ADVANCED DIPLOMA IN BUSINESS MANAGEMENT

ADBM 19.3P

Marketing Management
GROUP ASSIGNMENT

Prepared by
M.U.A. KAVINGI - COADBM193P-011
M.S.E PERERA - COADBM193P-012
W.N.H PERERA - COADBM193P-037
K.K.C.V PERERA - COADBM193P-036
B.S.A.R FERNANDO - COADBM193P-021
N.A IMANKA AKASH - COADBM193P-032
SHIRANTHA ARNOLDA - COADBM193P-034
P.M GAMANAYAKE - COADBM193P-056

DATE OF SUBMISSION – 24th May 2020

 Content

Page Number

1. Story of Spa Ceylon 01

2. Components of the Marketing Environment (Macro and Micro) 03

3. SWOT Analysis 05

4. Methods used in segmentation & Targeting 06

5. Pricing and communication strategies 08

6. Current issues and Recommendation 10

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The story of Spa Ceylon

The Spa Ceylon Ayurveda is more than a trademark in the field of natural health and beauty products
in modern Ayurveda beauty care in Sri Lanka. Its main target is to offer customers total natural
wellness through the highest quality ayurvedic services. Spa Ceylon products are formulated only with
the finest natural ingredients, including organic essential oils, organically grown fresh Aloe Vera, virgin
coconut oil, Ocean salts & Ceylon spices. As the pioneer luxuries traditional ayurvedic brand in Sri
Lanka it was originated in 2009 by Mr. Shiwantha Dias and Shalin Balasuriya. First spa was open in
2010 on focusing wellness and beauty treatments and now 14 outlets are operational in high end
urban locations. It also facilitates the national airline and many leading hotels in Sri Lanka. Spa Ceylon
encourages environment friendly concept and supports human rights. It is always against child labor.
All the products are alcohol free and contain no animal-based ingredients. Spa Ceylon is committed
to maintaining close working relationships with all of its distributors offering services ranging from
retail store design, customized marketing plan and strategy to achieve the perfect mix of luxury retail
distribution worldwide. Company has a unique theme of green and black color which represents the
nature and earth. Spa Ceylon brand is already expanded internationally among 07 countries. Including
Russia, Turkey, UAE, India, South Africa, Japan, Maldives.

Overview of Spa Ceylon

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Spa services

Spa Ceylon offers more than 25 very well designed its own treatments with Sri Lanka’s rich Ayurveda
heritage and old rituals performed in grand places in ancient Ceylon. All Sri Lankan team with fully
trained highly skilled therapists gives its customers head to toe luxury experience with old Ceylon
charm. A customer who enters will be welcomed with a good aroma which leads them to calm and
relax the body music which plays lead them to relax their mind and soul every detail of Spa Ceylon
designed to fulfill the customer experience.

Spa Ceylon services

Spa Ceylon provides more than 25 different types of services in few main categories such as

Body massages

• Kandyan body ritual

• Royal body ritual
• Royal body ritual with full body scrub

Calming & De-stress massages

• Sleep therapy calming foot rituals

• Sleep therapy calming body ritual
• Sleep therapy calming scalp rituals

Foot massages

• Ultimate foot ritual

• Luxury foot ritual
• Foot rescue ritual

Head, neck, back & shoulder massages

• Head, neck & shoulder ritual

• Stress relief ritual
• Scalp massage ritual
Components of the Marketing Environment (Macro and Micro)

Micro environment

Suppliers

Suppliers can sway the success of the business if they have the power. Spa Ceylon Ayurveda has a
community trade program, in which they grow their own organic medicinal plants, packaging materials
through local farmers and suppliers.

E.g.

1. Aloe Vera cultivation in Kalpitiya.

2. Packaging materials sourced from the Kalutara district.
3. Mostly use essential oils for fragrances which are produced locally.

Customers

The brand is aimed at high-end tourists and locals, and targets providing a lifestyle of fulfillment and
natural wellness with the touch of ‘Ayurveda’. They also reached their targeted market by locating
their spas and boutiques in local shopping malls and hotels.

