Spa Business Management

My morning really started off crummy. I raced to a dealership to have my car serviced. When I arrived at the dealership cars were parked everywhere. I found an empty spot near the service area, parked, and headed for my appointment. Before I got inside, a gentleman asked what I needed and I told him I had an appointment to have my Volvo serviced. He said, “you need to park it in there” pointing to an area that would require backing up 30 feet and then finding a way to maneuver a sharp turn into the covered service area. I got in my car, backed up 30 feet, went over a raised section of the parking lot, almost got hit by a car entering the same service area and failed at my attempt to get to the right spot.

Humiliated, I looked up to find the entire service team not moving an inch but all highly amused by my efforts. Needless to say, I won’t use their services again, but as I waited to be picked up I thought of all the touch points (customer interactions) I had with the dealership in that short time. If they had managed them correctly I would have left feeling great and ready to recommend them to friends and family.

I counted 5 touch points that occurred before I actually spoke to a service team member at the dealership. If they were given the insight to analyze each touch point through the eyes of the customer they could identify the gaps in service and fix them. Managing and refining their operation practices in the first 2 minutes of a customer's experience would have a tangible impact on their bottom line.

Create a customer service map that outlines your spa client’s service experience. By looking through the eyes of a customer you can create an organization designed around their desired buying experience. It will translate to customers by making them feel special, important and valued every time they use your services. Creating a consistent customer service experience is the means to an end–brand power.

Posted in Creating Customers, Spa Business Management, General • Comment »

Some of you have been out there for long enough to have weathered an economic storm or two. While there is certainly no end to coping advice circulating these days, we thought going to the source — those of you who have seen and done this before, and whose spas have lived to fight another day — was the best way find answers.

So, are you planning to adjust your holiday campaigns or offerings in any way? Are you considering offering packages with slightly different/lower price points? Or are you adding value, in terms of a giveaway product or perhaps a lengthened treatment time for the same price?

We've talked to some owners who are going as far as rewarding their longtime clients with temporary price rollbacks to ensure those loyal clients continue enjoying services on a regular basis.

What are you doing, what have you thought about, in terms of how best to ride this financial event out while continuing to provide great services that relax, pamper and support wellness for your stressed out and tensed up client base?

We want to hear, and thank you again for sharing your expertise!

Posted in Spa Marketing, Spa Business Management, General • 7 Comments »

Seth and I are Orlando bound, and would love for you to stop by and say, "Hi!" if you're planning to attend the show. We'd love to share holiday marketing ideas, answer any questions you may have and just chat!

Oh, and there will be chocolate… those organic, dark chocolate Buddhas we've been giving out!

Good conversation and yummy chocolate — just the ticket for making the most of an afternoon at the conference!

Click here for show info.

Posted in Spa Business Management, General • 1 Comment »

I had the pleasure of spending three days at the Red Mountain Spa and Resort in Utah this week, while attending the SpaFinder learning event. Invited were top spa owners, operators and some of the sharpest people in the spa  business. Over the next weeks, we will share some of the key ideas and themes discussed regarding spa products, operations, marketing and benchmarks.

As a prologue to the series, I want to make one overall observation. As the country obsesses with the economic issues confronting all of us, the smart operators are not waiting for a recovery to bail them out. They are proactively making adjustments and plans. Some are changing their compensation structures (a major issue discussed at this retreat), while others are making operational changes designed to follow customer's changing behaviors. Many are looking for innovative ways to market themselves in a cost effective manner (like Instant Gift Certificates and Dynamic Websites — at least half of the attendees were SpaBoomers!).

The lesson is clear — there will be winners in this next quarter or two and they will be the ones who are making a plan.

Posted in SpaFinder, Spa Business Management, General • Comment »

Holiday Promotion Brief:

• Background (situation Analysis).
• Target Audience.
• Measurable sales goal.
• Strategy.
• Tactics.
• Budget.

