The Endeering Day Spa is a full-service day spa dedicated to consistently providing high customer satisfaction by rendering excellent service, quality products, and furnishing an enjoyable atmosphere at an acceptable price/value relationship. We will also maintain a friendly, fair, and creative work environment, which respects diversity, ideas, and hard work.
Market research indicates a specific and growing need in the area for the products and services Endeering Day Spa will offer in the market it serves. This market strategy will be based on a cost-effective approach to reach this clearly defined target market. This approach will utilize resources to create awareness of the spa and encourage customers to benefit from the convenience and services it offers. Endeering Day Spa will focus on its client requests, specialty services, premier products, and competitive pricing. Their mission is to supply services and products that enhance clients’ physical health, appearance, and mental relaxation. The marketing objective is to promote rapid growth and profitability through effective implementation of the strategy.
Owners, Matt and Heather Deering, have successfully ran a reputable school that teaches esthetics, massage therapy, manicuring, and many other services. They have an extensive background in this industry and have a very good reputation. Endeering Day Spa will, upon commencement of operations, sell a wide range of beauty services and products. It will provide quality nail and skin services, along with body treatments. Courses and information on homeopathic treatments will also be available. What will set Endeering Day Spa apart from the competition is the commitment to provide all of these specialized services in one convenient location. The basic market need is to offer a variety of services at reasonable prices, for the “owe-it-to-yourself” clients, through a personalized spa that offers excellent service and treatment that encourages people to pamper themselves
We possess good information about our market and know a great deal about the common attributes of our potentially loyal clients. We will leverage this information to better understand whom we serve, their specific needs, and how we can better communicate with them. The profile of the Endeering Day Spa customer consists of the following geographic, demographic, psychographic, and behavior factors:
Our immediate geographic market is the Maryland Heights area, with a population of 24,470.
The City of Maryland Heights encompasses 23.14 square miles of geographic area in need of our products and services.
Maryland Heights is home to many of St. Louis’s major employers. The Riverport Casino Complex is Maryland Heights’ largest employer, with about 3,240 employees. Other local businesses with more than 500 employees are Edward Jones, Quest Diagnostics Clinical Laboratories, Mastercard International, United Healthcare of the Midwest, Watlow Electric Manufacturing, Electronic Data Systems, KY Pharmaceutical Company, and Schnucks Markets, Inc.
Maryland Heights’ residents are mobile. Of the residents here in 1999, 61 percent have moved in since the city incorporated in 1985.
The City of Maryland Heights has a relatively young population base. Over half of the total population is between the ages of 14 and 44. The predominately young age distribution is most likely associated with the high number of multi-family housing units within the city that are attractive to young persons. The 1999 median age was 31.4 years.
The City of Maryland Heights contained a relatively well educated population in 1990. Census data indicated that overwhelming majorities, approximately 86%, of the residents are high school graduates and 66% of the high school graduates have some college education.
A household annual income in excess of $43,000.
Age range of 20 to 45 years, with a median age of 32.
Rents apartment or owns their home, townhouse and/or condominium valued at approximately $88,000.
Work in a professional/business setting in Maryland Heights and its surrounding areas.
Personal appearance is a priority.
Has strong awareness of the necessities of mental well being and physical health
Associates spas as a prestigious form of “self-pampering”
Initial Question Results: The staff will note customer responses to the “How did you hear about us?” question. We attempt to correlate that with our advertising and promotional activities and referral-generation programs.
Suggestions: The suggestion box is another method to gain additional information from clients. Some of the most productive questions are:
oWhat suggestion do you have to improve the quality of service?
oWhat other products or services would you like to have available?
Competitive Shopping: We will continually shop other day spas. We plan to visit each competitor in our market at least once each quarter for competitive information, and we subscribe to many catalogs that have beauty products, herbs, essential oils, and other specialty products available to the market.
Endeering Day Spa is providing its customers the opportunity to relax and pamper themselves in a comfortable environment. They have the choice of many services that will help them look and feel better. They desire their experience to be personal, unique, and informational as well as a form of stress relief. We seek to fulfill the following benefits that we know are important to our clients:
Selection – A wide variety of services, products and treatments.
Accessibility – The client can directly purchase beauty products used in the spa.
