Spa Marketing

The State of the Day Spa Industry Address

As the year 2007 closed I felt it important to address the State of our Industry. It has been a tough year for Day Spas and it is critical to understand why, and how to overcome recent adversities. According to ISPA, Day Spa revenues declined 22% from $6.794 billion in 2005 to $5.294 in 2006. While at the same time the number of Spas (Day, Resort, and Medical) has grown by 6%. Many Day Spa Owners have really felt the pinch throughout the US and not fully understood why. Other Spa Owners have weathered the storm and though they have not lost ground, they have not grown at their anticipated rate. I think that it is important to understand the dynamics at play so that Spa Owners can adjust their business model and continue to grow despite this “Bear Market”.

The US economy and the devaluation of the US dollar has much to do with the situation but that does not tell the whole story, let us explore further:

1. In an economic downturn luxury items are the first thing that the consumer cuts back on, and as much as we would like to consider our services a “necessity”, not all Spa consumers agree.

2. While Day Spas have increased in number, Medical Spas have doubled in revenue and grown in number significantly faster than Day Spas in the same period. They have successfully siphoned off some of the Day Spa’s best customers, those customers for who price is not a factor.

3. There are more Day Spas sharing the diminished revenue.

Is this the end for the Day Spa business? Definitely not, but we will have to adjust our thinking, and there will probably be a big shake out within the industry. In order to adapt we must first understand the marketplace and how to make profit within our operation.

The Market has changed!

Within the last 18 months, and without many of us knowing it at the time, the market has shifted from an “excess demand” marketplace to an “excess supply” situation. That is to say we have more Spas selling to fewer Consumers today than we did in 2006.

In economics, when a marketplace shifts from excess demand to excess supply (and this happens often in many industries) the consumer looks for market differentiators. Unfortunately the biggest, easiest, and most important differentiator to the consumer is PRICE. Electronics is a good example of what I am talking about. When a new electronic gadget comes to the marketplace consumers are willing to pay top dollar to be the first to own such a device. When the several manufactures begin to catch up with this new demand prices begin to drop, and when the gadget becomes common place then the prices hit rock bottom. If a manufacturer wants to continue to charge top dollar then they must be innovative, and create some other market differentiator that sets them apart from their competitors, or continue to compete in a battle of pricing.

These principles hold true for the Spa Industry as well! We have seen the proliferation of Spas on every corner and the consumer has few ways of distinguishing the value of one from another. Further, with many competitors they expect to see more discounts and in fact can sit back and wait for offers to come to them and cherry pick the Spa or Salon that is giving the discount that week. For many Spas this “value oriented” customer is not an ideal Client for their business, but there is a silver lining: This budget shopping for services shows us that there is another whole class of Spa Goers that want to come to the Spa but cannot afford to come. In fact studies like “The Marketing Demographics of a Day Spa Goer” (available through the Day Spa Association) tell us that the reason 62.58% of respondents “never” or “rarely” go to Spas is because it is too costly; it is not that they don’t understand the importance, not that they don’t have a Spa available to them, not even that they think it is too indulgent. This is an opportunity knocking at our industry’s door if we can just get our expenses under control we can then deliver these services to these budget minded masses.

We Must Learn to Adapt!

As much as the Spa Industry has grown over the past decade (our Bull Market period) with record startups and record revenues, if we are honest with ourselves we must admit that we have never had “record profits”. Our business model has been broken for a long time and we have primarily survived by way of the “excess demand” that we have enjoyed. Well the time to pay the piper has come, and as an industry we must adapt or perish, as this is the way of the “free market economy”. The hard facts are that our compensation system has been upside down, and frankly just plain wrong for a long time, we have been chasing the high end consumer while virtually ignoring the middle class consumer, and we have done a poor job at building brands and loyalty that are results based (necessity) instead of pampering based (luxury).

