COVID-19 shutdown motivates retailers to sell accessories online
When the nation went into retail shutdown state-by-state in early March, many spa retailers found themselves scrambling to continue turning a profit while their showroom doors were closed. Virtual conference calls became the norm for some to sell hot tubs, but accessories and chemicals proved harder.
Eric Cassidy, vice president of Valley Pool & Spa with seven locations in Pennsylvania, says his store did not have an easy way for customers to purchase from them in the shutdown. “Curbside was still a hardship, and a lot of customers didn’t want to do it, with about 99% [of our customers] participating in the stay-at-home order.”
In mid-March, Cassidy’s business relies heavily on hot tub sales, so Valley had to find another source of revenue. In just six days time, the company had an e-commerce website.
Valley wasn’t the only company to recognize this pressing need. Clarity Pool & Patio in Auburn, Indiana, also got online sales going immediately, says Ken Thompson, owner and CEO. “With the changes in society brought on by the COVID-19 pandemic, we needed to create an e-commerce option.”
Hot Tub Products, an accessories manufacturer in Wallingford, Connecticut, has offered online store options for its products for years but saw increased demand with the pandemic shutdown and updated the online store as a result with a fresh new look and more listings. Andy Tournas, president of Hot Tub Products, says customers were excited to see it launch.
The e-commerce sites for Hot Tub Products dealers have two options. The first is the Premier Program, which is an e-commerce of Hot Tub Products’ full offerings integrated into the spa dealer’s website. HTP takes care of logistics, the dealer does not have to buy inventory and product is shipped to the customer directly from HTP, with a percentage of the sale going back to the dealer.
Alex Washington, owner and sole employee of Hot Tub Service Maryland in Bel Air, Maryland, added the premier website program to his business three years ago. Washington, a 17-year industry veteran, says customers go right to the site and purchase the products, and they ship in a couple days.
Washington does not have a retail location, and his service van has limited capacity for carrying products. But with more than 800 annual customers, he can lose revenue if he doesn’t offer an e-commerce site.
“People are going to the e-commerce site because they’re trying to stay home,” Washington says. “I’ve seen an increase because I’m doing more service calls than I normally do during this pandemic. When I talk to new customers on the phone [to set up service], I usually tell them to go to my site to buy chemicals and they will be there when I arrive. It streamlines everything for me, and I have less overhead. The less I have in the van, the better.”
The second website option from Hot Tub Products’ is a standard e-commerce site tailored specifically to the items the dealer wants to provide rather than the entire HTP catalog; additional items such as hot tubs the dealer carries can be added if the dealer chooses. This requires creating individualized menu items on the dealer’s site, and the dealer pays a surcharge to HTP for building it. Dealers who chose the standard option are also doing their own order fulfillment, with the dealer keeping inventory onsite.
Danielle Lavallee Wasson, owner of My Retail Coach, says dealers deciding what to offer on their websites should concentrate on easily shippable products with a low failure rate so they can maintain a positive online reputation and good reviews. “Also offer impulse-buy items,” Lavallee Wasson adds, “like toys, spa scents or convenience items, such as towel holders, coolers and spa surrounds.”
She also recommends making sure your online store matches your company image and branding. “Make it extremely easy to use and take multiple forms of payment,” she adds. “If you have never done [an online store before], start small and build it up as you go,” explaining that this means adding a few items at a time to make sure you can fulfill those orders well, then adding more products later. “And don’t forget that you can also sell services on your site by taking online appointments for servicing spas,” she adds.
Franco Valentino, founder of Narrative SEO, an online marketing firm in Nashville, says the challenge for the retailer is selecting an easy-to-use content management system and appointing someone to manage the product inventory and online store. “All e-commerce storefronts require a nontrivial amount of setup and a generous dose of product catalog tweaking,” Valentino says.
Choice of platform should depend on the number of items the retailer wants to expose online. From smallest number of items to the largest, Valentino commonly sees sites like WordPress integrated with e-commerce platforms like WooCommerce, Shopify and Magento.
Thompson advises building an e-commerce site during the slow season — or, if it’s the busy season, to plan to hire an extra staffer to handle photographing inventory. Thompson learned this the hard way: His online store was nearly two months behind at the time of this interview. “I should have hired someone from a temp agency to handle taking pictures of the products and adding them to our POS platform that will serve as the base for our e-commerce site,” he says.
Valley had a smooth transition to e-commerce since it had been maintaining an online sales presence through third-party fulfillment sites for seven years prior. Cassidy recommends dealers who have never sold online before should hire someone experienced in doing so.
