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HOTEL BUSINESS REVIEW

MAY FOCUS: Eco-Friendly Practices

 

Vetting Skincare Lines for Your Hotel Spa

By Kristi Dickinson General Manager, Canyon Ranch Woodside | May 2020

Full disclaimer: I am a difficult account to work with. In addition to being overly analytical, I am brutally honest and expect a great deal out of our skincare partners. I am very open about this when approached by skincare lines. But when they make it through the rigorous selection process, it creates a mutually beneficial relationship for years, if not decades.

Every spa has unique needs which evolve over time. I have not used the same skincare lines at all my spas because the clientele varies at each property, and markets vary across the country and globe. Once you understand your client demand and the gaps in your offerings, consider the following in making your final vendor partner selection.

Efficacy

If a product works, it will sell. Period. The estheticians will be excited about it, the spa reception team will find their go-to "hero products", and your clients will deepen their relationship with you because you are addressing their specific personal skincare needs.

When vetting a skincare line, ask to see independent clinical trials of treatments and third-party testing of each product. Invite the sales rep and trainer to the spa to demonstrate a treatment. You want to see an immediate result and some "wow factor" in the execution. It could be the uniqueness of the facial massage techniques, choreography of the protocol, or synergy of the products.

Samples should always be offered to your staff to test homecare results. Ideally, you should have access to full retail size of at least 3 products for manager, esthetician and spa reception staff (of different ages and skin types) to compare results.

Find out what the annual research and development budget is and what new products are in development. You want to feel confident that the line will continue to innovate with the latest scientific research in skincare, and that clinical trials will accompany all new product launches.

Quality and Integrity of Ingredients

Ingredients are a big part of vetting a skincare line. They must be high quality, effective, and backed by research. Alpha hydroxy acids (AHAs), beta hydroxy acids (BHAs), Vitamin C, Vitamin A, Vitamin E, hyaluronic acids, niacinamide, ceramides, curcuminoids, coenzyme Q10/antioxidants (various sources) and peptides are essential and many more have value. Always have at least one product with sunscreen for backbar and retail use as well.  

Of course, we want to know what active ingredients are in our skincare products, but it is equally important to know what is not.  Our skin is the largest organ of the human body and we absorb up to 60% of the product we apply to the skin. Many products with immediate results are full of potentially harmful chemicals.

Consumers are becoming very savvy and want to know every detail from the specific biological function achieving the result, to the source of the ingredient and sustainability of the supply. We are in the business of wellbeing and our guests look to us as the experts. We have an ethical responsibility to ensure we are not introducing toxic substances into the systems of our guests, or staff members who are interacting with these products all day, every day. 

The Environmental Working Group has a list of Unacceptable Ingredients that is truly overwhelming, but there are 12 ingredients you should aim to ensure are not in your product lines, ever. They are often referred to as the "Toxic 12" or the "Dirty Dozen" for their possible links to ecotoxicity, cancer, endocrine system disruption, fertility challenges, inflammation, allergies and at the very least, skin irritation which is contradictory to our goal of achieving healthy, optimally functioning skin.

 The list includes:

  • Phthalates (Dibutyl Phthalate)
  • Sulphates (Sodium Laurate, Lauryl Sulphate or Sodium Laurel Sulfate)
  • Parabens (Methyl-, Ethyl-, Propyl-, Butyl-, Isobutyl-)
  • Formaldehyde (DMDM hydantoin, diazolidinyl urea, imidazolidinyl urea, methenamine, quaternium-15, and sodium hydroxymethylglycinate)
  • BHA and BHT (Butylated Hydroxyanisole and Butylated Hydroxytoluene)
  • Coal-Tar Dyes
  • DEA Compounds (Diethanolamine)
  • Fragrance/Perfumes
  • PEG Compounds (Polyethylene Glycols)
  • Petrolatum
  • Siloxanes
  • Triclosan

I would also suggest the following for added safety:

  • Retinyl palmitate, retinyl acetate
  • Oxybenzone, avobenzone, benzphenone, ethoxycinnamate, PABA

Environmentally speaking, oxybenzone and octinoxate are banned in sunscreen in Hawaii with several other states soon following suit for the harmful effect on coral. Plastic microbeads are also now banned in the US and UK as they pollute waterways and are harmful to aquatic life.