The purpose of being so blunt in this message is to wake up an industry that has enjoyed a fruitful “Excess Demand Market”, but is about to pay the price of “Excess Supply”. While I remain confident that money can and will be made in the Day Spa world I know that it will become harder and harder unless we start working smarter and smarter. Just as on Wall Street, anyone can make money in a “Bull Market”, but it takes a smart business person to make money in a “Bear Market”. I know that many of you have struggled to earn profit while demand was high; you must now be even savvier if you are to turn things around during this “lower demand” period. I also know that of the thousands of full service Day Spas in the US about half of them will go out of business or change hands to new Owners within the next 24 months. Will you be one that survives or one that perishes? Do you have the cash reserves to weather the downturn economy? Can you still make money doing fewer services next year? Do you have the marketing muscle to increase your market share in a shrinking market?

It is not my intent to bring “doom and gloom” or to be pessimistic, rather exactly the opposite, to sound the alarm so that each of us can adapt our business to be recession proof. To put into place sound compensation systems that assures prosperity for your business. To allow you time to adjust your business model through market differentiators and to adapt to the new “excess supply” marketplace.

My Recommendations

First we must throw away an antiquated form of compensation that has prevented Day Spas from earning healthy margins. We need a compensation system that allows us to be more efficient and deliver services more economically and more cost effectively today than we were able to deliver them yesterday. We need to adopt a system that attracts a stable workforce that can contribute to the greater good of the company instead of only building their own personal clientele or book of business.

Second we must learn to either create a market differentiator that not only distinguishes us from our competitors but creates a “need” instead of a “want” in the consumer’s mind; or learn to make money at lower price points, and let that be your market differentiator.

Lastly we must band together as an industry and stand our ground against the Doctors and Legislators that would seek to take business away from our industry. We must band together to educate ourselves to be better business Owners, giving us greater understanding of how to compete and operate effectively and efficiently. Today’s Day Spas should belong to important Trade Organizations like The Day Spa Association to facilitate this “coming together”, “standing our ground” and “becoming better business Owners”. More will be accomplished through collaboration than through competition. Organizations like the DSA can help each of us accomplish this.

Last Thoughts

While the state of the Day Spa Industry is changing I am ever “bullish” that the strong will survive and thrive, new Spas will be built and made successful, and that there is even more opportunity in this market for those who operate intelligently and creatively. My pledge is to work more closely with Spas to overcome these obstacles and effect change throughout our industry through building better compensation programs and market differentiators. I know that it is easier to sit here and tell you what needs to be done than it is for you to implement these changes, therefore we can work together so that the load becomes lighter. I invite you to attend industry events and obtain the education, networking, and interaction that will have a profound effect on your business. Look for spa industry business workshops like those being organized by the DSA at The Day Spa Expo and the IECSC, and remember that the more we can shift the whole industry toward success the easier our personal success will manifest itself.

IMPORTANT NOTE: Let what is happening to the Day Spa Industry be an early warning and lesson to the Resort and Destination Spas as they may be affected by these same economic dynamics! As I write this message, they should be preparing for a similar downturn next year.

And if I am all wrong about the future of our industry, do these things anyway as they make good business sense and will help your business skyrocket. But if I am right then they are the things that will save your business from demise. Those who survive this economic storm will emerge as the pinnacle of success within their respective marketplaces, and be poised to take full advantage of the “Bull Market” that will come once again.

Who’s your competition and how you can blow them out of the water in today’s environment? You’re an enlightened owner/manager who knows most salon/day spa owners are folks who:

• have worked for other salons/day spas as a technician,
• were probably very successful at doing their job as a technician,
• thought they were smarter than their bosses,
• believed they would make more money as an owner, and/or
• believed that because they knew how to do the technical work, they knew how to run a business, which did the technical work.

The sum total of this experience brings to the market competition that, while it may look good on the surface, when you wipe off the “make-up,” actually is nowhere near close to being good on the inside.

