The $4.2 trillion wellness market isn’t a strong suit of Intercontinental Hotels Group (IHG), but the chain’s acquisition of Six Senses Hotels Resorts Spas is just the treatment it needs to change that.
IHG’s luxury brands do not have a dedicated spa concept, but there won’t be a Six Senses Spa in InterContinental, Regent, or Kimpton hotels. “I don’t want to do that,” said Neil Jacobs, CEO of Six Senses Hotels Resorts and Spas.
“We fought hard for years to change the perception that we’re a spa company. We’re not, we’re a hotel company. Besides, a brand like InterContinental has over 200 hotels — put Six Senses Spa in each?”
Instead, Jacobs pointed out that the Six Senses’ acquisition includes Raison d’Etre, a spa consulting company that can develop a wellness concept for some of IHG’s brands, starting probably with Regent, he said. Acquired by IHG in March last year, Regent is undergoing a rebranding journey. This week, IHG unveiled a new logo for the brand.
Raison d’Etre had created spa concepts for luxury hotel chains such as The Aman Spa, Jiva Spa for Taj Hotels, and Resense and Kempinski The Spa for the Kempinski chain. It was acquired by Pegasus Capital Advisors, then owners of Six Senses, in 2013.
A new report conducted by Reuter: Intelligence in collaboration with International Luxury Travel Market (ILTM) Asia Pacific in Singapore this week warns that not only do luxury travelers expect travel brands to have a spa offering, their expectations are “sky-high.”
It urges luxury travel brands to “move beyond simple concepts of a gym and a spa, to rebrand, reconstruct, and reposition their offering as a destination for holistic wellness.”
The wellness market has also become too big to ignore. The Global Wellness Institute said the industry is worth $4.2 trillion globally.
In Asia-Pacific, the corporate wellness market alone is expected to reach $7.4 billion by the end of 2024 and Asia has been the number one growth sector in both wellness tourism trips and revenues for each of the last five years, said the Reuter: Intelligence report, citing Transparency Market Research figures.
IHG’s acquisition of Six Senses is strategic for the chain to gain a healthy share of a market it has largely ignored. Six Senses is “ahead of the curve,” with holistic wellness, and Raison d’Etre is the backbone of this offering.
But each of IHG’s brands must decide for themselves what wellness concept is best suited for them.
“For example, holistic wellness is in our DNA. When we do a spa in someone else’s hotel — and we don’t do it as much now — it’s sometimes difficult for us to run the full gamut of our wellness programming because we don’t run the hotel. We’re not cooking the food, buying the mattresses, designing healthy rooms,” said Jacobs.
He continued, “When we run the hotel, our sphere of influence around wellness and sustainability is much greater than when we are just a spa operator.”
But what differentiates a wellness offering if the same company is creating all the concepts?
Said Jacobs, “Everything needs a narrative, a strong point of view. For us, wellness is not spa. Spa is part of wellness, but we can do wellness without a spa. … We do wellness probably better than most because it is such an important piece of our DNA.”
“Just like you create a concept for a restaurant, why can’t you create a concept for a spa? You might create a fun one, a serious one, a disco spa, you can be as creative as you need to be. It depends on what’s the hotel, what’s the DNA of the hotel, what’s the market talking about? So [concepts] will be all different,” said Jacobs.
Jacobs expects IHG to retain the identity and operation of Six Senses.
“They are really respectful of what they bought. It’s not part of the business they really do and they are mindful of that. They have a commitment to being in the luxury business and we’re [positioned] at the highest end of the spectrum. … The commitment is to just let us get on and do it and not to be overly involved in what we do everyday,” he said.
Three months on, the integration is currently more focused on compliance in areas that are key to IHG as a British public company, “around legal, finance, our reporting, so that it can be rolled up into their quarterly earnings report,” said Jacob.
“The level of governance is higher than we would do typically as a privately owned little boutique group. So we’re getting used to some of that. But as it relates to developments, new projects, execution, it’s kind of business as usual.”
Six Senses has 18 hotels in operation and Jacobs expects the figure to reach 50 in four years, thanks to the momentum the brand has created in the last few years. IHG’s infrastructure and enormous scale can help drive business for the recently acquired brand.
“IHG can really help us a lot in the non guest-facing areas, like in the back office — IT, systems, distribution. It can drive occupancy a little more aggressively than we’re able to because as a small company we can’t always afford some of the technology that we would like to have.”
“We just have to be sure that it’s the right kind of business, i.e., guests that really care about what we do.”
Photo Credit: Six Senses Spa. Six Senses Hotels Resorts Spas.