Ingredient Sources and Manufacturing Process

When considering a skincare line, ask about the manufacturing processes. Do they control the lab? Do they make their own base, or where is it sourced? Many skincare lines have their active ingredients tested for efficacy and guarantee these are clean of toxic chemicals, but they are using a lab with a generic base.  If the base is not clean, that could negate your entire intention of ensuring the quality and integrity of ingredients.  

Ideally, your skincare partner is operating their own lab and sourcing all the ingredients, in a way that they have a deep understanding of the entire product cycle. Ask about where the ingredients are sourced, if the source is sustainable, what farming methods and chemicals are used, fair trade labor practices, etc. If they don't have immediate answers to these questions or the ability to find out quickly, they likely aren't conscious of the importance of monitoring the full supply chain.  You want integrity in the products aligned with your brand, but this is also a great way to gather stories to share with your guests. 

Availability is also a critical aspect. What is the shipping time? How often do they have products on backorder? Operating their own lab is a good thing as long as the can handle volume and maintain consistent service levels. Once a client falls in love with a product, they become addicted. One line I worked with had an sunscreen formulation and labelling issue to work through when FDA regulations changed. This caused a long term out of stock situation. My clients started flying to another country to purchase the product and cost my spa more than $50K in sales of that top-selling product.

Cost per Treatment

Ask for a breakdown of each product used in the protocols you are interested in. Keep in mind that cost per treatment listed in the protocol is extremely conservative. These cost per treatment estimates are often 30% less than what is used in actual practice. You might also be able to streamline the protocols, remove a few items, or cross-utilize certain products to minimize your backbar investment. Do you really need six different types of cleansers? Work with your estheticians to determine the essential items. 

Education, Marketing, and Sales Rep Support

It is important to discuss training and ongoing support with a skincare line early in the vetting process. High turnover is a reality of the hospitality industry, so frequent training is essential. Discuss what type of training is provided (onsite, online, local seminars, etc.), how often it is provided, and if any continuing education credits are offered.

Determine who is paying travel and meals. I am still amazed at how many vendors ask the hotel to house them without understanding the hard cost of an occupied room and opportunity cost of a comp room. Well-established companies will have a budget for this.

It is critical that your team is versed on the features and benefits of the products in order to build trust with your clients and make recommendations for their unique needs. Nothing sells product like a personal testimonial, so you want your team using the product at home. Find out the process for staff orders at wholesale or better pricing.

Ask about staff contests and incentives to keep them engaged and having fun. Free product is also essential and commonly given after trainings to reinforce the learning and gain first-hand results so they can make confident client homecare recommendations.  I prefer a monthly incentive for the service providers and the spa reception staff, but certainly quarterly at a minimum.

Learn more about the type of marketing and special events being offered by the line, such as new product release calendar, gift with purchase and other promotions. Ideally you are putting these on your spa's annual marketing calendar and thinking through the timing for optimal results.

A good rep is a critical aspect of a partnership with a skincare line. Frequent rep turnover can be a red flag that the company is either not financially stable or has a short-term focus and is giving their reps unrealistic goals. Be sure to ask about the sales rep's history with the company during the initial conversations. The best reps take a vested interest in your business and help you grow treatment revenue and teach retail conversion skills. When your rep is a real pro, you may even consider sharing retail-to-service stats, facial sales, retail sales, and setting goals together. Many spa directors do not have retail backgrounds and can benefit from their reps' knowledge, many of whom hail from cosmetic counter retail experience.

Product Reputation and Brand Awareness

There is a balance to be struck between a line that has an exclusivity to it and one that a guest has actually heard of. Ask about their public relations and marketing campaigns in consumer media and how they help consumers locate spas that carry their line. It's not uncommon for a client to come into the retail shop with a page torn out of a magazine and purchase a product without even experiencing a service. 

Inquire about what other spas and retail stores the line is carried in. The right retail store can help with a perception of quality, just ensure that they are enforcing all stores sell at the MSRP (manufacturer's suggested retail price) so you don't lose a sale to the cosmetic counters. Similarly, finding out what other spas carry the line (and for how long) is important. I typically ask for exclusivity in the county but am fine with regional competitors carrying the line. We make a handshake agreement on their expansion plans and I ask that they have a conversation with me before signing a contract with a new spa in the region. This keeping in mind that my side of the bargain is a multi-year relationship, frequent engagement and open communication.   

Ask your estheticians and a handful of trusted clients for their thoughts on the brand. The more opinions the better. Reach out to your industry colleagues who have worked with the line and get their thoughts on the pros and cons as well.