However, unless you’re their accountant, you will never know it. All you see is that “bright-shiny-new” salon/day spa with their slick brochures. It would be only natural for you to believe they’ll take market share (clients) from you and that would be a disaster, especially in this economy. You wouldn’t want that to happen, would you.

Although you may have some competition that has actually managed and marketed well, it can be a revelation to realize most of your competitors run substandard, marginally profitable businesses.

Why? Simply because they don’t know how do it any other way. Rather than re-invent themselves and their businesses, they cling to their beliefs about what a salon/day spa is and what it isn’t, and how to market the business.

Rather than invest in themselves and learn how to navigate their businesses through rough waters, not realizing the journey is well worth it, they’re willing to go down with the ship, clinging to their beliefs on how to run a successful business.

You’re an owner/manager who knows your business will only grow if you build and operate an effective marketing system. This week’s feature gives you six strategies (systems) for increasing your client visitation patterns. See which one (or more) works best for you and then implement it—now!

Keeping Your Customers: 5 Proven Ideas to Create Loyalty

In addition to keeping up with the quality of the products and services of your spa, your customers need to feel connected to your spa in particular. To promote customer loyalty, try these 5 proven tips.

1 Create a Robust Customer Points Program The airline recognized many years ago that frequent flyer mile awards keep their airlines top of mind with customers when they look for tickets. Research at Columbia University found that consumers in a coffee loyalty program bought coffee more frequently the closer they got toward earning a free cup.

According to the Columbia study, “Not only do customers accelerate toward rewards (in terms of timing, quantity, and persistence of effort), but their acceleration also predicts loyalty and future engagement with similar goals.”

Spa managers can create their own “punch cards” and reward systems that encourage multiple visits and product purchases. As an added bonus, let your customers earn reward points for referrals and recommendations as well.

2 Get Back in Touch with Former Customers “Most customers won’t tell you they’re leaving,” said Denise Smith, president of Aurora Marketing LLC. “They’ll just never return to your spa.” Smith said spa owners should determine which customers are most important to win back before simply diving into the former client list.

“Determining which customers you want back is not always easy because ‘high value’ is not synonymous with ‘big spending,’” she said. Smith said spas may want to focus on customers who regularly referred business or perhaps people with a strong place in the community. She has a four-step plan to woo back the customers you want.

• Determine which customers you want back.

• Find out why they left.

• Fix the problem.

• Invite them back.

3 Communicate, Communicate, Communicate

Today’s high-tech world offers spa marketers many ways to keep in touch with current and former customers. Many of these tools are inexpensive and effective and keep customers in touch with your products and services.

Try these high-tech and traditional methods to keep your customers engaged and loyal.

1. Text messages, blogs, social networking and email promotions: These days many spas are trying high-tech marketing to reach consumers, reports ISPA’s Pulse March/April magazine. “Besides reaching consumers by the thousands,” the article said, “these new tools also allow spa and product companies to reach consumers previously untapped by conventional marketing methods.”

2. Telephone calls: Don’t be afraid to have staff spend an hour or so a week making phone calls to clients. “’TLC’ shouldn’t be restricted to the treatment room,” adds Smith.

3. Direct mail: The US Post Office says three-quarters of Generations X and Y, which represent 17% and 25% of the population, read and respond to printed. Further, these young consumers will keep catalogs for reference. Use a printed newsletter to showcase your products and services each quarter to enhance that connection.

4 Host a VIP Open House for Loyal Customers

When you identify the loyal customers who love your products and services, throw them a party. Host a wine and cheese event after hours to introduce a new line of products. Or welcome your new front-line employee with a meet-and-greet cocktail hour. The point is to create a home for your clients to help them recognize you as a part of their community.

5 Provide Your Clients More Than Products and Services

Today’s spa goers aren’t just looking for a one-visit fix for their overall health and beauty lifestyle. They want education about how to take care of themselves and what to expect from different treatments and products.

