Marketing your salon or spa is a complete waste of time and money! WHY?
80% of the clients may walk away and never return!
Marketing can be hard work and expensive, research shows its up to 5-15% MORE expensive then working with people who already know your salon or spa. So why do I say marketing is a waste?
Because most salons and spas FAIL too;
- Monitor Client Retention rates
- Have no client retention plan
- Don't train the team in the skill of client retention
and without those critical points in place will be losing tens even hundreds of thousands in revenue each year.
I’m Caroline Turner the founder of The Salon Money Maker and in this article I want to potentially change your salon or spa’s fortunes, now that’s a BIG statement!
A brief history... I’ve been working specifically in revenue development globally for 20 years with some of the world’s most financially successful companies in our industry. I also work with owners and teams, developing their skills to make money in a way that’s easy, fun and clients love.
I want to share a little knowledge and a technique that can make a serious difference to salons and spas. Enough about me, lets go.
If a salon or spa is achieving LESS then 70% retention and the team has NO training or focus to client retention, no pre or post appointment follow up plan, then marketing is a waste.
Its like running a bath without the plug in! No matter how fast you run the water, you'll never fill the bath!
No matter how much a business markets to get new clients, the business won't grow unless there's a focus on Retention and training.
Think about it, if a teams current retention rate was 20% for every 10 new clients seen, they lose 8 and only keep 2!
In fact it could be worse as Statistic put new client retention as low as 5%!
IF a salon or spa was retaining 5% then they'd need 20 NEW CLIENTS to KEEP just 1!
Every salon and spa must focus on monitoring retention, have a pre or post appointment follow up plan and develop the team in the skill of Client Retention with training if they want profit.
Not client requests, request monitoring is a COMPLETE waste of time and the wrong focus for owners and teams.
In this article I'm going to share with you The Client Score Card and how this SIMPLE focus can assist in changing your fortune.
I'm going to explain why you could lose 80% of your clients with an insight into The Oblivious Virus and The Client Buying Zone.
When a salon or spa has low client retention the business will often have what I call The Oblivious Virus©.
No one in the team has a clue they’re spreading it and unless monitored the owner / manager has no idea they’re infected!
And this is critical, every salon and spa should use a Client Score Card in my humble opinion, it's a way to check the health of the business, give the team a client focused target and understand how many of the clients are making it to The Client Buying Zone©.
For me as a revenue expert its like everything in one, a "will my business make money test" and it's so simply to use.
You see from the results it's easy to monitor if the client will become Loyal, spend more and refer others, now I've heard some people say “Clients aren’t loyal anymore”.
People ARE loyal, that’s why if the likes of Apple can release a new product and people camp out on the street to get it first.
I could list on and on of different companies, services, products, restaurants, authors, actors, singers who have cultivated a following. A fan base, they worked hard to achieve it and even harder to keep it.
People ARE LOYAL but if they’re not being loyal to a salon or spa then the business has the Oblivious Virus and that
KILLS BUSINESSES SLOWLY!
The scary facts;
80% of clients will be in the Nice Client Zone and this is very dangerous
Worst case scenario…
IF a salon or spa saw 100 clients in a week and had the Oblivious Virus
80 clients will be in the Nice Zone and may never come back IF a better offer/promotion or a friend refers them elsewhere
But that could potentially mean a salon or spa is bleeding out 80+ clients a week! This is so SERIOUS, the client MAY return BUT if something better does comes along at ANY time, there gone! Yes, that means one week it could be 10 who go, the following week 20 but WORSE case scenario, 80% may not return!
With that 100 clients a week, let play with the figures.
Potential clients lost = 3,840 in a working year
IF they each spent (a low figure, I feel) say £/$500 in the year that would be lost revenue of….
£/$1, 920, 0000
yes, it could be a potential loss of £/$1.9 MILLION based just on 100 clients a week!
Now, yes I'm taking a very simple view of the figures BUT...
I can't tell you how many times over the last 20 years I've asked owners when we start working together to print out their client retention and non returning clients reports
and the owner then sitting with thousands of people on the report, repeating the same phase (Always the same phase), "that can't be right" and YES one salon did have over 3,500 non returning clients.
Do you know your client retention numbers?
There are many reasons why salons or spas struggle, grow slowly or go out of business but in my experience at the heart of the issue, is the Oblivious Virus, teams are Oblivious they're spreading it, putting their clients in The Nice Zone and slowly the business loses clients and hundreds of thousands in revenue, millions even.
The Oblivious Virus©
The BUSINESS killer, the virus is widespread, and not just in our industry.
Think of how many times you've experienced "poor, mediocre or forgettable service" by a human who's being paid to serve. That's the Oblivious Virus.
It goes deeper then client care or customer care, that's like the cherry on the cake, understanding the Oblivious Virus is like the ingredients to MAKE the cake. The ingredients to make a business profitable.
The Oblivious Virus is based on Psychological behavior. I would say the virus is damaging what others would see as plan old Common sense, but common sense is in part a personality trait but ALSO LEARNT BEHAVIOR. It is this lack of knowledge that causes a person or team to be oblivious to what they see or do and the impact on a business.
Its all about understanding people, human patterns of needs and behaviors as consumers.
It's how behavior by a team member and as a team impacts how clients feel whilst in the business and how that damages retention, and reduces the number of clients in the buying zone . But the virus is treatable, with Client-Team Links training.
Can you see how dangerous this could be?
Do you currently know how many clients you have in the NICE ZONE?
