Spa Market Advantages And Disadvantages
740 Words
3 Pages
Spas are a growing market, but a luxury that not many can afford regularly. However, opening one in the right market can lead to a profitable business venture. According to Merriam-Webster dictionary, a spa is a commercial establishment providing facilities devoted especially to health, fitness, weight loss, beauty, and relaxation (Merriam-Webster Dictionary, 2016). Since the great recession, the number of spa locations in the United States has increased steadily to about twenty thousand in 2013 (Statista, 2016). Furthermore, those locations earned about 14.7 billion in revenue for 2013 with around one hundred sixty-four million visits. The industry, as a whole, employed almost three hundred fifty thousand people, half of them being part-time
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There are a small handful of national competitors, such as Woodhouse, LifeSpa, Red Door, Completely Bare, etc. (Joni, 2011). These spas are available in some states, but not all fifty, unlike many fast food chains; majority of day spas are sole proprietorships or partnerships (Allen, 2011). So understanding the competition is specific to the region that spa will be located, however, it is good practice to assume that there will be at least one spa that will offer opposition. Utilizing the figures from market trends, a store with a steady inflow of customers can average about seven hundred thirty-five thousand in gross revenue from about eighty-two thousand visits a year (Statista, 2016). Assuming that trends continue, the spa and beauty market is a safe investment for entrepreneurs seeking entry. It is safe to assume that in order to compete, the spa would need to be located in an area with a large, wealthy population who enjoy leisure …show more content…
So, according to Nielsen segments, the best segments would be Upper Crust, Networked Neighbors, and Movers and Shakers (Nielsen, 2016). Upper Crust are wealthy empty-nesters over the age of sixty-five, that have a median annual income of over 100 thousand. This segment enjoys their leisure time on the higher end of luxury, such as owning a Lexus, visiting Alaska, and following men’s tennis. Networked Neighbors are families with children that live in million-dollar houses, with the highest amenities that money can buy. These households earn almost 200 thousand dollars a year, and enjoy higher-end products such as purchasing Banana Republic, owning Acura’s, and flying United Airlines. Movers and Shakers are wealthy business class couples, usually middle-aged without children in their household. These households make roughly 125 thousand annually, and enjoy amenities such as driving a BMW, travels to ski/snowboard in the Rocky Mountains, and frequently dines out at restaurants like the Cheesecake Factory (Nielsen, 2016). These households make up the ideal market segment for the potential spa
There are a small handful of national competitors, such as Woodhouse, LifeSpa, Red Door, Completely Bare, etc. (Joni, 2011). These spas are available in some states, but not all fifty, unlike many fast food chains; majority of day spas are sole proprietorships or partnerships (Allen, 2011). So understanding the competition is specific to the region that spa will be located, however, it is good practice to assume that there will be at least one spa that will offer opposition. Utilizing the figures from market trends, a store with a steady inflow of customers can average about seven hundred thirty-five thousand in gross revenue from about eighty-two thousand visits a year (Statista, 2016). Assuming that trends continue, the spa and beauty market is a safe investment for entrepreneurs seeking entry. It is safe to assume that in order to compete, the spa would need to be located in an area with a large, wealthy population who enjoy leisure …show more content…
So, according to Nielsen segments, the best segments would be Upper Crust, Networked Neighbors, and Movers and Shakers (Nielsen, 2016). Upper Crust are wealthy empty-nesters over the age of sixty-five, that have a median annual income of over 100 thousand. This segment enjoys their leisure time on the higher end of luxury, such as owning a Lexus, visiting Alaska, and following men’s tennis. Networked Neighbors are families with children that live in million-dollar houses, with the highest amenities that money can buy. These households earn almost 200 thousand dollars a year, and enjoy higher-end products such as purchasing Banana Republic, owning Acura’s, and flying United Airlines. Movers and Shakers are wealthy business class couples, usually middle-aged without children in their household. These households make roughly 125 thousand annually, and enjoy amenities such as driving a BMW, travels to ski/snowboard in the Rocky Mountains, and frequently dines out at restaurants like the Cheesecake Factory (Nielsen, 2016). These households make up the ideal market segment for the potential spa