Competitors

Spa Ceylon has competitors such as Nature’s Secrets spa, Beauty Spa, Kemara, Prana Lounge and
Siddhalepa. Spa Ceylon offers a list of more than 25 wellness treatments from Sri Lanka's Ayurvedic
heritage which has been practiced since the days of the old Kings of Ceylon.

Partners

They have opened their boutiques and spas in many shopping malls, hotels, and high-end retail stores
in Sri Lanka. They have also commenced duty free operations, in-flight service and worldwide stores.

E.g.

1. Their first boutiques were opened at Crescat shopping precinct and Spa, and at Park Street
Mews which was located in an old tea warehouse from old Ceylon.
2. They also have hubs located in Seychelles, Saudi Arabia and Europe.

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Macro Environment

Demographic Environment – Their boutiques, spas and product packaging were inspired from the
heritage of beautiful art from the various kingdoms of Sri Lanka.

Economic Environment – The success for Spa Ceylon’s expansion thus far is that they have introduced
their brand as not just a spa, but a lifestyle as well. They have gone beyond the word ‘spa’ and
produced their own products to use for their services, changed their interior design that gives the
feeling of the ancient Ceylon theme, while even the fragrance while entering their boutiques is
soothing to a customer’s mind. The management does not get complacent with their current
strategies and strives to continue their rapid expansion operations.

E.g. They have started with 25 store keeping units in 1 boutique and it has been increased to 500 plus
units.

Natural/physical Environment – Most of the products that is used for their services are manufactured
themselves & are eco-friendly. They are also formulated with the finest natural ingredients and
organic essential oils from Sri Lanka. Spa Ceylon encourages human rights and is against child labor
and animal experiments. They especially use non-alcoholic/non animal-derived ingredients and
products.

Technology Environment – Their concept is widely known as ancient Ceylon Ayurveda, but they are
wise to do all services, marketing, branding and packaging using modern technology.

E.g.

1. Spa Ceylon launched their Global online store in 2011.

2. Created custom nail designs according to client’s desire by using computer applications.

Political and legal Environment – After 30 years of civil war in Sri Lanka the government relaxed
certain laws and policies is an attempt to improve tourism in the country.

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SWOT Analysis

Strengths Weaknesses

• Customer loyalty • Too narrow a

• Product flow customer base
• Modern production • Lack of trained staff
• Niche • High cost marketing
and branding

Opportunities Threats

• Global presence • Emerging

• Alliances and • Competitors
franchising • Adverse social and
• Integration cultural influences

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Methods used in Segmentation & Targeting

Marketing Segmentation

Mainly Spa Ceylon introduces their services and products according to the ancient
Ayurvedic recipes to the 21st century, which helps to make human lifestyle better. For that, Spa
Ceylon has to select their customer base accordingly.

1.Demographic

Spa service is still a new concept to Sri Lanka. Therefore, focusing groups are high-
income foreign individuals who travels extensively and also people who spend a luxury lifestyle in Sri
Lanka.

Current Sri Lankan Spa therapy market can be segmented under 03 categories.
1. Income level of Clients
a) Medium class earner
b) High class earners
2. Gender of Clients
a. Male
b. Female
3. Age of Clients.
a. 18-50 adults

2. Geographically
As per for this segment Spa Ceylon service is mainly focusing on high-end tourists and Sri Lankans who
earns well. Since most of the rich people are living in urban areas, Spa Ceylon has positioned their
spas in urban Areas.

3. Psychographic

Since the travellers and people who live in Sri Lanka are mostly concerned about the wellness, Spa
Ceylon is also focusing on wellness.

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4.. Behavioral

Products that are being used for the therapies and other spa services in Spa Ceylon are formulated
only with the finest natural ingredients, so the consumers who visits get to experience one of the best
spa services that’s available in the country as their using their premium line of products for their
spa treatments. E.g.: - mind relaxation therapy, body relaxation therapy.

Targeting

There was no iconic spa service in Sri Lanka 20 years back. Due to this reason Spa Ceylon has started
the spa service in Sri Lanka and made it a huge success. Therefore, so many foreigners and Sri
Lankans have started using this Spa Ceylon brand. By identifying the targeted market Spa Ceylon has
made a huge turning point in Sri Lankan Spa Sector.