Once a holiday promotions strategy is developed it is important to convert that strategy into implementable tactics or steps.

These tactics should be specialized, employed to carry out a specific strategy in an organized fashion. Some of these tactics will naturally come to life, an intuitive process born of the strategy conceived. Others will require a methodical approach to crank out.

Think about the 4 P's: Product, Price, Promotion and place (spa). Take each piece and think about what you need to execute the product, price, promotion and spa location components of the promotion.

Timing is important — it defines the nature of the promotion and its time limitations. Incorporating, “For a Limited Time Only” in any promotional offer should compel the consumer to take advantage of the valuable offer immediately. It is the fun and nature of promotion.

Timing is also very important in advertising when you are considering the lead-time for each element of the holiday promotion. If you plan to incorporate email communications to existing customers, make sure your email address list is ready. Then add as many addresses as you can before you send out your first email.

Using the SpaBoom e-mail marketing tool is easy. You can write your copy for the email message and add it to the scheduler right now, today. All email communications can be ready to send out well before the holiday.

We wish you all the success this holiday season. It’s been a rough summer, I think just about everyone could use a spa day this holiday!

Posted in Holiday Promotion Brief, Spa Marketing, Spa Business Management, General • Comment »

Holiday Promotion Brief:

• Background (situation Analysis).
• Target Audience.
• Measurable sales goal.
• Strategy.
  
• Tactics.
• Budget.

Developing a promotions strategy provides an outline of what will be communicated to target customers and how it will be communicated.

A promotions strategy is a plan of action developed to meet specific quantitative and qualitative objectives. It defines the process that will be implemented to meet a specific set of objectives.

The holiday promotion may involve developing a specific product/service package that provides value to the consumer and compels them to act and make a reservation. In this case you want to define the package, the "call to action" and then determine the appropriate method of communication to reach consumers with the offer.

There are a variety of advertising methods that can be used to reach target customers:

• Email marketing.
• Holiday Newsletter.
• Direct Mail.
• In-store promotion display.
• Traditional advertising, media.
• Public relations.

Developing a promotions strategy for the holiday will create a plan of action to meet set objectives and define a clear message to the consumer.

Posted in Holiday Promotion Brief, Spa Marketing, Spa Business Management, General • 2 Comments »

Let me be upfront right now. There is a reason I majored in marketing in college and not accounting. I just don’t have the patience for all those formulas that give you a sense of a business's bottom line. I know it is important but it lacks the excitement of my side of the business equation. That said, when it comes to advertising and holiday promotions I love to measure everything. It’s fun and there is nothing better than seeing a direct revenue jump from a planned holiday promotion that exceeds expectations. It just gives you a warm holiday feeling inside.

Your ability to measure your success based on original objectives also creates a benchmark for the future. If the promotion is successful, look for ways to improve and expand your holiday promotion next year and increase your budget accordingly. It will give you the confidence to build and grow your advertising plans.

Holiday Promotion Brief:

• Background (situation Analysis).
• Target Audience.
• Measurable sales goal.
• Strategy.
• Tactics.
• Budget.

Hit the mark this year by knowing what you want from your promotion before you put it in motion. The objective is to increase sales/margins over a particular time period based on previous years. It is a projection, a forecast and serves to guide future marketing investments.

It is critical to know how much your promotion costs, so add up all the expenses associated with the promotion. It is also important to try to identify the sales that result from the promotion over a specific time period. A concrete ROI (return on investment) will make your accountant sing.

Beyond quantitative there are the qualitative objectives that you hope to reach through your holiday promotion. Here are some favorites; you can add your own.

• Build awareness of your spa business and the services offered.
• Boost target customer traffic to your spa and business website.
• Increase the number of new customers utilizing your services.
• Encourage existing customer loyalty.

By understanding exactly what you want before you launch your holiday promotion you will be ready to meet success head on.

