A proposal for opening ten company-owned indoor tanning salons in the San Francisco Bay Area

1. A Proposal For TEN Company Owned Solar Planet Salons in the
San Francisco Bay Area
Advantages:
❑ Local control and management
❑ Track record of highly successful tanning salons
❑ Demographics and lifestyle of SF Bay Area ideal for indoor
tanning salons
❑ SOLAR PLANET: A Proven Indoor Tanning Salon Concept
❑ Salon expansion plan in place
❑ Marketing plan in place
❑ Management and support staff in place
❑ Economies of scale
❑ Solar Planet National Customer Profiling and Targeting

2. Local Control and Management
❑ Lower salon training and
support costs
❑ Improved communications
❑ Faster implementation of
procedures
❑ Easier to monitor salon
performance
❑ Standardized operating
procedures
❑ Easier to provide technical
support
❑ Easier to coordinate and
schedule staff training

3. A Track Record of Highly Successful Tanning Salons
❑ Very successful tanning salons in large, urban metro locations
like San Francisco, Seattle, Minneapolis, Virginia, Maryland and
Washington, D.C
❑ Top 10 Solar Planets sales YTD ending May 2001 $1.7MM versus
$1.5MM in May 2000--an increase of 12%--twice the industry
average
❑ Top 10 Solar Planets averaged $364,000 sales in Year 2001
versus $324,000 in sales in Year 2000
❑ Top 10 Solar Planet salons in top 2% of all indoor tanning salons
nationally
❑ Three Solar Planets in Top 100 in US in gross revenues in only
1000 square feet of space with 6 to 7 beds
❑ Scott Shortnacy’s Solar Planets sales up by $213,000 or 27% for
five month YTD period ending May 2001 - $1,009,000 versus
$796,000 for May 2000

4. Demographics And Lifestyles Of Bay Area Are Ideal
❑ Average household income
of $66,500
❑ 857,000 or 51% of HH avg in
excess of $50K per year;
537,000 or 32% of HH avg in
excess of $75K per year
❑ 614,000 or 21% of total
adults over 25 years of age
are college educated
❑ 1.5 million or 70% of labor
force are white collar
❑ 1.7 million or 50% of adult
population are single or
unmarried
❑ 2.8 million or 66% of
population is white

5. SOLAR PLANET: A Proven Tanning Salon Concept
❑ San Francisco Marina salon
grossed over $550K in five
years with only six beds in
1000 sq ft of space
❑ Fully tested training and
marketing programs
❑ Extensive classroom and
onsite salon training
❑ Extensive training manuals
& marketing materials on CD
❑ BREEZE indoor tanning salon
software
❑ DR MULLER German-made
tanning beds
❑ Twenty salons in a period of
three years

6. Salon Expansion Plan in Place
❑ Ten salon openings within 15 to 18 months
❑ Solar Planet national profile prepared by Claritas, Inc. will be
used as basis for selecting future salon sites
❑ Salon site selection will include an extensive demographic,
lifestyle segmentation, and competitive analysis
❑ Salon sites to include an extensive onsite field study
❑ Salon construction to include project scheduling, timeline and
PERT charts
❑ Salon expansion include estimated costs, projects and budgets

7. Management and Support Staff in Place
❑ Principals have nearly forty years indoor tanning salon
experience
❑ Customer support staff in place with a combined fifteen years
experience in salon retail operations
❑ Thoroughly tested and proven Solar Planet retail salon
operations and marketing programs
❑ Our proprietary BREEZE salon management system with the
ability to support multiple locations

8. Marketing Plan in Place
❑ EXECUTIVE SUMMARY: Includes a five-year business plan with
capital expenditures, profit & loss and cash flow
❑ OUR SALONS: Small, boutique style, attractive salons catering to
the successful single and urban up and comer
❑ OUR STAFF: Well educated, professionally trained and
knowledgeable salon staff who can relate to our customers
❑ OUR CUSTOMERS: Highly educated, white collar professionals,
working in management and executive positions, predominantly
single, with very high incomes
❑ LOCATIONS: Selected due to their proximity to consumers very
similar to our national Solar Planet customer profile
❑ EQUIPMENT: DR Muller line of superior, German-made, very high
performance tanning beds

