Thursday, 22 August 2019

WHITIANGA WEATHER

How "combos" on a blackboard changed The Lost Spring's fortunes

The Lost Spring in Whitianga celebrated their 10th anniversary on Friday evening last week with live music, happy hour and many friends.

After searching many years for a geothermal spring on what was his campground in Cook Drive, Alan Hopping, owner of The Lost Spring, started development of the resort in 1990. “There was only an empty paddock between my campground and the old Whitianga primary school building in School Road,” says Alan. “The building has been vacant for many years and was quite dilapidated, but I thought it would be perfect for the café/restaurant and day spa I had in mind for The Lost Spring. So, I asked Joan Gaskell, a prominent local politician at the time, if I should make an offer on the building. She said I should offer the South Auckland Education Board, the owner of the building, $2,000. That’s what I did and the Education Board came back and said if I could add GST to the amount I offered, I could have the building.”

Once the building purchase was finalised, Alan arranged for four trucks to “drag” the building across the empty paddock to his campground. “To move the old school building cost me more than five times what I paid for it,” says Alan.

In the 18 years that followed, Alan literally moved mountains. “We covered more than 35,000km shifting just the clay we needed to develop The Lost Spring,” says Alan. “We decided on a Polynesian theme for the resort because of New Zealanders’ love for the Pacific Islands and also because we’ve very much matured over the years into a South Pacific nation.

“The design inspiration of The Lost Spring came from Hawaii.

“In our commitment to bring magic to adult lives, we decided to make the resort a licensed retreat for adults and limited access to the pools to supervised children 14 years and older, which was a big call at the time.”

Alan formally opened The Lost Spring for business on 8 December 2008. “Everything in the resort - the geothermal pools, day spa, café/restaurant and landscaping - were all completed exactly as I wanted it to be,” says Alan. “I remember the overwhelming sense of gratefulness I experienced on the day we opened.”

The years that followed weren’t easy. “We had a $50,000 marketing plan in place, but it went out the window very fast,” says Alan. “We budgeted for 650 guests a day for the first six weeks, instead we got an average of 100 per day. It was challenging. We soon realised The Lost Spring wasn’t yet the primary reason for people to travel to Whitianga, so selling all-day passes for the pools weren’t working. We decided to sell one-hour passes, turning The Lost Spring into an experience people could add to whatever else they wanted to do in the Mercury Bay area.

“Within three months of opening, I had to borrow an extra $400,000 for us to stay afloat. We got through to late 2010 and I clearly remember our in-house financial and admin manager telling me that we weren’t going to make it to summer that year. Borrowing more money was out of the question, but fortunately we were able to hang in there.

“Early in 2011 we signed up to one-day deals which were marketed through the internet, very common at the time. We had to half our prices and pay the marketing company up to 20 per cent commission on our sales. From May to September that year we sold 2,400 all-day packages and provided roughly 1,200 bed nights to local accommodation providers. These one-day deals were risky as it caused people to always wait for the next cheap offer.

“In 2012, we asked ourselves, ‘What do we have to do to get through the year?’ We still didn’t have momentum in the business. At our weekly management meeting the team decision was that I was to go to Queenstown to see what the hospitality providers were doing there and what we could learn from them.

“I wasn’t in Queenstown an hour and I realised we had to change two things. Firstly, whatever we sold as ‘packages,’ things like a spa treatment combined with a pool pass and lunch, we had to call ‘combos,’ an international word guests from everywhere would understand. And secondly, professionally created posters didn’t represent a daily offer. Combos and special offers were wildly promoted on blackboards as it appealed to tourists as ‘today’s offer.’

“I phoned The Lost Spring and they had a blackboard in place that very day. I came home two days later, only to be told that we had sold 30 combos that day alone.

“The majority of our sales these days are combos. The Lost Spring is now also, indeed, a destination in its own right, which means our all-day passes are also very popular. Our guest numbers from when we opened for business on 8 December 2008 until 2012 were steady at 28,000 to 30,000. This year we’re expecting 60,000 guests with 40 staff members making sure the resort runs like clockwork.”

Pressure on The Lost Spring’s day spa has resulted in the development of a comprehensive “tree top” development plan. Stage 1 of the plan, two tree-top bures, has been completed. The remainder of the plan features a new “clam shell” pool and bathrooms and is subject to a financial assessment and assessment of any employment constraints that may be encountered.

An outside bar area for functions and which also serves as an extension to the resort’s café/restaurant has also recently been completed.

 “We can’t rest on our laurels and are constantly planning three years ahead,” says Alan. “Couples from Auckland were always a big part of our business, but their discretionary income is under pressure because of high property and fuel prices. We need to spread our risk and are currently pursuing marketing strategies that will target potential guests in key overseas locations.”

Alan stepped down earlier this year as CEO of The Lost Spring, when he handed the reins over to his daughter, Alanna Kline, who returned to New Zealand last year with her family after 20 years in the United States. “Alanna is a safe pair of hands,” says Alan. “She’ll take the resort to great new heights. All I want at the end of the day is for The Lost Spring to keep our original promise - to exceed expectations and to bring magic back into the lives of adults at every available opportunity.”

Pictured: Alan Hopping and Alanna Kline of the Lost Spring Whitianga 

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The Mercury Bay Informer is a highly popular community newspaper, based in Whitianga. The paper is distributed throughout the Coromandel Peninsula, coast to coast from Thames to north of Colville.