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U.S. Organic and Spa Market August 16, 2016
U.S. Organic and Spa Market
August 16, 2016
About GRIP IDEAS
• Formed in October 2003
• Provide marketing and business development
services
• Focus in wellness & nutrition industry
• Results-orientation mindset
GRIP IDEAS produces WINNERS
• 2014 – Nutritional Outlook – DianaPlantSciences – Best of Ingredient Supplier • 2013 – NBJ Innovation Award – DianaPlantSciences • 2013 – Functional Ingredients, Best Botanical Ingredient – KSM-66® – Editor’s Choice • 2011 – Best New Ingredient Finalist – Meriva® – NutrAward • 2010 – Best New Product, European Outsourcing Awards – Meriva®
• 2010 – Best New Finished Product – VitaPQQ® – NutrAward
GRIP IDEAS Brand Experience
Nutrition Industry
GRIP IDEA Philosophy:
A Framework for the Future
GRIP IDEAS Services
• Business Development
– Business and marketing plan development
– International market expansion
• Marketing Execution
– Internet/Social Media
– Advertising
– Public Relations
U.S. Spa Market Size
• International Spa Association (ISPA) estimates
the U.S. spa market at $16.3 billion – Revenue up 5.0% from 2015
• Spa visits up 2.1% to 179 million visits
• 21,020 estimated spas in the U.S.
• Average revenue per visit is $91
• Projected growth to $24.73 billion by 2020
– 5.6% growth annually
Source: International Spa Association, August 2016,
Technavio “Spa Market in the U.S. 2016-2020”
U.S. & Spa Trends
• Healthy & mindful living
– More Americans are
adopting healthier lifestyles
– Better for you foods, better
skincare, personal retreats
U.S. Spas by Type
Source: American Spa Industry Insider Survey, August 2016
• Primary types are Day Spas (24% of spas) and
Day Spa and Salon (23% of spas)
U.S. Spa Types
• 87% of U.S. spas are a single location
– Owner-operated
– Small business
• 9% of U.S. spas have 2 to 5 locations
• 4% of U.S. spas would be spa chains
Source: American Spa Industry Insider Survey, August 2016
U.S. Spa Types
• 87% of U.S. spas are a single location
– Owner-operated
– Small business
• 9% of U.S. spas have 2 to 5 locations
• 4% of U.S. spas would be spa chains
Source: American Spa Industry Insider Survey, August 2016
U.S. Spa Location Size
• 56% of U.S. spas are less than 2,000 sq. ft.
• 66% of U.S. spas
have 1-4 treatment
rooms
Source: American Spa Industry Insider Survey, August 2016
Top Spa Services
• #1 – Facial/Skincare Services
• #2 – Massage Services
• #3 – Retail Sales
Source: American Spa Industry Insider Survey, August 2016
Spa Revenues
• 48% of spas have revenues of $100,000 or less
• 37% of spas have revenues of $1,000,000 or
less
• 15% of spas have revenues over $1,000,000
– 1% of this has revenues over $10,000,000
Source: American Spa Industry Insider Survey, August 2016
Factors Affecting Revenues
Source: American Spa Industry Insider Survey, August 2016
U.S. Spa Clients
• 80% female
• 39% between the
ages of 31-50
• 69% Caucasian
Source: American Spa Industry Insider Survey, August 2016
U.S. Spa Products Selection
Source: American Spa Industry Insider Survey, August 2016
Use of Technology
Source: American Spa Industry Insider Survey, August 2016
• Spas rank having a web site as the #1
technology for increasing profitability
• Social media sites rank #5
• The top ranking social media sites are:
Top Spa Trends
Source: Spafinder Wellness 365 Trends Report
• Healthy Hotels
• Wired Wellness
Top Spa Trends
Source: Spafinder Wellness 365 Trends Report
• Suspending
Gravity
• Ferocious Fitness
Top Spa Trends
Source: Spafinder Wellness 365 Trends Report
• “Natural” Beauty
Meets Social Media
• Aromatherapy
“Scent with Intent”
Top Spa Trends
Source: Spafinder Wellness 365 Trends Report
• Wellness Retreats
• Spas & Life
Transitions
Spa Associations & Trade Shows
• International Spa Association (ISPA)
• Trade Shows
– ISPA Conference and Expo, Las Vegas, NV – Sep.