9. Economies of Scale
❑ Complete Solar Planet training manuals and marketing
programs on CDROM
❑ Purchasing salon lotions, lamps and acrylics at lower costs due
to higher volume
❑ Advertising and marketing expense can be spread over ten
salons rather than just one
❑ Training and support costs lower due to proximity to corporate
headquarters

10. Solar Planet National Customer Profiling & Targeting
❑ Solar Planet’s best customers
are our EXISTING customers
❑ You can target new customers
by PROFILING your existing
customers
❑ Profiling allows you to answer
three marketing questions:
Who are our Customers?, What
are they like? Where do they
live?
❑ MicroVision50 Segmentation
Analysis from Claritas, Inc. was
used to profile over 50,000
Solar Planet customers
❑ MicroVision50 Segmentation
assigns consumers into fifty
lifestyle segments defined by
demographics, behavioral and
spending attributes

11. Who Are Our Customers?
❑ Solar Planet customers fall into STRONG and WEAK
lifestyle segments:
❑ STRONG Lifestyle Segments:
▪ CORE: These customers display a high index value when
compared to the general population AND make up a significant
percent of all customers
▪ CONVERSION: These customers represent a significant
proportion of the total customers and an even larger
proportion of the general population
❑ WEAK Lifestyle Segments:
▪ EXPANSION: These customers display a high index value when
compared to the general population, but make up a small
proportion of customers
▪ NON-TARGET: These segments account for a small proportion of
customers and indices suggest they are less likely to become
customers

12. Solar Planet Strong Lifestyle Segments
❑ CORE Lifestyle Segments
represent our dominant
lifestyle segments as follows:
▪ Segment 01 – Upper Crust:
45 to 59 year old suburban
adults with families and older
children, very high income –
14,000 or 27.75% of total Solar
Planet customers profiled with
an Index of 291
▪ Segment 13 – Successful
Singles: 30 to 44 year old
urban singles, renters, white
collar professionals, executive
and managerial, very high
income and education levels –
5,700 or 11.16% of total Solar
Planet customers profiled with
an index of 125

13. Solar Planet Strong Lifestyle Segments (Continued)
▪ Segment 12 – A Good Step
Forward: 22 to 34 year old
urban singles living in non-
family households with one
or two people, renters with
high household incomes –
5,500 or 10.62% of total
Solar Planet customers
profiled with an index of
166
▪ Segment 02– Lap of Luxury:
35 to 49 year old adult
married suburban
homeowners, two to four
people per household, with
very high levels of income
– 1,400 or 2,80% of total SP
customers profiled with an
Index of 172

14. Solar Planet Strong Lifestyle Segments (Continued)
❑ CORE Lifestyle Segments -
Continued:
▪ Segment 37 – Urban Up and
Comers: 18 to 44 year old
urban singles, renters, mid-
high income, white collar,
professionals, executive and
managerial, highly educated –
3,100 or 6.05% of total SP
customers profiled with an
index of 176
▪ Segment 08 – Movers and
Shakers: 35 to 49 year old
suburban singles and couples,
median income, highly
educated, white collar
professionals – 3200 or 6.32%
of total SP customers profiled
with an index of 102

15. Solar Planet Strong Lifestyle Segments (Continued)
❑ CORE Lifestyle Segments -
Continued:
▪ Segment 36 – Metro Mix:
25 to 34 year old urban
singles, primarily renters,
with low-to-medium
incomes, high school to
college educated, white
collar, administrative
support positions, - 1300
or 2.64% of total SP
customers profiled with an
index of 107

16. Solar Planet Core Lifestyle Segment Distribution
• Solar Planet CORE lifestyle
segments include seven
dominant segments:
▪ 01 Upper Crust
▪ 13 Successful Singles
▪ 12 A Good Step Forward
▪ 08 Movers and Shakers
▪ 37 Urban Up and Comers
▪ 02 Lap of Luxury
▪ 36 Metro Mix
• CORE lifestyle segments
represent 34,622 or 67.34 % of
the total 51,416 customers
profiled with an average index
of 162

