Keeping a business profitable during a recession can be difficult, but it isn’t impossible. Spa professionals have to work hard to make their businesses successful, and during times of economic turmoil, it can be even more difficult. The country is currently experiencing the most significant economic decrease since the Great Depression, and it is projected to get worse before it gets better. Now is the time to set a plan in place if you haven’t done so already. Branding your business is one thing you can do to set your spa apart from the competition. A brand is simply a collection of perceptions or natural associations for consumers; thoughts and images that clients think of when they hear your name or place of business.
It is important to examine the message and brand you are sending to clients. Are they consistent with the product offered? Are they low-end or high-end? A business cannot be both; it must pick one and then project a message consistent with this defined brand. To create a successful brand, price point must first be identified, as well as the products being offered and the image being portrayed.
First you must decide if you would like to be a high-end provider or a more affordable option for clients. If the choice is a high-end provider, that message must be sent consistently. When business profits start to decline, many are quick to slash their prices. If the goal is to send the message that a business is high-end specializing in top-of-the-line service and quality, having a red tag sale will result in losing that brand. There are definitely ways to reduce prices without having a sale. Offer a gift to your clients, such as an add-on service or product with a treatment or send a “thank you for your business” gift card worth a dollar amount to make the client feel appreciated while still maintaining the idea that the business is not a discount spa. If portraying the spa as high-end, the necessary steps must be taken to make it worth the higher price, as well. Every part of the client’s experience needs to be upscale. Customer service is of the utmost importance, from the first phone call to checking out after a treatment. The products being used should be sophisticated and packaged as such, and the entire location should be aesthetically pleasing.
On the other hand, if you would like to bill your business as affordable, you will need to concentrate on a higher volume of services and products to make up for the price difference, although avoiding the client perks expected at a high-end spa will also help the business succeed financially. If you charge low prices, then efficiency has to be strict to tolerate thinner profit margins, which can be difficult in a down economy.
The products a spa sells can say a lot about the business itself. It is important to be consistent with the products offered and either stick with those that have withstood the test of time, or choose the latest and greatest in skin care. Tried and true products will attract those wanting options that have been around for awhile and have proven results. Some clients will visit spas that use a particular skin care line that has been around for a long time and offers facials specifically using the products in that line. Often, if a client uses one of these lines, they will frequent a business that uses the products because they are familiar and feel safe.
If a spa specializes in being on the leading edge, services and products need to be available that will attract clients who seek the latest and greatest. Even more importantly, spa team members must be educated in the most current advancements in the industry. Clients who seek cutting-edge esthetics will likely do research to find out what new treatments are available. The staff should be the experts and be able to answer any questions the clients may ask.
Image is everything
Spa professionals may wish to work more on the relaxation side of the business instead of the medical spa side. This can be further broken down into areas such as resort spas, hotel spas and wellness centers. This decision is going to subsequently result in what kind of image a particular business should convey. Resort spas and hotels are more likely to concentrate on relaxing the client, and this should be evident from the minute a guest walks through the door. The spa should have relaxing music, scents and décor that provide a calm, refreshed feeling. The treatments provided should be more focused on the experience, and give clients an oasis from their hectic lives.
Spas that are on the more holistic side should concentrate on offering treatments that include internal wellness, relaxation and spiritual healing. Educational seminars for skin care can be done in health food stores, yoga centers and vitamin shops to help bring in clients, and spa professionals may also perform treatments that involve energy work or relaxation techniques. It could be beneficial to focus on organic products and treating the skin from the inside out.
On the other hand, advanced treatments for the skin should be focused on in a medical office or a more clinical setting. The business can specialize in treating common skin disorders, such as acne, photodamage or hyperpigmentation. Many spas can individualize themselves further by concentrating on one particular skin disorder, such as acne. An entire esthetic business can be built on treating acne alone. Ask clients who have had good experiences to write testimonials, and use before-and-after pictures, if possible. If you are good at treating acne or any other disorder, word of mouth will get you far. Try to associate yourself with skin care clinics, high schools and colleges. Acne can be difficult to treat, but advanced training and experience can make you an expert. Having educational materials, testimonials and before-and-after pictures available for your clients can be extremely beneficial. This isn’t saying that you can’t treat all skin conditions, but becoming an expert in one area makes a big difference in the message that is sent to potential clients. If something was wrong with your heart, you would likely seek out a cardiologist instead of an internist. The same idea applies here.
Waxing is another possible option when choosing a specialty. Although the waxing business has found some competition with laser hair removal treatments, it can still be a profitable business. Laser hair removal cannot be done on the eyebrows, which is one of the most popular areas for waxing. There are many waxing salons opening nationwide due to the low overhead; for waxing, the spa professional only needs a table and waxing supplies. Waxing services are also very quick to perform, providing the opportunity for a high-volume business with high profit margins. (Editor’s note: To read more about the profitability of hair removal, see “Hair Removal in Hard Times” in the April 2009 issue.)
Once all of these decisions are made, you’re ready to face even the toughest of economic times; don’t think that just because it’s difficult, success in the esthetic industry right now can’t be achieved. Because people generally feel better when they look better, they will still spend money on cosmetics, as well as cosmetic services. But now they will be looking for cost-efficiency, as well as a skin care expert. Lowering prices and offering too many discounts won’t work in your favor, so be sure to position yourself correctly.
Don’t be discouraged by the economy; instead forge ahead with new motivation to turn this period of time into your opportunity. Create a plan and commit to following through with your goals. This is the time to connect with your clients, develop yourself as a brand and further your career.