Due to the popularity of spas, many products that were once sold only in spas are now found in drug stores and department stores, and they have been re-packaged and re-positioned to be "spa" products. People can buy spa products anywhere, anytime. So how are your spa products different and will they help you to market your spa both in terms of increasing the number of guests who visit your spa as well as increasing the amount of retail sales?
In a spa setting, the product focus is on benefits and results…they need to be of a "professional" or "institute" quality. They don’t just smell good…they need to be aromatherapeutic. They don’t just look good…they need to be part of your personality and brand identity.

In addition to touting the benefits and features of the products in order to gain consumer appeal and loyalty, the spa environment has its own set of additional criteria. Spa products that are used in a spa by aestheticians, hair stylists, nail technicians and massage therapists/body masters need to have a professional appeal and quality-level.

In this article, we will take a look at some of the factors and trends that you might want to consider when selecting or creating your spa product line.

What Products are Used in a Spa

There are several categories of products used in a typical spa:

• Locker Room amenities: shampoo, conditioner, bath gel, moisturizer, etc.
• Skin Care/Facial
• Massage
• Body and Bath
• Hair Care
• Nail Care
• Make-Up

You can find all of these in almost any store, but your spa guests do not want "off the shelf" items….they want "out of the box" products that are unique and interesting. As you read this article, think about your products as an extension of your brand identity and equity.

Options: Buy a Brand or Create a Brand

When trying to decide what products are best or you, it is important to understand the options and your market. This is not an "either/or" situation or an easy decision. Typically, the best solution is a blending of the following 3 options.

• Branded: products that have a specific name and established identity such as those developed by a manufacturer. They typically have some national or international name value due to the advertising and marketing. They have collateral material in terms of sales brochures, posters, logo bags, free sample sizes, etc. Product companies have created treatments that you would put in your spa menu. They will provide trainers to teach your staff about product knowledge, treatment protocol and how to set up the retail store for maximum merchandising appeal. If you use a branded product, try to select one(s) that are not sold in a department store since this could have a negative impact on your retail sales, e.g., why should they buy from you when they can buy from the department store.
  
• Private Label: ready-made, stock products that are typically in a generic package although sometimes you can select the bottle and cap. You can give your own particular name to the product and create your own label. The cost of the product may be less than the branded product since you are not "buying" the name and all the support that comes with it. There can be a higher mark-up value, but you will need to spend money creating your own treatments, training and sales programs. There are many labs that sell "generic" products that you can label as your own. The down-side to private label products is that other spas may have the same products just different packaging.
  
• Customized: can be anything from changing the color, texture or fragrance of a private label product to developing your own formulas and creating your "look" by selecting from an unlimited variety of bottle and packaging styles. Private label companies typically have a "library" of formulas that can be customized in a cost-effective manner verses having a chemist start from scratch. This option gives you the most flexibility in terms of creating some unique, marketable and profitable, but it can also be the most expensive and time-consuming to develop.
  When selecting products for your spa, it is fine to mix and match the above options. To keep things simple, in this article I will use the word "signature" products to include both private label and customized products since somehow the product or packaging has been modified to create and/or enhance your brand image.

Key Considerations for Creating Your Own Brand

While I am a strong proponent for signature products, I am not an advocate for doing this for skincare/facial products because they are so specialized, diversified, extensive and intensive or "serious." People are understandably particular and cautious about products they use on their face. I believe it is preferable to have a "branded" skin care product line that has lots of R&D behind it; name recognition and brand value due to their advertising and marketing; is exclusive to up-scale spas, skin care institutes and salons; offers excellent packaging and shelf appeal; has multiple lines within a line for men and women of all ages and lifestyles; carries multi-million dollar product liability insurance coverage; provides treatment and retail training; offers support and collateral materials including samples, testers, displays, bags, posters, brochures, etc.; and is willing to do co-op marketing.

I think it is fine to consider signature products for most of the other product categories. Signature products can strengthen your brand, improve your profits and enhance the value of your business. They can be unique because you can create them to match the treatments that you design. They are part of your "story;" and they are an extension of your brand identity and your USP. They are also part of your "home spa" program and help to maintain and strengthen your relationship with your guest. When your guests use your signature products at home, they will always think of your spa. Financially, there can be more profitability in signature products than with branded products due to the mark-up potential plus you have more flexibility in being able to financially reward your staff with sales commissions because of your profit margins. They can also be a "hook" to attract media attention since the media are always looking for something new and unique to share with their readers.

Getting Started

If you want to create a few or a collection of signature products, I recommend that you start by knowing your competition and your target market, then developing a concept that offers your guests something they cannot get elsewhere. This concept then gets further refined as you define the guest experience and spa treatments especially the signature spa treatments, then determine what products are needed. Although the products are just one part of your total concept, they are integral to your success because every treatment uses products and your retail program is strongly tied to products.

