Wellness Revenues for Any Hotel Brand Starts with Tech

NB: This is an article written By :  Adam Mogelonsky and Larry Mogelonsky

Wellness is at the forefront in 2023, both as a back-of-house means to retain talent and for the front of house as a way to support higher rates or grow ancillary spend. For this article, the focus is on the latter of these two as our thesis is that wellness as a profit center will come to rival the rooms ledger for many brands. But in order to activate new programming and support it with continuous improvement, a solid tech foundation has to be there first.

Why Wellness Now?

While ‘wellness’ itself is quite an ambiguous and omnibus term, that also means there are elements within wellness that can work for any category. Just consider a few of your options:

  • Health-conscious cuisine, herbal teas and antiaging supplements
  • Traditional spa treatments like massage, facials or acupuncture
  • On-demand, in-room fitness or stretching programming
  • Guestroom sleep programs with circadian lighting and smart beds or pillows
  • Yoga, meditation or breathwork classes and other forms of group mindfulness
  • Guided intermittent fasting regimens and water or juice detoxing
  • Contrast therapy with saunas, hot tubs, ice baths, cryotubes or hyperbaric chambers
  • Forest bathing, self-guided hikes and all manner of exploring the great outdoors
  • Light and sound therapy involving near-infrared exposure or sensory deprivation tanks
  • Cacao ceremonies and using borderline-legal psychedelics like psilocybin or ayahuasca
  • Physiotherapy and other one-on-one functional restoration sessions
  • Educational experiences like culinary or aromatherapy classes
  • Genome analysis with one-on-one nutritional and chronotype advice
  • Onsite counseling for blood work, epigenetic testing or microbiome analysis

Indeed, there’s lots of space to play within, but why now specifically? For this there are a variety of factors all converging over the next few years.

While the two of us would write a whole other longform essay on these that brings in OECD statistics, for your concentration’s sake, here’s another list:

  1. Awareness for at-home wellness boomed during the pandemic lockdowns and people are looking to persist with these lifestyle adjustments
  2. The rise and persistence of remote work means that people have gotten off the proverbial hamster wheel, with a newfound pursuit for a healthier work-life balance leading to more demand for products that help this balance
  3. The medical research around longevity and what causes aging is accelerating in both its findings and its acceptance amongst mainstream practitioners, thereby increasing the supply side of clinicians, dietitians and all manner of personnel who can fulfill wellness roles at hotels
  4. Baby boomers are both entering retirement in droves and starting to experience chronic illnesses, making them a demographic primed for wellness products and medical tourism
  5. With their more malleable brains, the younger generations (Y and Z) are increasingly foregoing 20th century mainstays like excessive drinking, cigarettes, lots of refined sugar and deep-fried foods that are proven to be key aging factors
  6. Corporations are pushing for more employee wellness and mental health programming in order to retain talent, thereby helping feed the market for corporate retreats or wellness-oriented ancillary spend budgets for business travelers
  7. As all these abovementioned factors work concomitantly to raise both the supply and demand sides, it democratizes the pricing for numerous wellness products, acting as a positive feedback loop on awareness and demand

But What About Staffing?

Okay, we’ve identified the diverse range of programming a hotel brand can potentially undertake, as well as some broad, global factors that justify their setup. But because many of these are high touch by their nature, who is going to administer and render all these services?

Concurrent to the seven identified macroeconomic forces, we can also confidently say that the labor challenges the hospitality industry is facing right now aren’t going away any time soon. Hence, why would a hotel executive even consider ramping up wellness product offerings when they are having trouble cleaning rooms to put more heads in beds?

This is the core question because it not only affects frontline teams earning hourly wages but also salaried managers. On the administration side, many hotels don’t have the ‘bandwidth’ in terms of executives will time to spare to formulate what the wellness program would look like, let alone operationalize it within SOPs and training.

And yet, if hotels don’t innovate within the wellness space, they are not only missing out on this astoundingly lucrative vertical, but it may also compromise future brand positioning. That is, given the rising demand for travel wellness offerings and amenities, not evolving the brand in this aspect means that nightly rates may be commoditized because there’s no meaningful ‘reason to visit’ one property versus another.

