From cafés to pharmacies, customer loyalty programs are earning people points that translate into savings. Some salons have taken advantage of these programs as a creative way to expand their customer base. “Loyalty programs open an opportunity to develop relationships with your clients, and they create repeat business because there is an incentive to return to your salon,” says Nicole Leinbach Reyhle, founder of Retail Minded in Chicago.
There’s been a notable change in the nail industry in the past number of years, and it’s more than simply a tight economy. “We noticed our customers were changing,” says Pam DiRenzo Knight, nail tech and part owner of Studio RK in Ft. Myers, Fla. “Clients want more bang for their buck. They want a great experience, not just a great service.”
Enter the customer loyalty program. From cafés to pharmacies, customer loyalty programs are earning people points that translate into savings. Some salons have taken advantage of these programs as a creative way to expand their customer base. “Loyalty programs open an opportunity to develop relationships with your clients, and they create repeat business because there is an incentive to return to your salon,” says Nicole Leinbach Reyhle, founder of Retail Minded in Chicago. A loyalty program also offers a tangible selling point for clients to leverage when they recommend your salon to their friends. They create buzz, they reward loyalty, and they speak to the next generation of consumer. If you’re looking for a way to attract new customers and keep current customers happy, the loyalty program may be the way to go.
Knight says one of the initial steps to setting up a loyalty program in her salon was to discuss what she and staff did and didn’t like from the loyalty programs they each already used. Next, they enlisted the help of the KRS Consulting Group, added the appropriate software, and they were ready to go. Once the program at Studio RK was up and running, it was well received among the clients. “There’s nothing better than seeing a client’s face when she receives a $25 credit or gift card,” says Knight.
One caution before you launch your loyalty program: Take your time creating the back-end systems. “If it’s not done correctly, you could lose money by giving things away prematurely,” says Reyhle. “You need to be clear about the rules and regulations, make sure the staff is trained well on how the program works, and understand how to track and update your loyalty program through the software you’ve chosen.” If you’re not a numbers person, you may want to sit down with your accountant to review profit margins and incentives.
Once your program is ready to go, be consistent about talking to your clients about its benefits. Studio RK has a system that lists the points earned on every receipt so clients can be reminded at each visit how many points they have accrued. Some salons create excitement about the program by having “members-only” events where special discounts are offered on services or retail items. Tools such as Constant Contact can be used to announce ways clients can earn extra points; for example, if they schedule an appointment during a typically slow period during the week. Another way to generate excitement for the loyalty program is through your staff: Be sure to give recognition or a small reward when an employee enrolls a client into the program.
Below are four ideas for how to structure your loyalty program, but don’t let our suggestions limit you. Decide what the purpose is for your loyalty program: Do you primarily want to attract new customers, or do you primarily want to keep current customers from straying to a salon down the street? If the main purpose is to gain new customers, reward your current customers with extra points for referring their friends. If the main purpose is to keep current customers from leaving, offer a program where clients can earn discounts for trying new services or for pre-booking their appointments. Ultimately, a good loyalty program will bring new clients to the salon and help retain
current customers, but the structure should reflect your main objective.
Popular Loyalty Programs
Punch card: This is your basic 10-hole punch. For every 10 (or 12) services, guests earn one service of equal or lesser value. You could offer a second punch card for retail items, offering one punch per dollar or one punch for every $5 increment. Reyhle cautions techs to be very specific about what a fully punched card earns guests. For example, you may want to indicate “10 punches equals one free manicure or $15 off the price of any service.” Print disclaimers on the card, such as “Not responsible for lost cards” and “No cash value.” Add a time restraint, such as “12 punches in a 12-month period.” Clients will be tempted to mimic the stamp or punch that you use, so be creative with the shape or pattern.
Points per dollar: Earn one point for every dollar you spend. Studio RK uses this system, using Envision software to track clients’ earnings. It’s a simple system where clients can earn points through hair and nail services, and in retail product they purchase. On a day when both a hair and nail appointment is scheduled, clients can earn well over a hundred points, especially if they purchase retail items. At 750 points, the clients receive a $25 gift card to use toward a service or purchases. Additionally, clients can earn 100 points for referring a friend, which allows them to rack up points fast, and gains the salon additional clients.
Sliding scale rewards: Mary Kate and Company in Wichita, Kan., offers clients a variety of ways to earn points. No matter how they are earned, 50 points equals $5. For referrals, clients can earn 50 points ($5) right out of the gate. Ten dollars spent on a service or on a retail item earns a customer one point. Additional points are earned by pre-booking, trying a new service, or for choosing high-ticket items, such as a retail item over $50 or a service over $100. Cassie Duncan, front-end coordinator at Mary Kate and Company, says the salon has a large number of clients who pre-book, which she attributes to the loyalty program.
One monthly price: Sense Nail Spa, with locations in Seattle and Shoreline, Wash., offers members a monthly “one-price” loyalty program. For a $99 enrollment fee and $59-$69 a month, clients can get all their services — any number of fills, repairs, or polishes changes — for one price. The benefit of this program, beyond having perfect nails every day, is that customers know a portion of the cost will be donated to benefit local artists. The program is called “Polish-for-Change.”
If you’re overwhelmed thinking about the organization involved in getting a loyalty program off the ground, don’t despair! Not everybody has the skills to develop and maintain a loyalty program. However, if you see the value of the program, take the time to find someone who does have the skills and ability. Hopefully you’ll realize there is someone on your staff who would enjoy researching software options and working with the software company to provide staff training and education. Compensate this staff person who agrees to set up the system, and do your part to motivate and energize the staff to sell the benefits of the program to your clients.
Loyalty Program Software and Tools
> Envision software (www.ennoview.com)