Saturday, October 27, 2007

Client Rewards Programs

My team has been saying for years that we should do something nice for our clients. I agree - we all know it's easier to keep a client than to get a new one. So why do we put so much effort into getting clients then do nothing special for our current clients? Years ago, before I owned the salon, they used to give clients a travel size shampoo for their birthday. I always thought that sounded kind of cheap. Some employees have suggested a frequent guest program where you get your 10th haircut free. Again, I love the idea of rewarding our guests, but haircutting is our major source of income. If I give away every 10th cut, am I not just giving away about 10% of our revenue? At the time that was suggested we were still a commission salon and you know the stylist would still expect to be paid for that free cut. It just wasn't an affordable, practical idea.

Our new salon software supports rewards programs so we are looking at implementing one in the next couple of months. Our software assumes that points convert to dollars at the rate you specify - for example 100 points = $1. We select the ways points can be earned, then they can be redeemed just like cash for any product or service. That brings up the old problem of me not wanting to discount my core business, haircutting. I don't want people earning points then not paying for their haircut. I want them to spend the points on something else. So we're designing ours a little differently but it will still work with our software. Here's what we've come up with:

Points can be earned by:
Referring a new client...........................1,000 points
Prebooking your next appointment.......200 points
Trying a new class of service...................500 points

These are all behaviors we want repeated so we will reward them.

Instead of points being redeemable for anything, we have a list of reward they can spend their points on:
500 points - shoe shine or travel size shampoo
1,500 points - 8 oz shampoo
3,000 points - manicure or grey blend (we are a men's salon)
4,500 points - 30 minute massage, facial or pedicure
7,000 points - 60 minute massage
10,000 points - 90 minute massage

Note that no where am I hurting my cash flow by letting them pay for haircuts with points. My hope is that having a list of awards will get my clients working towards a goal. If they are just spending the points as they go, they never set their eye on a prize and work towards it. I want someone to think "If I refer 10 people I can get a free 90 minute massage - I can do that."

We're planning to roll this out in November and run it through December 2008. Points will expire March 31, 2009 so we don't have a long-term liability out there.

2 comments:

  1. what salon software do you use?
    crystal

    ReplyDelete
  2. ReZoop Launches Mobile Reward Program

    Frequent flyer programs, shopping rewards programs, and other types of reward cards are going mobile. With ReZoop’s customer loyalty card app, customers no longer need to carry plastic reward cards, key tags or punch cards. All they need is one app.

    ReZoop today launched a customer loyalty card app that allows businesses to reward their customers for visiting. The universal loyalty program means no more paper or plastic cards to keep track of.



    ReZoop mobile loyalty app is more than a
    regular punch card or loyalty card. The app is a marketing tool that
    helps businesses communicate directly with their customers.
    It’s also a mobile platform for businesses to keep in touch with and
    reward their
    customers in real time.


    "ReZoop is the only free universal loyalty program available and is
    the fastest growing loyalty program,” said Roli R Agrawal, Co-
    founder. Merchants can join ReZoop and create a free account at
    www.rezoop.com.

    Unlike some mobile loyalty programs such as Belly card and
    LoyalBlocks, there is no hardware required and no monthly fees. ReZoop
    does not require Blue tooth activation. ReZoop creates QR codes for
    the business. Businesses print these codes and make them available for
    customers to scan with the ReZoop app on each visit.

    The ReZoop
    app provides customers with incentives to visit their favorite
    retailers. Customers hate trying to keep track of cards. They forget
    to use them, lose them or have too many. ReZoop eliminates the problem
    by having one app for all loyalty programs and is easy to sign up for
    and use.

    Customers do not have to search for the business on their phone (like
    Foursquare), and the app works even if there is no wireless signal.
    ReZoop app is designed with smart phones battery life in mind and does
    not need to be active in the background. The free app can be
    downloaded from the Google Play Store for Android phones or Apple App
    Store for the iPhone.


    ReZoop loyalty app makes it easy to reward loyal customers. They can
    see all of their points or rewards on their phone with one app.
    Businesses create loyalty programs that people will actually use and
    can
    track the response for more effective marketing.

    ReplyDelete