Me Time

At a high-end spa site nestled high in the mountains, an overworked sales executive’s journey to rejuvenation begins within its rustic apothecary, where staff assist her to create a signature blend of organic lavender, cedarwood and frankincense oils. Afterward, she receives a relaxing 50-minute full-body aromatherapy massage that benefits both the mind and the body. Meanwhile, in the city, a weary commuter receives a pampering water-heated hot stone treatment on her aching back during her lunch break. On her way back to the office, she picks up an energizing lime mandarin shower gel to bring the experience home to her apartment. Two blocks away, following a leg wax, a client springs for a green tea anti-aging facial to freshen up before that big Saturday evening gala later in the week.


Today’s spa sector is driven by innovative ingredients and novel technology, according to the International Spa Association (ISPA), which releases spa industry financial indicators each August. The segment continues to post healthy gains with increases in overall revenue, locations, number of spa visits, and revenue per visit, according to the Association.


The ISPA Foundation commissioned PricewaterhouseCoopers (PwC) to conduct the study which presents what is known as the “Big Five”—total revenue, spa visits, spa locations, revenue per visit, and number of employees in the US.



“Our annual spa industry study has shown revenue growth each of the past five years providing strong indicators of the continued future success of the spa industry,” said ISPA president Lynne McNees, Lexington, KY. “We are excited to share that both the number of spa locations and full-time employees in the United States increased in 2015, making a significant contribution to the overall economy.”


According to McNees, total spa revenue rose 5% to $16.3 billion in 2015 (the most recent figures that were available from the group). The increase in spa revenue was driven by growth in the number of spa visits, up 2.1% to 179 million in 2015. For the period, average revenue per visit increased 2.9% to $91.


“The figures are clear; it’s all-time record revenues, breaking the $16 billion barrier. The next big landmark, which I think is achievable by 2020, is the iconic $20 billion figure,” said Colin McIlheney, global research director for PwC.


New spa openings are estimated to have exceeded spa closures by a margin of 360 in 2015, bringing the total number of spa locations up 1.8% to 21,020—representing the first time the number of spa locations has exceeded 21,000 since the pre-recession peak of 21,300 back in 2008. 


What’s Working


“Some the hottest trends are still the ancient ‘go-to’ trends; efficacy or results are key—we’ve moved past fluff and buff,” noted Allan Share, president of the Spa Industry Association (Day Spa Association & International Medical Spa Association), Minneapolis, MN. “Clients want—actually demand—that results come from their sessions. There are always new ingredients that are hot, like charcoal, and equipment such as light stimulation that may have been around a while, yet have grown to be popular in today’s environment.”


The spa environment is making inroads in the prestige marketplace. While research firm The NPD Group, Port Washington, NY, doesn’t track spas, it has a “spa/natural/wellness” classification in skin care, which is defined as brands with an environmental focus that promote wellness or natural ingredients and/or are inspired by spas. Prestige skin care sales under this classification grew 9% in the 12 months ending February 2017. During this time, the total prestige skin care market grew just 3%, according to NPD.


In its recent report, Professional Skin Care USA, Kline Group estimates category sales reached $1 billion last year. According to Kline, medical care providers represented the largest channel, accounting for nearly 50% of sales. Growth was mainly driven by an increasing number of dispensing physicians and demand for non-surgical cosmetic procedures. Spas and salons continued to lose market share, but still grew at a moderate pace. The channel benefitted from new product launches and promotional incentives in spas and salons. The retail channel posted the best sales growth, supported by online sales and the entrance of Amazon’s Professional Skin Care department.


Taking a look at key players, SkinCeuticals became the market leader in 2016 and was the only brand to hold a place in the top five of each of the distribution channels, according to Kline.


ZO Skin Health posted the best growth rate in the market.


Dermalogica led both the spas and salons and retail channels in sales. And Johnson & Johnson entered the market with the acquisition of NeoStrata.


Massage Envy is adding a variety of new body care services to its membership packages, including customized massages and facials, microdermabrasion, stretch therapy, magnetic taping and chemical peels. In addition, the spa franchise says it will give a facelift to more than 700 of its more than 1,170 locations. Founded in 2002, Massage Envy stores can be found in 49 states and in Australia, too. The company plans to enter more international markets.