1) Size

Spa Ceylon’s targets both high end locals and foreigners. There are no
specific gender restrictions, but they do not encourage elderly people to get their spa treatments.

2) profitability.

Spa Ceylon’s charges are remarked as very high in price in comparison with their competitors. This
means that they target high income earners in current market. Also, we cannot find evidence that
their aims are also directed towards matured citizens (elder than 60 years) as their
customers. Therefore, we can assume Spa Ceylon targets high income earners and young people as
their clients. Also, their therapy parlous have located in both urban areas and 5 starts hotels.

3). Easy of reach

Spa Ceylon is the most reputed spa brand which used in most of the hotels nowadays. They have
identified reaching to hotelier sector as the easiest way to reach their local and foreign customer base.
This also will help to expand their customer base into a wider range.

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Pricing Strategy
Pricing of a product is one of the vital elements of marketing mix. It is the only element that produces
revenue for the organization.

Pricing strategy is mainly built on the strong brand equity

Premium pricing is the pricing strategy used by spa Ceylon, where the products are sold at a relatively
high price because of its uniqueness and benefits gained by creating a delighted factor among people.
As we all know the main objective of Spa Ceylon is to bring out the rich hidden Auverdic treatments
and culture of Sri Lanka (which they brand as Ceylon) to the International Luxury Segment.

Premium Pricing is used as the strategy in Spa Ceylon due to the below mentioned facts

• The parent company is Janet Cosmetics and has a very well established base / platform to
launch as an exclusive Luxury Brand.
• The Auverdic heritage of Sri Lanka has never been marketed or emphasized before in such
magnitude scale within the market.
• The potential customer base for a prestigious local product such as Spa Ceylon is substantial
while also creating a unique inability for the average consumer to purchase the same.
• They can set a benchmark price for products and services since the market is niche.

Luxury brand pricing strategy is fundamental to find the right balance between exclusivity and
availability.

Since Spa Ceylon has introduced the multi-way product line into cosmetics and its herbal products the
organization had used the premium price strategy, which allows to maximize the revenue of the
company from the promotion to the one who are willing to pay higher price, with the price of
promotion to attracted segment to show that the price is sensitive to customer. This is because once
using this segment to test the market, many new customers will look up for further sales on the
company and will start to get interest on the company’s sales and products. Spa Ceylon practices are
not on aimed for the high return of profit return in short period. They also aim for building good
relationship with their customer and keep the sales and the loyalty of the customers intact.

Advertising.

Spa Ceylon caters to eleven countries at present and has a very intense advertising campaign. Mostly
they will use seasonal design with seasonal themes to attract their customer in the special collection
of the limited products and services in each category. They employ profile Indian models for the
advertisement campaign to create luxury in people’s mind.

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Consistency

Consistency and transparency in pricing will reinforce the trust and authenticity of the brand. Spa

Ceylon provides the consistency throughout all the products and the service centers nationally and
worldwide. The customer experience, the ambience provided are on par in every branch in the island.
Each product from the packaging to consuming has its wow factor and premium feeling. Further there
are no specific grades or qualities based on the region meaning therefore that it is universal for all the
products.

Pricing is done mostly by using the currency USD where it will apply and look uniform throughout all
the countries. Given that the prices of the products do not vary between continents there is where
there is consistency maintained in the pricing mechanism.

Health and Wellness Collaborated with nature

Fighting urban pollution and to admire the use of natural ingredients are also a key aspect being
shared with the public by Spa Ceylon. They focus on protecting your skin from damaging blue light and
caring for your face with toxin-free products. Their quest for wellness and a healthier lifestyle is
transforming attitudes towards the beauty industry.

Personal Selling

The Spa Ceylon Team is very well trained to promote the product with very adequate knowledge on
the products and the services offered by them and is also very well trained effectively. Attractive
attitude, appearance is also a keen area where the staff is successful to build a relationship with the
customer to create value added service.

