Tapping into the Resort Market

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Jackson Hole, Wyo., the Hamptons, L.I., the Florida Keys. These are just a few of the country's top resort areas, each a popular getaway for vacationers looking for beaches or powdery slopes. Not only are they cool places to visit, they're also a unique niche for hot tub retailers: the resort market.

These top travel destinations are populated with cabins, cottages, condos, vacation homes and upper-crust estates, most of which are owned by people who don't live there full time. To cover the costs of ownership — and make a tidy profit while doing so — many of these homeowners rent out their properties while they're away.

But these days, having a vacation home for rent isn't enough to guarantee a packed calendar of bookings. Thanks to websites like Airbnb and VRBO (an acronym for "vacation rental by owner"), travelers can quickly sift through thousands of listings, not just by available dates and price range, but also by the features offered by each. In seconds, users can go from, "I wonder what a vacation home on the beach would cost," to "This one is $250 a night and has a sauna, Netflix access, a grill and a pool table. I'm in."

It's no surprise, then, that the hot tub is the perfect match for rental properties, making it a goldmine for dealers.

Juliet Phelps, co-owner of Ajax Pool and Spa, knows firsthand — Ajax is near Aspen, Colo., one of the top ski-towns in the world, and boasts decades of experience catering to resort owners. Here, she shares just some of what she's learned about selling hot tubs in this unique market.

By the Numbers

Of the 1,036 Aspen rentals listed on VRBO, 69% have hot tubs.

Make Smart Connections

There are several ways homeowners owners rent out their properties. They may use websites like Airbnb and VRBO, travel agents (yes, they still exist) and even eBay, but a great many turn the job over to management companies, which are often the easiest access point for a hot tub retailer.

Management companies are great partners to have in your pocket for a few reasons: First, they can manage dozens, if not hundreds of properties, which significantly cuts down on cold calling on your end. Second, since they get a cut from each booking, they have incentive to convince property owners to buy a hot tub.

Phelps offers an example:

"I had one customer that lived in a townhouse. The building isn't slope-side, both units have fireplaces and they both have the same management company. But one unit was getting rented all the time, and the other one was not so successful. It only got booked during high season, and that's probably because it was one of the last ones left. What was the difference? One had a hot tub and one didn't.

"The management company employee told the owner of the unit, 'You need a hot tub.' She got a hot tub and all of a sudden, she got the same amount of rentals as the next-door neighbor."

RELATED: Portable Spa Installations: The Crucial Site Visit

Let's put some figures to that story: If a property is rented for $350 a night for a week, that's $2,450 in revenue. Multiply that by 4.33 (the average number of weeks in a month), and that's more than $10,600 a month. And that doesn't even account for peak season rates, weekend rates and special (read: expensive!) holiday rates.

After years of building connections, representatives at management companies now tend to approach her with leads — but that doesn't mean an occasional check-in call isn't in order.

"It wouldn't hurt for me to have my sales guy call these management people and say, 'Hey, we're running into the rental season — do any of your customers need a proposal for a hot tub? Because you can maximize your renters that way.'"

Focus on Value

To really cement a relationship with a management company, look for things you can offer to make yourself valuable in their eyes. For example, while some management companies have contracts with outside service firms, other companies hire in-house service techs to take care of their units. These are guys you want to make inroads with.

"I have one management company with probably 80 homes, and they have their own cleaning guy — all he does is clean hot tubs for all their accounts. He comes down to my store to get free information and advice, and he gets 10 percent off on all his filters and supplies," she says.

He also gets VIP emergency service, a nice way of saying, "If something goes wrong on short notice and you can't get to the job, we'll take care of it." For management companies whose livelihood rests on the happiness of their guests, this can be a big deal.

Different Market, Different Needs

When vacation rental owners do reach the point of considering a hot tub purchase, it's time to adjust your sales pitch. According to Phelps, these customers have different priorities than the typical homeowner, and are especially concerned about durability in particular.

"One of the biggest concerns they have is making sure the hot tub doesn't have a lot of bells and whistles for the renter to break," she says. "So lots of them don't want to have a stereo upgrade. Lots of them don't want to have fancy jets because really it's a rental, and maybe they're only going to use it a couple weeks out of the year themselves, so they don't really feel that they want to spend the big bucks."

While they gravitate toward lower-end models, there are ways to gently encourage them into higher price points.

"I talk about the better warranty on Jacuzzi's line; you go from a two-year warranty on a Builder Series, which is an introductory spa, to a five-year warranty on the better spa," Phelps says.

First the Resort, Then at Home

It's clear the resort market is a boon for retailers who live in those areas. But really, it should be considered a wellspring for the entire industry.

Consider a family on vacation. They stay at a hotel, use the pool for swimming and jump in the gunite spa: the one built in the '80s with sharp corners, cracks and a broken foot-well jet that they're sharing with a mix of strangers. They may have great memories of the pool — of the thrilling waterfalls, caves and lazy river — but more often than not, the hot tub experience at hotels doesn't leave as memorable of an impression.

They think they've tried a hot tub, but the most compelling aspects of the experience are often missing at a hotel spa. But a family enjoying a portable spa at a vacation rental gets the Full Monty, and in the context of a relaxing vacation, it may inspire them to bring the experience home. It's that rich, intimate hot tub encounter that turns people into customers.

That poignant "ahhh" moment in a hot tub is what Phelps likes to pinpoint in radio ads in the Aspen Valley area for hot tubs as well as outdoor furniture.

"I do ads all the time," she says. "I talk to them like, 'This is what you want, isn't it? Come on in and buy it.'"


Marketing to Billionaires

In 2011, the Wall Street Journal declared Aspen the most expensive town in America, and last year, Forbes rated Aspen as the 9th most expensive zip code in the U.S. To put it bluntly, while there are a great many in the Aspen area who rent out their vacation properties, there are also many who don't need to.

"The billionaires pushed out the millionaires here," Phelps says. She estimates that of her hot tub sales, only 15 percent go to those who rent out their property, while 40 percent are second homeowners who don't open up their home to renters.

Because of this, Phelps also promotes her business directly to local homeowners. A tried-and-true strategy: Participating in a charity event at one of the area's top golf courses.

"I've literally parked a Jacuzzi right at the range — I like to display it at the range because everybody warms up there and everybody looks at it, even the people who aren't in the charity," she says.

"I like events that start on a Friday. I tell them, 'Oh I can bring the hot tub, but I don't have any staff on Saturday to pick it up, so can I pick it up Monday morning?' And then I get to leave it there all weekend long!" she says with a laugh.


Comments or thoughts on this article? Please e-mail [email protected].

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