Somber news from the housing market is usually identified as the culprit. "There're fewer and fewer people right now buying new homes and all the goodies you can get to go with them," says Max West, manager at Eastgate Pools in Cincinnati. "And I don't think people are quite as liquid as they were a couple years ago."
What's less obvious is how to turn that trend around. According to Linda Sisk, vice president of Hot Spring Spas of San Jose and Santa Cruz in California, it starts with your core approach: "Some people in this industry have the perception that this is a sales industry. It is not. It is a service industry, and that is a huge misconception some people have. Selling the product is easy; it's making sure that the product is taken care of, that the customer is supported, educated and knows how to take care of their hot tub so that they'll love the hot tub - that's where the work of this industry is. And that's where people have to focus in order to be able to make it to the next generation of spas."
In fact, Sisk says her company's entire philosophy revolves around customer service. "From day one, we've always been really devoted to making sure our customers are happy and satisfied with our product," she says. "And that's not just verbiage we use - it's really our philosophy that we live out. Because of that, we've had a very large referral business. About 40 percent of our sales are from referrals. What we're also realizing now as a 31-year-old company is that the real benefits of being devoted to customer service are coming full circle - we're now selling second spas to our existing customer base. That is where easily another 40 percent of our customers are coming from right now."
All these referrals and secondtime buyers are the difference between struggling and surviving in a market like this, adds Sisk. "We're not seeing first-time buyers in the high volume that we used to because it's a tough market right now with refinance money not being available," says Sisk. "So you have to go back to the best resource you have, which is your existing customer base, and you have to market to them to try to create more business for yourself.
Whether that means chemical or second- time spa purchases or use of your service department, all of that is what will get you through the lean years. You can't depend on 50 customers walking in and selling to 10 percent of them. You have to accept that you may have 10 customers walk in and you want to sell to 50 percent of them, and you want them to always come back to you for more."
Toward that end, Hot Spring Spas of San Jose and Santa Cruz captures all possible leads. "For every person that walks through the door, whether or not they buy a hot tub that day, we get their information and we get them into a database. Then we send them sales reminders and personal cards - we make sure they don't forget who we are," says Sisk.
Sisk says her company also has a referral program in place to keep in touch with clients after the sale. "So many people get sales, and then they never talk to those customers again. It's just crazy. You have to look at your existing customer base as your sales force, meaning you need to treat them well and make them want to come back to you and be your ambassador."
It Starts With The Sale
Sisk notes that great service starts with great salespeople and a positive sales process. "This is one of the areas I've always been most frustrated with in this industry - we have such an amateurish way of going about running our businesses," she says. "We don't train salespeople correctly, and we allow them to create a negative selling environment for the customer. "The way that most people sell - in my experience, and according to my customers - is the first thing they do is they tell you why you don't want somebody else's product," adds Sisk. "You don't want brand X because they're really horrible, and they just fall apart. Instead of building a customer's confidence in their product, they're building a negative experience about other people's products.
That has hurt this industry, I think, more than anything else because now customers have a negative impression about the industry, and they become adverse to even wanting to shop for a spa. Rather than having this industry come together and extolling the virtues of owning a spa, we're so worried about an individual sale that we've spent a lot of time creating a negative image of the industry, and people have a lot of options with their discretionary money.
"We're competing against a bigscreen TV, a boat or a trip," adds Sisk. "And if customers have an unpleasant shopping experience with us, they'll go buy something else. You don't go into a car dealership and have them bad-mouth other cars. They sell on the benefits of owning a Lexus. They don't sell on the negatives of owning a Mercedes."
At her own company, Sisk not only avoids negative selling herself, but she also trains all of her salespeople to focus on explaining the benefits of owning a hot tub. She sends her staff to Watkins sales training, where they learn to create a positive experience for customers and to sell in a professional manner.
"It's like something that Scott Iverson, one of the Watkins trainers, told us years ago: People aren't just looking for a product to buy. They're looking for a place to buy it, and so if you don't create that welcome environment where people are comfortable and want to be part of your business and want to be associated with you, then that's on you, it's not on the manufacturer."