Posted in Holiday Promotion Brief, Spa Marketing, Spa Business Management, General • Comment »

Planning Spa Holiday Promotions

It's time to plan your promotions strategy for the holidays. It can feel like an overwhelming task to develop and execute a successful campaign. There are ways to organize your plans that provide an effective framework and strategy.

I have been in the advertising industry for about 15 years. I have worked in Telecom, Retail and the Consumer Products industry. Whenever I was given the task of developing a promotional campaign I used an advertising brief to set the strategy and execution of the promotion. All industries use some amalgam of this form to guide a project. Whether you are a billion-dollar industry or an entrepreneur with a salon or spa, a guide will make any marketing project more successful. Why? It helps us to see the forest for the trees.

Here are the basic components of an advertising brief. In the coming weeks I will expand on each component as it relates to a spa holiday promotion.

Holiday Promotion Brief:

• Background (situation Analysis).
• Target Audience.
• Measurable sales goal.
• Strategy.
• Tactics.
• Budget.

Make the form your own and create a promotional campaign for the holiday that makes you jolly and sends you into the New Year a happier spa owner.

Posted in Creating Customers, Spa Marketing, Spa Business Management, General • Comment »

Orange County Convention Center

IECSC Orlando features more than 300 of the top skincare and wellness companies showcasing the latest spa and medical spa products and technologies. IECSC Orlando also offers leading education with more than 100 FREE classes, a special full day conference by Bryan Durocher called "Your Profitable American Spa." 6 hours of education presented by the University of California –- Irvine called "Introduction to Spa & Hospitality Operations," as well as Advanced Education and CIDESCO Workshops.

Special Discount Offers: Register by September 5th and get your Daily Admission ticket for just $30 (that is $15 off the regular price).

PLUS you can save up to $60 when you purchase a Best Value Package.

Register here or call 800.498.6984.

Posted in Spa Business Management, General • 1 Comment »

Don't let negative employees sabotage your spa's holiday success.

Watching employees work together harmoniously is like watching a symphony; there is such synchronicity and beauty in seeing a team steady even under the most challenging circumstances.

The holiday always brings added stress, particularly for service providers who strive heroically to maintain a consistently high level of customer service. It is most challenging when your team is not aligned because it can truly make or break your holiday goals.

Before the stressful season takes over with a tidal wave of Ho-Ho-Ho! and red, take some time to inventory your team's successes and challenges.

• Are all employees aligned with the spa's organization's objectives? Do they feel a part of something more than their particular role? If you are hearing more "we" than "I" from your team then you are heading in the right direction.
• Do all employees understand their role in the team? Are their duties and expectations clearly defined? Employees who understand where they fit in the team and understand their duties take more responsibility for their performance. It is very empowering to be measured based on clearly defined goals and to be rewarded for outstanding performance.
• Is there a way for the team to voice and resolve issues that come up among team members? Having unique ideas and ways of accomplishing a task is a good thing. Conflict among a team is inevitable; how the spa owner manages that conflict is critically important. Make sure all employees know their problems and ideas are being heard and, when possible, implemented to make the team better and stronger.
• Is there a lack of harmony or trust among the team? Find out why and fix it. Trust among teammates builds unity and success — it is absolutely critical to know that each member is looking out for the rest of them team.

You work hard every day to make your spa the best. Taking time now to align your team toward a common goal will give them the tools they need to make the holiday a success.

Posted in Spa Marketing, Spa Business Management, General • 1 Comment »

Now that you're thinking about holiday planning, keep up with the To Do list, and next thing you know you'll have set your spa up for a memorable and successful season!

Holiday To Do List (cont'd):

• Plan a customer event right before the holiday season.
• Use client email list to send out an invitation.
• Plan an evening of beauty to promote the spa’s services and product selection.
• Educate customers with a sampling party. Invite vendors to come and promote their products.
• Make sure your in-spa product displays are ready for the holiday.
• Place product orders to ensure that the spa can meet customer demand.

