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7 Secrets to Recession Proofing Your Salon – Part 6
Posted by: | CommentsRecession Busting Secret Number 5
How to Have All Your Overheads Paid for on the 1st Day of the Month Before You Serve One Client
Out of all my recession proofing secrets, this is probably the fastest way to bring rapid stability to your business and give you such an enormous advantage over your competition they simply will not know what ‘hit them’.
I first realised its power while doing a 5km run on a tread mill at my local gym about 5 years ago. I was on the last 1km, pushing hard and trying to keep my mind off my puffing and panting by thinking about how to help my clients. I’d renewed my membership that day and ‘plumped’ for the joint membership of £64 per month (which was clearly good value as a single membership was £44 and my fiancée had wanted to join).
My membership number was 2,343 and I’d asked the chap if that was the number of members they had. His response was ‘No, some of those have expired, we have around 1,700.’
Ok…back to the treadmill…
I did some quick maths in my head. £44 times 1,700. Um, that’s £74,800 a month. Even if 50% are joint membership that’s still £64,600…Per month…Every month, even before anyone has been to the gym!
But what really got my attention was whenever I’d been in the gym (and I had until recently been going twice a day), there were never more than about 15 people in there!
I finished my run red faced and sweating, stumbled over to the gym manager, legs like lead and asked him:
Of your active members, how many actually use the gym?
Did the active members that didn’t use the gym complain about the money they’d paid but not used?
His answers were as I expected. Only about 20% of members used the gym, and they’d only had 2 people ask for their unused gym money back in 18 months!
That means the model they use can sail through even the most severe of recessions. Plus their stable cash flow means they can easily allocate big ‘chunk of change’ to go find affluent new members and spend a lot of money to get them! Had they been reliant on single transactions, not knowing how they were going to do from one month to the next would have left them needing to be frugal about spending money.
You can and SHOULD use this model in your business immediately. A percentage of your clients will happily pay you a certain amount of money every month, automatically billed via direct debit or credit card in return for two things:
a) Getting more value than they pay. If they automatically bill for say £50 a month, give them a little more in ‘monthly money’ to spend with you e.g. £60. You’ll still make more!
b) Treat them as VIPs’… Have a range of V.I.P ‘bragging’ benefits e.g. fast booking, dedicated booking number, free gifts, member lounge, and member parking…
Even at just 100 members to a program like this you’ve banked £5,000.00 a month before you’ve completed one treatment. Plus, member clients will very often outspend their ‘monthly money’ because once they’re in your shop, on your website or whatever if they buy products for £25 it feels like they’ve only spent £25 (as the automatic billing happened in the background)…
Can you see what a dramatic difference this can make to your businesses profitability, stability and ability to weather hard times?
The key is to adapt the strategy to formulate a win-win for you and for your clients. And there is ALWAYS a way to do it!
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7 Secrets to Recession Proofing Your Salon or Spa – Part 5
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Recession Busting Secret Number 4
Tap Into Your Acres of Diamonds
Your salon or spa clients spend much more money on your type of products and services and related products and services than you ‘extract’ from them. Way more…And, their capacity to buy ‘stuff’ is much, much, much higher than you think.
Depending on whose marketing research you read, it costs up to 20 times more to get a new client than it does to get repeat business from an existing client. So where should you be focusing? Pretty obvious right? On existing clients.
Yet, 95% of salon/spa owners insist on focusing on looking for new clients rather than nurturing and maximising the ones they have. They scramble around throwing money in all directions hoping to get new clients into their business. Not realising spending a fraction of that money on their existing clients could generate huge returns.
Some businesses don’t even know who their clients are (and if that’s you, fix it!!!)
A few months back my mother had a problem with her boiler not working. In traditional ‘good son’ fashion I offered to help her get it fixed (and not get ripped off).
So, I grabbed the Yellow Pages, flicked through to the boiler repair section and had a look at the ads.
First of all, it was nigh on impossible to make a choice between them as they all looked pretty much the same.
- Name and logo at the top of the ad.
- List of services
- Some industry seals of approval.
- Telephone number.
How the heck was I supposed to make a choice (important – is your marketing the same as everyone else’s)? In fact I couldn’t so I sort of just waived my finger around and plumped for one that ‘the force’ attracted me too.
Picked up the phone, dialled the number.
“Yep” came the response.
“Hi, I need someone to look at my boiler.” I replied.
“Can’t do it today mate.” Was the reply.
“Ok, thanks, bye.” Was my response.
Flippin’ useless. It’s great he’s too busy but I doubt he will be for too long…
Waived my finger around the page again – picked another company, dialled the number.