“I recommend hiring someone who has experience with UPS, FedEx and the post office, and understands the logistical side of e-commerce fulfillment,” Cassidy says. “Anyone can put the site together, but if you don’t have that person who fully understands the logistics, you can lose a lot of money very quickly.”
Among the chief logistical concerns: The shipment of hazardous materials, such as hot tub chemicals. There are multiple rules and regulations for doing so, including box labeling. “Most don’t understand these rules,” Cassidy adds. “You can’t put spa shock in the same box with a liquid filter cleaner. There will be big problems if they leak or get exposed to other things en route.”
State and county taxes also need to be applied to sales. Generally, an e-commerce platform can calculate taxes per order once tax rates are in the database. However, the further the sales reach from the site, the more complicated that becomes.
Additionally, preparing for a surge in sales ensures the e-commerce site can stand the test of time. “We work with national brands that have had significant operational challenges with the increase in orders [during quarantine],” Valentino says. “Increases in order volumes magnify weaknesses in e-commerce infrastructure. Low-quality servers strain under the increased volumes, and improper setup of business processes that take orders from the front end of the website to back office tend to fail.”
Dealers adding an e-commerce site will also need to make sure they can handle the additional customer support needs. T.J. Welsh, vice president of marketing at Stryde, an e-commerce digital marketing firm in Draper, Utah, recommends either outsourcing a chat-support service on the website (such as Needle.com) or hiring someone to help customers who aren’t sure what to buy or what they need, Welsh says. “Dealers also need to create video tutorials to educate consumers who want to do it themselves,” Welsh adds.
Local Versus National
The temptation when adding an online store is to jump straight into national sales, but it makes the fulfillment process harder on several fronts. “Deciding to go national increases the complexity of the sales tax issue based on other states’ tax requirements,” Valentino says. “e-commerce platforms can handle the intricacies of local tax calculations, but a CPA with a solid knowledge of sales and use tax should be consulted [for national sales] to avoid surprises.”
Tournas advises sticking with local sales. “We’ve found the only real success [with e-commerce] is marketing to your customer base,” he says. “Otherwise, you’re going to compete online from a keyword standpoint, and ROI is difficult to achieve. Your success ratio is good when you’re dealing with the customers you’ve sold to in the past.”
The Clarity Pool & Patio online store will focus on its local market because Thompson doesn’t see value in trying to compete for national sales. “There are a lot of national companies selling and shipping products, and our long-term success as a company will come from the community we are a part of,” he says.
Cassidy shares that sentiment, mentioning that about 98% of his company’s orders are from local customers. “That’s where our email list is, social media and where we’ve promoted the site because we look at it as an extension of our store. We want to not only create additional revenue, but also additional awareness of our brick-and-mortar stores.”
Promoting Online Sales
Even for dealers that don’t intend to sell nationally, online presence is crucial. Welsh points out that the keyword phrase ‘hot tub’ is searched 246,000 times a month in the United States, excluding searches for related purchases like covers, parts and chemicals. “The amount of exposure a hot tub retailer will get online in one month could be more than it gets all year long at the store,” he says.
Leisuretime Warehouse in Wickliffe, Ohio, has had an online store in some capacity since 2012, but revamped its e-commerce site for the pandemic. Owner, Ted Dellas says his local customer base is his best shot at revenue at this time. “Whenever we run a special in our online store and send that out, we get 150 or so orders,” he says.
Tapping into your local market can do wonders for customer loyalty, too, as Lavellee Wasson experienced. During the stay-at-home order, she needed supplies for her hot tub and the local dealer she frequented closed completely, with no delivery or e-commerce options. After an exhaustive search, she found a store 32 miles away that allowed online orders and contactless pickup.
“They sent us a thank you text after our pickup, which included wishes of good health,” Lavallee Wasson says. She frequented this location for nearly three months before her previous dealer opened its doors: “We have decided to stick with the e-commerce store because they are friendly and efficient. If your competitors provide easy access to essentials, your customers become used to purchasing there — and eventually you lose your customers.”
The Future of E-Commerce
While the burst in online stores for spa retailers may have happened as a result of the coronavirus, e-commerce within the industry may be here to stay. “We had a lot of people in the beginning try it out of necessity, and a lot of those people are now both e-commerce shoppers and brick-and-mortar shoppers,” Cassidy says. “The combination of having e-commerce and brick-and-mortar makes loyal customers more loyal. COVID-19 forced us to try things we wouldn’t in a normal year and we can grow from that.”