Indian Spas

With estimates for double-digit growth, the Indian spa industry is on the verge of a boom. Long considered a niche segment, the Indian spa industry has begun to attract both local and international attention over the past year and a half, and the reason for this attention and growth is multifaceted.

First and foremost from the local perspective, the spa industry has benefited from increasing consumer awareness about concepts of beauty and wellness. Wellness is no longer just an aspiration; it is fast becoming an affordable indulgence—especially in major cities such as Delhi, Mumbai, Bangalore, Chennai and Kolkata. “[Society’s] views in respect to wellness [are] drastically changing,” says Carina Chatlani, chairperson of Spa & Wellness Association of India and CEO of Body Bistro, a range of spa products. The consumer mindset has moved from going to a doctor to cure ailments, to using therapies for better lifestyle management, she explains. In fact, Indians are now traveling to both Indian and global spa destinations for recuperative wellness vacations. In conjunction with this trend, there is a rising demand for exclusive and customized beauty and wellness services that only spas can offer.

While women still comprise of 70% of the clientele, men no longer shy away from going to a spa to look and feel good. According to an estimate, the entry of male customers into spa and wellness centers is increasing by almost 80% annually. According to Chatlani, 69% of the population falls into the highly health conscious 25–45 age group, making them highly potential spa customers.

Meanwhile, over the past few years, Indian ayurvedic and herbal therapies have been gaining ground among consumers in U.S. and European markets. Thus, India has become a destination for wellness tourists seeking specific Indian therapies. In addition, specialty spas in the U.S. and Europe have also begun to offer Indian ayurvedic and herbal beauty and wellness therapies, which translates into business for many Indian manufacturers, who can contract manufactured products for these spas or supply base materials for therapies.

Emergence of Day Spas


Until recently, India has been promoted as a place most suitable for resort or specialty spas, with a special focus on the Kairali (Kerala) therapies offered by resort spas in South India, notably in the state of Kerala itself. This market was very small and catered specifically to foreign tourists looking for a medi-spa experience. However, this has changed. Over the past couple of years, Kairali massages have given way to many more exotic therapies taken from other global locations, especially Southeast Asia. This is directly due to demand from Indian consumers.

In fact, destination and resort spas have given way to day spas. The four main Indian metropolitan cities are seeing an increasing number of day spa openings.

“The Indian spa scenario is changing drastically. It is expected to grow 100% this year,” says Sanjay Malik, director, Fitplaza, a Dutch chain of day spas that recently opened its first Indian day spa and wellness center near New Delhi. “In fact, we see day spas growing more than resort spas this year. Since there are many foreign business travelers that come here on work, they do not have time to spend four to five days at destination spas. Yet, they need to wind down, and day spas give them this opportunity. That is why we feel it is a good idea to invest in day spas. In fact, after establishing our current wellness center, we plan to go to other locations in and around Delhi.”

More international investments are expected in day spas, as well as resort spas, this year. MSpa International is planning to open its specialty and day spas across the country—beginning with Mumbai, Delhi and Bangalore—in 2007. The company is targeting major metropolitan areas as well as tourist destinations, in order to cater to both local consumers and international travelers.
Additionally, Unilever has recently taken over a chain of day spas run under the Ayush brand, demonstrating that international players are seeking entry into the Indian spa market. Currently, big hotel groups such as ITC and Oberoi are operating the most popular resort spas in India.

According to Kendra Lee, exhibition manager of Spa India Exhibition & India Beauty Expo, the Indian spa industry is still relatively small, but, with the current growth and influx of international companies, resort spas will give way to day spas, and spas in general will become part of a daily routine and not simply a holiday luxury. While the Indian spa industry remains very unorganized due to a lack of industry-wide standards and quality checks, Malik sees a light ahead: “I see this industry getting more organized in the next six to eight months, seeing the present growth rate.”

Cities like Mumbai are an up-and-coming market for spa operators. Because the city is already a tourist attraction due to the popularity and attraction of Bollywood, many spa operators are setting a foundation there. South Indian locations like Bangalore, Chennai and Kerala remain more traditional and still promote resort spas rather than day spas. However, commercial locations such as Delhi, Gurgaon and Mumbai will see a proliferation of day spas.

