Magazine for the professional nail industry.
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104 | NAILS MAGAZINE | JULY 2016 } BUSINESS Ofering discounts can sometimes turn out to be more trouble than it's worth, but if done correctly, discounting can translate into increased loyalty, bigger service tickets, and more retail sales. Learn the right and wrong ways to ofer special pricing. BY TRACY RUBERT Let's Make a >>> DON'T NEGLECT TO PLAN AHEAD AND SET GOALS Most salons and nail technicians experience high/ low revenue, which historically reoccurs the same time each year. In colder months, for example, women start wearing boots and closed-toe shoes, and neglect the maintenance and beauty of their feet. This causes downturns in pedicure business and personal income, so it's vital to create and plan exciting service promotions to counteract the slow time and fll your appointment book. Valenzuela suggests ofering a "Purchase three, get one free" service and having it go on sale prior to slow season. "Make sure to upsell additional treatments or retail on the fourth visit," she says. "Consumers tend to splurge on themselves with these extra amenities when they are receiving something free — but you have to make the ofer." Summit Salon Business Center consultant Jill Wilson sends cards during the holidays to thank her clients for their business. "I also include a pre-made postcard with a January and February ofer," says Wilson. "This discount can be for $10 of an upgraded pedicure, $15 of a manicure and pedicure, or as simple as a complimentary parafn treatment with any nail service. This discounted ofer is only valid in January and February. By doing this, Wilson plans for the slow months and does something to get clients back in the salon. Creating a personal plan and setting goals will help you keep an eye on the bigger picture. Valenzuela says the simplest way to do this is to begin by deciding by what percentage you want to grow your yearly business. Write down your service and retail income for each month of the last 12 months. Multiply last year's monthly revenue number by the percentage you want to grow in both service and retail. Divide that monthly number by the number of days you work per month. Now ask yourself, what specials or promotions do I need to excite and engage my clients to try new services, come back more often, or purchase my home-care recommendations? Tracking success (or failure) is just as important as creating a daily/monthly sales plan. "It's important to track what worked and what didn't work," says Valenzuela. "Keep a fle of your projections and your results of each promotion. For the specials that worked, repeat them. For the ideas that didn't, adjust and tweak them or simply don't do them again." DE L BE STRATEGIC Ofering discounts willy-nilly is how salon owners and techs can get into trouble and actually lose money. Discounts will only yield more proft if they are used strategically and with restraint. Professional development manager for Milady, Steve Gomez, suggests ofering discounts in conjunction with an in-salon event, as part of a seasonal promotion such as breast cancer awareness month, Mother's Day weekend, etc. "You can also ofer a discount if you are participating in a local event in your community such as a fair or having a booth at an expo to build a specifc part of your business," says Gomez. "All of these examples are quick-hit programs, which is what you want." It's also important to put some thought behind setting up your promotions correctly. "If the discount is set too high, it creates low or no proft," says Kristi Valenzuela, Director of the Front Desk Division for Summit Salon Business Center. "In the long term, this will be demotivating to the employee or self-employed technician. An example of this might be 'buy one pedicure, get the next pedicure free.' If you set it too low, however, (receive $5 of on your 10th visit), it won't motivate the client to participate." DON'T OFFER AN ONGOING DISCOUNT OVER A LONG PERIOD OF TIME Always remember that you are worth the price you charge for the services you provide, so only discount a service that you are introducing for the frst time or as part of a temporary promotion. It is not wise to ofer an ongoing discount for a service over a long period of time. "If you're going to discount a service, ofer it for a maximum four-to six-week time period as part of a marketing promotion," Gomez suggests. "If you are going to ofer a discount on products, it should only be as part of an introduction of the product in your business, as part of a promotion for something seasonal like a holiday promotion, or if you are not selling the item and are putting it into a fnal sale discount to move the product of the shelves for good. It should never be done on an ongoing basis." Ultimately, the message is to be strategic, think it through, and ofer discounts when it makes sense. "If discounts are ofered on a continual basis it lessens the value of what is ofered; it's a way of hoping to get extra sales but it may just attract people looking for deals," Gomez adds. By eliminating a discount-seeking client, you make room for a client who will gladly pay for good experience and service.