“Clients are hungry for information about the technical aspects of treatments,” said Dr. James Richardson in the ISPA Pulse magazine article, Knowledge is Power: Turning the Spa-goer Into a Repeat Spa-goer. Richardson advises adding education to spa menus and websites to satisfy that need for education. You can also create handouts and tip sheets for care between spa visits, creating valuable, branded takeaways your clients will keep.

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Spa Gift Certificates

Celebrate Every Season With Gifts Of Beauty!

Promote Spa Gift Certificates

Salon, spa and medical center gift certificates need to become a priority part of your Annual Marketing Calendars – with the strongest emphasis before the year-end holidays! The Holiday Season is always a terrific time to launch your Annual Gift Certificate Marketing Programs. Salon `Gifting Programs’ must become a year-round activity, beginning with Birthdays, Anniversaries, Corporate Gifts and the big seasonal gifting holidays. Gift Certificates will always become your best annual `New Client Salon Referral Program’ for introducing many new first-time clients, while also achieving incredibly successful new sales increases.

PROFESSIONAL CERTIFICATE DESIGNS: Create and custom print professionally designed salon gift certificates, with your logo. Make these certificates appear valuable by using a gold or metallic foil imprint, embossing or thermography in the printing process. Special gift certificate boxes with foil logo labels and bows add an extra touch of elegance. Make them distinctively unique in look, color, design, shape and size while matching the total graphic design and image of your salon. You may want to consider two to four color printing, specialty papers, die-cuts and unique paper cuts. You might consider a nice cream, gray or other elegant color that matches your salon décor package, so it is not just plain white … but will still look terrific with graphics or photographs printed on it. Visit your printer to review various textured, marbled and watermark papers.

Some of the more progressive salons and spas now offer plastic Gift Certificate Cards, which have pre-designated values and packages. Consider unique sizes and shapes for your gift certificates. Make certain that these will fit within a standard envelope or a gift box available through local office supply stores and box companies. There are `stock design certificates’ available through the professional beauty industry, yet you really should consider something upscale that is totally unique to your

business. Remember that image is everything – and your clients will want to be proud of the elegance of their gift.

GIFT CERTIFICATE PROMOTIONS: We must remember to promote gift certificates all year long, especially before the year-end holidays, Valentines Day, Secretary’s Day, Mother’s Day and Father’s Day! Create ads, posters, fliers and direct mail campaigns to sell gift certificates while offering several differently priced packages in $25 to $50 increments from $25 through $250. Don’t be afraid to sell a `Year Of Beauty’ package with 10 each of your various salon and spa services for $2000 to $2500. Create and promote an array of special `Holiday Beauty Retreat Packages’, `Days Of Beauty’ and `Men’s

Executive Retreat’ packages.

GIFT CERTIFICATE BASKETS: Create a special in-salon display of at least six examples offering `Customized Gift Baskets’. Make these colorful, while including a salon or spa service gift certificate within each basket. The key is to have the recipients come in to experience your salon services. Gift certificates are often given by your regulars to people that have never been into your salon before – so it also services as a tremendous new client referral program. Don’t be afraid of price points like $25, $50, $75, $100, $150, $200, $250, $300, $500 or $1000+.

PRIZE GIFT BASKETS: Get your clients in the gifting mood each season by offering a huge gift-wrapped basket of

professional salon products and service certificates with a seasonal drawing – up to four times per year. Create professionally printed `Register To Win’ slips, to save this database for future mailings. Another alternative is to charge $2 to $5 for a Charity Fundraiser Ticket, with a chance to win your $100 to $250 value gift basket. Display an assortment of several salon gift baskets in your reception area with signs that note `Give A Gift Of Holiday Beauty … customized gift baskets may be created for any products and services and in any price range’.

HOLIDAY GIFTS FOR CLIENTS: Plan to give one small salon gift certificate to each client during the month of December, so they will come in during January through February for some new service area that you are trying to promote. This may be for a free manicure or $10 off their next facial or massage service. It may be specifically geared to a brand new service that you are offering. This will provide your clients with a terrific holiday bonus, while teaching them about your terrific gift certificate programs. Your staff will love the idea!

