reception/retail area of Spa Space
Savvy business skills and a readiness to adapt have lent the Windy City’s Spa Space remarkable staying power.

Spa owners comprise a rare breed of entrepreneur. Rather than shrewd businesspeople and cutthroat tycoons, this world attracts a warm-blooded workforce that prioritizes helping people live happier, healthier lives—which is precisely what inspired Natalie Tessler, owner of Chicago’s Spa Space, to leave her job as a tax attorney and open her business. “I enjoy the process of taking people out of the doldrums of their everyday lives,” she explains. What Tessler wasn’t prepared for, however, was the rollercoaster ride she was in for in this new role.

Since its founding in 2001, Spa Space has faced its share of obstacles—namely, the September 11 tragedy (which occurred just three months after the spa’s grand opening) and the Great Recession. Despite these trials, the resilient Spa Space has emerged victorious, and now stands as one of Chicago’s top-ranked day spas. In its 11 years in business, the facility has received several accolades, including being deemed Best Massage and Best Spa by Citysearch, and a “Rising Star” by the Fashion Foundation of Chicago. The American Massage Therapy Association has also crowned Tessler “Best Employer.”

Here, the once unlikely spa owner reveals her secrets to weathering the ups and downs of the capricious day spa business. —Jennifer Keishin Armstrong

Running from the Law

Born with an entrepreneurial spirit (at the tender age of 11, she spearheaded a short-lived day camp operation for young children), Tessler graduated from New York University’s Law School. After failing to convince some classmates to start a firm with her, she went to work as a tax attorney for a large firm in Chicago. But every morning before work, Tessler found herself repeatedly hitting the snooze button, dragging herself in at the last possible moment. Her unfulfilling career led to some profound realizations: Tessler didn’t want to work for someone else and, more importantly, she didn’t want to practice law. “I wanted to wake up and be excited for my day, ” Tessler says.

After a visit to Miraval in Tucson, Arizona, the disenchanted lawyer experienced a career-altering epiphany. “The people who worked at Miraval clearly loved what they were doing, and I thought there might be a way to take that spa concept and put it in an urban setting,” Tessler recalls. Never one to hesitate when it comes to a new venture, she began scouting local neighborhoods in downtown Chicago. Six years after Tessler graduated from NYU, Spa Space was born—but this aspiring entrepreneur still had a lot of self-educating ahead of her.

Calling in the Big Guns

Having grown up with a dermatologist father, Tessler had always been well versed in skin care; however, she was in no way prepared to spearhead a skincare operation. So in launching her business, she wisely enlisted the help of a few good men.

First, she hired a real estate broker to help scout the perfect location, a small corner space just four blocks from her previous employer. “I had this idea of being in a loft in an up-and-coming area,” she reflects, “but my broker advised against it, and recommended the area we ended up in. It’s much more developed today than it was then.” In fact, the neighborhood has experienced a growth spurt over the past few years, and so has Spa Space: Through several renovations, it has been expanded by 2,500 square feet (to a current total of 7,500) to accommodate seven additional treatment rooms as well as a private party room that holds 12.

Tessler also called on her father to consult on various skincare practices, help train her new staff, and select the lines used and retailed. She sought to attract clients looking for a lunch-hour or quitting-time escape from the office buildings towering above the area where Spa Space would open. The idea was to focus on making customers feel good, with “tangential emphasis on making them look good,” says Tessler. As a tax attorney, she knew how to draw up a business plan. The trick was combining that skill with her father’s skincare wisdom and all she’d learned by feverishly researching spa business books and trade journals. (Dr. Martin E. Tessler continues to serve on Spa Space’s medical advisory board, along with a nutritionist and a plastic surgeon.)

Her final step involved the creation of Spa Space’s website. Tessler had the foresight to prioritize search engine optimization (SEO) practices from the start. She hired a company called Intercon Solutions to build the original site over about three months, testing along the way to ensure the best search-rank possible, knowing how much SEO had influenced her own consumer decisions. “We were lucky that we got online when we did,” Tessler says. “There wasn’t a lot of local spa competition back then, and most existing facilities didn’t have websites. Our site has been instrumental in attracting new clients.”

Thanks to the site’s early online strategy and its simple name, most “Chicago spa” Google searches take surfers straight to Spa Space. The site’s current iteration offers online booking, rotating monthly specials and preferred-client email sign-up, as well as detailed information about every treatment, the spa’s management philosophy and even nearby restaurant offerings.

On the less tech-savvy front, Spa Space’s block-long window space and location across the street from a major commuter train hub translate to lots of foot traffic, and the spa takes advantage of its display space with large signage and placards broadcasting its many awards.


Hunkering Down

Right off the bat, Spa Space faced a marked downturn in the wake of national tragedy. “After September 11, downtown Chicago became a ghost town,” Tessler says. “The Sears Tower [located mere blocks away from Spa Space] was considered a key target. Suddenly, there were days that we did just one eyebrow wax—that was it.”