Crucial Qualities


The most important factors clients look for are atmosphere, professionalism and results. According to Lydia Sarfati, CEO and founder of Repêchage, Secaucus, NJ, a client makes a judgement about a spa within seven seconds after entering. Is the spa clean, well lit, have a professional-looking staff at the front desk to greet them? Does everyone from the receptionist to the spa manager to the esthetician dress and behave in a professional manner? Are they well educated on skin care so that the client can put their most vital organ, their skin, into their hands? 


“The results of the treatments must be unparalleled by anything they have experienced before,” she told Happi. “Most important is to be kind to your clients’ skin by providing responsible exfoliation, coupled with great hydration and protection with mineral-based creams. Clients want to walk out of your spa feeling better than when they walked in.”


Annet King, vice president of global education at Elemis, Los Angeles, agreed.


“I think clients expect high quality products, with clinically proven results and premium textures and experiences. When buying a professional brand in this channel, it’s a given that it will have a high percentage of active ingredients/and or cosmeceuticals and should be more environmentally conscious when it comes to sustainability, origin and packaging,” she told Happi. “As luxury spas and resorts may have higher service pricing, treatments must deliver an exceptional experience, visible results and be worth the expense and time to the client. Expectations are higher in this type of environment. I’d love to say every spa brand can deliver on this, but not all do.”


Dr. Neal Kitchen, chief operating officer of HydroPeptide of Seattle, said his brand is having success at high-end spas like Premier 57 in New York City and Spa Del Rey at The Ritz Carlton in Marina Del Rey, CA. He told Happi that clients are looking for two specific qualities for their products and services—immediate and long-term results, and a luxurious experience.


“If they do not see results they will move onto the ‘next best thing,’” he warned. “Second, they go to a spa where they can feel pampered and rejuvenated. Just as important, if they are able to take home that luxury experience, the client is far more likely to create a consistent beauty regimen in their home that will maintain their results.”


Kitchen insisted that HydroPeptide is committed to developing products that provide a clinical result and luxury experience so that clients don’t have to choose between these two important needs. He added that with so much information at their fingertips now, consumers have countless ways of finding the latest and greatest in development. 


“Platforms like Pinterest, Instagram, YouTube and bloggers have become a huge influence on evaluating the latest developments for better or worse,” he observed. “At the same time, the ‘referral’ from a trusted friend, colleague or professional remains  the gold standard in seeking confirmation on whether a new technology, treatment, product or service is worth investing time and money.”


Trend Setters


According to spa industry tastemakers, there is a cornucopia of creative delivery systems and novel components that are expanding this skin care sector. According to Sarfati of Repêchage, one of the biggest trends is face masks.



“Although face masks are not a new concept for the spa industry, the numbers speak for themselves,” she told Happi.



According to Datamonitor, from 2010 to 2015, overall face mask sales rose nearly 73% to $5 billion. The research company expects sales to exceed $7.4 billion in 2020.



“Masks certainly should not stop at your spa menu—complementary masks should be available at the retail level,” added Sarfati. “This allows clients to continue the benefits of their mask treatment and allows them to bring the spa experience home. This has always been our goal with creating professional masks and retail masks, and is the concept behind our new Repêchage Fusion Express Bar and Spa Masks and at-home Repêchage Fusion Face Masks.”



Additionally, Repêchage Biolight Luminex Mask, launched in May, is an entirely new concept in professional facial treatment masks, said Sarfati. Based on kaolin clay, it is fortified with glycolic acid, fruit acid, laminaria digitata seaweed filtrate and other botanicals to help reduce the appearance of fine lines while sloughing off dry skin, leaving it bright and glowing.



Products loaded with certified organic ingredients are big sellers right now, observed Helga Hefner, Aveda manager professional skin and spa education, Blaine, MN.



“Last year, we introduced the new Tulasāra skin care line of products featuring certified organic ingredients. More will join this line in 2017, that already includes steps for doing an at-home Radiant Awakening Ritual,” according to Hefner.