Moreover, beauty salons are upgrading their offerings to include specialized skin care treatments and labeling themselves as day spas. “We see this happening [because] women are not just looking for beautiful skin but healthy skin,” says Malik.
“Even when women come to regular salons, they are looking for more than just a facial,” says Blossom Kocchar, director, Blossom’s Aroma Spa, a salon turned day spa. “They are looking for relaxation that promotes a sense of wellness. That is why we need to offer services that are more than just facials. At the day spa, they can spend an hour or two and get relaxed and feel healthy and not just merely beautiful.”

Demand for Global Brands

With the mushrooming of specialty and day spas across the country, especially in the five major cities, India is a wide-open market for international beauty brands and spa products. “The beauty industry is one of the fastest growing sectors in India. It is growing at the rate of 20% a year—twice as fast as the U.S. and the European market. So, it is the right time for international brands to seek buyers here,” says Raj Manek, managing director, Expomedia Events India Private Limited, organizers of the Professional Beauty Expo.

While local brands still hold 70% of the spa market, the growing beauty-consciousness among consumers (especially the globetrotting executive class) and interest in higher-value products, spurred, in part, by higher purchasing power, is generating demand for imported high-end spa brands.

“When it comes to spa products and solutions, Indian spas like to add exclusivity and so use imported ingredients,” says Smita Agarwal, director, VNS Marketing Pvt Ltd. “We bring in many exotic products and oils from Thailand, Southeast Asia and the Middle East, and supply to all the major spas in India. They use these to offer exotic treatments inspired by Southeast Asian therapies, which are very popular currently amongst Indian and international clientele.”

In fact, international spa brands such as Thalgo, Pevonia Botanica and Remy Laure are already present here. Other players such as Austrian brand Dr TempT and French Dalton Beaute De la Mer are looking to establish a presence in the Indian spa market. “When Indian women go to spas, they are looking for an international level of experience, so these international brands give them what they are looking for,” says Rekha Chaudhari, director, Nagai Overseas, which sells Remy Laure products to Indian salons and spas. “This also gives them an element of exclusivity and glamour. Besides, these skin care products are superior to what is available in the Indian market.”

Made In India

While Indian clients are asking for treatments utilizing international brands, the Indian herbal and ayurvedic beauty product manufacturers are looking to the global markets for potential growth.

Due to the unorganized nature of the industry, most Indian manufacturers sell raw ingredients or base products rather than complete products. Most of them supply to Indian spa operators. However, there are few popular local consumer brands that have branched out to supply international spa operators or suppliers that sell to spas in the U.S., Europe and the Middle East.

“There are many manufacturers of ayurvedic and aromatherapy products in India. Most of them develop good blends, since Indian ingredients are very good and of high quality, but for an international buyer that wants to source from here, it is necessary to find a good manufacturer with quality control standards,” advises Malik.

“While we focus on the consumer segment in India, in markets like the U.S. and Central Europe, we develop products for the wellness and spa owners,” says Kamal Passi, MD, Lotus Herbals, a popular mid-tier consumer brand in India. “We have a very strong manufacturing base here, and manufacture for a few spas in the U.S. and Europe under their branding.”

“Our products are being used in quite a few spas in the U.S. and the Middle East. This year, we are targeting the suppliers market in the U.S. and Europe,” says Mira Kulkarni, CEO, Forest Essentials, a major product supplier to spas and hotels across India that is now focusing on the international market.

Similarly, Prana Naturals, an aromatherapy brand, has been selling outside India to the major spa destinations in Australia, Canada, the Middle East and Sri Lanka for the past 10 years. According to Shakun Goyal, director, Prana Naturals, the demand is for products such as bath salts, soap, aroma candles, essential oils and massage oil.

With the popularity of natural and herbal products and therapies in the U.S. and Europe, there are good revenue sources waiting for Indian manufacturers to tap into.

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