Business consultant Phil Jackson from Build Your Salon and Queen of Memberships, talks about how membership can give your business a boost.
The New Year is the perfect time to think about your business differently, to put some of the horrors of 2020 behind you and rebuild in an exciting new direction. And salon memberships can not only help your salon’s bottom line, but set you apart from your competitors too.
More than that, clients are currently looking for ways to support their local businesses. They’ve seen one familiar name after another disappear from the High Street and they have more of an understanding of the economic pressures we’re facing.
Memberships give customers a great way to show their support and commitment, but offering them also sends a signal. They tell the customer that you’re confident in your salon’s future, that you’re not afraid to innovate to thrive and most of all, that you’re here to stay. After all, you’re potentially asking your customer to sign up for the next 12 months.
Salon memberships are also a terrific way to build customer loyalty. Not in a negative way by ‘locking’ a customer into a contract, but by encouraging higher frequency of visit and, in my own salon, by heaping on the VIP benefits too.
If you have employees and have ever felt vulnerable to a team member leaving, memberships can be a really useful way to build loyalty to the salon brand rather than to individuals.
We often find that when a stylist or therapist leaves, the membership customer sticks around until the end of their membership term. That gives you an opportunity to impress and build a loyal relationship with a different team member.
Speaking of team, memberships are a great way to direct customers to a particular part of your price card too. I’ve seen memberships where the customer can enjoy great extra benefits, but the membership is only available with the more junior team members.
That gives the juniors a taste of the challenges that repeat customers can bring and helps them on their way to filling a column of regulars. At the other end of the scale I’ve helped salon owners who want to manage themselves out of the business put memberships in place too. A high-end membership became the only option for clients that wanted to see the salon owner. That encouraged customers into other team members’ columns and helped the owner command a higher price for the few treatments she wanted to do each week.
Memberships can give a great competitive advantage since they are still relatively uncommon in the salon space. That helps you stand out as something different and innovative and can genuinely bring back that ‘new salon’ buzz. Even if other salons catch on to the idea, you will always be the first in your town!
Most importantly though, memberships are a terrific way to help the salon financially. Not only do we get to smooth the peaks and troughs in our turnover, we also have a source of stable income which helps salons plan financially.
I used to really struggle to know when it was OK to refit the salon, or grow the team, or invest in equipment or training. By having a percentage of your income on a regular retainer those decisions are much less risky.
So how do we go about building a terrific membership programme? My first step is always to start with exactly who you want the membership to appeal to.
Memberships aren’t for everyone and I don’t believe you should move your most profitable customers on to memberships either: they are, after all, already profitable.
The perfect membership customer for me is that client who makes a New Year’s resolution to put herself first and make frequent salon visits, but by March life has gotten in the way. Or that customer who you think to yourself “you know, if we just saw you a little more frequently we could get a much better result”.
Once you know who the membership is for, knowing what to build is so much easier because we know what is important to the client. Does she need something that makes great sense financially? Or is she after some exclusivity? What is it that would make a membership a no-brainer for her? Keep your membership offering really simple.
The most successful memberships I’ve seen have been built around one service or a tight group of services. I’ve seen a massage club work really well, I’ve helped with blow dry clubs, waxing memberships and haircut clubs too. Ideally you should be able to describe your membership in one sentence – more than that and it’s probably too complicated.
Some services lend themselves to a gym-type membership with unlimited access. Most hair services, waxing, spray tanning and many nail services can work well on an ‘unlimited’ basis and represent excellent value for the customer.
By contrast facial services, sunbeds, massage and most holistic therapies lend themselves to a subscription or ‘defined benefit’ membership where the customer receives a certain amount of a service per month. They can be a little easier to price but sometimes need more work in the marketing.
When it comes to pricing there is no need to over-discount. Certainly the membership should make financial sense, but it has to be a win-win for you and the client or you’ll come to resent your club members.
Try to build in extra benefits to reduce the need to take money off. A free upgrade to a deluxe facial or full-head of foils once or twice a year is often enough and doesn’t cost the salon too much. In my own salon we include a “mayday” voucher which guarantees the client same-day service even if we’re fully booked and any day of the year.
Another salon I’ve worked with had a slightly different cancellation policy asking for 2-hour’s notice instead of 48 which appealed to her very busy customers. The acid test for pricing is a simple question: If everybody signed up, would this still make financial sense for the salon? If the answer is anything less than a resounding ‘yes’ you’ve probably priced the membership too low. Bigger discounts make sense for ‘last-minute’ memberships though.
The toughest thing with promoting a membership is creating scarcity. By definition, the membership is always there so we need to do something that makes the customer want to take action today. A small ‘early-bird’ discount can work or in my own salon we limit the number of memberships available to make signup more desirable.
Phil Jackson is the self-styled Queen of Memberships, the founder of QueenOfMemberships.com and has been midwife at the birth of thousands of salon memberships across the world.
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