How Innovation Shapes the Spa Industry and Determines its Evolution

Abstract

This paper pursues the creation of theory that helps in the understanding of how the spa industry innovates and how innovation impacts its evolution. Methodologies employed include literature review, analysis of a sample of spas, and case study research on a European spa company. Conclusions highlight that easy to imitate innovation shapes the industry which makes first movers advantage vanish very quickly, since the emergence of dominant design at maturity does not deter new entrants. This brings about a scenario of high intensity competition that may be overcome through the development of innovative low-cost business models based on critical industry success factors such as spa design with more emphasis on collective use, standardization of service providing and product bundling.