13-15
– The International Congress of Esthetics and Spa
• Long Beach, Sep. 11-12
• Miami, Nov. 6-7
• New York City, Mar. 12-14
• Dallas, Apr. 2-3
• Philadelphia, May 21-22
– International Beauty Shows, Las Vegas and NYC
Best Practices
August 16, 2016
Best Practice:
Get to Know the Market
Market Research Resources
• Nutrition Business Journal – Provides quantitative market data for the U.S. nutrition industry www.newhope360.com/nutrition-business-journal
• SPINS – Offers U.S. retail scan sales data for natural health food stores and mass market retail www.spins.com • Euromonitor International – Supplies market size information for the nutrition industry covering a number of country markets www.euromonitor.com • MarketResearch.com – Research reports on a variety of subjects www.marketresearch.com
Best Practice:
Organizing Your
Business
Strategy & Structure
Developing a Plan
A plan should include: • Situation Analysis – Organization description, target market overview, purpose of effort, international marketing objectives
• Product Overview – Product description, key features and benefits, competitive advantages and required adaptation for exporting
• Market Entry Strategy – Target market, competitor overview, distribution & channel strategy, promotional strategies and terms of sale
Developing a Plan
• Regulatory/Legal Requirements – Regulatory approvals, import restrictions, duties and tariffs, intellectual property protection, insurance and trade documentation
• Identification of Risk Factors – Country market risks, credit and currency risks and political risks
• Tactical Plan – Overview of key activities along with measurement and evaluation
• Financial Plan – Funding, operating budget, conservative revenue projections
Getting in the Market
Establish own presence 1
• GLOBAL FOOD COMPANIES
(Nestlé, Coca-Cola, Cadbury, Kellogg’s)
• MULTI-LEVEL MARKETING COMPANIES
(Amway, Nu Skin, Shaklee, Herbalife)
• GLOBAL FOOD INGREDIENT COMPANIES
(DSM, BASF, Indena, Lonza)
Find a local partner (Distribution/License) 2
Process for Finding a Partner
• Identify Partner Candidates - Size of partner - Appropriate channel
• Partner Interviews • Partner Meetings • Follow Up • Partner Agreement
Important Criteria for Selecting a Partner
• Industry Experience - What is the background of the company? - What companies do they currently represent? - What experience do they have with nutritional products? - How successful have they been in growing sales?
• Regulatory Experience/Support - What regulatory staff is in place? - What experience do you have in registering currently products? - What ongoing regulatory support do you provide?
Important Criteria for Selecting a Partner
• Marketing/Sales Support - What sales/marketing staff is in place? - How is your sales organization structured? - How do you support the marketing of a new product? - How would you keep us informed?
• Importation Procedures
- What importation procedures need followed? - What staff is in place to handle importation?
• References
INNOVATION
BRAND DEVELOPMENT
CUSTOMER SERVICE
• Product development • Intellectual property • Invest in science
• Quick response • Sales Team • Technical Support
• Segment-specific marketing
• Brand consistency • Take time to plan
Successful
Brands
Organizing for Success
Reasons International
Businesses Don’t Work • Lack of organizational clarity
– International business has not been a priority
• Lack of planning
– Have responded to needs of current business and plan has not been developed to build new business
• Barriers to entry
– Regulatory barriers have halted efforts
• Lack of resources
– Resources have not been identified and allocated to grow business
• No patience
Best Practice:
Developing a Brand
What makes a product
successful?
• Relevant
• Differentiated
• Believable
What is a Brand?