But as the holiday season got underway, business picked up with gift certificate sales. It built steadily over the next six years, mostly due to bustling business from corporate groups (stoked by regular off-site visits in which spa staff performed chair massage, and strategically placed brochures touting Spa Space’s group corporate offerings) and outreach to local hotel concierges.

And then the Great Recession hit.

The economic disaster drastically curbed Spa Space’s corporate business, the segment Tessler had long relied upon to stay afloat. The spa had grown by applying its attention to details that matter most to companies: careful organization, clear contracts (a byproduct of Tessler’s law background) and customization. (For example, the spa team once unveiled citrus-infused mini services for an event introducing a vodka company’s new citrus flavor.) There is even a designated section of the spa’s website enlisting menus, service packages and other offerings specifically designed for corporate events.

But once the recession arrived, no amount of catering to corporate needs could reverse the losses. “Those kinds of things—corporate spa-going—were very frowned upon during that time,” Tessler reflects. She resorted to “strategic scheduling,” cutting back on her staffers’ hours rather than laying them off completely. This helped Spa Space weather the slumps, but Tessler wasn’t through—she discovered a few more sales-boosting techniques to counteract the loss.

For one, she started combining treatments into value-based “super-offerings”—microdermabrasion with a green tea peel plus a lightening mask, for instance, or a “head-to-toe massage” incorporating several different modalities. Both proved popular and profitable. And she implemented a “Current Specials” website feature, which also caught on, to the point that clients still often call in advance to inquire about the next month’s offerings.

Endurance Tactics

Over the years, Tessler has made it a point to avoid straying from her original business model. For Spa Space, this means forgoing many trending beauty offerings and sticking to tried-and-true spa treatments. This spa owner prefers to concentrate on the services she’s sure her staff can provide “with impeccable results.” She’s learned her lesson from past experimental forays.

“We used to do a bronzing treatment, but it was the type of service where about 20% of the time, the client would scratch herself or the technician would miss something,” she says. And an attempt at providing an organic facial fell short of Tessler’s financial expectations: “We discovered there wasn’t as much interest as we had anticipated, at the price we had to charge.”

Targeting a male audience was an initial goal of Tessler’s, given Spa Space’s office-surrounded location and her initial market research indicating a dearth of male-oriented offerings in the area. The spa started by providing private rooms for men’s nail services. (Although the same was extended to women, Tessler has found this option key to making men feel more comfortable.) The menu features an extensive array of male-friendly treatments, including a Glycolic Facial (40 min./$80); a variety of massages specialized for runners and golfers; a Sports Pedicure (60 min./$55); and a Man Hands Manicure (30 min./$25). Today, men comprise more than half of the spa’s top clients. “Overall we see more women than men,” Tessler says, “but men are more likely to return.”

Not so coincidentally, couples have long flocked to Spa Space for tandem massages and other romantic offerings like the Strawberry & Champagne Pedicure (60 min./$60) and the Wine & Roses Body Treatment (90 min./$160). (Private suites for two are available; wine is BYO.)

Corporate group business has resumed as Spa Space’s goldmine, thanks to the spa’s entirely separate menu for companies seeking everything from fun ways to host a working lunch or large-scale client-appreciation event to full spa rentals. Always at the forefront of Spa Space staffers’ minds? “How to accommodate groups without bothering individual clients,” Tessler says. Mid-sized treatment rooms that can accommodate a few clients, with sliding partitions to make them versatile, have come in handy. Tessler often partners with nearby eateries to provide food for group events, or for individuals who want to eat between treatments—a nice complement to the spa’s extensive in-house selection of delectable treatments such as the Vanilla-Almond Pedicure (50 min./$55) and Peppermint Patty Body Treatment (90 min./$160).

It’s safe to say that life as a spa owner has been anything but dull for Tessler—and she wouldn’t have it any other way. “You would think that after 11 years there would be a pattern,” she says. “But every day there’s a new surprise.” It beats hitting the snooze button.

Spa Space

Year opened: 2001
Square footage: 7,500
Facility: 14 treatment rooms; mani/pedi lounge with 10 stations; couple’s pedicure suite; his-and-hers locker rooms, each containing a relaxation lounge and steam/rain showers; private, large hospitality suite for groups; retail boutique
Number of employees: 75
Average ticket: $77
Product lines: Anthony for Men, Epicuren, Essie, Kiehl’s, Kobo Candles, OPI, Sharp’s for Men, Skinceuticals, Sonya Dakar, Vibraderm, Voluspa
Most popular treatments: Swedish (60-120 min./$95-180) and deep-tissue (30-120 min./$55-180) massage

Jennifer Keishin Armstrong is a freelance writer and co-author of the forthcoming lifestyle guide, Sexy Feminism.

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