Company History and Focus

The story of a skincare line is vital. Guests want to trust the intentions of the line and believe in the brand promise.  It's also good to learn about their business roots. Did they start in retail, medical offices, direct-to-consumers or spa? What portion of their business is spa? Who is on the team and what is the structure? You want to feel confident that the line will be around long into the future and will continue to develop products and experiences for the spa and consistently support your operation.

It's also important to know if they sell online direct to consumers. Guests will purchase from you on the day of their service for convenience but if the vendor sells online and you do not, you will likely lose the continued care sale. Even if you do not offer online sales currently, find out what the skincare line's stance is so you know your options. The least ideal scenario is that you both offer online sales, but they won't allow you to offer the product online. Finally, the A word… Amazon. Learn more about what resources they have to police resale of their product and knockoffs, as this is a growing problem.

Packaging, Price Point and Margins

Unique design in packaging of retail products is imperative, as spas often don't have the budget for a dedicated retail associate, and the client could be browsing unattended. The product should be eye catching, jump off the shelf, and clearly communicate the benefits. If there are multiple ranges within the line, it should be clear what need each range is meant for (i.e. hyperpigmentation, lifting and firming, problematic skin, sensitive skin, etc.)  Find out how many SKUs they offer. You likely only need half of them or less.

It's also advisable to ask how often they change their packaging and if they will swap out your old product when new packaging launches. By human nature we are drawn to shiny new products, so displaying both old and new product on a shelf as you sell through inventory is something to be avoided at all costs.

Determine the shelf life of the products before opened and estimate your sell-through to plan your order wisely, and never let a rep write an order for you. It seems like a kind and convenient offer but even the best intended reps will draft an opening order much larger than you really need.

Price point and margins are hot topics these days. Know your clientele and their price tolerance really well. Your team is a great resource for this. Have them ask the guest what they are using now and report back to you. This will give you a feel for the price point they are comfortable with. In some markets that may be $60 and some markets it may be $700++.

We typically have at least two lines, one for the easy, same-day sale and one for the luxury, results-driven focus. Offer a minimum of two lines and a maximum of five, depending on the size and volume of your spa.

Product margin is more critical than ever, with many budgets expecting a cost of sales below 50%. Gone are the days of the 2x keystone mark-up. Find out if the line will allow you to sell above the MSRP (if they sell online this strategy won't work) and even better, if they can offer you a wholesale price below 50% of the MSRP. Many are open to negotiating based on volume. It will usually come in the form of a free unit with the purchase of a case of 12.

Further Considerations

  • Consider your current pain points and gaps in offerings. Give the rep your challenge and see what solutions they can offer.
  • Determine shipping fees.  This alone can be a deal-breaking margin-killer.
  • Ease of billing and terms. Ideally, they accept purchase orders and Net 30 terms, but your property may be perfectly fine with credit card orders.
  • If phasing out an old line, ask the new line if they will buy your inventory. This is less common than it used to be but it's worth an inquiry. Markdowns on skincare rarely moves out old product so it's a significant financial consideration before moving forward with a new line.
  • Ask about the brand's community outreach and conscious capitalism initiatives. We are seeing a growing trend in new product lines that are healthier choices for body, community, and environment. Some lines plant trees, some donate a portion of proceeds to charities and some even have B Corp certification. As younger generations gain the means for more and more travel, they will gravitate towards the more conscious lines.

Conclusion

The process of selecting a skincare line requires a serious dedication of time and resources. It is not a decision to be taken lightly and should not be rushed. Choosing wisely can make a huge impact on your brand and translate to tens and even hundreds of thousands of dollars of additional annual profit. The science in skincare continues to evolve, so be sure to regularly chat with your esthetics staff, monitor Environmental Working Group's Skin Deep website and spa industry publications, as well as attend conferences and network with your peers.

Best of luck with your search!

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    • Imagine stepping into a hotel lobby and feeling instantly transported. Not by the grandeur of the architecture alone, but by a subtle, woody aroma with a hint of tranquility. Not just hearing conversation, but feeling the soothing pulse of music easing the day’s tensions. Not simply seeing a beautifully arranged floral display, but actually smelling the silky petals as you walk by. This is the power of sensory marketing, a curated orchestration of sight, sound, scent, taste, and touch that transforms a hotel stay into an unforgettable experience. In a world full of visual stimuli, hotels are discovering the profound...

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Amy Draheim Raising the Bar in Hotel F&B
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Ayana Rodriguez Why Intentional and Engaging Junior Activities Programs Lead to More Reservations and Revenue
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