Last month, I mentioned how Abraham Lincoln was known for saying that if he had six hours to cut down a tree, he’d spend the first four hours sharpening his axe. Well, this time of the year is excellent axe-sharpening season!
It’s hard to believe, but thank goodness, for most of you the busy season will start rolling around after the first of the year. Now is when you need to be looking at every area of your salon operations to figure out what needs to be done so you can maximize your profits in the upcoming months.
Listed below are the top three “areas of opportunity” I see most often when I work with salon owners. Even if your salon is currently doing most or all of these things, I can guarantee that with significant tweaking, they can increase your profits.
Create a robust, healthy EFT membership program
that brings you a big payday on the first of each month. The biggest common denominator I see with a successful salon is that their EFT program brings in at least 30-40 percent of their total monthly revenue. Rich people always get paid before they do the work – EFTs pay you before you deliver any services.
If you’re sitting in your salon waiting on who will decide to walk in and buy something, you’re not setting yourself up for success. I would never want to own any business that doesn’t have a healthy dose of re-occurring monthly revenue. Tanning salons are an ideal EFT business, so not maximizing this opportunity is a big mistake and is costing you a lot of revenue every year.
If you already offer an EFT membership, is it performing as well as it could be? Almost every salon owner I’ve ever worked with was not maximizing their EFT membership revenue. Your EFT needs to be structured so that it is the easiest, most logical and best membership choice for your customer to buy.
It is also vitally important that you make it simple to join without too many restrictions. The most common mistake is having a high minimum number of months that they must be enrolled in the program. The less appealing it is for a customer to join, the less EFTs you will sell! Effective EFT memberships are the cornerstone to healthy salon profits.
If you’re sitting in your salon waiting on who will decide to walk in & buy something, you’re not setting yourself up for success.
Communicate with your customers frequently
with proven trackable and measurable marketing methods. Posting on facebook all day doesn’t count; while it might be frequent, I bet you can’t track or measure the results. Never pay for any marketing if you can’t track the results.
Email is okay, but should never be solely relied upon since only about 15 percent of them ever get opened or noticed. For most single store operators, mass media like newspaper, radio and TV are generally not cost effective.
I know it sounds boring, but direct mail, done correctly, is the most trackable, measurable and effective way to get money from your customers. Good, old fashioned postcards, a well crafted sales letter, or even “marriage mail” like ValPak can literally make you wealthy! It’s very important to remember that it’s not your customer’s job to remember you; it’s your job to remind them that you’re there and haven’t forgotten them. Taking your customers for granted and assuming they’ll automatically think of you when they need a tan is a fatal marketing flaw.
ValPak for example has a 98% open rate because everyone looks for at least one coupon they know will be in there; the pizza place they like, or the oil change they need. If you’ve tried ValPak before and it failed, I’ll bet you all the money in my pocket that your ad rep created the ad for you. Big mistake. They’re great at selling ads but lousy at creating them.
A properly crafted VP ad can be a huge winner once you understand how to do it. ValPak gets mailed to a targeted number of homes – usually as few as 5,000 – which you reach for around a nickel or so each.
Reactivate lost & inactive clients.
You’ve probably never given two seconds of thought to your good customers that you haven’t seen for a while. You’re busy looking for new customers and just figure that the old and lost ones will show up once they are ready to tan again. Sounds nice, but it doesn’t work that way.
The good news is, a gold mine of untapped revenue sits in your old and inactive customer lists. Once you identify a lost or inactive customer, you can usually bring them back with a properly crafted “lost client reactivation” campaign. They usually just need a little nudge to remind them they’re missed and that you have a special offer for them. Reactivating these clients is an easy way to generate some quick revenue.
As a final thought, you need to remember what business you’re really in. You probably think you’re in the please-come-in-and-get-a tan-business, but you really are in the marketing business. Whether you like it or realize it, your main function as a salon owner is to bring in a steady stream of customers. Without new and repeat customers coming in frequently and handing you their cash, everything else you do is inconsequential.
