Ms. Clarke

Spas, Health & Wellness

An Overview on Medical Spas

By Jacqueline Clarke, Wellness Research Director, Diagonal Reports

This new "medspa" category is growing - strongly. In the USA, the most developed medspa market, the numbers more than doubled between 2004 and 2006. And in barely more than a decade medspa dollars went from zero to over one billion dollars a year. (There is as much conflict about market sizes as there is about definitions.)

The medspas are themselves but one segment of a relatively new category, the day spa. Currently in the USA, revenues in 14,000 "spas" are over $12 billion a year. The spa market is growing faster than wider professional beauty services market. Indeed spa revenues compare to the $60 billion revenues in about 313,000 hair salons/beauty salons in the USA.

The growth drivers of the medspa market are much the same in different market around the world. The chief of these would include:

For example many managers of medspas stress the "ordinariness" of their clients: "We are seeing more and more very ordinary people."

Medspa business categories / revenue generators

The medspa range of treatments can be very wide ranging - from A to Z, that is, from Aromatherapy to Zen. However, despite the "medical" in their title, the leading treatments in medspas are cosmetic. They are:--

Medical treatments non-invasive and invasive, such as surgical treatments (such as face lifts) trail the cosmetic.

Technical developments

Technical developments grow demand for skin care, particularly non-invasive anti-ageing skin care, in medspas. For example, the latest lasers also treat a wider range of conditions, among which wrinkles, pigmentation, acne, sun damage, tattoo and lesions. Also lasers treatments, such as hair removal, can be longer lasting and also less painful than the alternatives (waxing).

Technical innovations also lower costs. For example, lasers with multiple heads that can be used in a variety of procedures and reduce both investment and training costs.

Faster and faster

Fast procedures, that is both in terms of treatment time and recovery time continue make many non-invasive medspa treatments popular with time-poor consumers. Speed is one of the main drivers of sales growth for laser treatements.

The "holy grail"

The "holy grail" of medspas, and the wider cosmetic laser industry, is a laser that would effectively reduce weight. Such a laser could win sales from the large, and highly profitable, weight control market in many countries. The market includes such sectors as health and fitness, diet, diet foods, anti-cellulite body products, and counseling.

Medspas - the different business formulas

The new medspa market is in an experimental stage of development. That is there are many different business formulas. They include:--

A disputed formula (medical or not?)

An essential difference between business formulas concerns the role of licensed medical professionals.

In the "medical" formula the role of a licensed physician or dermatologist is central. Its advocates claim it is the only possible formula and they argue that "a reduction in the role of the medical professionals" leads to failure.

In the non-medical or "spa" formula, medical professionals may have only a limited role. This is a matter of some controversy in the medical profession. Its advocates however argue that medics' position is an anti-competition attempt to exclude them from a lucrative market.


The medspa market is very fragmented in terms of the numbers of suppliers and their market shares. In every country few companies have a significant share, that is in double digit figures, of the medspa market. However, the large medspa skin care market is dominated by the so-called "pharma" or "doctor" brands. This is because their claims are backed by "hard science," and thus as superior to the "non-doctor" or "cosmetic" skin care brands.

Negatives, and uncertainties

However, although the medspa market is generally positive, the performance of individual facilities can be uneven. Indeed, not all of the many new openings are successful. As one investor noted about the US market "some people suggest that medspas have a license to print money ... and they do not."

The negatives that market experts identified would include:

Cowboys and counterfeits and controversies

The medspa industry should not ignore the growing number of reports about a "cowboy" element. That element could bring the entire industry into disrepute. The term "cowboy" is used to describe a range of practices, such as unlicensed/untrained providers of treatments, the dilution of products to increase profits, and counterfeit products. There have been suggestions that legitimate medspas have been the victim of counterfeit suppliers.

The controversy between (broadly) "medical" and the "beauty" interests over the medspa market can be something of a negative for consumers. This controversy arises because historically many of the products and devices that are the main plank of medspa business were developed for medical purposes. Thus they were restricted to licensed medical professionals. However, some have been "deregulated," that is approved for cosmetic purposes, and by aestheticians rather than being restricted to licensed medical professsionals. Some medical professional argue against the "deregulatory" process.

The most famous example of deregulation from the medical to the cosmetic is Botox. Another example is the approval of lasers for cosmetic procedures, such as skin rejuvenation and cellulite reduction.

The controversy can confuse, and even scare, potential consumers. For example, reports about the dangers of unqualified operators, the possible long term effects of new procedures, or the use of counterfeit products.

Conflict about definitions

The data conflict about the medspa market often arises from different definitions. As experts note in a new market many different types of facilities can self-identify as a medspa: "The term can cover anything from a laser hair removal clinic to a dermatologist's office."

The development of the market continues to change the original concept of the "medspa." The first medspas were generally defined as facilities where cosmetic treatments that are true extensions of medical procedures were provided by or under the supervision of licensed medical practitioners. However, the use in medspas of devices and products that had first been developed for medical purposes for cosmetic ends blurred what had been distinct spheres of the cosmetic and the medical. The distinctions between beauty/cosmetic and medicine/health are supported by regulations that cover not only the licensing of practitioners, but also of products and tools.

Guidelines to be called a medical spa: a facility must operate under the continuous supervision of a licensed health care professional - physician, naturopath, osteopath, dentist, nurse, therapist, nutritionist, or chiropractor. Furthermore, the staff, including medical technicians, aestheticians, and cosmetologists, work within their scope of board certification to provide complementary and alternative services in a spa-like setting.

A medical spa is "a facility that is owned by an individual or corporate entity with an office/treatment area of a licensed health care professional located on the premises. Included in the services are medically based consultations and treatments provided by the licensed health care professional or medically trained technician.

(International Medical Spa Association-IMSA and the National Coalition of Esthetic & Related Associations-NCEA.)

A medical spa is a facility in which the primary goal is to offer comprehensive medical and wellness services in a spa atmosphere, which may include complementary therapies. (International Spa Association ISPA.)

Jacqueline Clarke specialises in global wellness market intelligence. Her particular focus is the de-medicalisation of healthcare and the medicalisation of beauty and the new market that is taking shape. She tracks market developments and changes in consumer behaviour worldwide to determine demand for solutions (products, devices and services). She finds out what is really happening in the market-place and obtains the latest data by working closely with sector experts – through discussions and interviews in their place-of-work. This valuable intelligence is then analysed and coded in-house by Ms. Clarke and her team. Ms. Clarke can be contacted at +353-4695-49027 or dreditor@eircom.net Please visit http://www.diagonalreports.com for more information. Extended Bio...

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