Personal Client Services – Employees have had extensive training and can help clients design a spa package that would be most beneficial for them. This enables clients to benefit from suggestions regarding the services and products in a manner to complement their skin type and individual needs. They also have access to information on home treatment taught by professionals at the spa.
Competitive Pricing – All products and services will be very competitively priced in comparison to spas in the St. Louis market.
The day spa industry market is experiencing a tremendous growth spurt. The industry is expected to realize a rapid increase over the next five years. This is primarily due to the increased awareness of the health benefits associated with the industry. This growth also comes from more and more individuals seeking a variety of forms of stress release and alternative medicine.
More people are turning to homeopathic medicines and the use of herbs and essential oils to treat ailments instead of a typical visit to the doctor’s office. This could be because of the increasing costs of medical care. It could also be due to the ineffectiveness of many medical treatments including antibiotics. Day spas typically teach individuals how to accomplish total mind and body health with the implementation of natural elements into their daily routine.
Another factor that could be affecting this growth is the increased number of men that are also taking a stronger interest in their mental and physical health. Prior to 1990, less than 20% of the targeted males had even been to a day spa. This percentage has been rapidly increasing. In 1999, according to Maxim magazine, over 50% of young businessmen have a health routine that includes a regular visit to a day spa for a massage.
The outlook for this market is very prosperous. It is still in its growth stage and market projections have determined that it will continue to be in this stage for quite some time.
In brief, our marketing mix is comprised of these approaches to pricing, distribution, advertising and promotion, customer service, and product offering.
Pricing–The pricing structure will be one that is extremely competitive with other spas. We will offer many discounts for multiple services. For example, the price for a Relaxing Facial is $30 and an Aromatherapy Full Body Massage is $50 per hour. If a client wishes to receive both services, a 5% discount will be applied. If three or more services are performed, a 10% discount will be applied. Our base prices alone are over 20% lower than our competitors. This is one of our key advantages.
Distribution: All beauty products and services will be distributed at the spa. We will be developing a website in which customers can purchase products and gift certificates.
Advertising and Promotion: We will be placing fliers and brochures at businesses and health clubs in the area. We will be placing ads on bulletin boards of local universities. We will also be placing ads at many of the apartment complexes in Maryland Heights. This is where the majority of our target market lives. The ads will include coupons for discounted or free services in an effort to build an initial client base. Our research has shown that word of mouth is the best advertising for this type of business. We will also ask clients for referrals, and reward them with discounted or free services depending on the number of clients they bring. We will also offer discounts to the new clients who have been referred. There are plans for a drawing that will offer a free trip to, say, Cancun. A client would simply refer new clients to us, and we will place a card in a box for each client he or she brings. The more they bring, the more chances they have of winning the trip.
Customer Service: All of our employees have been highly trained. Since this is a service industry, unsurpassed customer service will be our primary goal. This aspect, among others is what will set us apart from our competitors. We will strive to offer superior service that will make our clients desire to return. Each customer will be assigned to a specific technician in the spa. This will encourage a strong employee-client relationship. This type of dedication and customer loyalty will keep our clients returning and referring friends and family.
Service/Product Offering: The following is a brief list of the services and products that will be offered at the spa:
oFacials and Skin Care Treatment: European, corrective, therapeutic, and relaxing. Glycolic Acid and acne treatments.
oNail services: Sculptured manicures, pedicures, and paraffin treatments.
oTotal Body Treatments: Full body massage, body wraps, reflexology treatments.
oCourses/Training: Stress relief and stress management courses, training on the benefits of Aromatherapy and home uses of essential oils, dietary and nutritional training, and yoga classes.
oBeauty Products: Full skin care line of facial and body products, herbs, and essential oils.
Our target market is primarily the Maryland Heights’ residents and employees. This is a young market with a great deal of potential.It consists of the following three groups:
Young Business Women: This group makes up the majority of our target market. There are a significant number of young women (22-35 yrs old) that live and/or work in Maryland Heights. We will be advertising by placing fliers at local grocers, bars, restaurants, etc. with ads that stress the benefits of relaxing and self-indulgence at our spa. Location will be are primary advantage. This group most likely has been to one of our competitors. We will key in on the fact that we are “right around the corner”. We will also have spa packages available for “the busy business woman”.
