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Skin/Spa > Articles > Massage Envy: Massage for the Masses

Massage Envy:
Massage for the Masses

By A.K. Sterling

Want a quick, consistently delicious latte in any city in the world?  Head to Starbucks.  Need the latest crime novel, plus a place to flip through the newest magazines and sip a cappuccino?  Drive over to Borders.  And, if you’re looking for a great massage in a clean, friendly and affordable environment--whether you’re in Santa Barbara or Staten Island--check out Massage Envy.  Here’s the rub: this new entry in the beauty business has unlocked the secret to combining personal attention with mass appeal and profit.

Filling a Knead
When John Leonesio opened his first Massage Envy location in March 2002, he hoped to do
maybe 400 massages the first month. He had not planned to make a large franchise out of the massage membership club. Five or six locations seemed more the speed. But after that first Scottsdale, AZ, location did 1,400 massages in one month and after receiving 30 franchise inquiries in three months, Leonesio quickly changed his thinking. Six years, 4 million massages and 340 locations later, Massage Envy has taken off in a big way across the country. Last year alone, Massage Envy stores exceeded $200 million in sales, a rapid success Leonesio attributes to three basic elements:  1) professionalism 2) convenience and 3) affordability.

As a longtime health and fitness industry veteran who has successfully sold health spa chains to heavyweights such as Bally’s and 24 Hour Fitness, the CEO had seen a change in people’s perception toward massage. “They no longer looked at it as an indulgence,” says Leonesio. “If they got a massage with their workouts, they recovered faster, felt better and it became part of their routine.”  Through in-depth research, Leonesio and his team quickly discovered that massage enthusiasts wanted therapists with whom they could build a relationship, almost like a personal trainer. They also wanted a place where they could book a massage within 24 hours ? not two or three weeks. And they wanted a price that was affordable.  So the corporate team went to work. They designed each well-appointed 3000-square-foot location to feature a large quiet room, an inviting reception area and an average of 12 spacious massage rooms, each measuring about 10 by 11 feet.

They created a schedule in which the locations would stay open seven days a week with extended hours to accommodate the busiest of customers. And they constructed a price model that encouraged loyalty. For a membership fee of $49 or $59 a month, depending on the market, and a six- or 12-month initial commitment, members receive one monthly service plus an additional monthly service for $39.95. Some clinics offer members their choice of massage or facials, and memberships are honored at any location.

Opportunity on the Table
In a $6 billion industry largely run by “mom and pop” massage outfits, the Massage Envy franchise concept has clicked with both therapists and clients. For clients, the high visibility and consistency of the Massage Envy franchise makes it a comfortable fit, particularly with first-time massage clients, who comprise about 24% of the company’s total clientele.

Massage therapists new to the working world also find Massage Envy attractive for its employee package and the chance to build a complete clientele. “We can put them to work right away and start building their clientele immediately,” says Leonesio. Therapists who love the nurturing side of their jobs but hate the business aspect as well as those looking for a part-time gig also comprise a large percentage of the 8,000 therapist Massage Envy workforce.

To work for Massage Envy, the company requires a minimum of 500 hours, and the therapist must be licensed, registered and own insurance. All therapists undergo Massage Envy training to ensure consistency with massage techniques, draping policies and other protocol.
In exchange, therapists receive $15 to $20 per massage plus bonuses and tips and enough hours to fill a 30-hour workweek. Many of the clinics also offer insurance, a 401(k) and paid vacations. And, after a long hard day, therapists can get a little TLC for themselves with services offered at the employee rate of $39.

According to Glennda Donate, franchise owner of the Simi Valley, CA, location, many massage therapists like the flexible operating hours and multiple room setup, which lets them acquire all of their hours at one location rather than hop around from salon to salon to accrue a week’s wage.  For franchise owners, Leonesio designed a corporate model, in which region developers assist the local franchisees with tasks such as finding a real estate broker, builder and architect in their respective markets.

To maintain a highly visible profile, site locators concentrate on open shopping centers (not malls) offering about 3,000 square foot of space. In addition, each location must pass a rigorous demographic profile:  70,000 people in a 3-mile radius bearing an average household income of $70,000. Franchise owners are responsible for the build-out, which typically costs between $150,000 and $200,000, yet everything from the placement of rooms and number of electrical plugs down to the finish details are furnished by the corporate team. The Scottsdale headquarters also supplies franchisees with advertising materials and training as well as hiring assistance for the first three clinics in a new market. In exchange, franchisees pay 5% general royalties and 1% advertising royalties.

The Envy of All
Massage Envy’s strict adherence to a proven business and training module has paid off. Last year, the franchise organization logged an average of 400,000 massages a month and a 10% to 20% annual growth rate for the clinics. To date, only one Massage Envy location has had to close, an early miss Leonesio attributes to site placement in the wrong market.

Other challenges have included the normal pitfalls encountered with antiquated laws at the local and city levels. In highly populated areas like Los Angeles and San Francisco, for instance, some cities place the clinics in the same category as Turkish baths and adult entertainment, thus forcing the franchise to obtain special use permits or a change in the law. Massage Envy is also working at the state levels to effect a change in the law to govern legitimate massage.

In the future, Leonesio hopes to roll out his franchise across U.S. borders. He’s received inquiries from Italy, the United Kingdom, Australia, South Africa and Canada. But, for now, this CEO is content to make his organization the envy of every massage outfit here at home.

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