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China: The Next Beauty Frontier

By Ada Polla Tray November 2007 issue of Skin Inc. magazine

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The simple mention of China is enough to get any businessperson agitated and excited. China has one of the fastest-growing economies in the world and offers a large number of consumers ready to buy any number of a variety of goods. In addition, a significant portion of the world’s products are made in China. All this points to one thing—the Asian country appears to be the next economic superpower. However, just hearing about this economic wonder is sometimes not enough. I decided to go see for myself what is really happening in this country.

The numbers
       There is much to be said about the attractiveness of the Chinese market for spas and cosmetics. In 2006, the sales of cosmetics and toiletries in China reached approximately $7.5 billion. According to a national government research project, spending on beauty products and services has been increasing at an annual average of 15–20% during the last five years, and the growth rate is expected to increase to 25%. Foreign brands can make up as much as 90% of total national cosmetic and toiletry sales.1
       In terms of spas, research indicates there are a multitude of luxury spas, mostly in hotels, and hundreds of independent massage and beauty parlors. Linda Au, director of sales and marketing for Spa Resources Asia Ltd., a trade and consulting organization, estimates there are currently about 40 brand name spas in China in more than 75 outlets, up from about 25 brand name spas in 2003. Today, 32% of them are in Beijing and 36% are in Shanghai, with 70% of them being located in hotels. From 2001–2002, there were approximately one million spa visits in China and Hong Kong.
       Current figures were not available, but Au conservatively estimates an annual 10–20% growth in clientele for the past few years, with similar increases expected in the future. According to Intelligent Spa’s 2002 Spa Industry Survey Program, 41% of the spa visits were from international tourists, with the rest being from Chinese and foreign residents. While local expatriates and tourists represent the majority of spa clients at name brand spas, Au also predicts the local/foreigner share of the market will shift to a 50–50 ratio in the next few years.2

Seeking out Shanghai spas
       Wanting to get a more insider look at what’s behind these numbers, I traveled around Shanghai, visiting various spas. While a range of services and products are offered, there are definite distinctions in style and operation.
 
       Decléor Spa. I arrived at the Decléor Health and Beauty Spa, a place said to be popular with the locals, and immediately was awed by the size. There are nine Decléor locations in Shanghai, and my first impression of this one was that it was a truly institutional operation. Prices were higher than expected, with an average
115-minute facial costing more than $150.
       I was asked to take a seat in a consultation booth and offered a hardcover, 20-page bound treatment menu describing a wide variety of facial and body treatment options. Without booking a service I wasn’t allowed to visit the spa, but was assured of its grandeur and beauty. The receptionist who offered descriptions of the various treatments in broken English was so hospitable and friendly that I left with a bottle of facial oil, hoping she worked on commission.

       Dragonfly. The next stop was Dragonfly, a local spa chain said to be preferred by Shanghai’s burgeoning nouveau riche population that still tends to shy away from the higher-priced hotel spas. The spa was small, but well-decorated and welcoming. I was offered tea and another hardcover, bound treatment menu. Here, the prices were surprisingly low—a 30-minute head-and-shoulder massage cost less than $10, and I couldn’t resist.
       I was led to a dark room with several lounge chairs positioned side by side where I had a wonderful head, shoulder and arm massage. A first for me, I remained clothed, and no products, apart from hand sanitizing gel, were used during the treatment. My therapist nodded disapprovingly as she massaged my neck, saying, “Here no good,” which I translated as “Too many knots.” Her expert hands combined with the soothing music, darkness of the room, and waterfall sounds helped me to relax, and I left refreshed and convinced I had gotten a true bargain.

       Banyan Tree Westin. I learned here that oftentimes the hotel in which a spa is located is not necessarily the spa’s operator. Rather, many Chinese hotels outsource their spas’ operations to spa management companies. At the Westin, the spa is operated by the Singapore-based Banyan Tree, and, in addition to having the spa in the Westin, the company is planning to open a resort in the northwest part of the country’s Yunnan province.
       While I didn’t benefit from a treatment here, the overall feel was corporate, dark and heavy. When I asked to visit the spa, I was rapidly escorted in and out of one of the couples’ rooms, then was asked to leave when I said I wasn’t planning on booking a service.

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