Today more than ever, many salons owners believe that the only way to grab new clients is to offer heavily discounted deals via coupon promotions.
The erroneous sales pitch given to salon owners is “Don’t expect to make any profit, but look at all the new clients you will gain”.
Here are the facts…
Most clients that you attract via a coupon are discount shoppers.
The reason they’re coming to your salon is because they’re looking for a cheap deal, and when that deal is no longer on offer, they’ll move on to the next salon offering a cheap coupon deal.
Not only do these clients salon hop, but they seldom purchase additional services or retail product.
This makes sense because the whole reason they’ve come to your salon in the first place is to spend less money… so why would they pay full price for future services when they can simply get another coupon and move on to someone else?
Coupons companies often require salon owners to discount their services by up to fifty percent and then ask for up to 50% of what is left over.
They do this with the promise that it will bring a flood of new clients through your doors and it often does….but many times at a major cost to your business?
If you look at the actual dollars and cents involved in this kind of offer, you’ll most likely be horrified at just how much money these kinds of deals are actually costing you to provide.
Let’s look at an average coupon offer.
When costed out using quite conservative figures, it would probably look something like this:
Normal service price is $120.00
50% Discount $60
Coupon fee $30
Cost of products $12
Cost of consumables $2
Cost of labour $25
Salon Owners Profit/Loss = $9 LOSS
That’s a LOSS of $9 for this kind of offer, with very little chance of up-selling services OR retaining the client.
Before you decide to jump on the coupon bandwagon, take a long hard look at the reality of coupon and discount marketing.
Ask yourself if this is really the kind of client you want to attract to your salon, or whether you would be better off going about gaining new clients in a way that will help you to make money and keep you in business for the long-term.
Not only do you risk losing a great deal of money with coupon marketing, but you also risk losing your loyal clients who have been content to pay full price for your services in the past.
Is it really what you want for your business?