MONEY MATTERS
CONTINUED
Know Thy Guest Too
A thorough understand of guests ’ habits is also a crucial part of a spa ’ s approach to yield management . In fact , keeping close tabs on his guests ’ habits and mindsets has led Shane Bird , director of spa operations at Skana Spa , to adjust his spa ’ s yield management strategy in a way that has made its pricing more effective . Though , like many spas , Skana offers services on Friday and Saturday at the high end of their price range , Bird has elected to price services at basic rates on Sundays . That decision allows guests to enjoy a massage , for example , at a below-premium rate on a weekend . It has another important effect too : “ Sunday is kind of a big checkout day [ at the resort ],” says Bird . “ So my philosophy there is , can we keep them around longer ? Can we extend their time and get them to leave their bags at the bell desk and spend their day at the spa ? Get another lunch or dinner or whatever ? It ’ s almost less of a financial decision and more a psychological one .”
By carefully evaluating guest behaviors , as well as closely examining which services book most heavily at which times , spas can not only increase revenue by identifying periods of high demand , they can also fill in bookings at the edges of their service schedules — so-called shoulder hours — all while extending the benefit of lower rates to guests who may seek that additional value . That ’ s not something Bird has tested yet , but it ’ s something to which he ’ s given thought .“ Maybe in the future we yield prices for our shoulder hours . You know , you ’ re looking at your morning hours and your evening hours that might tend to book last because
10 to six is your sweet spot — do I yield those down and fill them in a little bit better ? Should I maybe incentivize to get people into my shoulder hours ?”
Bird is also quick to point out that yielding doesn ’ t have to mean enormous price swings and advises spa leaders to give serious consideration to the impact of yielding prices down even slightly during off-peak hours .“ I think sometimes , when operations folks think about yielding , they think sometimes of what a hotel does , where one night is $ 199 and the next night its $ 299 ,” Bird explains .“ You ’ re using a scalpel more than a shotgun . Even if you said ,‘ My services after six pm are five dollars less ,’ you ’ d be amazed what five bucks does for a consumer ! And you ’ ve booked those hours that maybe aren ’ t as bookable — it ’ s amazing what that will add up to over time .”
“ Some software supports dynamic pricing by the hour of the day — Friday mornings I have a lower price and Friday afternoons I have a higher price , for example — but others only work by the day of the week . So the first step is to really understand your software , get a full training on how yield pricing may work and support you .”
Don ’ t Sleep on Software
One potential hurdle to refining a spa ’ s yield management strategy — or implementing one in the first place — is the detail-oriented work that goes into evaluating booking patterns and determining when and by how much to
— VERENA LASVIGNE-FOX
34 PULSE ■ MAY 2021