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Current issues in the organization and recommendations
1. Managing off-season operational expenses -Spa Ceylon target customer base is aimed at high-
end tourists and locals; major part of their revenue is generated through the income from the high-
end tourists. Due to having off peak tourist season, it is very hard to manage the operational expenses
during off season and the company must totally rely on the local high-end customers which is a very
narrow customer base.

Recommendations- This issue can be resolved by Introducing special offers to the existing
customers and encourage them to have more often visits to obtain the services and by
selecting organizations and introduce cooperate packages to the cooperate sector employees.

2. Managing existing customer – Even though online booking system was already established
customers tend to do more bookings over the phone and there's also walk in customers. There were
certain issues regarding managing online appointments, over the phone appointments and walk in
customers. And there were lot of complaints regarding customers waiting for extensively long periods
even after making prior appointments for that relevant time slots.

Recommendations – Improve the online booking system and making it more user friendly so that
people with weak computer literacy can even use it. Encourage customers to use online booking system
by introducing special offers to newly registering customers to the online booking service. And to
minimize the customer waiting time Introduce an automated system to manage between
online appointments, hotline appointments and walk in customers.

3.Lack of trained staff

When we pay our attention to customers who had their services, according to their experiences there
are certain issues in the organization such as lack of trained staff, incomplete communication between
customers and staff and organization couldn't understand what really customers are expecting.
We did a background research about what customers really expect from this organization. We were
able to get customer`s feedback on internet. And did a research on their comments and suggestions.
Considerable amount of reviews we found out regarding Lack of trained staff.

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Recommendation - Eventually we came up with a practical solution for this lack of trained staff issue.
To avoid such issues, organization needs to start a proper training program for their staff. That
program should focus about how therapists satisfy their customers. Having practical training program
with organization`s expertise and training staff need to perform essential practical activities will be
great advantage for company reputation. Because in this wellness spa industry therapists play a vital
role in maintaining the brand image and the reputation of the company.

4.Finding the right staff – One of the major issues that are being faced by the wellness spas are finding
properly qualified therapists, beauticians and support staff. During the employment process there was
no proper method to evaluate their skills since it’s a hands-on
job.
Recommendation – To overcome this issue if it's hard to find well trained recruits for the job the
company can introduce training courses and use experts in the industry to train the existing staff and
certify them by their own institute , also they can advertise the vacancies internationally
and recruit more overseas recruits who are trained and well experienced for the job. During the
employment introduce new recruitment process which evaluate a person's practical skills in a more
effective manner.

5.Limited customer base

Spa Ceylon brand, whether it is the product or the treatments, it is an experience. The organization
target is to offer the customer a luxury experience. Organization`s target is mainly high-income
individuals who travel extensively. The brand is targeted towards high-end tourists and accordingly
they have positioned the brand. Because of that, they have limited customer base. Having limited
customers is not good for company. Value of a single customer is comparatively higher than other
companies and the impact by loss of few customers can even have a considerable effect on the
company sales when compared to another company of the same range with a wider customer base
and individual customer value is less.

Recommendation – The company should pay individual attention on the products and the services
offered to the customers and the level of satisfaction of the customer towards the product and services
offered by the company to them. They should be more aware of the comments and the reviews
they get through the online media since majority of their customers are the tourist who visit the
country and they look into these reviews before getting a product or service from a company. Its better
if they can introduce new ways to get the customers feedback such as asking them to rate their
services and comment on their experience. They can individually address to their issues as per why the
service or product brought them an unsatisfactory experience.

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Referencing
https://www.tripadvisor.com/Attraction_Review-g293962-d2233594-Reviews-or145-
Spa_Ceylon-Colombo_Western_Province.html#REVIEWS

https://lk.spaceylon.com/spastory#

http://www.ft.lk/lifestyle/Wellness-in-motion-Spa-Ceylon-to-celebrate-Global-Wellness-
Month-in-June/8-656319

http://www.businesstoday.lk/searchresult.php?start=6&p_f=0&Sort=&txtsearch=spa%10c
eylon

http://bizenglish.adaderana.lk/spa-ceylon-wins-asias-greatest-brands-2018/