Welcoming Environment
Friendly, knowledgeable salespeople are the human element necessary for creating an appealing place to shop - an attractive, inviting showroom is another critical component. "The showroom has to be clean," says Sisk. "You cannot believe how many stores I've walked into where I've seen cleaning rags still lying around, the showroom reeks of chemicals because they haven't balanced their spas correctly, and the employees are dressed like they've been hiking all day," says Sisk.
"You have to have an inviting image that's healthy and clean because those are some of the concerns people have about our product. So you don't have employees sitting at their desk eating lunch while customers walk in and you don't let spas get dirty. That water needs to look fabulous every single moment of every single day.
"You don't need to spend a lot of money, but de-junk your showrooms - they shouldn't be cluttered," adds Sisk. "There should be clean spaces where people can walk around and feel comfortable. This industry is one of the least sophisticated I've ever seen when it comes to showrooms. When I walk into some other types of storefronts, I think, 'Oh, my god, if spa stores looked like this, we would just be cleaning up. People would be clamoring to get to us.'"
It's not costly to keep the store up to minimum standards. West says, "Fresh paints always looks nice. Clean ceiling tiles that don't have any water spots on them from a leaking roof always looks nice, too. The first thing people see when they walk through the door is probably the most important because that's when they make a snap judgment about your store, whether they realize it or not. So your front end better have attractive, clean displays."
Another relatively inexpensive way to improve the look of a showroom is to buy your suppliers' support materials. "That is something every manufacturer should be willing to spend the money on to develop and then make affordable to its dealers," says Sisk. "As dealers, we don't have the money to go out and create this beautiful artwork, but certainly the manufacturer can."
In The Door
Before you can impress clients with a beautiful showroom and excellent salesmanship, they need to walk through your door. Providing superior service so customers refer friends and family is one of the best ways - probably the best way-tomake this happen.
Advertising is another common route. One way to determine where to focus your advertising and marketing dollars is to ask everyone who walks through the door how they discovered you. "Then that's where you advertise and put your money," says Sisk. "If they're saying they noticed the store when they drove by, then you dress up the front of your store. You give it more pizazz. If they're saying their friends referred them, then you get to those friends and thank them for all of their confidence they have in you. Whatever they tell you is where you should be putting your money."
To reach potential customers who haven't yet discovered your store, "you have to think outside the box," says Sisk. "You have to get creative with marketing in this kind of a climate. You can't keep doing the same ads the same way because you're going to get the same results. Isn't that the definition of insanity - doing the same thing in the same way and expecting different results?"
To spread the word about her company, Sisk gets involved in the community. "That's been big for us for years. Soon we're donating a spa to a nonprofit for a fundraiser they're doing at Clint Eastwood's Tahema golf course, and that's going to be a huge way for us to get our name into the marketplace without doing direct sales," she says.
Both West and Sisk believe it's very important to have a top-notch Web site since so many people shop online these days. "Having a Web site is huge. You're crazy if you don't have a Web site, and you've got to make that a friendly, easy-to-use, informative site," she says.
Both Sisk and West are also happy to see the Hot Tub Council get more involved in promoting the category. "I think a national advertising campaign promoting hot tubs could be incredibly helpful," says West. "It's just a matter of how it's going to be funded. The only hot tub commercials you see nationally now are from a couple of different spa manufacturers that have the funds to put out their own infomercials or commercials. And the world needs to be apprised of the value of owning a hot tub: the therapeutic benefits, and the relaxation and family time they facilitate. There's never, to the best of my knowledge, been a national ad campaign to do something like that for hot tubs. I've seen it for the boating industry, and RVs, and that's who we're competing with. My No. 1 competition is not the big guy across town that also sells pools and hot tubs. It's Dick's Sporting Goods, it's the golf courses down the road and the Bass Pro Shop in town. That's who we're competing against."
Sisk believes there's plenty of room for many dealers to thrive. "I think we've missed a lot of opportunity in this industry out of fear. People have this scarcity model of thinking. They think there's not enough to go around, so I've got to do everything possible to get my share of it because there's not enough. And the leaner the market, the more frenzied we become, which drives even more people away from us," she says. "But there's plenty! The universe is abundant, and if they can switch their thinking to embrace this, there are so many hundreds of thousands of people that would benefit from our product that we don't have to each fight over one sale to the point where we kill the sale."