Execution is key, now. You've set the wheels in motion, now it's time to attend to the finer details and enjoy being so very proactive with your business this holiday season!

Posted in Spa Product Sales, Spa Marketing, Spa Business Management, General • Comment »

We rolled out the ability for your clients to review both their experience with the Instant Gift Certificate process as well as your business as a whole. You can add those reviews to your website, show them off for all the world to see and even choose to not display the ones that might be inappropriate.

There is a long way between "showing" and "doing," however. What can the reviews give you to make your business better? Negative feedback!

When you log in to your SpaBoom account, we have been showing you a notice on your Today tab when you've recently received reviews. Now, we have added an extra head's-up if any of those reviews are either 1 or 2-star, ending the notification with, "and one of them needs your attention!"

It looks like this:

When you receive a less than stellar comment, it might be instinctive to flinch and just brush it aside. However, little can help your reputation and the happiness of your clients more than a quick and effective response to complaints that could indicate real problems with your business.

For example, when we check on the link to the reviews report from the example above, we see the following:

Uh-oh. It looks like Maggie is going to need a phone call to ensure she feels taken care of — otherwise it could be hard to convince her (or her friends, since the word will probably circulate at her next social gathering) that visiting your spa again would be an enjoyable experience. Luckily, because she signed in with her client account, you know how to get a hold of her, via email or phone.

What might happen if you got a negative review that was left anonymously? That depends on the review. Let's say it just says, "Your lobby is horribly smelly." Even if you don't know who left the review, you can still do a spot-check of the lobby and see if anything is a problem. If not, get a second opinion and then move on. Any negative review, anonymous or not, should at least garner a quick investigation to see if something can be improved.

In the business world, focus groups are created for the purpose of getting consumers to tell companies what they really think. Focus groups cost money, time, and are not easy to do for a small business — and with reviews, you have the opportunity to get the same kind of valuable information, while at the same time building your relationships with your customers and the local community.

Now, go forth and create some happy customers!

Posted in Tutorials, SpaBoom New Features, Spa Business Management • 1 Comment »

Before you know it, pumpkins will be all over the place and then a week later you will walk into Target and see red. It is in this moment that fear floods through the body and the realization strikes: procrastination has gotten the best of you. You have waited too long to plan a successful holiday season.

Don't wait. It is not too late to plan your holiday promotions, and with a little planning you can make this a record-breaking holiday for your spa. Take advantage of the lull that the end of summer brings and GET BUSY.

This is the time to think about how you can provide value to your customers. It is no secret that great service brings the prize of customer loyalty. Making your client's spa experience special and memorable is valuable to that person. They will want to help you succeed by buying Instant Gift Certificates from your website over the holiday.

So get ready now and you will experience a smoother, happier and more successful holiday sales season.

Holiday To Do List:

• Clean Up.
• Make sure all internal processes and procedures are working smoothly.
• Make sure spa employees are ready to make each client spa experience special.
• Clean the spa from top to bottom and give staff a visual image of your service expectations.
• Take care of the little things that are missed when everyone is too busy over the holiday.
• Make sure your spa website is updated and ready for the holiday.
• Update all content and contact information.
• Add a map and directions to your spa.
• Use the SpaBoom promotional content tool (accessed from Setup/Events) that allows you to enter your promotions that will go live at the dates you preset.
• Update your email list.
• Gather as many new email addresses as possible from your current customers.
• Purge the addresses you know are not correct.
• Have your list ready and set up in SpaBoom.
• Start thinking about a great service/product holiday promotion.
• Make sure you have the product in stock.
• Create POP (Point-of-Purchase graphics) to promote the promotion.
• The promotional offer should be visible in the spa and on the website.
• Make sure customers know your spa offers Instant Gift Certificates on the website.
• Develop POP that promotes the Instant Gift Certificates.
• Create an Instant Gift Certificate flyer to go into each clients bag.
• Make sure your website address is prominent in your spa.
• All advertising.
• On the door.
• Bags to business cards.

