Winter 2008 Seacret Spa’s Secret to Success
When Robert Meirovich started selling Dead Sea skincare products in 2002, they were just starting to capture the attention of consumers, mostly women but some men. Trend-setting beauty and pop-culture magazines were beginning to seriously cover the benefits of Dead Sea salts and minerals, not only for readers with skin problems but also for those who simply wanted healthier, softer skin. Celebrities, routinely asked about their beauty secrets, started attributing their glowing skin to the latest Dead Sea masks. Around the world, doctors and scientists studying the Dead Sea’s world-famous powers of rejuvenation were publishing results showing marked improvement—and sometimes even total alleviation—of common ailments such as psoriasis, eczema, acne, arthritis and muscle stiffness.
Although Meirovich welcomed each of these developments, he knew that two more important trends were reshaping the skincare industry that would impact his sales for years to come. First, women around the world were searching for natural products to replace the harsh synthetics in so many mainstream skincare products. Second, many of the 76 million baby boomers nearing retirement were women who had an increasing interest in anti-aging products, with an emphasis on skin products that could head-off or reduce the look of wrinkles. All of these factors combined in one perfect retail storm, giving Meirovich a growing market and an up-and-coming product he could sell. And sell he did.
In just four years he helped the company grow from a few carts to more than 120 locations, in nearly every state, selling to all kinds of women.
But he wasn’t just selling. He was listening.
By listening to his customers, Meirovich learned a great deal about how the Dead Sea products were perceived, what motivated customers to buy and, most importantly, what kept customers coming back again and again.
Soon he and other key company personnel identified ways to improve the product line through specific formula improvements and by introducing new complementary products they felt customers would buy. In other words, they saw an opportunity to manufacture their own line of Dead Sea products that would outsell anything else on the market.
It wasn’t long before Seacret Spa was manufacturing in Israel, not far from the Dead Sea.
The new Seacret Spa products were distributed among the company’s 120 cart locations and put to the test. Customers loved the new line and the carts began to rack up record sales. It wasn’t long before other specialty retailers started taking notice—and began calling to find out how they could sell the Seacret Spa line.
Recognizing the opportunity to wholesale to independent retailers, the company began wholesaling to a handful of specialty retailers who didn’t compete with Seacret Spa’s company-owned locations. Once again, that handful turned into hundreds, as specialty retailers flocked to Seacret Spa.
Converting its own locations to owner/operators so the company could focus solely on wholesaling, by 2007 Seacret Spa had gone global, selling to more than 600 carts around the world.
Although the company does not divulge sales figures, Meirovich says owner/operator retail sales for 2007 were up 160 percent from the previous year.
Growing beyond specialty retail
Certainly, growing a business from a few retail carts to manufacturing and wholesaling to more than 600 carts could be the end of the Seacret Spa success story—but it’s not.
In 2007, Seacret Spa recognized yet another opportunity to expand. The company purchased the Arizona Golf Resort Hotel & Conference Center in Mesa, AZ, complete with 180 rooms and suites, an 18-hole PGA-rated championship golf course, restaurant and 12,000-square-foot conference center.
It is there the company will create the first Seacret Spa, a full-service spa featuring Seacret Spa products, expected to open mid-2008. “The Spa will add a lot of volume to our company,” says Meirovich. The Spa will give the company exceptional visibility and allow customers to experience Seacret Spa products first-hand and purchase products to “bring the Spa home,” of course.
But while the Spa is an exciting development, Meirovich says the new venture will not distract the company from its core market strategy: specialty retail sales. Seacret Spa continues to invest significant resources studying its retail strategy, products and customers to identify future selling opportunities for cart operators.
In 2007 the company hired a marketing consultant for a four-month-long market research study. Four different focus groups were invited to company headquarters—current retailers, customers, people who had never used Dead Sea products, and professionals from the cosmetics industry—to test and talk about, well, everything.
“We learned about what people thought of the product and how it’s sold,” says Meirovich, who now serves as the company’s leasing operations manager. “We found out everyone loved the product and it gave us so much motivation.” The company also learned it could make improvements in some areas, such as the sales approach and visual merchandising. Once again, the company listened and changes were implemented to improve the look of the carts, including professionally designed aprons with the company’s logo for cart employees to wear and a new visual merchandising package for retailers that’s due for release in 2008. Another area identified for improvement was the demonstration technique, and here Meirovich and his partners took the focus group input particularly seriously.