The Solution to Wellness Is Technology

Much like the great strides that hotels made to modernize their tech stacks during the early phases of the pandemic, more is still needed to both automate the monotonous, coordination tasks that associates are currently performing as well as free up managers’ time to focus on the planning, implementation and continuous improvements of any wellness programming. In this sense, it’s all about time management so that you can more adroitly redeploy existing resources to new tasks.

Within this, however, is another fundamental goal that we call ‘data plumping’ or the establishment of rich system integrations to help clean and structure all guest data across multiple profit centers into one centralized storehouse. Once you do this, you will then have profound insights on your existing customers so that you can more accurately predict what new product offerings will be measurably productive insofar as generating more loyalty, more ancillary spend or more awareness.

On this note, we leave you with four general ideas for how and where tech will become instrumental for the development of a profitable wellness arm to your hotel brand.

1. Unified Guest Profiles:

The consolidation of siloed guest data is the lynchpin of all future services, amenities and programming that you create. These can be built within the PMS or CRS, or fed into a CRM or BI platform using a CDP and direct interfaces. Only once you have all these siloed systems connected can you start asking questions and getting prescriptive answers according to KYC (know your customer).

The game here is to more accurately assess what guest segments spend the most onsite and what they are already spending the most on. As a basic example, by building a good bridge between the restaurant POS and PMS, you will not only know what percentage of hotel guests dined at your restaurant but also who opted for the healthier menu options. If you notice an update in the latter, it can help guide menu expansions and packaging creation.

2. Upselling Platforms:

While the core driver for your brand’s bookings will likely remain for most hotels as the location, nightly rate, room availability, distribution and value-added promotions, many guests will nevertheless be primed to purchase additional services from their chosen hotels in the weeks and days before arrival.

Thinking contextually, how will your incoming guests know what’s available at the exact time when they are ready to buy?

Cross-selling tools like well-configured prearrival emails and guest communication platforms that can push notices to SMS or texting apps can ensure that customers receive your upselling messaging through the medium they prefer. Moreover, testing within these systems will allow you to refine your approach by giving you more data on the conversion funnel. What lead time from the arrival date generates the most clicks on our prearrival cross-selling email? What channel, whether email or WhatsApp, generates the most conversions for additional service purchases?

3. Dynamic Availability:

Whether it’s yoga, guided meditation or one-on-one consultations, as stated above a critical step is the automation of any practitioner’s hours with the portal that guests book through. Most hotels simply don’t have the bandwidth to manually herd all these third parties then, through double entry, offer this time-based inventory to guests through an online booking engine (that hopefully can also seamlessly charge to the reservation folio) so that they can complete a purchase without having to get a spa receptionist on the phone.

Then comes ‘dynamic availability’ wherein you use intelligent tools to recommend what days of the week and times of day you should offer specific treatments or classes. The idea here is profit maximization for spa services – for example, you don’t want a loss leader manicure eating up a primetime Saturday afternoon timeslot when you could sell that for a couples massage – as well as making informed decisions about when your guests would be most receptive to buying said service – for example, scheduling a yoga class for 10am on Saturday is very different than 10am on Wednesday).

4. Inspirational Transformation:

Guests want inspiration from their chosen hotels so that they can ‘transform’ their own habits back at home, and this alone means you can set services and amenities that can either be sold or baked into the nightly price in order to drive ADR growth.

For a tech-centric exercise example, think bespoke in-room exercise programming that connects to custom classes through an interactive TV. Already mentioned, you could build a new wellness center with an infrared sauna and ice plunge tank (big capex and staffing requirements for safety), but something simpler would be a breathwork module built into your hotel app that can interact with an in-room IoT device to keep guests on track. Finally, to grow within the now-popular mindfulness space, guided meditation apps abound while sensory deprivation tanks and sound therapy chambers (two more expensive yet techy options) are both reaching the mainstream.

About Larry Mogelonsky

Larry is managing partner of a hotel consultancy that assists independent luxury hotels meet their goals and helps technology companies understand how their solutions work in the hospitality filed. Together with his son, Adam, they are the world's most published author in the field of hospitality, with weekly columns in many leading industry publications, as well as

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