“XZY Heating” came the response.
“Hi, I need someone to look at my boiler.” I replied.
“Ok, sure we can help. The first appointment we have is Friday.”
“I was looking for something sooner.” I responded.
“Sorry, that’s the quickest we can get to you.”
“Ok, not to worry, thanks anyway.” I responded.
Second attempt down the drain. This was getting painful, blood pressure was rising. Anyway, on the third attempt I got a polite lady and indeed someone to come see me that day.
They arrived on time and fixed the boiler. Great!
Now, when we were in my Mother’s cellar with the boiler and the technician had a torch (because there aren’t any lights in there); on the side of the boiler I spotted a sticker from the person who had fixed it last time.
Aha, I thought that’s who it was. They did a great job too, and at a good price.
But they made a ‘school boy’ error.
Had they simply kept in contact with me at regular intervals using something as simple as a monthly 2 page newsletter I would have called them in a shot and they would have got the work.
Even better, had they put me on a monthly continuity plan where I pay a little a month for peace of mind that if things went wrong they’d fix them I’d be happy and they’d have a stable, reliable cash-flow boost that could sail them through even the deepest recession…
Building and maintaining relationships is fundamental to prospering in un-prosperous times. Whenever your clients think of what you offer you need to be at the top of their consciousness.
To make that happen you need to be more than just another provider of what you do. You need to build a strong and continuing personality bond with your clients.
Think of it like when you visit the hairdressers.
When they’re in the salon it’s easy. You talk about yourself, your family, hobbies and ask them questions about the same.
BUT, as soon as you leave, that relationship, that bond starts to fade…
And, if another salon ‘pops’ up with something that grabs your attention (or indeed another business eager to get a slice of their disposable income) then you’ll be off to them in a second and the hair salon will be scrabbling for a new client.
However, if the salon had built a strong personality bond with you built through continuous, repetitive contact even when you are not in there – then chances of you switching salon and being ‘unfaithful’ are slim.
So how do you create an ‘unshakeable’ personality bond
with your customers and clients?
Sending a monthly newsletter continues to be the best way to establish this bond for my clients and members. How many businesses like yours in your area contact their clients with a monthly newsletter containing stories about them, their lives, interesting news, gossip and offers? I suspect that may be none…
For close to £10 a year per client in printing and postage costs, you can generate hundreds, if not thousands of pounds in repeat business. You can switch from struggling and willing to accept any client at any price to having only the best, highest paying, and most loyal clients.
And writing then sending a monthly newsletter is neither difficult nor particularly time consuming.
Start providing one now!
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7 Secrets to Recession Proofing Your Salon or Spa – Part 4
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Recession Busting Secret Number 3
Attract Premium Price Buyers
I’m lucky enough to spend a lot of time talking to business owners about the challenges they face and also the successes they are seeing.
I was chatting to a beauty salon owner recently about how she was doing and some of the challenges she was facing.
Her salon is located in a predominantly Asian community and she is virtually flanked on either side by competing salons.
She employs 15 staff and runs a good quality salon providing good service to her clients.
Her single biggest challenge is competing with the salons almost next door that are able to charge much lower prices than her.
How?
Well, by having poorly trained staff, cash only businesses, a suspected lack of adherence to tax rules, little if any adherence to health and safety and little if any focus on providing quality client care…
She spends a lot of money training her staff, paying good wages to get good staff, paying her taxes, providing employee benefits such as holiday and bonuses. All stuff that she should be doing and is right to do in a quality salon.
Her perspective is that it’s just not ‘fair’ that another salon should be able to run a dodgy ‘ship’ and be able to take business away from her.
Of course whether or not it is fair is unfortunately completely irrelevant and the argument that ‘they’ll get what’s coming to them’ may impart a little satisfaction, and is likely a valid one but in the meantime she’s got to struggle, scrape and barely pay herself to survive. Not quite what she had in mind when she opened her salon.
And it is seemingly an impossible task to compete with
a business next door which charges lower prices for
the same products/services as you.
Stories of clients popping their heads in the door saying ‘why would I come to you when I can get the same treatment next door for less?’ were of course rife.
This is a very common and very real challenge.
How do you as a quality business, help your clients understand why they should pay more to come to you?
Clients, consumers, me, you, are more aware, more informed than ever and we are rarely interested in doing anyone a favour by paying more for something we can get cheaper somewhere else.
If I’ve got two items lined up side by side that are exactly the same and one shop is selling the item for £50 and the other £65, you can be damn sure I’ll be keeping the additional £15 for something else.
