Spa operators may be uncomfortable
with the notion of charging higher prices
for customers treated in more desirable
rooms (perhaps those with a view or with
added facilities and amenities) or for particular
spa therapists, but some customers
may be more than willing to pay such a
premium. The spa could also charge extra
for customers who desire to use the facilities
for a period of time longer than specified
in the treatment, as well as those who
choose to book at busier times. In consideration
of the premium price, the spa can
provide added amenities during this time
and offer additional refreshments and
snacks for those resting and waiting in
relaxation areas.
The supply of spa treatment-room time
often exceeds the demand in most markets,
and managers frequently offer discounted
prices in an attempt to fill empty times.
While discounting is nearly unavoidable in
this instance, the point of revenue management
is that any discounts should fit the spa’s
overall strategy. Broad-scale discounting is
dangerous because price is one of the means
that customers use to determine the perceived
value of a service. In the absence of a
rate fence (that is, a reason for the discount),
customers will benchmark the discounted
price as the “real” price. One tactic to offset
this difficulty is to offer upgraded services at
the regular price during off-peak times. This
approach builds demand for slow periods but
does not diminish the customer’s perception
of the regular price. Beyond off-peak specials
and the like, some spas offer added
value in the form of additional treatment
time and complimentary retail products or