If you are going to have signature products, there is a significant amount of screening that needs to be done to find a reputable, reliable and experienced manufacturer who will be your "partner" and who will work with you in terms of creativity, quality, affordability, timeliness and liability. There needs to be a lot of collaboration between you and the manufacturer. You may have to bring in additional partners if you want the turn-key approach: product development, packaging, filling, marketing, home spa sales, etc.

Here are some of factors to consider:

1. Determine the treatment menu based on your concept
2. Develop your signature treatments
3. Determine what products are needed for the signature treatments
4. Determine the type, number and unique features of products for each treatment and for retail home spa usage
5. Find your product partner(s)
6. Create, test, tweak, re-test and re-tweak the products until you are totally satisfied
7. Create the package: bottle, cap, label
8. Train the staff on the signature treatments, benefits and features of the products and how to retail them

When creating signature products, make sure the products:

1. Appeal to your market: consider gender, age and lifestyle
2. Deliver the promise: use quality ingredients that produce results both in the treatment room and for the home spa program
3. Are affordable for you to create and for your guests to purchase
4. Are simple to use rather than complicated and time-consuming for both the service provider who delivers the treatment and for the guest to use on a daily basis.

Pros and Cons of Brand Expansion

Pros

The spa products do not need to be confined to the spa. It is quite common to use the signature locker room products as your "basic 4" in-room amenity line: shampoo, conditioner, body wash and body lotion. This helps to market the spa plus it expands the retail potential beyond just to those guests who visit the spa. In addition, the "basic 4" can be sold as part of your honor bar program or in your mini-bar, thereby increasing your retail potential.

If you create a truly unique line of signature products, you might have the opportunity to market it or set up license and/or franchise agreements to other spas and/or stores. This can help you extend your brand identity and maximize your profit potential beyond your resort.

Signature products can have a higher mark-up and profit potential than branded products. This is a positive point since retail products are a spa’s only "annuity," e.g., they are a consumable item that guests will continually re-order. Retail can be profitable since selling retail products is not as labor-intensive as the delivery of treatments. The most effective retailing strategy is giving the guest an excellent treatment then "softly educate" the guests on how the products can be of benefit when used as part of the home spa experience. Assuming people like your treatments, you have set the stage for people to buy without your having to do any "heavy sales" pitch. Retailing can and should be a positive extension of the relationship between you and your guests.

Cons

While the benefits of having a signature product line can be attractive, it is important to also recognize and address the potential pitfalls. The major pitfall is that if you do not create a great product, you cannot offer a great experience. You need to assume more responsibility, be more self-sufficient and entrepreneurial since you will not have a big brand name product "partner" behind you. Be prepared to develop treatments, provide training programs, conduct retailing sessions, create attractive marketing pieces, etc.

Since "you are your product" in the eyes of the beholder. you need to do your due diligence. If the product does not do what it says it should do, there can be a break in consumer confidence and trust.

Once you allow others to sell, license or franchise your products and name, make sure the quality control mechanisms are in place. You need to closely control the experience in terms of how treatments are performed and how the products are sold. The products are an extension of your core business so you need to protect your brand integrity and brand equity.

What is the Financial Risk?

You need to look at the cost/benefit value of both the established branded products as well as the signature products that become part of your brand identity since it can take a significant amount of time and money to create a product line.

There could be R&D fees that the manufacturer may charge. There might be minimum quantities that you need to commit to purchasing for the retail items and maybe for the professional/back-bar items. Then there is the issue of storage…will the manufacturer warehouse the products or do you need to do it yourself. Another consideration is the home spa sales program, e.g., who will handle your on-line sales, call-in sales and packaging/distribution. With a branded product, sometimes the company will provide this as a support service.

Conclusion

It’s obvious that creating your own signature product line requires that you carefully and thoroughly examine the benefits and risks inherent in this under-taking. It has been my experience that the most advantageous scenario may be to have the best of both worlds. Have branded products for your facial treatments and maybe even for some of your other spa treatments but complement this with your signature products. If you want to start slowly, consider creating a few select signature body and bath products as well as locker room amenities. It is more important to have quality than quantity.

With healthy regards,

Judy Singer
Health Fitness Dynamics, Inc. (HFD)
judysinger@hfdspa.com

 

Judith L. Singer, Ed.D., ISHC, is the President & Co-Owner of Pompano Beach, Florida-based Health Fitness Dynamics, Inc. (HFD) (www.hfdspa.com) an internationally recognized spa consulting company that specializes in the planning, marketing and management support services of spas for fine hotels and resorts, day spas and mixed-use developments. HFD is also actively involved in conducting economic and consumer spa research. Since its inception in 1983, HFD has been the consulting firm to over $650 million of completed spa projects. A partial list of clients includes: Little Dix Bay, Four Seasons Hulalai, Miraval, Malliouhana, Cranwell, Pinehurst, The Homestead, The Greenbrier, Bacara, Silverado, Delano, La Posada de Santa Fe and Hotel Crescent Court. Dr. Singer is also the past chairperson of The International Society of Hospitality Consultants (ISHC). Ms. Singer can be contacted at 954-942-0049 or judysinger@hfdspa.com