Now you're cooking. See how easy it is once you just get started? Go on, start ticking off the To Do list items, and look for more next week.

Posted in Spa Product Sales, Spa Marketing, Spa Business Management, General, Spa Gift Certificates • 1 Comment »

Competing in today's market requires skill and tenacity, and an undying focus on making the absolute most of your business, regardless. The media hypes negative events because they garner attention (and sell issues/subscriptions), but even in the face of tighter financial times there is opportunity for all who take the time to really embrace their effort.

The bottom line? You must trust yourself.

You created this spa business with passion, sweat and effort. Know that you can and must manage your business, like a business.

Get in control by actively acknowledging and managing your business challenges.

• Get real and face the problem.
• Dissect into manageable pieces.
• Define each task to accomplish.
• Take action.

Strengthen your relationships.

• Build loyalty with existing clients and employees.
• 80/20 rules always apply.
• Stay in contact with the spa's most loyal 20%.
• Keep track of your top customers and let them know you appreciate their business.
• Create a spa environment that is positive for employees and customers.
• Develop an online marketing program.
• Use all those client email addresses you've been collecting over the years.
• Let customers know about special events, new treatments and promotions going on at your spa.
• Send clients an email and give them a good reason to come in for a new spa experience.
• Provide value and strengthen relationships with existing clients.
• Send clients appointment reminders.
• Let clients know when you have appointment openings.
• Deliver Welcome emails for new clients.
• Send out a spa newsletter.
• Think long term.
• Update your website and keep it current.
• Educate your clients.
• Optimize your connections with clients.
• Know your audience and what they need.

Build new relationships that strengthen your bottom line.

• Create partnerships with other retailers and garner support for your business.
• Have a spa event at your day spa or salon.
• Get out of your comfort zone to create new customers.
• Look for ways to provide a key service to an unserved market.
• Help others. Selflessness and helping others is empowering. Problem solving for others keeps you ready for new challenges.
• Improve your processes.
• Correct mistakes that you've too busy to fix.
• Act on revenue-generating processes you have been meaning to get to but keep putting off.

Tighten your belt.

• Look at your inventory to look for efficiencies.
• Hold off purchasing new equipment.
• Focus on increasing sales instead of new product development.
• Increase profits by selling gift certificates from the spa website.

Occasionally stepping back and getting down to basics allows us an opportunity to strengthen the very foundation of our businesses. Now is an excellent time to take that step back!

Posted in Spa Marketing, Spa Business Management, General • 5 Comments »

That may seem like a strange thing to say, but hear me out.

When YOU are looking at online reviews of a business you'd like to visit or a book you want to buy, doesn't it give you just a smidgen of doubt if every single entry is a 5-star glowing testimonial that sounds like their best friend… or their spouse… or their mother wrote it?  You find a dose of comforting reality in the business that has a 4 star average — from lots of 5s but a few 4s and 3s now and then.  Now you know exactly what I mean.

You might get reviews that are mixed, or less than perfect.  Embrace them.

As a business any amount of feedback you get from clients is pure gold, even if it does not appear shiny at first glance.

If you know the client who left the review, give them a call and thank them for their feedback.  Don't even mention the content.  If you don't know the client, consider the review — are there any nuggets of truth that could be addressed?  Perhaps they found the services wonderful but the wait time a little long.  If you were busy that day, of course that could have happened if bookings were going over their time frames.  Use the feedback to make your business better for the next client, and the next…

If the review is truly awful, the same followup procedures apply.  However, if you have ample reason to believe that the review was mean spirited without substance, you can choose to suppress it in your showcase reviews in SpaBoom –  just go to your Reviews Report, click on the date of the review in question, and use the checkbox "Hide this review."  You are only allowed to hide a few reviews, which gives you control over the quality of what appears on your site, while also allowing for your clients to express their opinions.

Enjoy this feature, but act as if each review is a gift from your clients and you'll continue to improve.