Seacret Spa products are not typical shelf products, says Meirovich. Customers need to see them and try them in order to buy them—and not just any demonstration will do. Dead Sea demonstration products have been getting a bad rap in the industry lately due to overly aggressive retailers, he says. “It’s a multimillion dollar industry with a bad image because of retailers who go too far with demonstration. We are trying to change that image.”
Part of that change means refocusing the demonstration from selling to educating. “People like to learn about new products,” he says, so retailers need to draw customers to their cart through fresh, attention-grabbing visuals, well-dressed employees and an attractive product display. “That’s 60 to 70 percent of the sale itself,” he says.
Once customers approach the cart, five to 10 product samples are ready to go and the demonstration can begin. Because many Seacret Spa products produce instantaneous results, they make an impressive presentation, Meirovich says. “You want to show your customers results, educate them about what the product can do for them, and gain their trust as an expert who knows everything about the products and what they can do.”
Because the right demonstration is so vital to the success of the product, Seacret Spa has an in-house team of professional trainers who travel from location to location to teach owner/operators the most effective way to educate customers about the products and execute a powerful demonstration that sells. Ori Cohen heads up the customer-relations team.
“We have a full customer-relations department that helps cart operators from start to finish,” Cohen says. “We help owner/operators pick the right location, order the right amount of product for start-up, get the in-depth product and sales training they need, and plan well for a smooth opening day. Then we support them with professional guidance through the years so they can successfully grow their businesses.”
Cohen’s mission is to give operators all the product and business knowledge that they need, “so they can focus on selling their product, training their people and managing their locations.”
But that’s not where Seacret Spa’s support of its owner/operators stops.
Owner/operators get support from Seacret Spa every step of the way during start-up, well before opening day, says Retail Leasing Manager Dawn Sadler. As a former specialty leasing manager for Scottsdale Fashion Square, Sadler brings years of on-the-frontlines experience to the table from the landlord’s perspective. She assists operators by finding available locations, negotiating lease terms and building positive relationships with mall management. “By me being available at all times to assist the mall team with any situations with regard to our cart operators, it gives the mall and the operator an additional support system,” she says, adding that for Seacret Spa to grow in the years ahead, its owner/operators must be given the support they need to succeed today.
In addition to high-impact graphics designed for carts, Seacret Spa provides its owner/operators with branded shopping bags, product brochures and a host of free samples for customers to try—then buy.
Another way Seacret Spa supports its owner/operators is by constantly introducing new products that give owner/operators new opportunities to wow customers and sell more. “New products are always a given,” Meirovich says. Ten new products were introduced toward the end of 2007, including a new travel kit for women—and a new kit for men—featuring small sizes that are airline-approved for carry-on.
Growing through experience
It’s hard to believe that in less than a decade Meirovich and his equally determined partners have turned a modest yet successful cart operation into a multimillion-dollar, multi-channel powerhouse, but that’s exactly what they’ve done.
Meirovich says the company’s willingness to explore new opportunities at every turn has led Seacret Spa to where it is today. During the company’s formative years, the lessons learned about the Dead Sea’s customers, products and approach to selling became opportunities to introduce new products and develop a highly effective demonstration strategy. The partners’ experience selling from carts, which Merovich says sets Seacret Spa apart from other Dead Sea companies, gives the company useful insights in how to best support cart-based retailers in the field and understand how leasing managers think about their properties and tenants. “We realize and understand what the leasing manager cares about, what the cart operator cares about and what the end-use customer cares about,” Meirovich says.
Of course, everyone at Seacret Spa is excited about the new spa venture in Mesa. As for the possibility of more spas in the future, Meirovich says, “We’re going to see what opportunities develop.”
When asked how many owner/operator locations the company expects to have a few years down the line, Meirovich says point-blank: “It’s not how many operators that matters, it’s the quality of the operators that’s key. It’s better to make less money in the short term and be stable in the long term.”
It’s easy to get caught up in growing the numbers, constantly focusing on adding more locations and getting bigger, “but that’s only part of growing a successful company,” he says. “The way we’ve been able to grow is by delivering a top-quality product with the ingredients our customers want, securing the best cart locations available, having a great visual merchandising package, building great relationships with mall management, and giving our owner/operators the tools and the support they need to succeed. It’s only by focusing on each of those aspects of our business that we reach our true potential—which is unlimited.”
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