When service and retail sales are slow at your salon, it’s easy to resort to a discount promo as a quick fix. We are not slamming discounts, as a strategically planned sale can be incredibly beneficial for your salon for a myriad of reasons. However, it should not be your go-to move all of the time for your salon promotions and in this blog, we are going to look at the pros and cons of discounting versus adding value! We also will leave you with plenty of “value adding” examples for you to turn to when you’re looking for the instant gratification of offering a discount. So without further ado, let’s dive into discounting 101.
As mentioned above, we are by no means saying you should never run discount sales as we have seen them be successful and lucrative for salon and spa companies. They drive sales and spike revenue and can create new loyal customers that perhaps wouldn’t have taken the plunge without a discounted rate. However, we want to give you the low down on some of the cons of discount sales (and revolving all promotions ONLY around discounts) because when they are not done properly, they are ineffective at best and harmful at worst.
Clients and customers may come to expect these “new” discounted prices. If you are discounting too much or too often, you are essentially training your guests to wait for promotions to purchase retail or book in for services with you. While the promotion may bring in new clients, are they only there just for the sale or will they be loyal supporters after the discount offer is over? This is important to track as a measure of success when running discount promotions.
Clients may perceive your brand as lower quality due to discounts. We all know the saying “you get what you pay for” and if you are regularly discounting services and retail, it may paint the picture for current and potential clients that your offerings aren’t as valuable. Think of it this way; if you don’t believe your services are worth the value of the full price and feel the need to offer a discount… why would your clients think any differently?
On an interesting side note, studies have also shown that prices have an unconscious effect of the consumers experience of the product. For example, consumers enjoyed the same glass of wine labeled as a more expensive brand more than when it was labeled as an inexpensive brand. In the salon where experience is of the utmost importance, is offering frequent discounts actually hurting your clients experience?! Something to think about.
It is more difficult to raise your prices in the future when you offer regular discounts. If you offer a major discount one month and then slightly raise your prices the next, the price increase is going to seem astronomical to your guest as they just spent a major fraction less at their last salon visit.
All of this sounds scary, but it is incredibly important to keep in mind when planning your salon/spa promotions! Discounting doesn’t need to be the only way to entice existing and potential clients, let’s talk about the concept of adding value!
ADDING VALUE 101
There are countless ways to add value to your salon/spa’s service and retail offerings for free, with minimal effort and without breaking the bank. Of course, you can choose to make this as easy or difficult as you want but we are going to give you some incredible, EASY, ideas to spark inspiration for use in your own salon company.
-Create or include a FREE gift with purchase. As soon as the consumer is aware that they receive something for free with their purchase, it automatically becomes more enticing and attractive to them. Here’s a few ideas that salons and spas can include as a freebie with services or retail sales:
Include a lower cost item as a freebie like a hair accessory or travel sized product with purchase.
Create a digital freebie like a video tutorial or step by step graphic to include with purchase.
Include a low cost, low time investment add on service for free. This could look like a hair treatment, a paraffin treatment, or perhaps an extended scalp massage with a hot towel.
Add value with BONUSES. Similarly to freebies, consumers get excited when they see the word BONUS and are more likely to do what they need to do/spend what they need to spend to unlock the bonus. This can be a great way to incorporate discounts as a BONUS to incentivize higher $$ tickets to make sure you’re not messing with your profit margins when discounting. Here’s a few ways you can include bonuses in your salon’s promotions:
Spend $X to have the opportunity to buy something else (whether it be a product, service, or bundle) at a discounted rate
Book in for X amount of appointments to be entered to win a prize.
Book in for multiple appointments to receive bonus discount on those services.
Add value with TIME. This works better with salon professionals that are still building their books as you obviously need to have the time if you’re going to spend it. Here are a few great ideas you can use to add value to your services/retail with time:
Offer a complimentary amount of time with purchase to show guests exactly how to use products or tools. This can be done quickly and efficiently and your guests will absolutely love the added value of your team taking the time to show them exactly how to use their new product(s) or tools at home!
Offer a complimentary add on to services that have low or no product cost associated, just time. This can look like offering a complimentary makeup touch up following a service or perhaps offering a specific hair style to finish that takes a little extra time like braiding, blow outs, or a simple updo.
Offer complimentary consultations for high priced services. The value of offering 15 minutes of time complimentary before your guest takes the plunge booking the service is huge and for the majority, you will see the return on investment of time.
Here's a few incredible examples of adding value promotions from a few of our amazing Salon S.O.S clients:
Now that you’ve got a few ideas to spice up your promotions by adding VALUE instead of discounting, we want to let you know how you can do this all of the time using a loyalty rewards program.
When you have a loyalty rewards program, your guests always get the excitement of working towards a freebie or bonus. So instead of rewarding new guests with discounts and savings, treat your existing clients to the freebies they deserve as a token of your appreciation for their continued support and loyalty!
At Salon S.O.S, we take loyalty programs seriously, in fact, they’re kind of our specialty!
With a custom branded loyalty app built by the pros at Salon S.O.S, you can strategically decide how you want your rewards system to look like. You choose how many dollars need to be spent to earn a stamp and how many stamps are needed to redeem rewards.
Not only is it a great way to incentivize sales and reward client loyalty, you can also send texts about current salon promotions and post about sales and features to promote in salon and online sales. You can set it up to message your clients with a freebie or gift on their birthday which not only is an adorable touch that they will feel special about, but is also a great way to encourage a new purchase! Win win!
To learn more about our incredible and affordable loyalty apps, hit this link to request a FREE demo. It’s risk free, give it a shot to see the benefits of a Loyalty S.O.S custom branded app for your salon/spa!
You should also give this blog post a read to learn even more about the benefits of having a loyalty program for you salon!
Here's a social post from one of our Salon S.O.S clients about their salon's loyalty app!
While discount sales can be successful once in a while for your salon, the key thing to remember is once in a while. If discounting is the only thing you lean on to generate major sales and you use it often, the appeal of paying full price will start to fade and the quality of what you’re offering may be perceived as less valuable. So instead of always running sale promotions, concentrate on adding value in different ways!
We challenge you to sit down and plan your next quarter or review your next quarter of promotion planning for your salon. Is every promotion a sale on your services or retail products? Are there any discount sales that you can change and include an added value freebie or bonus instead? Then, as an experiment, compare a discount promotion and an added value promotion to see your profit margins and how successful they were individually. You just may find that getting creative and figuring out a strategic way to add incredible value to your offer without affecting your profit margins is a smart way to add some spice and variation to your salons promotions!
We can’t wait to see how you get creative with adding value to your salon/spa promotions, make sure to tag us in your social posts!
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‘Til next time,
Your Team at Salon S.O.S