What Salon Owners Don’t Know About Salon Pricing Strategies
…And if YOU knew, it would truly change your fortunes
If you own a salon or work as an independent salon professional, here are 5 SALON PRICING STRATEGIES you need to understand:
WARNING! These Salon Pricing TRUTHS are ONLY intended for confident cosmetologists who know their “Acres of Diamonds” are within themselves…
1. Price is largely unimportant in a consumer’s decision to buy
It’s true – a few customers base their decision for salon services on salon pricing – that’s why Groupon is so popular. But how many Groupon customers become lifetime customers? They are only loyal until the next Groupon deal comes up, which might be their very next haircut.
Not a great way to build your book.
On occasion, people do make purchasing decisions based on the lowest price – for some of their purchases some of the time. If PRICE was always the most important factor, no clothing store would exist except Wal-Mart. And the only car you’d see on the road would be the Yugo (instead it filled for bankruptcy).
2. People buy at different prices
Instead, some people shop for clothes at Wal-Mart, and others at Nordstrom. You can get an Italian meal at Dominoes, and you can get an Italian meal at Carrabba’s. You can sleep at a Motel 6 or a Marriott.
Since you attract your own clientele, if you wish, you can certainly keep your chair full with clients for whom salon pricing is not the main consideration.
3. Never compete on price
You only have so many hours in the day and much of your overhead is fixed. There’s no benefit in being the cheapest.
If you’re competing on price now, it’s time to reinvent yourself. Meaning, find other qualities about you and your work that give you the edge and distinguish you from all the rest.
4. Don’t set your price by what others charge
Do you look at what others are charging, the highest and the lowest, and pick some place in between? That’s what most salon professionals do.
It’s a fool’s method.
There’s PRICE, then there’s PRESENTATION of price. Consider how you present your services and deliver them. What is the atmosphere in your salon? Who do you primarily serve? What products and services do you offer? What marketing message do you use to describe the benefits of your services?
When you package your products and services differently than everybody else, you can price it differently. Direct comparison with any other stylist or salon becomes impossible.
5. Stop living in fear
Most salon owners needlessly keep their prices too low, raise them too little too late, and ignore opportunities to offer premium priced versions of their salon services… entirely out of FEAR. Fear that they’ll lose customers. Fear others will ridicule them. Fear of not being of VALUE to the people they serve.
Business decisions made out of fear are bad decisions. If you to grow with more clients, sales and profits then yoiu must ask…
Price paid is a result of a combination of factors:
- Who you serve – the target market you select
- The value you bring to your services
- How you present your offer
- You communication skills
- Your credibility
- How well-known you are
- Your brand image
- The client experience
- How you stay in touch in between visits…
And many other considerations. We perceive things differently according to how we look at them. Look at the image of the salon door to the right – can you shift your perception and see the circles?
Try looking right at the X in the middle of the image – now do you see the circles? Perception of value can shift just like that, because…
The right price actually has very little to do with some “objective” measure of value
Consider the imagined worlds TV shows create and how society engages with them as if the characters were real people living real lives. It’s all fabricated for entertainment and advertisements.
Think about diamonds. Despite their beauty and durability, they are plentiful. The price is kept artificially high by controlling the market. Otherwise, diamonds would command similar prices as glass or coal. If you’ve ever tried to sell a diamond, you would know this first hand.
“Acres of Diamonds” In Your Own Yard
Instead of basing your prices on what others are doing, approach price courageously and creatively. A great way to gain courage is to become aware of what else your clients spend their money on, and how much they spend. Purses? Shoes? Restaurants? Wine?
How do your more affluent clients spend their money on products and services?
This huge difference between measurable and perceived value exists in every city and town. There’s always someone successfully setting their prices significantly higher than everyone else, with a message, presentation, and delivery – beyond objective quality alone – that supports their price.
If one person can, so can you…
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