17. Solar Planet Conversion Lifestyle Segments
❑ CONVERSION Lifestyle Segments
represent a significant
proportion of customers and an
even larger proportion of the
general population, not likely
customers, but with potential:
▪ Segment 04 – Mid-Life
Success: 40 to 54 year old
suburban adults, very high
income, white collar jobs –
3,500 or 6.72% of total SP
customers profiled with an
Index of 66
▪ Segment 15 – Great
Beginnings: 25 to 34 year old
urban and suburban young
adults, renters & homeowners,
white collar, managerial, high
income and education, – 1900
or 3.74% of total SP customers
profiled with an index of 64

18. Solar Planet Conversion Lifestyle Segments (Continued)
❑ CONVERSION Lifestyle Segments
– Continued:
▪ Segment 03 – Established
Wealth: 40 to 54 year old
suburban family homeowners,
sales, executive and
professional, very high income
and education – 1100 or 2.18%
of total SP customers profiled
with an index of 71
▪ Segment 05 – Prosperous
Metro Mix: 30 to 44 year old
urban and suburban married
couples with young children,
high income, white collar,
college educated, executive,
managerial and professionals
– 1200 or 2.34% of total Solar
Planet customers profiled with
an Index of 37

19. Solar Planet Conversion Lifestyle Segment Distribution
• Solar Planet CONVERSION
lifestyle segments include four
segments with potential:
▪ 04 Mid-Life Success
▪ 15 Great Beginnings
▪ 03 Established Wealth
▪ 05 Prosperous Metro Mix
• CONVERSION lifestyle segments
represent 7,702 or 15.24 % of the
total 51,416 customers profiled
with an average index of 59.50

20. Solar Planet Customer Rank Order Correlations
❑ Rank Order Correlation is a statistical method used to classify a
group of consumers into their most likely demographics, what
products or services (I.e. lifestyles) they are likely to buy and the
type of media they are likely to read, listen or view. Solar Planet
customers rank order DEMOGRAPHIC correlations were the
highest in the following:
▪ Very likely to be female without children
▪ Very Likely to have an undergrad or graduate degree
▪ Very Likely to be employed in a white collar positions
▪ Very Likely to be professional, executive or managerial
▪ Very Likely to be between 40 and 49 years of age
▪ Very Likely to own property worth $300K to $500K or more
▪ Very likely to be single or non-family

21. Solar Planet Customer Rank Order Correlations (Continued)
❑ Solar Planet customers rank order LIFESTYLE correlations were
the highest in the following:
▪ Very likely to be involved in physical activities like
rollerblading, jogging, tennis, weightlifting, volleyball,
backpacking, cycling and aerobic exercise
▪ Very Likely to wear soft contact lenses
▪ Very Likely to attend movies regularly
▪ Very Likely to frequent bars and night clubs
▪ Very Likely to travel internationally
▪ Very Likely to own a cellular telephone

22. Solar Planet Customer Rank Order Correlations (Continued)
❑ Solar Planet customers rank order MEDIA USAGE correlations
were the highest in the following:
▪ Very likely to listen to Modern Rock, Classic Rock, Jazz and
Adult Contemporary music
▪ Very Likely to rent a video at least once a week
▪ Very Likely to own and use a computer and surf the Web
▪ Very Likely to listen to the radio on weekdays between
6-10AM for at least one hour
▪ Very Likely to read a magazine (Top 50%)
▪ Very likely to attend live theatre performances
▪ Very likely to be view less television programming
(bottom 50%)

23. Solar Planet Potential Target Markets
❑ Target markets with potential customers that are most similar to
its customer profile can most likely be found in the following
locations in order of population ranking (Top 10):
▪ New York City
▪ Los Angeles
▪ Chicago
▪ Philadelphia
▪ San Francisco-Oakland-San
▪ Boston
▪ Dallas-Fort Worth
▪ Washington, DC
▪ Detroit
▪ Atlanta