POINT-OF-PURCHASE MERCHANDISING: Create large window and in-salon banners to promote your gift certificates on sturdy papers, cloth or plastics that can last all year long. Local sign companies can illustrate your gift certificate with your salon logo on attractive banners. Use smaller matching 8½ ” by 11″ point-of-purchase signs in beautiful frames throughout the salon and spa areas. Frames are available at the local office supply stores and department stores.

Promote your gift certificates with P.O.P. devices from your front door and reception area to the changing, treatment and bathrooms.

DIRECT MAIL MARKETING: Create a computerized database of past gift certificate purchasers and how much they spend each year. Promote gift certificate sales with letters, postcards, brochures and in your newsletters. Thank them for past holiday gift certificate purchases, and remind them they can simply phone in an order and that you’ll be happy to mail their gift certificates directly to their friends, relatives and business associates. Use direct mail for soliciting new gift certificate buyers. Here is where cooperative direct mail works well for approximately 3.5 to 4 cents per home. Look for upscale direct mail coupon companies like Clipper Magazine, Val Pak or Money Mailer in your local Yellow Pages

telephone directory. Research solo direct mail, bulk mail and business-to-business mailing programs.

HOLIDAY EMAIL MARKETING: Create a database to promote gift certificates before each holiday via email notes and newsletters to your regular clients. Collect email addresses from each new and regular client over the next few months.

CORPORATE GIFTING & RETREAT PROGRAMS: Both large corporations and small businesses are always looking for creative new incentive program rewards, unique sales contest prizes and special holiday gifts. Create a holiday promotional flier and letter that can be mailed to the president’s of all local businesses. You can also send out `Broadcast Fax’ memos in mass to businesses in select zip code areas by utilizing local direct mail resources. If you have a corporate meeting space, offer `Corporate Retreats’ at your spa facility. The new 22,000 square foot Robert Andrew DaySpa Salon in Crofton, MD will offer `Business Retreats complete with a conference room, refreshments and spa services. Others like the Avon Trump Tower Salon & Spa have done this successfully for the past few years.

DEAR SANTA: Create a fun promotion for women to register for whatever products and services they would like to receive from their boyfriends and husbands. Design a clever Dear Santa postcard that can be mailed to their significant others, with a note about what salon or spa service they desire – via a gift certificate. If it is properly pre-printed, women will just have to fill in their desired services, while addressing the card to their mate. You simply help your salon clients to mail this reminder card - from Santa. Create matching point of purchase posters, counter cards and station note cards.

BARTER CERTIFICATES: Don’t be afraid to barter your gift certificates with local restaurants and other service-oriented businesses. You can use these extra gift certificates for staff rewards and client contest prizes. This type of program also works as a referral while each participating business sends some of their best clients to each other.

CHARITABLE DONATIONS: Whenever any local organization, club or charitable group comes in asking for a donation, use your spa service gift certificates rather than to offer free retail products. You need these new people to try your salon services first, so you have the opportunity of winning them over as a regular client. Retail gift certificates are fine, yet they will usually not win over any new clients.

GIFT CERTIFICATE `SALES’: Don’t be afraid to offer a `Pre-Holiday SALE’ with 10% to 15% off of any $100 to $500 or more gift certificate purchase, from November 1st through Thanksgiving weekend. Some salons offer corporations and large gift certificate purchasers extra savings with a `Buy 5 - Get 1 FREE’ Holiday Promotion – Minimum $25 per gift certificate.

PRESS & MEDIA RELATIONS: Promote your unique and wonderfully different `Gifts Of Beauty’ with a press release to the local newspaper editors and the TV show producers. Be sure to include photographs of your gift baskets and a special salon service. Send a free `Day of Beauty’ or a free facial certificate to the local beauty editors, TV news anchors and Radio personalities, with a professionally written and typed cover letter noting how you can help them create some exciting local stories, contests and promotions.