That “ritual” begins with the Tulasāra Radiant Facial Dry Brush—gentle brushing exfoliates to help reveal smoother skin—and massaging with the Tulasāra Radiant Oleation Oil, a 100% naturally-derived blend with six plant oils (sesame seed, sunflower seed, jojoba seed, rose hip, apricot kernel and sweet almond oil) designed to be massaged into skin after facial dry brushing.



Meanwhile, Annet King, vice president of global education for Elemis, Los Angeles, is enthusiastic about oils. She told Happi facial oils like her brand’s Pro-Definition Facial Oil are popular due to its skin energizing qualities.



“Delivery is also very important—encapsulation being the ultimate buzzword,” she added.



HydroPeptide is pioneering a movement of genetics in skin care. According to Kitchen, research shows that the secret to anti-aging and the fountain of youth is not in skin—it’s in your genes and how they are expressed.



For example, the company’s newest launch, Nimni Cream, is specifically designed to “turn on” your body’s collagen in a meaningful way, by focusing on the health of cells, said Kitchen.



Many ingredients have been discovered, launched and improved upon, but an important initiative is ensuring ingredients are combined in a meaningful way so that they amplify the benefits to the skin.  Synergistic formulas that use “tried and true” ingredients with new technologies and ingredients can more dramatically impact skin health, according to Kitchen.


The company’s HydroPeptide LumaPro-C combines ingredients such as vitamin C and other antioxidants with more advanced ingredients like a resurfacing peptide, an upgraded form of resveratrol, and the latest in probiotic skin brightening technology. 



Peptides were introduced into skin care treatments more than 10 years ago, and they continue to be some of the best, most effective means of addressing skin concerns, according to Sarfati. 



Repêchage combined the latest peptide technology with the comfort and convenience of a sheet mask with the launch of the new, at-home Repêchage Triple Action Peptide Mask, designed for all skin types. This new face mask combines laminaria digitata seaweed extract with five advanced peptides to hydrate, firm and help brighten skin appearance.



According to Danae Markland, VP-business development, PCA Skin, Scottsdale, AZ, the best performing brands are those that have a cosmeceutical slant and provide more clinical treat ments, while preserving the pleasant experience spa goers expect.



“PCA Skin offers many therapeutic masks and blended chemical peels that deliver real, visible results,” she told Happi. “Many of our products like Dual Action Redness Relief provide soothing and barrier enhancement, while Hyaluronic Acid Boosting Serum plumps and minimizes fine lines and wrinkles.”



Top spas cater to sensitive skin needs, too. VMV Hypoallergenics has teamed up with mobile concierge beauty service platform, Priv. Available in New York City and Los Angeles, Priv offers VMV Hypoallergenics’ Signature 60-minute Vx facial.  



“Clients want two things: results and skin safety. People are no longer going to the spa just to relax—although that’s definitely still a factor. They want to know how a service or product is going to help them reach their skin goal,” said CC Verallo Rowell, US director, VMV Hypoallergenics, New York.



Spa executives and brand owners say they have the answers to consumers’ questions and desires.



“For me, the most important trend I see is the demand for clean products, products that take into consideration the health of the person using it,” noted Michelle Schlekewey, director of guest programs and services, Golden Door, San Marcos, CA. “The Golden Door product line was created with the same message that we use—wellbeing for the mind, body and spirit.”



Tranquil Progressions


The professional skin care market in the US is forecasted to grow at a compound annual growth rate of 4.5% through 2021, supported by positive performance in all distribution channels, according to Kline. Active new product innovation, consumer demand for skin treatments, and the increased focus on e-commerce business are some key factors to fuel growth in the market.



“Spas will continue to incorporate more advanced clinical daily use and professional treatments into their menus,” Markland of PCA Skin told Happi. “Consumers are savvy and are looking for products and treatments that deliver. Although relaxation will always be in demand, results are becoming even more important.”



“The 21st century has ushered in a multitude of technological advances in skin care in the form of peels, laser treatments and technologically advanced ingredients,” said Sarfati. “What’s next? What goes around comes around in skin care. Perhaps the biggest leap in spa will be the re-emphasis on some of the first ingredients ever used, including clays and seaweeds. Sustainably harvesting natural ingredients and providing truly beneficial derivatives that are processed and formulated for optimum efficiency can be the next wave in skin science that is both earth-friendly and skin friendly.”