Spas and salons

Andrew and I are working on http://spaciety.com (think "Spa + society" for pronunciation) -- I've been calling it the "Expedia/OpenTable for Spas", but same idea.

We're at the Brandery in Cincinnati Ohio now trying to blow this up and we've ended up thinking a lot about different verticals that this might apply to.

One of the interesting things is that its actually difficult for us to decide what our pitch for Spaciety is.

To me (and I think a lot of hackerish types), the core value proposition is 1. "Information transparency and aggregation".

What I perceive to be the biggest pain point is the fact that to make a decision about a massage, you need to determine (a) availability, (b) pricing. That information is basically not available online. The SOP is "call 3 spas and ask if they are available at time X".

This was the case for plane tickets 10 years ago as well. If I didn't have [hipmunk/$OTHER_FLIGHT_AGGREGATOR] handy, it'd suck. This _IS_ the primary value provided by flight aggregators and the model serves itself well.

However, we struggle with it because our customers and market research (read: free online surveys) indicate that users what DISCOUNTS. So the core value proposition perhaps should be: 2. The best prices, not UI or accessibility (what I believe hipmunk and expedia/travelocity sell).

Unfortunately this is a metric we can't really compete on because of the market structure.

Hipmunk doesn't have to answer to this because the flight market isn't as fragmented as $OTHER_SMALL_BUSINESSES so they don't try to fight the PRICE fight with Groupon, LivingSocial, even Amazon and Yelp offering at LEAST one Spa service a day at 50% off. While we could negotiate for insane discounts, spas we work with (over 100 now) basically HATE these coupon sites because they get blown out with zero profit appointments for the next month and dont get return customers. Repeat dealsite vendors in the spa industry are a rarity for exactly this reason. However, there are over almost 2000 spas and salons in Chicago, so group buying sites can just burn one at a time, continue to offer a new cheap deal every week, and consumers whose primary decision criteria is price will never need an aggregator.

So all the while, we've been thinking we're selling convenience and information transparency and we're basically just making customers "almost really happy" on this other hugely important value criteria.

This has made our niche really small: Since its clear that only a minority of consumers care about UI, transparency, convenience and -- and we can't compete on absolute price alone with dealsites, our value proposition is a qualified:
1. We can give you the best price today (if you buy a LS deal today you probably can't use it immediately)
2. We can give you the best price near your house (we offer discounts at all our spas and have wide coverage, but dealsites offer 1 a day)

So we don't win entirely on price, but we can win on "Agony" (to borrow from the hipmunk guys), which is basically the right combination of price and time/position convenience.

Basically my long winded way of saying "I think you need to have an industry with very little price competition in order for the aggregator component to be a huge selling point."