Tag Archives: spaboom

The ‘Common Elements of Successful Promotions’

We’ve been focused so much on Deal a Day, that we sometimes forget that Deal a Day is just part of the mix when it comes to successful SMB promotions. Seth Gardenswartz of SpaBoom, a provider of promotion services for spas and restaurants, held a helpful Webinar last week that stressed the six “common elements of successful promotions.”

The first common element is “brand strength,” which might be measured in non-traditional terms, such as positive reviews. The second is the “quality” of the offer. The third is the offers “integration,” and whether it is effectively communicated across all mediums.

The fourth element is the level of “engagement” with the audience. The fifth is the promotional “reach” of the offer – not only the size of the list, but its effective segmentation. The sixth and final element is the offer’s “persistence,” and whether its effectively part of everything else that the merchant is promoting.

Gardenswartz’s webinar highlights three successful Spa promotion case studies, each focusing on different parts of the promotion spectrum . The Bella Spa in Merritt Island, for instance, scored $10,000 off a Mother’s Day gift certificate promotion, with 225 purchases averaging $125. Seventy-five percent of the customers were new.

One of the keys was that it encouraged people to spend more by providing a $20 gift certificate with a $100 purchase, and a $45 gift certificate with a $200 purchase. Usually, when a buyer meet a threshold, they aren’t actually incented to spend more, says Gardenswartz. The gift certificate promotion provided value without discounting.

The Spa also was able to leverage a very strong 5,000 person newsletter and 904 person Facebook marketing list, which it goosed prior to the mother’s day promotion with a $75 sweepstakes. “That gave them more people to talk with,” Gardenswartz notes. The heavy load of clicks for the sweepstakes also increased the spa’s prominence in the Facebook newsfeed — an increasingly important part of the equation that is often often overlooked.

Another spa, Cloud 9 in Gainesville, Florida, focused largely on adding Facebook fans with its sweepstakes, which was worth $250 in services. Clud9 started with about 1,900 fans. They had 1,346 people enter the sweepstakes, who invited a total of 4,857 to become “fans.” At the end of 8 days, they had 3,977 total fans. They have added around 600 since then. If you multiply that count by 130 — the average number of friends each Facebook user has — you’ve got quite a viral list, notes Gardenswartz.

While the first two case studies focused on social media, the third promotion focused more on email – many spas aren’t really going to be oriented towards social media. The unnamed midsized market spa provided a $25 Groupon-like deal for $50 of services, and gained $9,600 in website traffic –$5,000 in new sales. The price was deliberately set low to encourage more buyers (and extra spending.) The average purchase from this spa was $29.

From the spa’s point of view, the best thing was that the spa did not use Groupon, so it netted an extra $2,335 (after SpaBoom’s $1 per sale fee was deducted). Instead of Groupon, the spa relied mostly on its 1,467 person email list, which has been used carefully – the spa sends out just 12 emails a year. The appeal of the offer got a high 18 percent click thru rate, he says.

Vertical Case Study: SpaBoom Web-Enables Local Spas

spaboom-image.jpg Spas have always been a leading advertising category for city guides and other local sites. In many cases, they are virtually the only break-through for “services.” The rest may be dominated by restaurants and bars.

But the spas themselves have more upside to explore from online marketing. Gift certificates are especially hot. Spa Web site development and targeted email management are compelling add-ons.

Working with them is SpaBoom, a 2 ½ year old, 10-person company based in Albuquerque, N.M. that started with a gift certificate solution, winning its first 1,000 customers via direct mail and spa industry meetings. Since then, it has been providing the spa community with a growing range of services, such as a spa directory. It has also developed a partnership with Millennium, a leading spa software firm, and begun exploring local media and directory ties. It now has 2,000 spas on board.

SpaBoom VP Seth Gardenswartz notes that it is important to appreciate that the spa business has many elements to it. There are day spas, vacation spas, med spas and salon spas. And then there are sub segments, too. Med spas, for instance, include therapeutic, holistic and aromatherapy spas (or services).

Whatever their specialty, spas tend to have a strong local brand. What is unique about them is that treatments are often given as gifts, especially around the holidays. Roughly 30 percent of all spa revenues are gifts.

Many of the gift-givers, especially men, don’t really want to go to the spa to buy a certificate, notes Gardenswartz. And Spa treatments are often gifted from out of the market. Both of these characteristics bode well for ecommerce transactions.

The SpaBoom offer to spas is a $99 set up fee, and then 5 percent of the gift certificate value. “We don’t pitch it to the spas as advertising,” says Gardenswartz. “We are delivering cash to them. There is a nice cash flow.”

Part of the gift certificate business is participation in “Spa Emergency,” a national directory of spa gift certificates that often drives last minute sales after mail deadlines have passed. For instance, $2 million of the company’s $5.4 million gross in December came after December 20. “It is a private label ecommerce presence,” says Gardenswartz.

While the company’s core business is the gift certificates, it also provides free email marketing tools as a bonus for signing up. Email is critical to keep in touch with customers, and to drive online sales for gift-giving occasions, Gardenswartz notes.

The company has also branched off into website development. Most spas could use an improved Website, says Gardenswartz. SpaBoom’s Dynamic Spa Websites are provided for $39.95 per month and have a range of templates and full-service or self-service options.

While SpaBoom still sees plenty of new opportunity in the spa space, it is beginning to investigate additional segments. Recently, it also began working with restaurants.