Here Comes the Sun
Affluent customers and a good product mix help tanning equipment retailers weather the economy and seasonal sales
by Mark J. Greenfield
Layoffs, bankruptcies and recession have been staples of the news media lately. Winter has also arrived, signaling a traditionally slow period for many pool and spa dealers. Has the bottom dropped out of the market.AQUA magazine spoke to several dealers to get their take on the state of the market and tactics for keeping business rolling in.
The recession took a temporary bite out of sales, according to Christine Webb, controller for Watson's of Dayton, Ohio. "Immediately after it started, we saw a bit of a slowdown," she says. Fortunately, the slowdown didn't last long. "We had a record month in November. I don't think it's going to be the strongest selling point for home tanning beds, notes Webb. "I think a lot of people like the idea that they don't have to leave home, especially in the winter," she says. "Also, they know it's clean — they don't have to worry about who's been in it."
"I wanted to have top salespeople, and they need to have year-round income," says Bob Davis, president of Lynchburg, Va.-based Aqua Pros Pools & Spas. The company's first store, which opened in 1984, featured a tanning salon, so retailing home tanning equipment seemed like a natural business progression.
While they don't make up a huge portion of the company's sales, tanning beds and other seasonal products do bring customers into the store during winter months. "The tanning beds are definitely supplementing our annual gross," Davis says.
One reason more dealers are carrying home tanning beds is that many of their existing pool and spa customers are likely prospects.
"It's the kind of thing that goes along with pools and spas," Webb says. "Those people like being outside and like being in the sun."
At the same time, indoor tanning has become very popular — a quick look at your local Yellow Pages will likely reveal a long list of tanning salons.
Convenience is probably the have a whole lot of effect on us — our sales are going to be higher than last year."
Other retailers report steady if not growing sales, too. Why are many in the pool and spa business bucking the economic trend.
"People aren't travelling, let's face it," says John Mosher, owner of Central Iowa Pool & Spa, Des Moines, Iowa. "They're looking for things to do at home. All in all, I don't see the doom and gloom everyone is talking about."
GETTING THE RIGHT MIX
In spite of the economy, winter weather and sunless days, many pool and spa dealers are finding success with product lines which include items such as tanning beds that heat up when the weather turns cold.
Home tanning beds have become popular for both dealers and customers looking to beat the winter blahs.
Residential tanning beds such as this one from ProSun have seen continued sales strength in the recent downturn.
Another reason many pool and spa dealers have seen continued strong sales in spite of the economy is that they focus on upscale clientele. "I think those people that have the money have it in good times and bad," Davis says.
Focusing on that segment of the market also reduces or eliminates the need to compete against big-box retailers with massive advertising budgets.
"What I believe is that we need to focus on high-end products," Davis says. "I can't compete with the discount stores." The hot price point for tanning beds is in the $2,200 to $2,500 range for Aqua Pros.
While not nearly as lucrative as an in-ground pool sale, items like tanning beds not only pump up off-season sales, but bring in new customers who might consider a pool or spa purchase.
"If we do a good job with a tanning bed, I think we've assumed that they're going to at least come back and talk to us," Davis says.
While that strategy may be worth pursuing, Mosher cautions retailers to do their homework before hooking up with a tanning bed supplier. "Find a good company that has technicians available if you need assistance, because they are not always trouble free," he says. "We went through a company that didn't have any service whatsoever, and that kind of left a bad taste in our mouths."
STAYING THE COURSE
While many companies may be tempted to scale back their advertising and marketing efforts when times are tight, the dealers we spoke with are forging ahead with their campaigns, and in some cases, increasing their advertising budgets.
"We increase our advertising every year, regardless of the economy and what has happened," Webb says.
Advertising isn't cheap, though. Mosher says his company spends about 40 percent of gross sales on advertising. The company uses radio, newspapers, direct mail and the Yellow Pages, as well as appearances at various shows. Mosher's dealership started using radio last year to bring in customers during the slowest months, and Mosher thinks the effort paid off during a soft year. "I think it kept us from being down for the year," he says.
The key to success in radio advertising is to keep your message in front of the public and to keep a steady flow of spots on the air, according to Mosher. "Radio advertising is somewhat long term," he says. "You can't just jump in and out."
Tanning beds and other off-season products may find their way into advertising campaigns year-round, but most retailers place special emphasis on them as the weather turns cooler. "We advertise them when we feel like the market's spiking," says Davis.
STELLAR SERVICE
Dealers also say that providing topnotch service will help them ride out the tough times. Upscale customers won't accept anything less. Regular sales training and strong familiarity with the products on the showroom floor help salespeople meet and exceed customer expectations.
"We want to find out what's going to suit the customer best," Davis says. "If that prospect believes that you have their best interests at heart, they're going to do business with you."
With the right mix of products and an ongoing, aggressive marketing and advertising effort, savvy pool and spa dealers are finding success no matter what the economy and the weather bring their way. Mosher's strategy for thriving during the downturn is to stay the course: "I think we'll just continue to do the things we've done —it's been successful." For Central Iowa Pool & Spa, the formula includes great customer service, salespeople who follow through after the sale and an ongoing, aggressive advertising campaign.
Then again, perhaps it's all in the attitude. "I refuse to buy into the so-called downturn," says Davis.
"We're not going to participate in this recession."
The end of summer sends over 33 million tanners back to tanning salons.
Mark J. Greenfield is a Milwaukee, Wis.-based freelancer specializing in business topics.