Why wouldn’t I?
However, if I’m looking for somewhere to take Tracey (my fiancée – and by the time you read this, who knows, we may be married) for a romantic meal and I line two restaurants side by side, one selling a 3 course set meal for £15 a head and one offering a gourmet a la carte menu with a professional lounge piano player, romantically decorated restaurant, a top quality wine selection and a beautiful countryside setting for £75 a head, I wouldn’t hesitate for an instant to opt for the chap tinkering the ivories…
You see, this challenge of competing with low price competition is fortunately something which can be easily solved and by solving it you can actually lay the foundations to become the most profitable and stable business in your market.
If it were true that people ONLY bought based on price then no one would buy a Mercedes, no one would go to expensive hotels, no one would buy holidays with Kuoni, no one would stay at the Savoy, no one would buy Chanel bags, no one would choose to buy Tesco’s finest food over ‘smart price’, no one would send their dog to a ‘dog spa’ (and they do exist) and I wouldn’t pick the higher priced restaurant…
Only about 10% of our population choose the lowest
price option for anything.
That means a whole 90% of the population are happy to pay above the lowest price and a whole chunk of those want to pay premium prices!
On top of that, lower price buyers are much more likely to complain, much more likely to switch to competitors at the ‘drop of a hat’ and much less likely to spend a lot of money with you…
High price luxury buyers tend by their very nature to be the complete opposite.
They complain less, they are more grateful, they spend more, are less likely to switch to competitors and are not only more likely to refer people but are more likely to refer people like them (bonus).
And even better, they are the least likely to be affected by the credit crunch, rising fuel prices, falling houses and economic uncertainty…
So…
For a second, ask yourself this question…
WHO you would rather serve?
Affluent clients with money to spare who are least affected by recession or low price buyers who can barely afford their rent when the price of petrol rises by 2p a litre?
The answer of course is obvious.
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7 Secrets to Recession Proofing Your Salon or Spa – Part 3
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Recession Busting Secret Number 2
Focus on a New Customer/Client
Generating System
Simple supply and demand illustrates that high demand for something in low supply will lead to higher prices and a position of power. Such a position gives you the ability to raise prices and the ability to create wealth.
So, we need to create MORE demand for what you have than there is supply (or at least perceived supply).
What we can’t afford to happen is you spend every waking moment physically making your demand generation machine work.
We need to create something which consistently pumps out new customers/clients come rain or shine whether you’re around or not.
Here’s how we’re going to do it.
1. Get Prospects to raise their hands as interested in what you have.
2. Capture their details.
3. Educate as to why YOU are the perfect choce for them.
4. Remain in contact with them with timely, pertinent offers until they become a customer and beyond.
Nothing magical about that. BUT, do you do that now?
Let’s look at an example based on a local nail salon looking for new clients to see how it works.
My name is Jane Bloggs, I’m sat at home, fed up to the ‘quick’ (excuse the pun) with my poorly maintained, ‘ugly’ looking nails.
I’m 47 years old, a professional (in this case a doctor), own my own home, am married, have 2 children at university and earn over £80k per year.
A letter arrives at my door. Hand addressed, real live stamp in the top right hand corner.
Ummm, I wonder who this is from.
It’s not my Birthday, Aunty Gerturde is back from OZ and she emailed me yesterday so it can’t be her. My Mum is downstairs drinking a cup of tea so it can’t be her.
Dunno…I’ll open it and see.
I open up the envelope and am greeted by a personal, well written letter with the headline “Who Else Wants nails So Perfect You’ll Constantly Be Asked ‘How Do They Look So good?’”
What an interesting headline. Let’s read on.
I then read the rest of the letter. A well written personal invite from a nail salon a few miles away offering me a free nail consultation worth £35 and a free guide called ‘The Consumers Inside Guide to Selecting the Perfect Nail Treatments For You”.
Funny enough, I’d been thinking about my nails recently and am a bit fed up with the way they look.
Now, the letter says I can call the salon to book my free nail consultation; I call an 0800 number to get my consumer guide or head to a website to do the same.
I’m not sure about calling for an appointment yet – this is an interesting letter but who knows, it could be a con!
So… I head to the office and tap in the web address.
I’m immediately presented with a single page website giving me a number of options.
I can request my ‘Consumer guide’ by leaving my details and in fact there are a couple of other free reports on their too. One about ‘the 7 secrets to a nails so eye catching you’re friends will think you’ve been to Hollywood’ and one called ‘How to Stop Biting Your Nails Forever’.
Plus, there are a whole bunch of videos on the site from happy, smiling clients professing what an amazing job the nail techs had done for them.