Because there is a way to find out, and it is KEY if to SURVIVAL in business, let alone make a profit!
The Client Score Card is easy and based on NPS (Net Promoter Score) this is a globally recognized measure of consumer engagement in business.
There are a few rules a salon or spa MUST follow;
- It MUST BE done anonymously
The psychology of human behaviour IS people will MORE often tell you what you WANT to hear.
Baring this in mind, please never ask the client at reception “how was everything for you today?” the business WILL NEVER get the feedback needed, clients will say it was great even if it wasn’t!
By allowing the client to rate the experience and being anonymous it give the person the freedom to be honest and feel comfortable.
This is so important, critical to get a clear picture of how healthy the business is.
- Documented either with a card or use a tablet app
The front of house coordinator (reception) finishing the salon journey will check the CPS (Complete Professional Service, more information is available in the free eBook 7 killer Sales mistakes, and or a revenue article).
Then reception can ASK the client to rate the experience “Would you please complete our Client Score Card, we’re working hard to improve and your feedback is vitally important, so please be completely honest”.
However asked being very polite is key, I would use 3 simple questions, it’s for me the last question that is vital.
How happy were you with the hair and or beauty service you received?
How happy were you with how the team serviced you?
On a scale of 1-10 how likely are you to recommend us to family and friends?
I would strongly recommend using a salon tablet and a score rating app as it looks more professional, it will be easier to introduce to the team and the app does all the work for you.
Yes, I want feedback on the quality of the work and the happiness of the client but it’s the last question that gives me the health check I need
If the client scores between;
1-6 The No Fit Zone
They are unhappy clients who can damage a salon or spa and effect growth.
7-8 The Nice Zone
They are satisfied but uninspired clients who are vulnerable to the local competition
9-10 The Buying Zone
They are loyal enthusiast clients who will keep booking and will trust advice offered, happy to spend more in the business and will make referrals. They are long term followers
I decided I would hunt down a simple app that can be used on the salon tablet, it does all the work for you giving the team a daily rating of their performance and owners vital information about the client zones.
Its 79p or just over a $1. I’m not getting anything from the company for recommending it, I have no connection with the company, I just wanted to find the cheapest, easiest and simplest way to assist salon / spa owners.
This is a team target, score 9-10 each day. To achieve this target the team HAS to be completely client focused as a TEAM.
If a business scores a high level of 1-6 then they have a REALLY bad case of the Oblivious Virus, think of it like a serious case of the Flu, it can be fixed but will require serious work. Action is urgently required, the business is at serious risk.
If the score is 7-8 then the business still has the Oblivious Virus but it’s more like a cold, with a little knowledge, staff training and team focus a MASSIVE increase in revenue is possible.
Action is also urgently required, as 80% of clients MAY never return, therefore the business is at risk long term, if nothing is done.
If the score is 9-10 the business should have a very high level of client retention 70-90%, growing constantly, and this should reflect in all of the 4 R’s of Revenue.
HOWEVER, if an area such as recommending (cross promotion) or for example, retail is not achieving between 20%-50%+ the team in my experience needs additional training on how to sell / professional advise clients.
The clients want more, and will be happy to spend more, the team just needs a little help with technique and confidence.
Do you know your retention figures / %?
Do you Know which Zone your clients are in?
I always like to finish my articles with; What would I do next?
For a number of reasons, but with this article taking action NOW could mean the difference between struggling or making a profit in my opinion and experience.
Let's not mess around here, you could be losing hundreds of thousands and what I'm sharing is a starting point to changing that situation.
Nothing will change without change.
What would I do next?
Check you have a retention report
How many people they have seen and how many returned. What was the retention rate?
I'd want to see how many have not returned and the retention % over a time frame to see if its improved or got worse.
The MOST important point here, get the information!
Remember, if the clients are in the buying zone you will see 70%+ retention, but if you have a serious virus it could be as low as 5%.
Get a calculator Again, I would do this, BUT I have a very positive mindset, I'd take the number of clients lost and multiply by the annual average spend.
I would do this as a "HOW MUCH!! RIGHT THAT'S NEVER HAPPENING AGAIN" moment.
No time to wallow if it's a big figure
we can't change the past, it's time to change the PRESENT to make the future.
But I wouldn't do this if you're struggling, whilst its easy to say "don't cry over it" when a business is struggling it IS hard to keep a positive focus, my advice... DON'T CALCULATE this if you're feeling down.
When our mental focus needs to stay strong, we avoid anything that will knock or rock it.
Get a tablet for reception JUST for Client Score Card (nothing else) and down load the app and set up the spreadsheet (its very simple).
Get a team follower onboard, plan to introduce the system to the team, get a couple of the team to try the system with you so you can see how easy it is.
Involve your team followers in introducing the system, explain the benefits to the team, after all if the team can hit the target of 9/10 with support and training, they will improve what they earn too.
I'll share more in a future article, how the team follower grows salon/spa, not the owner! If you haven't already sign to the Revenue Newsletter.
I'd also suggest getting the 7 Killer Sales Mistakes in the Salon and Spa Industry, its free to download and I share the mistakes that can cost serious revenue.
Spread the love, if you feel this article could help others in our industry then share. I've seen far to many salon and spa owners and teams work hard for little reward and I'm on a mission to share my knowledge to help develop revenue for others, so spread the love.
Finally, if you could open up an email from me and find a Revenue Newsletter what would you want it too cover? I have over 20 years of experience in developing revenue in salons and spas, what would you want to know? Comment below