In our industry we absolutely need to raise prices. With the average income per client in the industry at less than £40 (net of VAT) and the average stylist serving fewer than 25 clients per week,* the maths simply does not stack up to provide an aspirational environment paying high enough salaries to tempt young people into our industry.
The first challenge is to reduce the culture of discounting in our industry. I have already worked with some salon owners this year who have stopped virtually all of their discounts and seen their businesses grow. One of them saw the average bill of each of their team rise by about 20 per cent.
The main purpose of reducing discounts is that you change the perception of your brand from that of a discount brand to that of a luxury brand, one that is worth paying for. Let me give you an example. Most of you reading this article will own an Apple product, yet Apple never offers discounts.
The second challenge is if you want people to pay more for your product, you have to raise the value of it. When most people hear the word ‘value’, they assume it means ‘cheap’. This is incorrect; how often have you bought a cheap product which subsequently broke or disappointed you, only to wish you had bought the quality product in the first place?
I worked with a hairdresser recently who charges more than £200 for a cut and finish. He appreciated a haircut is probably worth that amount of money, but then clients don’t go to him just for the haircut. If you don’t understand what he means, then you’re probably not ready to raise your prices. Clients can get a haircut anywhere. What sets him apart is his knowledge, expertise, creativity, advice, inspiration… all the things that clients are really prepared to pay higher prices for.
The next thing that people are prepared to pay for is luxury and pampering. When I visited one salon recently, the luxury was apparent as soon as I sat in reception. In front of me was a beautiful carafe of iced water with spirals of shaved cucumber in it, with glistening glasses on a tray alongside. Each member of the team was impeccably dressed with fabulous hair and the whole air was one of quality and luxury. I sat and watched a client pay £85 for her blow-dry and £85 for a missed appointment. She then booked her next visit. I can’t think of many salons that have impressed me as much and clients are obviously happy to pay for the experience.
One of the challenges we have is that many of our team members have never experienced true luxury; this is when investing in giving them a Tea at the Ritz-type experience is so worthwhile. It is only when you have experienced service that exceeds expectations that you can truly understand that price can become secondary.
Ken West is director of business experts 3•6•5