There’s even a 100% money back guarantee on all treatments.
Blimey, these people look really good.
I think I’ll request my ‘Consumers Inside Guide’, have a read and then maybe go see them for the free consultation – what the ‘heck’ have I got to lose?
I type my details into the website and click submit.
Wallop, I’m taken to another page with more videos from happy smiling clients from my area and a voucher I can print for a FREE ‘bracelet’ with any first paid treatment if used within 2 weeks.
Geez, this gets even better.
What a professional, interesting, different and exciting way to present nail care.
I then open up my email and surprise, surprise there’s an email from the salon.
A really well written personal welcome from the owner telling me all about where she’s from, her family, what she likes doing at weekends, and a little story about her claim to fame giving that famous actor a perfect nails.
Plus, a whole bunch more comments from really happy clients, my free report attached to the email and even my voucher for a free bracelet!
You know what; I think I’ve just stumbled across something special here. I really feel like these people know what they’re doing and could actually help me.
Anyway, let’s print off the report and have a read.
“The Consumers Inside Guide to Choosing the Perfect Nail Treatments for You”. Ok, what have we got.
The 3 fatal salon selection mistakes and 5 steps to the perfect salon selection for you.
You know what, this makes sense.
I should expect amazing service from my nail salon. I should expect a 100% money back guarantee, and why would I want to go to a salon who can fit me in today… Surely if they’re any good they’ll be busy!
Two days pass.
Beep, beep, beep.
Oh…There’s a voicemail on my mobile. Let’s have a listen.
“Hi, this is the owner (she’d say her name) from XYZ nail salon. I just wanted to say hello and thank you for requesting our ‘Consumers Insider guide’ a couple of days ago. Just to remind you, we do have a £35 free consultation available for you. We’d love to see if we can make you look and feel your best. But please be aware, we are very busy and I can only hold the free consultation open for another 2 weeks. Hope to hear from you soon.”
Wow, what a pleasant message. And you know what; I had seen the expiry on the consultation voucher. Perhaps I’ll call tonight.
Another day passes.
5am on Thursday and I’m checking my emails. Aha…An email from the nail salon. A case study of a lady who’d been embarrassed by her nails for years. Wow, she looks great.
Ok, and some answers to common questions about the salon. How the consultation procedure works, how long treatment takes etc.
Ah yes and my free consultation expires in a little less than two weeks.
Ok, I’ll call today…
Another day passes…
Ooo…Post is here…
What’s this postcard?
Ah…Another case study from the nail salon. Geez, this lady has gone from a nail biting fanatic to having amazing looking nails. If they can fix her, they can sure fix me!
Right, I must call today and book in that FREE consultation.
Another 4 days pass.
Post arrives. A red envelope. Umm, what’s in here…?
Aha, another letter from the nail salon. Blimey, I’m glad these guys don’t give up.
A nice letter saying they’re concerned I’ll miss my free consultation. How it is 100% free with no obligation. And two more case studies from clients who’ve had their lives changed by having their nails fixed…
Wow, this is one professional outfit. I must call now and book my appointment.
“Hello, this is XYZ nail salon. If you haven’t been to see us before please press 1. If you have, please press 2.”
I press 1.
“Good morning, Claire here and welcome to XYZ nail salon. My I ask you name.”
Claire then asks me a few questions and lets me know that the earliest consultation available is in 14 days time. And while that’s outside the date allowed for my free voucher they’ll be happy to give the consultation free as they’re just so busy they can’t do it sooner.
Great I say. That’ll be fine. I then come off the phone and jump on the laptop for work.
Ooo, an email. Ok, it’s a confirmation from Claire confirming my appointment in 14 days time and inviting me to take part in a brief survey.
Why not?
The survey asks me a few questions about my feeling towards the salon so far, what has been great and also what my main reason for booking a consultation was.
There’s also an opportunity for me to refer a friend or family member and if they book in for a free consultation I’ll receive a £10 M and S voucher and if they proceed with treatment I’ll receive Theatre Tickets for 2. It’s clearly explained that the salon relies heavily on word of mouth to help them keep their costs down and thus keep their fees as low as possible and maintain the highest level of service possible.
Quite frankly I’m ultra impressed so far and they’d have to do something monumentally stupid during the consultation to get things wrong so why not! I know my sister hates her nails and my Mum is constantly complaining about hers and how her current salon is way to heavy handed and treats her like a ‘prisoner of war’.
I bet those people would look after them!
In the run up to my free consultation the communication doesn’t stop. I still get interesting, educational emails and a couple of postcards and the day before I even get a little reminder message left on my voicemail.
