Wednesday, 5 June 2013

How-to: Get The Edge On Competing Salons

It's not news that profit margins on the high street have suffered as a result of the recent recession. What may suprise a few though is that hair salons are no exception to this trend.

According to a recent survey, customers have begun to cut back on discretionary spending such as hair and beauty products. 

Surely then it is the smallest salons that are suffering the most, those that are unable to weather the storm. 

 Apparently not, on closer inspection it appears that the salon industry is pretty unique on the highstreet; no one company holds more than 2.5% market share! In actual fact the hair and beauty industry is a fiercely competitive lanscape for even the most established of brands. Salons then need to find affordable ways to remain competitive and gain the edge on their competitors. 

Is it time for the hair and beauty industry to embrace mobile technology? 

Mobile applications offer significant potential benefits to salon owners. By achieving the dual goals of: targeting new customers and deepening existing customer loyalty, they could well prove a valuable weapon in the battle for highstreet survival. Most applications do not cost businesses much and by identifying the correct mobile solution, both of these objectives can be achieved and exploited. 

Take for example loyalty cards: Many salons already offer a stamp based paper loyalty card (eg "Visit 9 times get % discount on your 10th visit"). For a minimal monthly fee, being able to mirror this offer on their customers' mobile phones has genuine advantages:

- Convenience:  customers do not have to worry about losing or misplacing their loyalty cards. They know that all the data is in their phones and not taking up space in their purses or wallets.

- Customer understanding: what do we really know about our customers? Their names? The way they like their hair cut? Wouldn’t it be more useful to understand spending habits, not just in your salon but across the high street. Perhaps this person might be a valuable brand advocate across social networks. These benefits are only available through a digital device.

- Personalisation: in order to really make a customer feel special, the reward provided has got to suit them. There is no point offering a reward that the customer does not value. Mobile loyalty devices help salons identify what rewards will appeal to customers and in turn trigger them to spend more, visit more frequently or tell more of their friends.

Encouraging customer to share offers with their social networks can have really positive results for the salon. People are becoming immune to offers being presented to them by businesses, but are more open to offers recommended by their friends. 

Posting to customer's social networks on their behalf however, is a fine line to tread in the 'cool v creepy' tightrope that mobile apps walk. Some customers may feel that this is a little intrusive, yet other will be happy for the app to do this if there is a reward such as 20% discount for clicking on a link. What is certain is that customers should be made aware before they start using the app, that content may be posted on their on their behalf with an "opt out" option for each customer.

Having completed several surveys, we are now about to start building an updated version of Loyalli. The update is going to contain some really exciting new features aimed specifically at salons! Features for driving new business, encouraging repeat business and developing customers into brand advocates!

If you would like to learn more do be in touch!