Impact of Social Media and E-Commerce on the Spa Industry

Coyle Hospitality Group recently released its 2011 Global Spa Report. This is part two of six blog pieces that will summarize and highlight key pieces and findings of the report.

This year, a major hospitality industry hot topic is the explosion of social commerce thanks to the dominance of deal sites like Groupon and Living Social. Naturally, spa professionals have a lot of questions. How powerful are these discount sites? What other websites are consumers visiting? What are consumers using these websites for?

Deal sites are impacting spa businesses in a big way. When Coyle asked respondents which websites they use to seek spa information, Groupon enjoyed a tremendous increase in usage, jumping from 22% in 2010 to 52% this year (see chart below, where dark blue represents 2010 and light blue represents 2011). Living Social, a new addition this year, became the fourth most popular website for seeking spa information, tied with Facebook and beating out sites like Yelp, Citysearch, and SpaWeek. We also found that online-deal sites are utilized by 56% of respondents to book and receive a service. The power of these sites is hard to deny: while a risk analysis on such a technique is certainly a good idea, the consumers are definitely looking to such avenues, so a well executed ‘deal’ may be worthwhile to consider.

Coyle asked respondents what other websites they use to seek spa information. This year, search engines became the most widely used resource for seeking spa information at 56%, indicating that spas need to focus on search engine optimization (SEO) now more than ever. 45% of respondents said they use SpaFinder to look up spa information—making it the third most popular website used to do so—proving that it is still a relevant tool for spa professionals. Two other deal sites we added this year, Rue La La and Buy With Me, started strong with 7% and 5% respectively, surpassing other sites, including some that are dedicated to spas.  Another important site to recognize is Yelp, used by 19% of respondents.

Respondents use these websites for many reasons, but the number one primary reason for website usage is finding deals at 71%. Viewing spa menus and reading feedback followed at 56% and 52%, respectively. This year, more respondents said they used websites to learn about spas altogether (up 2% points to 48%) and to find new spas to visit (up 2% points to 43%).  This indicates the importance of optimizing your web page and being detailed to attract consumers to your spa. Our spin on the deal-savvy consumer is that you don’t necessarily have to discount heavily to be ‘seen’ by him.  A presence on greatly-searched websites, added-value, and a high quality brand name or reputation seems to be enough to effectively produce the same result in terms of traffic—thus, you do not have to jeapordize your business by offering deals that negatively affect your bottom line.

A final note—47% of respondents said they were likely or very likely to communicate experiences via online review, expressing the importance of monitoring these websites. People are trusting review sites more and more—4% more of our respondents described them as trustworthy this year compared to 2010—which can be frightening to spa owners who know the arbitrary nature of these sites. Maintaining your reputation is important, so it is a good idea to perform a daily scan of sites like Yelp and TripAdvisor.

To download and view the full report, please visit Coyle’s website at www.coylehospitality.com/2011-global-spa-report/. To view our spa mystery shopping program capabilities and consulting services, please view our website at http://www.coylehospitality.com//mystery-shopping-services/spa-consulting/.

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