If these guys are half as good at nails as they are at clientt communication then this is gonna be great!
STOP!
Ok, let’s take a quick pause here. I’ve just described the bare bones of a high value and very effective client attraction system.
Did you notice all the different things that happened?
All the different ways we were immediately presenting value and immediately positioning ourselves as something completely different than the norm…
Now, what’s really important in this example is not so much how we instigated the initial interest – direct mail is one way but it could equally be via a magazine ad, newspaper ad, Yellow Pages, TV, Radio and article, press release, telephone etc, etc. but rather the comprehensive value and benefit driven follow up.
In the example we followed up with the ‘prospect’ many times.
In reality this person may have responded a lot sooner or may have taken even longer to respond. What’s key is that we keep following up until they do.
Now, there is a point where that becomes counterproductive but we’ll leave that until another time.
You see one of the BIGGEST mistakes businesses make is not following up with the interest they generate from their marketing.
MOST people will NOT respond on the first touch – the first time they are exposed to us.
It’s therefore essential we capture the details of the interested people early and then focus on maximising new clients from those people with their hands raised.
Using the ‘lead generation’ approach I’ve just shown you then overtime you will build up an enormous ‘pile’ of ‘hot prospects’ i.e. people who have shown an interest in what you have. AND, you can at any point send those prospects an exciting offer and you will instantly generate new clients.
The larger the ‘pile’ of ‘hot prospects’ the more customers/clients you will generate.
Imagine the feeling of security and ‘power’ that will give you. Pretty cool eh?
And don’t think it all needs to be manual labour. Nearly everything that happens can be automated!
Ok, I went into that in a lot more detail than I expected but it is of VITAL importance. There are a LOT of secrets to success in there. Be sure to re-read it, circle what you don’t do and apply to your business quick-sharp…
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Give Your Salon or Spa the ‘Wow’ Factor
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Have you ever been somewhere and been so impressed that you literally said ‘WOW’?
A restaurant, a hotel, a theme park, a holiday, a wedding?
I can count on one hand the times that’s happened to me.
Sad, but true.
However, the people, places that DID make that happen have received hundreds, thousands, even times of thousands of pounds of FREE promotion from me.
I’ve told friends, family, colleagues and even used these places as examples in my newsletters, tele-seminars, marketing materials, books, courses in interviews, on the radio and more.
And don’t for a minute think it’s ONLY me they’ve received that free promotion from.
By creating the ‘WOW’ factor they’ve literally created an army of fired up sales people trotting around around the world spreading news of their amazing service…
Would you like a piece of that?
Any sane salon, spa, business owner of course would.
So how do you create the ‘WOW’ factor.
Is it so rare because it’s just fluke? Nope…
Is it so rare because it’s so expensive? Nope…
Is it so rare because it’s so difficult? Nope…
Is it so rare because most business owners NEVER think about how to create it? Yep…Probably…
It’s the LITTLE things that can ACTIVATE the ‘WOW’ factor for you.
Think of it in a different way.
Think of it as making yourself ‘WORHTY OF BRAGGING ABOUT’…
What can you do to make your salon/spa stick in your clients minds as something truly:
- UNIQUE
- OUTSTANDING
- SHOW OFF ABOUTABLE (I know that’s not a word)
You could:
- Pick up your clients in a limousine (charging a LOT for it of course).
- Have a different themed celebrity chef every month providing ‘nibble’.
- Have a world class MAGICIAN performing tricks for waiting clients.
- Have a monthly FREE dinner for your top clients at an exclusive restaurant.
- Provide a once a year trip to the most exclusive spa in the world for your top clients (and charge them but you arrange it all).
- Link your salon/spa to a celebrity so your clients can say… “I have my beauty treatments at the same salon/spa as XYZ…”
- Just give each client a fresh flower at the end of each treatment.
Look, there are endless things you can do.
And don’t think the small investment in each of them won’t pay you back…Do it right an it will…Multiple times over…
And if fact there’re are a whole bunch of things to do which I show you in my ‘Client Attraction System’ which cost very little and yet I can pretty much guarantee NONE of your competition will be using them…
Give yourself the advantage you need to prosper in these unprosperous times.
Don’t sit on the sidelines and worry, stress, ponder what to do.
Let me make is really simple, fun and profitable.
Grab your pile of salon and spa FREE marketing tools here:
FREE SALON AND SPA MARKETING TOOLS
And get looking for ways to create the ‘WOW’ factor in your salon TODAY.
Oh, and have a great day…
Henry.
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