IECSC/IBS NY Day 2 brought more crowds, as the sun came out.  Booth traffic was steady on both sides of the show, and was especially crowded on the IBS side.  Being constantly jostled in the aisles by technicians carrying large bags, while a bevvy of models with outrageous hair styles and outfits paraded by felt like the old days!  Education classes were especially packed for the hair and makeup demos.  Left, Mike Karg & Jo Blackwell-Preston give a cut & color class.

Spa business education featured Janet d’Angelo in an excellent session, “The New Rules of Engagement,” which gave guidelines on use of copyright materials, permissions, and truth in advertising for both traditional and social media efforts.  Additionally, Dori Soukop of InSPAration Management offered a packed class on menu development, and I offered a session on reading and understanding your financial statements.

There was also an excellent panel presentation entitled “Ask the Experts,” featuring Julia Sutton of Exhale, Bruce Schoenberg of Oasis Day Spa, and Sandra Sadowski of Ritz-Carlton Central Park, and moderated by Julie Keller of American Spa Magazine.  These spa veterans all felt that clients were really focused on results right now, more than spa experiences, and shared some of the current initiatives in their businesses.  I’ve detailed the highlights to Julie’s questions below.

Where are they investing in their business? Sadowski remarked that Ritz-Carlton has gone back to marketing; Exhale, with 18 units, is trying to get more guests to book online, and has hired a person to manage social media at the corporate level.  Oasis is bringing in lasers and anti-aging services.

What are their thoughts on the group discount sites? Schoenberg firmly believes that discounts devalue our business, and is against offering them.  When Oasis offers a discount, it is to move a specific product or highlight a particular service, and it’s never on weekends.  Sutton shared that Exhale had some luck with Gilt and Rue La La, they were able to make some good deals, with no Saturday visits, which helped to carry them through the downturn.  Ritz-Carlton’s Sadowski ran an offer with Rue La La; a $100 gift card, to be used to pay for a service; but the service was not discounted, and they were able to retain 15-18% of the clients they attracted this way.

How are retail sales? Sadowski reports that her mid-town Ritz-Carlton spa has the highest level of retail sales in the whole chain, at 38%.  She attributes it to the power of the La Prairie brand, and the well-trained CSR’s and estheticians who engage with the client throughout the service delivery cycle.  I’d say those are pretty impressive results in a hotel spa!  Exhale retail sales are up 6% after being hit hard during the downturn.  Because they see their clients several times a week due to their fitness component, they treat retail as a separate segment and take great care with it.  Schoenberg reports that his retail sales were also up, and he actually invites some of his top clients to attend this show and let him know what they like.

What are the current staffing issues they are facing? Sutton reports that Exhale created a position, Manager of Guest Experience, who is really like a revenue manager and helps them to focus on revenue growth and current customers by creating incentive programs for the CSR’s.  At Ritz-Carlton, they decided to hire more career-minded folks, and at the front desk, they changed the pay to a lower hourly plus a 2-4% commission on bookings, and now her CSR’s are fighting over the phone.  Also, another valuable effect is that they have a better understanding of what it is like to have a bad month.  Schoenberg hires for personality, and makes a point to personally connect with all 165 of his staff at 3 locations.  He offers “Breakfast with Bruce” once a month; buys breakfast and hangs out in their event room, staff can join him to discuss anything on their minds.

How do they manage around events like SpaWeek, which create swells in business in a particular week?  Sutton says that Exhale participated once, and it was not their customer.  They prefer to focus on ongoing client retention efforts.  Schoenberg notes that the idea came from Restaurant Week, but restaurants can make the money back in alcohol sales, not an option for spas!  He found that his regular customers were participating, so he now runs his own special week with a 15% discount.  Sadowski says Ritz-Carlton also runs their own promotion.  All agreed that you need to be collecting data from every person who calls or walks through your door.

Altogether, an excellent show with lots of great take-homes.  If you attended either IECSC or IBS, I’d love to hear your comments.