GIFT CERTIFICATE EXPIRATION DATES: We suggest using “This certificate expires one year from date of issue”, not just three or six months. Create goodwill by always giving the client the benefit of the doubt – on certificates redeemed after the expiration date.

EXTRA SPECIAL SURPRISES: Work with your manufacturer and beauty supply distributor’s sales consultants for any extra holiday promotional materials and thin packet product samples that can be offered as a surprise within your gift certificates packages.

YEAR-ROUND GIFTING: The best time of year to promote Gift Certificates will always be between Thanksgiving and New Years, with most certificates sold the last ten days prior to Christmas. Mothers Day and Valentines Day are the next best times. Gift Certificate marketing programs should be promoted for Secretary’s Day, Easter, Father’s Day, Weddings, Anniversaries, Birthdays, Bar/Bat Mitzvahs, New Moms and Bridal Showers. Gifting must be promoted in every salon allyear long to be most effective.

FINANCIAL REWARDS: Gift certificates must become an essential element in your salons Annual Marketing Calendar. Some salons sell minimal gift certificates each year. Other very progressive salons and day spas sell from $50,000 to $1,000,000 or more per year in gift certificates, while others have yet to begin developing a promotional plan. Now is the time to help your salon team launch a powerful new plan with seasonal advertising, marketing and public relations programs that will offer a special celebration with new `Gifts Of Beauty’!

Let Spavelous Promote your Gift Certificates in Spavelous’ National Spa Gift Certificate Directory 

Experts Agree Spa Training In Top Demand

“According to Global Spa Summit, a shortage of high quality, trained labor, including spa managers, spa directors, aestheticians, and massage therapists, are some of the top challenges facing the spa industry today”

Maintaining the integrity of a fast-growing $40 Billion industry, while at the same time attracting investors & reaching more consumers, was cited as the top challenge in summit meeting for 2007 and on-going concern for 2008. Along with this, there is a lack of industry wide standards for defining spa categories and best practices. According to spa summit, “the spa industry’s authenticity is threatened in the present and even more so in the future, by outside investors that only think of the bottom line and not the mind, body and soul transformations of the people”. It will take leaders in the spa industry to turn this around for 2008 and keep that genuine goal to be profitable, yet retain the authenticity.

How does one retain the authenticity in this growing industry? Liz Galloway of The Lotus Effects is a leading innovator and spa consultant, with concentrated focus and attention that on-going training in the spa industry continues as the industry grows. Developing and founding both The Lotus Effects and Spa College International, along with speaking at Spa Events and teaching at International retreats, such as Costa Rica, Liz is an innovator in teaching new techniques, quality training, styles and consulting to make your business grow into the best it can be. On-going training and quality is very necessary if spas want to outlast the newcomers to the scene.

3 topics stood out in the 2007 summit—solving Spa labor shortages, standardizing best practices & building a model to benchmark success. Because there is no conduit for training and experience in this industry, there is an urgent need to refocus efforts on hiring educated and qualified managers, employees and spearheading future movements for standardizing and shaping educational programs and pumping money from investors back into the sector.

The spa industry has grown 40% over the last 3 years and shows no signs of slowing down in 2008, but rapid growth can also create fragmentation and impede innovation. Women’s Wear Daily expanded on the fragmentation of spas “Spas started falling into different categories, for example, a spa is known either as a Day Spa or as entity within the hotels and resorts, focusing either on medical in nature, or those that focus on skin care or target a certain demographic”. For 2008, the industry is coming of age, needing to keep up and meet demands for personal development, environmental and proper hiring of educated managers and employees, while maintaining high industry standards.

