While the pandemic contributed to an influx in hot tub and swim spa sales, it also disrupted business practices, leading to unprecedented delays, product and labor shortages. Now that the smoke has cleared, retailers and manufacturers are assessing what went wrong, what went right and what this experience will mean going forward.
For Troy Bull, hot tub sales specialist for NB Pool & Spa in New Braunfels, Texas, the pandemic prompted a change in inventory purchase and management. As new customers flooded in, the business had to respond to the increased demand and secure additional products.
“Once the pandemic hit, we just couldn’t get spas,” Bull says. “You had to change the way you were managing your product flow so that you always had something to offer clients. And if that manufacturer didn’t work out, we went and found other manufacturers that had inventory so we could keep up with demand.”
The struggle to secure stock during the pandemic was felt throughout the industry. Melissa Kennedy, chief operating officer for online retailer Pool and Spa Supply Store in New Port Richey, Florida, says its spa sales increased so much in 2020 that its manufacturer stopped taking orders. “And they have not yet, to this day, started taking orders,” she adds. “So we have not had any spas for sale on our websites for over a year.”
As delays mounted and inventory issues persisted, retailers like NB Pool & Spa had to deal with frustrated customers. What helped ease some of those frustrations, Bull recalls, was maintaining transparency and good communication. “I think the customers, at first, were frustrated, but then at a point, it just became, ‘That’s just part of life,’ ” Bull explains. “I mean, it’s no different than anything else you’re trying to buy. They just understood. That’s just the way it was.”
Amanda Hargrove, co-owner of NB Pool & Spa, says that during this time, her business built a healthier relationship with customers. “Instead of being one or two touch points of communications, it turned into months of communications,” Hargrove says.
That increased communication helped keep the retailer’s customers in the loop, every step of the way, which Bull believes was key to assuring customers that their new hot tub wasn’t being held in limbo.
“We changed how we were buying, preparing and working, so that customers knew we were trying to get it to them as fast as possible,” Bull says.
For many, this period had become a stress test for the spa retail industry, which had to find quick solutions to manage issues with the supply chain.
“To overcome the disruptions, we are talking to new suppliers and manufacturers and bringing in products to our location to ship ourselves instead of drop-shipping everything,” Kennedy says.
While many retailers would typically use sales events, promotions and special offers to drive customers to their doors, NB Pool & Spa chose to abandon such activities during the height of the pandemic, as it found marketing to be an unnecessary expense at a time when customers were already banging down the doors.
Another reason for abandoning discount sales, was the unpredictability of the market.
While NB Pool & Spa registered a significant spike in consumer demand for its spas and accessories, it also had to overcome soaring freight expenses and “unknown costs,” according to Hargrove.
“We would order something at one price and by the time we got it, freight had gone up three times,” Hargrove says. “So, we couldn’t give a lot of sales and incentives because we did not know what our bottom line would be.”
The combination of bottlenecks, soaring costs and high demand, just made sales, promotions and special offers untenable.
“During the pandemic, I don’t think we had one sale the whole two years,” Bull says.
“No,” Hargrove replies. “The sales [event] was: We had a hot tub, and talked to you, ‘You want it?’ ”
The sales [event] was: We had a hot tub, and talked to you, ‘You want it?’ ”
Amanda Hargrove, NB Pool & Spa
But now that supply shortages are easing, the hot tub and spa industry may be returning to something resembling “normal.” This means that retailers are reconsidering past marketing strategies. Hargrove, for example, says that NB Pool & Spa is bringing back promotions.
“Now, we have a better grasp on our costs that we can offer more competitive prices,” Hargrove explains.
Bull adds that the company is reverting to several past marketing techniques, including special offers and sales. “During the pandemic, lead times became so long that things were just spread out,” Bull says. “So now, with so much more competition going on, we’re going back to some of the old [things] that we did.”
Despite the challenges, the pandemic had presented unique opportunities. As such, some spa dealers have reimagined the relationship with customers, all while delivering hyper-personalized experiences.
Some of the lessons learned during the COVID-19 crisis can be applied in the long-term. For instance, NB Pool & Spa plans to maintain increased interactions with its clients.
“We do a lot more communicating with the customer,” Bull says. “Constantly saying ‘this is what’s going on’… a lot more communication than before. Giving them an idea of what’s coming.”
Some changes, Hargrove says, the business will happily do without, having discovered the pitfalls of curbside pickup and contactless solutions. According to Hargrove, the company employed curbside pickup solutions for a period, but then, they abandoned it, because it limited personal connections.
“We chose not to continue that because we felt it put a damper in our relationships with our customers,” Hargrove says.
She adds that the interaction felt too transactional. “We were no different from Amazon,” Hargrove says. “When customers would come into our store, we were able to talk to them and continue that relationship. The average ticket sale was the same whether they were buying it on curbside or whether they were buying it in the store, but I felt that the repeat relationship was really important to us, so we did not continue the curbside pickup once the COVID numbers went down.”
At the same time, Bull highlights another hard lesson learned by many retailers during the pandemic. As the company couldn’t get stock from U.S. manufacturers, it tested the water with an overseas order, but congestion at clogged ports threatened the success of the order.
“We did bring in one line from overseas,” Bull says. “But then, it was coming into Los Angeles and the freight was just sitting there, not moving. It pretty much lost all of its advantages because of just the huge delays in getting it processed.”
Compared to other industries that have been hit hard during the pandemic, the spa retail industry has benefitted from shifting attitudes and new consumer habits. Perhaps going forward, customers too will benefit from the shifting attitudes and new habits formed within the spa retail industry itself?