Posted in Tutorials, SpaBoom New Features, Spa Business Management • 4 Comments »

Last time, I showed you how to easily add your Reviews to your SpaBoom Dynamic website — its incredibly fast and most of the work is done for you, thanks to the design of our templates.

However, if you already have SpaBoom Instant Gift Certificates linked to your existing website, you can still join the party — we love for everyone to collect and show off their customers' comments, so here's part 2: how to add reviews to your existing website.

Wonder if you already have reviews out there?  Get a glimpse by logging into your SpaBoom account, and go to the Reports tab, then take a peek at the Reviews report.  You'll see any reviews you've collected so far, for a glimpse into what your customers think and how much they appreciate your services to them.

Ready?  You're all set to add the link to your website.  We have a great tutorial on the details in our Help section, titled "Reviews for Linked Websites".

Essentially you or your web designer will be adding a link to your website, just like you did when you added your Instant Gift Certificate link when you first signed up with us.   Easy, huh?  Promote this new and neat way to connect with your customers, and your business will surely keep booming!

Posted in Tutorials, SpaBoom New Features, Spa Business Management • Comment »

According to Advertising Age (via TechCrunch), the top 100 advertisers in the U.S. made a big shift from old media to online in 2007:

What does this mean for you? The smart money is increasingly moving online and you need to think long and hard about whether enough of your marketing budget is following their lead.

The first places to spend money online for your spa:

• Your website: A great website — one that is both beautiful and effective — is the basis for all of your online marketing. If your website hasn't been updated since Al Gore invented the Internet, then get a new one! This doesn't have to mean a lot of money, witness SpaBoom Dynamic Websites.
• SEO: If you don't have a SpaBoom Dynamic Website, then second thing you should spend a little money and time on is search engine optimization (SEO) of your website. The Online Spa Marketing Guide has a great SEO overview.
• Integrate with offline advertising: Now that you've got a great website, ironically one of the best things you can do for your online presence is simply to make sure it is an integral part of all your offline marketing. Highlight your website, and make sure to tell people that you offer Instant Gift Certificates!
• Spa Emergency: 85% of SpaBoomers participate in Spa Emergency, the national directory of instant spa gift certificates. The free listing is great for SEO, and the pay-for-performance model is the perfect example of measurable online advertising — you only pay when you've actually sold something!

Once you have the bases covered, it's time to step up your online marketing:

• SpaBooker brings new business by enabling clients to book appointments directly from your website and from SpaFinder.com.
• Pay-per-click advertising with AdWords drives targeted visitors to your website.
• Local directories: Advertise on directories like CitySearch and Yelp! which have a strong presence in your area.

Posted in Spa Marketing, Spa Business Management • 3 Comments »

My wife had a very interesting problem in doing her 2007 taxes this year: Her accountant — whom she had mailed all her 2007 receipts and financial information half-way across the country to — fell off the wagon. He stopped returning calls, and didn't even bother filing an extension for April 15th deadline. I introduced her to my accountant here in Albuquerque, who quickly filed an extension for her. However, she needs her 2007 materials from the old accountant, so the new accountant can do the 2007 taxes. Worse, my 2007 taxes are being held up, because they depend on hers.

Being an attorney, I live-and-breathe what I must now unfortunately call the "old way" of thinking. My old-fart process is very structured, requiring a lot of effort, time and expense. It goes like this: Make a telephone call (no answer, of course), leave serious and threatening message (no response), send certified letter demanding 2007 tax materials (certified letter not picked up at post office), contact relevant oversight authority (in this case, state CPA board) who then follows the old-fart process themselves with similar results, once self-help options are exhausted file a lawsuit (which has its own lengthy process).

My "old way" takes months, several thousand dollars and an the results are uncertain (i.e. even with a court order, will they put the accountant in jail if he doesn't deliver all the materials, and how do we prove what materials the accountant actually has in his possession?). Worse, without very significant effort, time and expense, there's almost no way to obtain the 2007 tax materials in time for the upcoming October filing deadline.