Brand – A perception or emotion maintained
by the consumer, describing the experience
related to doing business with an organization
offering a product or service.
Branding Fundamental
In order to have a BIG brand, you must have a
BIG category
In order to grow the category, you must promote the
category.
If you assume leadership of the category, people will
follow your leadership and buy your brands.
Assume B to B category leadership.
What is a Category?
• A “category” is a group of products that perform the
same essential function
• The Law of Category − It is better to be first, than it
is to be better.
• Category descriptors allow your target audience
– To quickly grasp what the product is and does
– Relate your product to competitive offerings and the
functional role each product will play
Growing a Category
• Categories grow out of the intersection of discovery,
entrepreneurship and human need
• To build a category
– Developing and communicating a core category
vocabulary
– Developing and communicating a core benefit that
responds to a need inadequately served by existing
products or services
– Providing a product that distinctively serves
the language of the new category
Elements of Branding
• Brand Identity
– Name, logo
– Messaging
• Brand Architecture
– Brands within an organization and their relationship
among each other
• Brand Development
Brand Development
Develop a set of rules and stick with it.
What do Brands do?
• Encapsulate actual, experienced value
• Own a particular behavior
• Based on consumer preferences
• Respond to real needs
What’s Important for Brands?
• Consistency
• Cohesiveness
• Continuity
Communicating the same message throughout
everything you do over time.
Great Brands Have Consistency
“The one way to make your brand
stand for anything is to be consistent
with message, image and even
trademark.”
- Al Ries
Why is Consistency Important?
• Consistency is key to brand equity
• Without consistency of message, graphic look and style,
trust may be broken
Great Brands Get Known for A
Singular Focus
• Nike is about athletic performance
• FedEx is about overnight delivery, an unrelenting
commitment to deliver
• Microsoft is about the digital future
• Marlboro is about the macho cowboy
Brand Identity
Developing A Brand
Brand – A perception or emotion
maintained by the consumer,
describing the experience related
to doing business with an
organization offering a product
or service.
Wellness Brands
Brand Positioning
• Seeks to develop ownership of a concept in the mind of your target audience
• Develops a focus on what the product is about and does
• Differentiates your product from the competition
• Establishes why your target audience should believe you
Brand Positioning Model
• Frame of Reference: The association between your brand
and the target audience that makes your product relevant. Establishes the "category". • Differentiating Benefit: The differentiating benefit and value proposition must be unique to your product. • Reasons to Believe: Proof that your value proposition is true. For example, scientific studies, patents, trademarks, etc.
For target audience, brand name is the frame
of reference that provides differentiating benefit
because of reasons to believe.
Brand Development
Brand Development
• Meaningful brands accomplish • Push to the industry
• Pull from the consumer
• Become self aware • Measure and adjust
• Built in years, not in months
Great Brand Development Is
• Disciplined • Deliberate
• Determined
• Die Hard
“You don’t merely want
to be considered the best of the best.
You want to be considered the only
ones who do what you do.”
Jerry Garcia
Best Practice:
Packaging & Labeling
Packaging & Labeling
• First impressions are important
• Regulatory compliance
• Less is more
- Clean label trend
- Fewer ingredients
- More white space
Clean Label: White Space
Best Practice:
Get “In Market” Support
Get “In Market” Support
• Find a distributor that matches your company culture, mission, vision & values
• Hire the right consultants
– Regulatory
– Marketing, public relations
– Industry expertise
• Manage & Support
Best Practice:
Exhibiting & Trade Shows
Exhibiting & Trade Shows
• Select the right shows
• Determine level of involvement
– Attendance
– Exhibiting
– Exhibiting & Sponsorship
• Develop clear goals & objectives
Exhibiting & Trade Shows
• Develop “talking points” for your sales pitch
– 3-5 compelling reasons to do business with your company
• Booth design & development
– Less is more
– Focus on “what you do” & “what makes you unique”
– Simple, elegant design draws more attention
• Sales follow up
THOUGHT INTO ACTION
