Spa KPIS are amazing. Just looking at your numbers and plotting how you’re going to improve them should make you dizzy with excitement.
The term “KPI”, or “Key Performance Indicator,” might at first glance seem like dry, corporate jargon. But if you delve deeper into these amazing little metrics you should find that this isn’t at all the case. KPIs tell you everything you need to know for your business to succeed. This isn’t boring. It’s actually pretty exciting.
KPIs are the crucial signposts that steer businesses towards their ultimate goals. More than mere metrics; they’re the narratives that chronicle a company’s journey, highlighting achievements and flagging areas for improvement. By diving into KPIs, companies can celebrate milestones, understand setbacks, and benchmark themselves against industry peers. In the world of business, KPIs are the silent architects of towering success stories. Just looking at your numbers and plotting how you’re going to improve them should make you dizzy with excitement.
The allure of data-driven decisions
There was a time not too long ago when Data Scientist was labeled “The Sexiest Job of the 21st Century.” That’s not for nothing. KPIs allow businesses to make decisions based on hard data rather than hunches, which can be transformative. KPIs give you control over chaos. And there’s something inherently compelling about taking charge and providing clarity and direction to those around you.
Then there’s the thrill of the challenge – pursuing a KPI is an exercise in strategy, anticipation, and eventual satisfaction when you get what you want. And the mystery! KPIs can unveil insights and trends that might have been hidden, much like the allure of getting to know someone or something intriguing.
What we’re saying is, KPIs are awesome and you should love them.
Let’s take a look at 16 important KPIs for your spa.
16 important spa KPIs
1. Total Daily/Weekly/Monthly/Annual Revenue Growth
Total revenue generated by the spa during any given period of time compared year-over-year, month-over-month, etc.
2. Capture Rate
The number of spa guests as a percent of guests who are staying at the hotel or resort where the spa is located during a period of time.
3. Retail Capture Rate
How many guests purchased retail products as a percent of spa guests. Potentially more useful if kept specific to spa guests who book aesthetic appointments, such as facials or microdermabrasion, and body-treatments.
4. Repeat Guest Rate
The number of people who return to the spa after an initial visit as a percent of the number of spa guests over a period of time.
5. Return Request Rate
A deeper dive into your returning customers providing information about your frequent guests and an understanding of their customer profiles, including the service providers they request.
6. Add-On Revenue
Calculation of additional revenue that adds no more time to a service, like aromatherapy, CBD upgrades, and eye masks. Can be facilitated with online booking, where a spa allows guests to build on top of a basic service.
7. Average Transaction Amount
Total revenue generated over a period of time divided by the number of guests during that period. For example, $1,500 in sales in a day divided by 10 customers is an average transaction of $150.
8. Average Monthly Retail Sales
Total retail sales revenue generated by month and compared month over month to see improvements or declines.
9. Therapist Utilization Rate
Amount of time a practitioner is booked as a percent of their available time. If John is working a six hour day and is booked for five of those hours, that’s an 83% utilization rate.
10. Spa occupancy
The number of booked appointments as a percent of available total treatment hours. Total available treatment hours is calculated using the number of treatment beds (and possibly chairs), rather than rooms in your spa, multiplied by the number of operating hours.
11. Treatment Room Utilization
Total treatment hours sold divided by total treatment room hours available (a spa with eight treatment rooms open for 10 hours = 80 available treatment hours)
12. Revenue Per Available Treatment Hour
Total treatment revenue divided by the number of available hours (treatment rooms multiplied by numbers of business hours ).
13. Outside Customer Percentage
For hotel and resort spas, the percent of guests who are not hotel guests vs. those who are.
14. Cost of Goods Sold (COGS)
Calculates the direct costs associated with providing treatments and selling products, helping to manage profitability. One might look at everything as a whole that would fall under services, or sort by category: The cost of retail ordered vs. retail sold or the cost of keeping the hot tub running all day vs what it brings in.
15. Online Booking Conversion Rate
Measures the percentage of website visitors who book appointments online, reflecting the effectiveness of the online booking system.
16. Customer Satisfaction Score (CSAT)
Gauges client satisfaction levels through post-visit surveys or feedback forms.
These KPIs help inform all of your business decisions
Reports like these are generated in a comprehensive reporting dashboard with Book4Time and will help inform all of your business decisions. These KPIs will help you create strategies for marketing, customer acquisition and retention, and revenue and yield management. They can help inform your loyalty and membership program strategies. For example, knowing who is coming to your spa, and when, allows you to schedule accordingly, and facilitates creating personalized experiences. Your occupancy and revenue per hour numbers will help you make decisions about revenue and yield management. You might, for instance, offer your highest revenue generating services only during peak hours and lower revenue generating services during less busy hours. Your outside guest percentage can influence your revenue management strategy, perhaps in the form of different pricing or offers for different types of guests. Members, for example, or hotel guests, may get a percent off of spa services while local residents pay a different price. Your add-on revenue can influence decisions about additional treatment offerings. Your therapist utilization rate, repeat request rate, and retail sales can help inform your training and performance management strategies.
You’ll find another list of spa KPIs by Trent Munday here on LinkedIn.
Spa Executive is published by Book4Time, the leader in guest management, revenue and mobile solutions for the most exclusive spas, hotels, and resorts around the globe. Learn more at book4time.com.
Image by Drazen Zigic on Freepik