My wife introduced me to the "new way" of problem resolution, and not only is it effective, it's fast, easy and very inexpensive. It turns out that my wife was a member of BNI, a business networking group, where she met her accountant. She found out that her accountant was still attending BNI meetings. Despite all the trouble we were having with him, he felt he needed to maintain his networks for business. So, my wife sent an email to a number of her BNI contacts, simply stating the facts and asking if they see her accountant or have any influence with him. Those contacts, in turn, ended up forwarding the email to other people, and so on, and so on. Turns out that a number of contacts had ongoing business relationships with her accountant.

This became very embarrassing for her accountant, who within 2 days, sent all the materials back to my wife. Problem fully resolved within 2 days, with very little effort (an email note) and no cost. This is unprecedented with "my old" way of handling things.

Social and business networking has always been important, but the Internet is exponentially increasing the value and power of networking. In the case above, email was the tool. New social networks, including MySpace, facebook, LinkedIn, and friendfeed, are enabling near real-time access to your network of friends and business associates, which will have profound impacts on businesses and how problems are resolved.

Are you on any of these social networks? If not, you might want to look at them and start paying attention to what others might be saying about you or your business. At the very least, they could provide feedback to you on how your business is doing.

Posted in Spa Business Management • 2 Comments »

Noun: entitlement - 1(a): the state or condition of being entitled. 1(b): a right to benefits specified especially by law or contract. 2: a belief that one is deserving of or entitled to certain privileges.

No other element of the salon and spa business is more worshiped than followings or “full books.” The “full book” syndrome, as I like to call it, creates an untenable sense of “client entitlement,” and serves to shift customer loyalty and income security from the salon and spa, to the technician. A “full book” is prized by technicians and feared by the owners and managers. It creates an unfair sense of ownership, or “my client” mentality, by the technician. Technicians all too often use a “full book” to hold management hostage, and it fuels the “walk-out bomb” that has devastated many an otherwise successful salon and spa.

I am no longer surprised when I hear employees saying, “I’m paying the salon/spa I work for 50% of what I bring in;” it’s a sure sign of a salon and spa being contaminated with entitlement.

Do your employees have the mentality of “client entitlement” in your salon/spa?

• Technicians use the phrase "my client" instead of "our client."
• If a particular technician is unavailable, the front-desk lets the client go without a booking, rather than try to find another technician to service the client.
• Technicians get angry if a client decides to go to another technician, and says “That was my client!”

There is good news. Salon and spa owners have tools available to them, to move away from this dusty relic from the salon industry’s glory days. Followings don’t fit today’s fast-paced, streamlined business thinking. Clients want access to salon/spa services when they need them.

The Three “C’s” – Factors Affecting the Client Entitlement Mentality

Commission ~ One of the biggest contributors of this client entitlement phenomenon is the commission pay structure. Since commission pay rewards only individual sales, it’s no wonder employees feel entitled to “their clients.” The strongest message that commission pay delivers is to “build my following.” Reward your employees for building a following and they’ll feel entitled to build it and take it. Your pay program must reward over-all performance. What gets rewarded, gets repeated. Consider implementing a compensation system that rewards technicians for sharing clients … and communicate it to your clients.

Culture ~ It is never too late to change the culture of your business. A culture of client sharing; the ability to share, move, pass and feed clients to other technicians is imperative to growing your business.

Instead of it simply being assumed that when a new client arrives, who they are scheduled with will become their exclusive technician, develop an orientation program for new clients explaining that there is no need to feel locked into any one technician.

Contract ~ Every client that walks through the door rightfully belongs to the spa, not the random technician who happens to be available when the new client showed up. Having a strong contract in place with your technicians doesn’t just protect the long-term viability of your business; it sets the expectations of your technicians and tells them you mean business when it comes to clients. There is much confusion about Non-Compete Agreements. Read Larry Donahue’s blog article, Non-Compete Agreements: They Can Work for more information.

