Medical Spas Get Creative With Downturn

Dr. Humes opened her spa a little over three years ago and the business grew by 30 percent each year. For 2008, however, her business grew only 20 percent.

Across the United States, the industry is being dramatically affected by a reduction in the number of new clients coming and those who are coming in are opting for less expensive services. Even well-heeled clients are trying to get a little more for their dollar. Gabriel Chiu, D.O., of Beverly Hills Plastic Surgery, Inc., said there is an inclination toward frugality and a more “creative” approach to beauty maintenance. Instead of fat transfer to the hands under anesthesia ($4,000-$6,000), some clients are opting for Radiesse rejuvenated hands ($1,300). And rather than a traditional face lift ($10,000-$15,000), some clients are opting for a filler (Radiesse, Restylane, or Juvederm) in the cheek area along with an advanced facial chemical peel and Botox to eliminate fine lines and wrinkles.

“In this economy, even the wealthiest women have to make a decision between the coveted Hermes purse and looking the age she feels. Of course, I tell them they can have the best of both worlds by opting for a Chanel and seeing me for a recession-friendly treatment,” Dr. Chiu said.

Dianne York-Goldman, president and CEO of La Jolla Spa, in La Jolla, Calif., said there is a general downturn in the number of clients coming in for plastic surgery. Instead, more and more clients are choosing fillers and injectables. York-Goldman said her business normally increases significantly during the Thanksgiving and Christmas holidays but not in 2008. Business was off by about 35 percent, she noted.

BOTOX AND RESTYLANE DAYS

To get things back on track, she has been offering gift cards where a client gets a $25 gift card back for themselves for every $100 gift card they buy. She and her staff have organized a Botox day and Restylane day. They have a DYG mineral make-up day every fourth Thursday of the month where they charge $75 per person. That charge is then applied toward any products that are bought at the event. “They are all taught how to do make-up for their eye and hair color. We always have refreshments,” York-Goldman explained. “Food makes a difference. We have chocolate fountains and strawberries all day long and people like that.”

Most spas are trying other approaches to bring in new customers. Some are offering two-for-one specials, coupons, and even deep discounts. Others are shunning that approach, saying that demeans the industry.

The United States has approximately 2,500 medical spas, according to the International Medical Spa Association. The association estimates that the gross volume of the medical spa business in the U.S. is more than $1 billion.

“These figures do not include any of the services performed in traditional doctors’ offices,” said the association’s executive director Hannelore Leavy.

Lauren Olson, a Certified Physician Assistant, is the owner of the Radiance Advanced Skin and Body Care Spa in The Woodlands, 35 miles from downtown Houston. Her business had experienced of growth of 20 percent for three consecutive years, she said, until September 2008, when it dropped to just an increase of 14 percent.

Unlike many spas, however, she opposes offering heavily discounted services. “That is a car salesman’s approach and I am not a car salesman,” Olson said. “I think we are known for offering quality service. It is not always about the cost. Some women do their shopping on the Internet, but this is very much a relationship business and if they trust your work they are not as likely to run to the cheapest deal.”

That is the same philosophy for Nancy Semaan, RN, in Los Angeles. She has an MBA in healthcare management and is the director of the Health Care Partners Medical Spa in Glendale, Calif. She said a mailer is sent out twice a year to all clients but her spa mainly relies on educational and promotional events. The spa has special promotional events that feature such things as “Chemical Peel Night” and similar events. She and her colleagues also invite speakers from hospitals and host events there. They also visit private schools and sponsor educational events centering on sunscreen protection and tips on acne and skin wellness.

“We also go to hair salons and show them some of the things we do,” Semaan told Aesthetic Dermatology News. “We explain to them what we offer and how they can refer clients. It has been our most successful way of attracting patients by doing these events at hair salons. Women trust their hair stylist and there is a bond there.”

THE 80-20 RULE

Larry Oskin, president of Marketing Solutions, Inc., and the public relations chairperson for the Day Spa Association & International Medical Spa Association, said in this tough economic climate, it is best to use the 80-20 rule. In the medical spa and day spa industry, 80 percent of business comes from regular clients, so they are the ones who need to be rewarded.

Day spas and medical spas, Oskin said, should offer specials to their regular customers for Valentine’s Day, Mother’s Day, and other holidays. He advocates bounce back certificates. These types of promotions can help clients take advantage of products and services they may not have tried in the past, he said, adding that pre-booking is vital.

“Most medical spas are not good at booking. Usually, they just let them walk out the door and wait for them to come back,” said Oskin, adding that medical spas should make every effort to get clients to book appointments before they leave.

Another effective approach is to set up a referral rewards program that gives regular clients bonus services, products, or vouchers for dinners. Oskin said he believes that now more than ever spas must increase exposure to their services through lecture demonstrations, client appreciation nights, open houses, and special theme nights such as teen night and men’s night. Another tip from Oskin: make it a charity event.

In Oskin’s view, offering two-for-one specials or coupons or other types of discounted services is a mistake. Many women think something is better if it costs more and spas need to make sure they are attracting the right kind of clientele, he said.

“Doctors want to be considered professionals and they don’t want to be considered a price driven, value service,” Oskin said.

“Many consumers equate price with quality and that is true of women. These are not the Kmart shoppers who go to spas. They respect education, certification, specialization, and service and they are willing to pay for it.

SURVIVING TOUGH TIMES

Here are tips for surviving tough economic times from Larry Oskin, president of Marketing Solutions, Inc., and the public relations chairperson for the Day Spa Association & International Medical Spa Association:

• Use your regular clients as your publicists.

• Use bounce-back certificates to help clients take advantage of services they haven’t tried yet.

• Offer savings with a series package. If a client gets microdermabrasion offer them a buy six get one free package.

• Host Open House, Teen Night, Men’s Night, and Charity Events.

• Review your professional products. Make sure they are visible and on counters, not in locked cabinets.

• Create your own private label for skin and hair care products.

• Create a video for your front desk area that shows what goes on behind closed doors. Americans love makeovers and seeing in a 30-minute video may be highly motivating.

• Use downtime wisely. If a staff member is not working with a client then have them work on marketing products, calling clients, working on post cards or doing other jobs that promote the spa.

• Get wired. Use the Internet more.

• Do a public relations push. Get on the morning talk shows on radio and television.