EVOE SPRING SPA

-DECISION REPORT

WRITTEN ANALYSIS AND COMMUNICATION

GOWTHAMRAJA T
P15045

13th September 2015

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MEMO
EVOE SPRING SPA

Date: September 2015

From: Gowthamraja, Executive assistant, EVOE spring spa.

To: Gopal Raman, Anil Kumar, and Sumit Gupta.

Subject: Decision reports on which positioning concept should EVOE select for its
business.

Report on which of the positioning concepts should be selected for new venture Evoe
spring spa is enclosed after considering all criteria and available options.

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Executive summary
After a stressful corporate job, the three new generation entrepreneurs wanted to
open a new venture named Evoe Spring Spa, which helps in relaxing and rejuvenating
people after a long hectic week. The trio conducted series of research about the spa
industry, consumers, and segments of consumers and arrived at three positioning
concepts, of which one is to be implemented on Jan 1, 2011.

To select one among Affordable Indulgence, Affordable health and little vacation
we evaluated three criteria a) likely impact on health and beauty b) impact on competitors
c) Affordability and accessibility.

Based on the above three criteria it obvious that Affordable indulgence ticks all
the required boxes and consumers also stated that they would try if its price is reduced.

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Table of Contents

Situation Analysis: ......................................................................................................................................... 5

Problem statement: ...................................................................................................................................... 5
Available options:.......................................................................................................................................... 5
Criteria for Evaluation: .................................................................................................................................. 6
Evaluation of options: ................................................................................................................................... 6
Recommendation Plan:................................................................................................................................. 6
Action Plan: ................................................................................................................................................... 7
EXHIBIT 1 ....................................................................................................................................................... 8
EXHIBIT 2 ....................................................................................................................................................... 8

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Situation Analysis:
With the growing concern among people about the health and to De-stress after a long
week work, people want to relax and rejuvenate by indulging in some wellness activities. Spa
was one of such wellness activities, which reduces stress and makes them feel good about life. In
India, spa segment was nascent when compared to the international markets. After own
experiences with their stressful corporate jobs, the three friends (Gopal Raman, Anil kumar,
Sumit gupta) were in search for relief. They couldn’t afford to pay the steep prices charged for
the regular massage at hotel spas, despite of their well paid jobs. They also felt some other
working professionals would also be in need of relief after their hectic work schedule. They did
some research about the spa industry and found that the industry was growing at faster rate in
India. So they decided to start a new venture called EVOE SPRING SPA, which was about to
begin in Jan 1, 2011. The trio also identified that market in India was very competitive and
choosing the best possible positioning would be crucial.

The co-founders of Evoe decided to research and analyze Indian spa industry in various
stages. One of such stages of research were understanding the consumer, Raman was in-charge
of this and he conducted focus group discussions (FGD) among people of all ages of both
genders which include working professional, self employed and Home-makers. From FGDs he
identified some concerns among people were: high price, for relaxation they don’t want to spend
a lot of money. Second one was accessibility, as viable spas were far away from their home.
Third one was that people felt spa was considered as socially and culturally unacceptable in
India.

Second stage of the research was identifying the consumer segments. The trio thought it
would give the clear picture of which segment that we would be targeting. They plotted a map;
affordability on one axis, approach to wellness on the other (See exhibit 1). The area on the high
of the map on both wellness and affordability presented an exciting proportion for Evoe because
it was fairly empty and uncluttered. For different segments of consumers see exhibit 2.

Finally the trio thought that choosing the right segment and finding a strong and relevant
positioning would be a challenging task. After serious discussions among themselves, they
finally arrived at three distinct positioning concepts- Affordable Indulgence, Affordable health
and little vacation.

Problem statement:
A decision regarding which one of the positioning concepts (Affordable Indulgence,
Affordable health and little vacation) needed to be selected for business in emerging Indian spa
market and how to alter the consumer attitude towards health spa market.

Available options:
1) Affordable Indulgence
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 2) Affordable health
3) A Little vacation

Criteria for Evaluation:

1) Likely impact of health and beauty in a short span of time
2) Likely impact on competitors
3) Is it easily affordable and accessible?

Evaluation of options:
1) Affordable indulgence:
People actually comprehend what this spa was all about and if prices were lowered
they would be tempted to try this therapy. Working women also wanted to try but huge
price hampering their wishes. Advantage being a “feel-good” therapy it would not aim to
disturb consumer’s perception. Challenge was to convince consumers that drop in price
did not constitute a quality.
2) Affordable health:
Creating awareness about spa benefits and how spa could aid health would be a
biggest challenge. Creditability was important for consumers to believe it. Affordability
and communication would never be an issue, as health would be taken seriously by
almost all consumers.
3) A Little vacation:
Everyone wants to go vacation, if the spa retreat was closer to home so everyone
in the family could go for vacation frequently. Challenge would be, vacations are
seasonal so it might create inconsistent flow if unable to change perception among
consumers.

Recommendation Plan:
I would recommend the co-founders of Evoe spring spa to go with Affordable indulgence,
as it is ticking all the evaluation criteria such as accessibility, affordable price, to relieve stress
and gives happy state of mind, etc. Various consumers segment such as Climbers, Racers and
Sprinters shown reasonable amount of resonance towards affordable indulgence. But much effort
has to be made to convince people under snails segment. With attractive and affordable price we
could easily persuade those people under snails segment.

Affordable health poses some serious competition to affordable indulgence but it’s very
unlikely that people would go to spa for improving their health issues. Also little vacation didn’t
get much resonance from various consumer segments. So it’s safe to go with affordable
indulgence as their positioning concept.

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Action Plan:
As we know that people understood what affordable indulgence spa was all about and many
people told that if its price was lowered they would try this spa. So we need to convince people
that lowering the price of the spa retreat don’t mean that we are compromising the quality. By
lowering price we can convince consumer under snails segment, which constitutes the large
amount of population (see exhibit 2). Then if we look at the exhibit 1, the area marked in the red
(Target area) was unexploited and uncluttered. Our target is to exploit those areas and pose some
serious competition to neighborhood spas. Consumers had also stated that were vary of rapid
growth of spas so they were inclined towards trusted brands. We can easily capture those
neighborhood spas (unnamed brands) if we provide a good brand value to consumers.

Words count: 919

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EXHIBIT 1: POSITIONING MAP OF CONSUMER PERCEPTION OF BRANDS
(AFFORDABILITY Vs APPROACH TO WELLNESS)

EXHIBIT 2: INDIAN CONSUMER SEGMENTS (WITH APPROXIMATE POPULATION)

Population

SNAILS
CLIMBERS
RACERS
SPRINTERS

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