapshot makes the spa sector one of the first industries to organize at a global level and analyze its own worldwide impact.

The report also found that 1.2 million workers were employed in more than 71,600 spas worldwide in 2007. During the same period, capital investment in spas approached $13 billion, with continued expansion on the horizon.

"The spa industry is growing at a breakneck pace, but its diversity and scope have always made it difficult to quantify its size and financial strength, as well as to harness the full power of its collaborative voice," said SpaFinder CEO Pete Ellis, who also serves as the chairman of the board for the Global Spa Summit. "For the first time ever, this report shows decision-makers just how big the industry is, and how integral it is to the global economy." 

In a breakdown of spa revenues by nation, the United States emerges on top, with earnings of more than $12 billion, followed by Japan ($5.7 billion) and Germany ($3.8 billion). The list continues with France, Italy, the United Kingdom, and China.

The report's findings derive from interviews with over 50 high-level industry executives; 1,000 responses to a global survey of industry sources; and data collected from more than 210 countries – ten times more than in previous spa industry reviews. The study defines spas as establishments that promote wellness through the provision of therapeutic and other professional services aimed at renewing body, mind, and spirit. Refreshingly candid, principal researcherswho conducted the study at SRI International, a worldwide independent 
research firm originally founded as the Stanford Research Institute, said they had to use models for other industries like golf becausethere are no global data bases for spas. “It was like comparing apples, oranges, and rice,” said a report author.

About Global Spa Summit 

Global Spa Summit is an international organization dedicated to bringing together leaders and visionaries to shape the future of the global spa and wellness industry. Founded in 2006, the organization hosted the second-ever Global Spa Summit in New York City in May, where industry executives gatheredto exchange ideas and advance industry goals. Participation is by invitation, restricted to corporate CEO, top executives of non-profit organizations, and educators.

More than 220 industry leaders from around the world attended this year's Summit. Keynote speakers included hotelier Ian Schrager, and Dr. Richard Carmona, Vice Chairman of Canyon Ranch. 

Emphasizing the need for innovative approaches to expand the market for spa services, key reports also raised an alarm about the need to educate future spa managers, motivate staff, and attract new personnel. Labor shortages are now a major issue in the industry.

Benchmarking came into focus at several sessions, as the delegates sought a method of establishing a common language and understanding across regions and continents and creating uniform performance benchmarks for spas worldwide. Progress on the issue of benchmarking (reported in the April issue of Spa Management Journal) was promised by leading hotel groups, including Fairmont Raffles and Mandarin Oriental.
 

Objectives - The Global Spa Summit is dedicated to the advancement of the spa and wellness industry on a global basis. Key objectives include the following:
  • Create community by fostering relationships among global industry leaders; Facilitate friendly dialogue and the exchange of ideas; Act as a catalyst for continued conversations beyond Summit meetings.
  • Establish a common language and understanding across regions and continents, while retaining individual identities.
  • Create and endorse uniform measurement systems for performance tracking and benchmarking of spas world-wide.
  • Initiate, gather and trumpet quality industry research on a global basis.
  • Provide accurate and reliable information for the investment community.
  • Identify and assist in resolving issues affecting the spa and wellness industry.

Global Spa Summit was underwritten by Spa Finder, Inc., the world's leading spa marketing and media company, in collaboration with a team of international advisors, including principals from Raison d'Etre, Sweden, RMIT University, Australia, Spa Strategy, Inc., USA, Mandarin Oriental Hotel Group, Hong Kong, Mandara Spa Asia, Bali, Fairmont Raffles Hotels International Inc., Canada, Bodhi Dharma Group and, Spatality Inc., Cornell University, USA and the Wuttke Group, USA.  

This year's Summit was sponsored by Technogym, Pevonia Botanica, CNL Income Company, LLC, Fairmont Raffles Hotels International, Mandara Spa, Murad, Raison d'Etre, Spa Chakra, SpaFinder, Spatality, Steiner Leisure, Sodashi, and Jumeirah Hotels’ Talise. 

Explaining the philosophy of Summit organizers, Pete Ellis said “ The industry must change to embrace the ability to serve more who want access to wellness through the spa model.  The industry is moving very quickly into a professional realm, and we recognize the importance of balance in doing so with the blend of spa and business.  Part of the industry’s lack of sophistication is the homegrown aspect that has hindered its growth financially.  We see so many spas losing money, going out of business, and struggling to make it work.  This is because of many factors but mainly healers trying to become business people.  The Summit is trying to assist healers who have a special way of addressing people’s needs to mix with those that can help them....tough job because of the left brain and right brain attributes. The Summit is also about operations, deal making, global sharing of new business models and - the biggest section-investment and financing.”

While spa managers were not invited or credentialed, the summit attracted corporate executives not seen at industry events like the ISPA conference. Press specifically was requested by the board and many delegates to be excluded from most sessions so that private conversations could take place.

Sharing information with the rest of the spa industry, the summit sponsors now have a Web site. For more information, visit www.globalspasummit.org.

The next Summit will take place in Europe. Hosting the 2009 event will be the Victoria-Jungfrau Hotel in Interlaken, Switzerland, famed for its spa wing featuring ESPA and Clarins.

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Contact:

Bernard Burt
Biburt@aol.com

 

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Also See: Examining the Findings of PKF's Inaugural Edition of Trends in the Hotel Spa Industry / John R. Korpi / May 2008
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