Growing Your Business During the Recession
October 27th, 2008 • Posted by Ana Loiselle-Donahue • Permalink
If you are among many salon and spa owners/managers who are feeling your business slow down during the recession; it doesn’t have to be that way. Sure, tough economic times have a major impact on peoples’ buying habits ~ But, the good news is, even if the recession is here to stay a bit longer, you can survive and prosper by following some of my tips below:
Don't cut your marketing budget: The recession offers unprecedented opportunities to market in an environment of relatively less noise, as others cut back. I will tell you though to avoid spending marketing money on those venues that have never, ever brought you a single customer. Focus on marketing efforts that can be traced to sales.
Start getting your existing clients to refer: As a business, you are at your highest level of refer-ability during times of uncertainty. The best way to convince new prospects to utilize your salon or spa is to spend more time with the people who are already convinced. In times of uncertainty, many of your competitors are neglecting their clients as they attempt to recruit new business. If a client truly believes in your services, the likelihood that one of your existing clients will recommend you to one their friends is extremely high.
Explain how your services are beneficial during these stressful times: People are generally reluctant to enlist outside services during tough economic times. By outlining the short and long-term benefits of your spa services you make yourself indispensable. In a recent web site headline from Green Valley Spa, in St. George, Utah read, "RECE$$ION DEPRESSION?" Alan Coombs, owner said, “Even in recessions or difficult times, spas are busy because people need what we have to offer."
Launch a simple call campaign: I found this idea in my research to help one of my clients and they are seeing amazing results ~Reach out to the 20 percent of your clients who generate 80 percent of your business to touch base with them and ask how they are doing: You aren't trying to sell anything or be the bearer of any profound news, just placing a courtesy call. As the conversation is winding down, simply remind your clients that as a value added service, you make yourself available to answer any questions that their friends or family members might have regarding makeup, hairstyles, de-stress techniques, etc. Simply planting the seed and opening up the option gets the concept of referrals embedded in your clients’ minds so that they may respond when the opportunity presents itself, without making you appear needy or putting them on the spot.
I personally think your clients can have the best business advice. If you want to improve your bottom-line, ask your clients. One of the most beneficial concepts you can implement is the Client Advisory Council (CAC). As a business owner/manager, few activities are as informative and worthwhile as surrounding yourself with a group of your favorite clients and probing them for ideas and insights.
What steps are you taking to minimize the economic impact to your salon or spa? Please feel free to leave me a comment.
With almost 10 years experience in new business start-ups and transformations, Ana Loiselle-Donahue is a specialist in finding new sources of revenue and growth for companies of all sizes. She founded theSECRET in 2004 to help businesses flourish through creative —and powerful —new solutions; including brand development, strategic financial planning and employee training. Mrs. Loiselle-Donahue can be reached at 866/288-7353 or at www.thesecretconsultant.com. Check out her blog!
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One thing you did not touch on was how to avoid the conversation of a recession with the guests. Regardless of how busy a salon or spa is, it becomes a negative.
I liked these simple solutions. One way our spa is working hard to increase our revenue is reaching out to businesses in our area. We have started our Corporate Spa Connection where we are marketing to business by giving them volume discounts on gift certificates, creating wellness programs for them to use with their staff. We are inviting select groups of people to Cocktail Hour where we are going to introduce them to the program and find way to market together with them. Our first cocktail hour will be with all the innkeepers in the area to get them to think about using us in their marketing promotions and winter ski packages. There is business to be had…but you have to be very proactive and go get it. Make them realize that other businesses need you and how you can help them. We are also using all our resources, as a physical therapist, I am making sure that I am promoting that aspect of wellness and it is a necessity, not pampering.
Good luck this holiday season to all my fellow spa owners!
Sara
I am focusing on referrals, as well as doing a client satisfaction survey to make sure I am continuing to keep my current clients happy. Sounds like I am on the right track!
In response to Michele's comment..I told my employees they are not allowed to talk about the price of heat, gas, the news, etc. Clients are coming to get out of the "heat" of the world…so they are to redirect the conversation. My staff immediately got it. Ask the client if they would like more tea, get them a magazine….do not respond to negative world talk.
Further to Michelle's comments. All the studies and research about the changing spending habits during this downturn economy indicate that while spend in "luxury" categories are being tightened, spending on "feel good" categories are still being kept in the budget. So, to the extent that you can build an emotional connection and establish the spend about feeling good your in – even if they do it a little less frequently – they will appreciate that you keep in touch in a proactive manner.
Thank you all for the comments! Sara, I love your Corporate Spa Connection, cocktail hour idea. Way to go on creativeness!
What is your take on starting a salon/spa business during these times with no current clientele?
Hi Kimberly,
That is a good question, and a smart one to be asking with the current economic abyss. My answer is this: The future cannot be predicated, and any business decision is a gamble. Success in business is never automatic; with or without clientele. It isn't strictly based on luck – although a little never hurts. It depends primarily on the owner's foresight and organization. Even then, of course, there are no guarantees. Starting a small business is always risky, and the chance of success is slim. According to the U.S. Small Business Administration, over 50% of small businesses fail in the first year and 95% fail within the first five years. These figures aren't meant to scare you, but to prepare you for the rocky path ahead. Unless you have a secret crystal ball, you will want to increase your chances for success by relying upon a business consultant. The intricacies of owning and operating a salon and spa in today’s marketing can be overwhelming. No matter how good you are in business, you can't know it all, and can't do it all. Having a business consultant on your side can curve the above statistic in your favor,especially in this time of recession. My company offers free 45 minute consultations to discuss your ideas. Give us a call if interested.