This year will bring about huge change with the use of technology, consistent training and increasing demand from the public for new treatment options catering to youth and beauty. People are being geared not just toward an environment to be pampered in, but a place to escape and achieve overall health in mind, body and spirit. With new & cutting trends on the increase, training and innovative techniques are key for staying on track and maxing business potential to that next level. What can one expect for 2008? Medical spas are on the rise in Costa Rica and other areas, as people are looking for alternatives that are less expensive outside the US, providing not just cosmetic procedures, but aftercare and recovery in a soothing luxurious environment. Therapeutic therapies combined with relaxation methods and detoxing seem to be the latest craze in 2008. Needing complete beauty and body overhauls, Americans are picking retreat destinations such as Costa Rica, for a soothing way out of everyday reality.

Learn how to keep up with the latest spa trends and grow your business to the next level, expanding and incorporating on-going training into your spa, whether for yourself, or your managers and other staff.

Advice for 2008? “Be pro-active, train your staff consistently, keep up with the latest trends, and get involved in 2008, protecting the spa industry from sub-standard practices and those just interested in the bottom-line”. The resources are out there, start today with a consultation from Liz to make your spa a leading success.

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http://www.spavelous.com

Economic worries mean fewer spa visits

Today’s economic downturn is causing spa owners in the Valley to sweat as they watch their bottom lines sag.

“When the real estate market began dropping, people stopped spending money on themselves,” said East Valley, Scottsdale, Arizona spa market analyst and Mesa author Christina Jordan. “Spas in the Valley, especially the day spas, are losing customers and income.”

Day spas is the general term for less costly, quicker-service spas, usually located in malls. Among the fastest-growing segment in the industry, they are mostly smaller facilities, Jordan said.There are an estimated 500 day spas in Arizona, mostly in the Valley.

Other spas include Arizona Resort spas, located in moderate to posh hotels and resorts, and Arizona med spas, a combination of a day spa that also offers medical treatment supervised or directly provided by certified medical physicians. There are more than 200 resort spas in Arizona, with most of them in the Valley, Jordan said.

“Resort spas are losing clients, too, but they have more financial support and better marketing to stay afloat, while the day spas are being hit the hardest by the economy,” said Jordan. “The smaller day spas generally don’t have enough capital to handle this downturn.”

Day spas began expanding in Arizona and the Valley about 15 years ago and - until the recent economic decline - had been doing well.

“The growth is the result of the baby boomers, both men and women, who are going to day spas for beauty and body treatments,” Jordan said. “There is also an increasing number of young people who are attending and graduating from aesthetic and cosmetology schools in the Valley and throughout the state. Thus more spas.”

“But while the spa industry is growing in size, it’s not growing in income.”

Lisa Allen, co-owner of Blush Med Spa in Gilbert, said her spa has steadily been losing clients since December. “We opened in November with a lot of customers, but then it started slowing down,” said Allen, who describes her spa as a combination day and med spa.”Today, we’re trying to get them back by offering special treatments at lower costs.”

Her spa, as well as others in the Valley, are attempting to lure customers back to their massage tables, cosmetology chairs and meditation rooms with reduced rates Spa Deals and Spa special offers.

Spas in the United States

* There were an estimated 13,757 spas in the United States in August 2006, up from 10,128 in April 2004. This includes 3,139 spas in Arizona, Spas In California , Spas In Nevada, Spas In Utah, Spas In Colorado and Spas In New Mexico that earned a combined $2.7 billion annually.

* The spa industry generated $9.7 billion in 2005, up from $7 million in 2003.

* There were 10,988 day spas in 2006, about 80 percent of the total in the United States that earned $6.7 billion in revenue annually; 1,218 resort spas earning $2 billion and 915 med spas taking in $469 million.

* A total 267,400 employees worked in the spa industry, including 124,500 full-time, 101,300 part-time and 41,600 contract workers.

* Arizona is the busiest spa state followed by California and Nevada and is, appropriately, called “The Spa State.”

Source: International Spa Association’s 2006 Spa Industry Study

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Spas: Customers buy Relationships, Employees buy Opportunities…Are you selling yours?

Everyone is looking for something to buy; whatever your “Authentic Signature” is you need to uncover it ~ define it and market it aggressively -

If you don’t know what you are selling, how will anyone else know? Our clients are looking for value, results and convenience.

