Hotel Spa Recovery Hinges on Vaccinations, Consumer Confidence and Pent-Up Demand

According to Jan Freitag, senior VP at Smith Travel Research (STR), the industry can expect to see a pick-up in the luxury hospitality sector, including hotel spas, in a matter of months.

STR has been tracking the state of US hotels’ revenue per available room (RevPAR) alongside the proportion of the population that’s been vaccinated.

“It’s too early to make statements about more vaccinations and more people travelling because those who are already vaccinated – like the elderly or high-risk population – are less likely to be travelling,” Freitag tells Spa Business.

“However, there will be a relationship here very soon, especially as you get into the second half of the year, because vaccinations will have rolled out and this will give people the confidence to travel.”

Freitag believes vaccinations will be crucial for spas’ recovery considering they’re high-contact environments.

He also says that government approaches to lockdown and virus re-emergence will matter immensely to global hospitality recovery, as regions with stricter controls and more rapid responses have seen a much more promising return to business – for example, in the Asia Pacific region.

He says: “People have used the term ‘K-shaped recovery’ for the US, meaning people at the upper end of the consumer market have saved money over the last year, versus the downside of the K – those who’ve lost their jobs, are less financially stable and will be unlikely to travel.”

Freitag believes the upper end of the market will do well towards the end of Q2 and into Q3 2021.

“Plus, once corporate demand returns in Q4 and into 2022, full-service hotels that traditionally have offered spas should see very healthy demand,” he adds.

Some enthusiastic onlookers have gone as far as saying we’re on the cusp of the second ‘roaring 20s’, with hopes the economy will boom in the wake of the pandemic, as consumers splurge money they’ve saved during lockdowns.

STR reported that as of 20 February 2021 US hotel occupancy had reached 48 per cent and was on an upward trajectory, compared to its lowest point in early April 2020 where occupancy hit 22 per cent.

Freitag anticipates interest in hotel spas could be on the up because of the enhanced global focus on wellbeing.

“It’s been a rough time and we know self-care needs to be top of the agenda,” he says, “this will provide a prime opportunity and drive demand for all spas, because they epitomise what self-care stands for.”

To read the whole interview, head to the latest issue of Spa Business magazine.