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!

Posted in the SECRET, Spa Business Management, General • 10 Comments »

One of the biggest concerns I hear about from spa and salon owners and managers, is the fear of key therapists or technicians walking away with the "book of business." I've talked with key therapists and technicians at many spas and salons, and it's clear: These people believe any client they work on is "their customer," they are free to take "their customers" away from the salon and spa they work for, and they don't believe non-compete agreements are enforceable.

I just cringe for the spa and salon owner, who have such individuals in their employ. Sure, they are busy, but make no mistake about it — they are working for themselves and there is zero loyalty — they will leave you in an instant if they think the grass is greener elsewhere.

Aside from being completely wrong on all accounts, these therapists and technicians have little knowledge or respect for the difficulty and sheer effort it takes to open, run and successfully manage a profitable spa and salon. It's the salon and spa owner that invests in marketing and signs the advertising contracts. It's that same owner who doesn't sleep at night, trying to figure out how to keep the lights on, the clients coming through the door and the paychecks issued. Client loyalty is key to the success — and long-term viability — of any spa and salon.

How can you prevent former employees from stealing your clients? The answer is, a well-crafted non-compete and non-solicitation agreement.

The laws vary from state-to-state, jurisdiction-to-jurisdiction. There are ways to write bad (i.e. unenforceable) agreements, and there are ways to write great (i.e. enforceable, with teeth) agreements. The best way to obtain a great agreement, is to hire a local attorney familiar with such matters — the money you spend writing such an agreement will pay for itself in dividends.

Do you even have agreements in place with your employees? If not, you have no excuse! Start now!

Don't give courts reasons to invalidate your agreement. Make it fair and reasonable. This means take ownership of what is yours — the client — and don't unduly restrict your employees from being gainfully employed elsewhere. Avoid:

• Geographic restrictions - even limited ones can pose problems
• Blanket restrictions - everyone has a right to work, so don't prohibit someone from earning a livelihood
• Unlimited restrictions - always reasonably time-bound the restriction (i.e. 1 year)
• Non-solicitation only - everyone tries to get around this, by creating the circumstances where "I didn't solicit them, they called me!"
• Punitive damages - courts seldom award punitive damages, especially for employee contracts; so they just help to instill the belief that your non-solicitation agreement is egregious, unfair and unbalanced

Every good non-compete agreement should, at a minimum:

• Define Confidentiality and require employees to honor the confidential information of your salon and spa
• Define "Client" and "Client List," and make it clear they are owned by your salon and spa and are to remain Confidential and Trade Secret
• Indicate that employees (including "whether as an individual for its own account, or for or with any other person, firm, corporation, partnership, joint venture, association, or other entity whatsoever, which is or intends to be engaged in the same line of business as YOUR SPA AND SALON, or in such other business competitive with YOUR SPA AND SALON,") may not solicit, interfere with, or entice away any clients (or employees) of your salon and spa, for a reasonable period of time (i.e. 1 year)
• Indicate that employees (with language above) after their employment ends at your salon and spa, may not service, or perform services for, any Client, for a reasonable period of time (i.e. 1 year)
• Require employees to acknowledge that the restrictions will not create an undue hardship, not prevent them from competing in an independent business, and agree they are subject to a restraining order and/or injunction if they violate the agreement
• Require "reasonable enforcement costs and expenses" to be paid by employee, if they violate the agreement
• Contain the standard clauses of severability, survival, waiver of breach and assignment

Note that if you are presented with therapists or technicians who are bringing their own clients, and you want to acknowledge the clients they bring, my advice is to create an "attachment" that has the actual names of the clients you want to exclude from the agreement. The employee should specifically indicate who such individuals are.

If you have a therapist or technician who doesn't want to sign such an agreement, then you have some interesting information: They intend to steal clients from you the minute the relationship doesn't work for them. Do you really want such employees in your organization?

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