But on a deeper level, and perhaps more importantly, they want to enjoy pleasurable relationships that provide them with a sense of belonging and importance. If you can tap in at this level, you need to sell it.

Our employees want professionalism, flexibility and fair pay. These are important values, but if we as Leaders can create an environment that deliberately challenges and encourages personal growth, we need to let that be known, and sell it.

Let’s break these two stories down and begin with the client.

We learn something from someone every day. Learning develops an automatic connection between the teacher and the recipient, and if fed, it is a relationship that can thrive for years. So, in a word, “education” may well be what sells relationships. As soon as a client enters your life:

Ask for “Permission to Educate” her, and then tell her “This is what you can expect from us”

1.  We will target your needs
2.  Set mutual goals
3.  Focus on results
4.  Monitor and adjust
5.  Reach goals and set new ones

In obtaining her permission to educate, you have accomplished many things:

You have prepared your client to receive immediate and ongoing guidance and recommendations for services and products;

• You have opened the door for staff to feel comfortable in recommending these items;
• You are setting in motion, relationships that could potentially last a lifetime;
• You have provided your staff with a challenge and the potential for personal growth;
• You are contributing to your Spa’s bottom line and therefore your sustainability.

As you progress through the steps to achieving her goals, she begins to catch on to the concept of “Self-Care” and personal goal setting. With this comes the promise of both a relationship and results - just what she is looking for. If you view every client as a life-long client, the rewards will come.

As we work with our clients, we learn their desires and their fears. We begin to open our eyes and our hearts and start to see them in a very different light. We are better able to recognize their potential and how to reach it with them. This relationship is what conveys the sense of belonging and importance that you’re client so carefully seeks out, as well as the personal growth that your employees so desperately desire. This is not to say that we encourage our staff to develop “ownership” of the client. The system that works is a system that is able to change faces. So we all need to share the same long-term goals. It will be up to you, the Leader to plant the seed.

There are other important components involved in developing the relationship:

    Show them you understand time is the new money - Implement time-saving opportunities

    Strive for health over wealth - guide them with caring hearts and human touch

    Offer solid business services and value-added incentives wherever possible

• Incorporate their family and even their pets into the experience
• Make their convenience your priority - be their servant - show them your smile
• Support spiritual wellness - share the occasional secret
• Be aware and participate in the community
• Be environmentally conscious
• Offer them support through your business alliances
• Encourage the “I deserve it” mentality of self-reward, small indulgences and forbidden or exotic pleasures.

Now, our coveted employees. The desire for personal growth and to see others grow, is an inborn characteristic that most caregivers possess in abundance. In order to gain and retain the best contenders out there, you will have to sell this as one of your Spa’s Opportunities.

The opportunity to grow with the clients, grow the business and ultimately grow personally is not common in our industry. It gets talked about a lot, but is difficult to find. If it is made clear that this is alive and thriving at your Spa, it will become ultimately clear to your employees that coming to work with you was, or is, the best choice possible.

So the ability to develop and transform your employees is perhaps the biggest opportunity you have to sell, but you may also want to consider creating an outstanding “package” of opportunities that will clearly outweigh the competition. This is referred to your “Value Packed Proposal”. Here are some other opportunities that could potentially form your proposal:

Caring Culture - Driven by Inspiring Leadership

•   Work/Life balance
•   Flexible work arrangements
•   Ongoing Talent Recognition and Action Plans - Cultivating potential
•   Training and Development programs to provide stretch experiences and opportunities
•   Diversity rules!

Compensation - A performance-oriented reward system

• Bonus Plans
• Incentive Programs
• Recognition and Reward Systems
• Service and Product Allotments
• Training and Educational opportunities
• Employee Benefit programs

All of human-kind wants the same thing - to treat and be treated kindly and feel a sense of importance. As Leaders we are in a position to make this difference. Are you doing your part?

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