What a terrific opportunity that was to interact with so many stylists in my webinar sponsored by the Associated Hair Professionals. I’m very much looking forward to the next one and, if you weren’t able to participate in the live event online, the recorded webinar will be available soon to AHP members at this link: www.insuringstyle.com. Also go to that address for information on membership or call (800) 575-4642. I highly recommend the AHP and sibling associations that serve the various salon professionals from nail technicians to stylists and estheticians, providing business insurance and other services.
This recent webinar was about “Gaining and Retaining Clients.” A lot of the discussion concerned marketing, including the use of discounts, which came up in a number of questions from salon professionals attending the webinar.
I encourage you to listen to the webinar to get all the details but, overall, my advice is to be very cautious about offering discounts and pricing your services too low. These strategies definitely have a place in business and can be a great way to attract customers, particularly when you need the income if you are starting out or if you’ve just relocated to a new town.
HOWEVER, you can really work yourself into a corner with these tactics. One problem with discounts is that you only attract customers shopping for discounts. These people will never be clients, returning to you again and again. These people always shop for discounts. When your discount ends, they go find another one somewhere else. What have you gained?
What about setting your prices low to attract new customers? If those people become clients, then you’ve got a different problem: you need to raise your rates! How do you think those new clients will feel when they suddenly get hit with a big increase? Is that their reward for being a client?
What do you charge referrals? Do you give them the same low rate that you charged your clients who made the referrals? Your low prices were probably a big part of why they suggested you.
What do I do? I give my clients a free service on their birthdays. This is a great way to thank them for being “clients.” It is a clearly defined and limited reward. It doesn’t threaten my regular rates.
I also think that bundling rates is reasonable. This came up as a question in the AHP webinar. If someone is getting two or more services at one appointment, this sort of discount makes sense. This reduces the sticker shock, and we get to do more work in a single appointment.
Go to the webinar at AHP to hear the whole thing and all the questions and my responses. And, again, I highly recommend that you join one of these organizations to benefit your business.
As always, be open to change!