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Despite an Economic Decline The Spa Market is Bubbling



Harvey Fishman has a consulting firm at 34 Chicasaw Drive, Oakland, NJ 07436, hrfishman@msn.com, specializing in cosmetic formulations and new product ideas, offering tested finished products. He has more than 30 years of experience and has been director of research at Bonat, Nestl� LeMur and Turner Hall. He welcomes descriptive literature from suppliers and bench chemists and others in the field.



Published September 30, 2008
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The popularity of spas and their corresponding home-use products in Europe’s Big 5 seems to be increasing, despite the credit crunch that is gripping most the U.S. and Europe. It seems that people still find the time and the money to pamper themselves despite these hard times.
   
Europe's spa market is one to be envied across the world. According to The Global Spa Economy 2007 Report, unveiled at the Global Spa Summit in New York City in May, Europe is home to the largest regional spa market in the world. It boasted an estimated 22,607 spas in 2007, earning $18.4 billion in revenue and employing 441,727 people. Europe is also unmatched in its quantity of health resorts that emphasize wellness, traditional healing therapies and medically-based services.
   
France is the second biggest spa market in Europe, after Germany, with estimated revenue of $2.2 billion. According to Cassandra Cavanah, executive director of SpaFinder in Europe, four to five million French people visit a spa around four to five times a year, and impressively, “50% of people aged 20-60 have experienced balneotherapy,” she reported.
   
Thermal centers and thalasso therapies have enjoyed a long tradition in France and such spas are well recognized for offering medical benefits. The country has unrivalled experience in the field of thalasso cures and thermal centers are even sometimes covered by health insurance.
   
“The growth of the spa industry in France reflects similar growth spurts in other countries, like the U.S. and the UK,” said Ms. Cavanah. “A key reason for the growth is simply consumer demand and as the concept of spa has become more popular globally, there have been many French cosmetic and product brands that have opted to launch a spa component including Caudalie, Nuxe and Clarins.”

Germans Love Spas


German consumers are passionately interested in anything to do with preventive health care, including functional and bio foods, fitness, alternative medicine and wellness. According to sources, the German spa market reached $3.8 billion last year.
   
Spas are an important aspect of the German beauty sector and it is the most lucrative spa market of the Big 5. During the past five years, a multitude of different spas have opened their doors in both urban and rural locations. These days, very few major hotels can afford to be without a spa. At the same time, there are spas on cruise ships; spas attached to perfumeries, department stores or hair dressing salons; medical spas; nail spas; yoga spas and hair spas; a dental spa in Berlin and plenty of stand-alone city spas and day spas.
   
On the product front, German spa manufacturer Babor is launching a Spa Around The World concept that includes three product ranges and matching salon treatments inspired by ingredients from India, Asia and Africa. The three SKU Shadiva of India line includes balancing shower gel, oil-salt scrub and a body lotion containing neem tree extracts and Indian ginger lily. ScenTao includes shower milk, scrub, body lotion and body spray formulated with classic Asian ingredients such as green tea, gingko extract and ginseng. Finally, Khanya Energy Balance contains African marula oil and tea tree extracts “to balance body and soul.”

Spa Products to Go


The spa sector in Italy is posting good growth. The Italian spa industry boasts more than 20,000 spa operators and sales of $2.2 billion. In recent years, there has been a significant expansion of product sales in day spas. Clients are attracted by the promise of relaxation and of improving their appearance without having to make an effort like they do in fitness clubs.
   
Among the top brands in the spa products market in Italy there are two Italian companies, GTS, the manufacturer of the Dibi brand, and Jean Clebert. Some experts argue that the top two or three manufacturers may hold more than half of the Italian spa market, while the top six control 80%. Other companies in the Italian spa market are the French brand Phytomer, the American firm Pevonia and the Italian company Comfort Zone; all of them using their own products within their spas. Italy also has several spa export brands, among them Collistar (Bolton Group) that has a reported presence in more than 1,000 European stores and spas outside of Italy.

Fun in the Sun


Since 2000, the number and variety of spa offerings in Spain has grown dramatically, reaching $1.5 billion last year. However, as a result of the current economic conditions and the significant drop in consumer spending, early predictions for spa expenditure among Spaniards is likely to be less than first anticipated.
   
Despite that, the amount of money still being spent by Spanish consumers on spa products to use in the home is encouraging. In February 2007, Aveda opened its first Lifestyle Salon & Spa in Madrid to much acclaim. As a precursor to Aveda being available in Spain, Estée Lauder promoted its natural cosmetics brand Origins sold through the country’s El Corte Inglés stores and both product lines have been embraced by customers wanting luxury spa products for home use.

Day Spas Post Gains in the UK


Despite growing consumer awareness, the value of the UK spa market is just $1.7 billion, a far cry from its European neighbors. When it comes to spa types, it seems that day spas are the venue of choice for Brits. Penny Turvey, director of GMT TEC, which provides training, education and consultation to the UK beauty and spa industry, said that day spas are offering an opportunity that residential spas do not.
   
“Day spas offer spa type treatments that are more accessible and didn’t require too much time to be taken out from our daily life and work commitments.”
   
One successful day spa concept is from Elemis (Estée Lauder). The brand offers many stand-alone stores across London and has recently opened its doors at a new British Airways Elemis Travel Spa in the new Terminal Five building at Heathrow Airport, London.
   
Such is the prevalence of the UK home spa market these days that 25% of The Sanctuary’s spa clients purchase products from the company range to continue the experience at home.
   
So, while the economy is in the doldrums and recession fears sweep Europe, the popularity of spas prevails. But as spa products take priority over spa treatments themselves, it remains to be seen whether the do-it-yourself trend will impact spa revenue in the future. For now, the two are happily co-existing.

European Cosmetic Markets is published monthly by Wilmington Media. It provides in-depth data and analysis of the European cosmetics and toiletries market. For subscription details contact Wilmington Media, Tel: (44) 20 7549 8626. Fax: (44) 20 7549 8622


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