Homemakers, College Students, Service Industry Professionals (bartenders, servers, beauticians, etc.), Other Industries: This group makes up a quarter of our target market. Price will be our advantage to this market. These individuals probably have not been to a day spa because of the high industry prices. We have overcome this obstacle with our low pricing. We will be advertising to this group by placing ads at local grocers, apartment complexes, college bulletin boards, and direct mailers. We will also have coupons to encourage this group to take advantage of the benefits that previously have been associated with high income individuals.
Young Business Men: This group we hope to reach because they represent a significant percentage of the population of Maryland Heights. We hope to accomplish this by overcoming the beliefs that day spas are “just for women”. We will be placing brochures and ads at local health clubs that emphasize the importance of stress relief and massage therapy in developing muscle tissue. We have also developed spa packages for the “healthy male”.
The keys to success in our business are:
Location: providing an easily accessible location for customers.
Environment: providing an environment conducive to giving relaxing and professional service.
Convenience: offering clients a wide range of services in one setting, and extended business hours.
Reputation: reputation of the owner and other employees as providing superior, knowledgeable personal service
The following SWOT analysis captures the key strengths and weaknesses within the company, and describes the opportunities and threats facing Endeering Day Spa.
Strong relationships with suppliers of beauty products that offer credit arrangements, flexibility, and response to special product requirements.
Excellent well trained staff, offering personalized customer service.
Location: providing an easily accessible location for customers. We are currently the only day spa located in the City of Maryland Heights.
Environment: providing an environment conducive to giving professional service in an attractive, relaxing atmosphere.
Convenience: offering clients a wide range of services in one setting, and extended business hours.
Reputation: reputation of the owner and other technicians as providing superior personal service.
Great referral benefits for clients.
In-store complimentary juice bar and refreshments.
Growing market with a significant percentage of our target market unaware that we exist.
Continuing opportunity through strategic alliances for referrals and marketing activities.
Benefiting from high levels young professionals in the area.
Continuing awareness of spa industry and its importance to health.
Increasing sales opportunities beyond our “20-mile” target area.
Internet potential for selling beauty products to other markets.
Competition from a current high profile day spas.
Salary commission structure of employees.
Potential new competitors in the area
Competition in the area comes from the following three day spas:
Green Door Spa – Plaza Frontenac: Green Door has a very good name in the spa industry. They have been around for a long time. Their pricing is very high but they can get away with this because of the location and market they serve. They are associated with prestige and a certain amount of glamour is represented here. Although we aren’t specifically targeting the same clientele, we would like Endeering Day Spa to also represent prestige and glamour.
Ginger Bay – Manchester: Ginger Bay has also been around for several years. They will be our largest competitor. They located less than 10 miles from our spa. They have the major share of our target market. We hope to attract and serve many of the clients that they are currently serving. Our advantage is that we offer the same services but at a significantly lower price. We are also located closer to our target market.
Cary Obrien’s-St. Charles: Cary Obrien’s is new to the industry. They have a lot of new clients and are comparatively priced. They offer many of the same services we will be offering and also have a full service hair salon. This is a major advantage for them. However, they are located in St. Charles, which is approximately 10 miles away. There is a lot of traffic during some of our peak hours of operation. Our target market lives in Maryland Heights and if they are currently clients at Cary Obrien’s, we feel that they would prefer not to deal with the traffic heading toward St. Charles.
Heather Deering, the owner, is the one primarily responsible for marketing activities. This is in addition to her other activities, and she does depend on some outside resources for mailings and graphic design work. Heather intends to delegate responsibilities for special event planning to Matt Deering.
The personnel plan calls for a receptionist who will greet customers and receive payments for services and products. There will be one nail technician, three estheticians, and a massage therapist. Everyone but the receptionist will be contract workers, and will be paid a sliding commission scale based on the amount of revenue created.
Like any new ventures, there are many risks involved in opening a new business. Although a significant amount of market research supports the opening of the Endeering Day Spa, there will undoubtedly be obstacles to overcome in the near future. Heather and Matt Deering have dedicated a tremendous amount of time and effort in developing a product that meets the needs of their target market. They must not stop here. In order to be successful, they will need to continue market research and listen to the demands of their market. The industry is booming and with careful planning and marketing, the Deering’s will be on their way to a prosperous and successful future.