IS IT MORE BENEFICIAL TO OFFER DISCOUNTS OR ADDED VALUE OFFERS?

Two business owners discuss whether discounts are better than special offers

Discounts

“In an increasingly competitive industry I definitely believe that well-thought through and selected discounts can be a useful business-building tool. The key is to use both discounts and offers wisely because believe me, having survived the Groupon era, I have seen how mass discounting can ruin a salon’s business and reputation!

I would never run regular monthly offers, that’s when discounts don’t work

Our first port of call is to use an introductory offer to build a new stylist’s column. Whether it’s a new stylist or a newly-qualified assistant, column building can be hard work. I want the team to feel confident about their job, and that doesn’t happen with a quiet column. A percentage discount or set price service offer in this situation can work wonders, it is attention grabbing for new clients – particularly if we are on their radar but they’ve never taken the next step to book in. Another scenario where we would use discounts is when providing multiple options for clients when team members are promoted. Clients can often be reluctant to follow their stylist when they are promoted, and in the current climate it is completely understandable that not everyone is in a position to pay more. For clients that are nervous about moving to a new stylist, we’ve seen that an introductory discount can help encourage them to try a new member of the team.

I would never run regular monthly offers, that’s when discounts don’t work. You become known as a discount salon and it’s really hard to reverse that reputation. I feel like we’ve got a great balance using them in a considered way.”

TIM SCOTT-WRIGHT, OWNER OF THE HAIR SURGERY

Added Value Offers

“To some extent, I do see discounting as de-valuing the services you offer and the work your team is delivering. Instead, I look at ways that I can add value to an appointment so that clients still feel they are getting value for money. Discounting regularly can attract fair weather clients. Some people may only use your salon when you are discounting, and this can have a negative effect on business. Discounting may get someone through the door, but it doesn't keep them.

I try to look at how I can not only attract clients, but turn them into loyal customers. The reality is you will not be able to maintain discounting as a business model. It will affect your profit margins and is not sustainable for client retention. Adding value, creating irresistible offers and wowing with your customer journey is going to be far more beneficial in the long run. Complimentary retail products work great for new clients because if they enjoy the homecare you have provided they will return. If you are discounting, I would recommend creating a package, such as a colour, treatment and product, and take 20% of the total, rather than one service. There are more creative ways to entice new clients into your salon than discounts.

There are more creative ways to entice new clients into your salon than discounts

You also need to consider the morale of your team. Devaluing their work through discounting is not going to make them feel fulfilled. Your team will appreciate the value you place in them, and this will have an impact in the quality of their work and customer service, which in turn will benefit your business more than offering discounts.”

LEAH DURRANT, OWNER OF LEAH DURRANT HAIR & BEAUTY