Last Minute Voodou – our Salon Late Deals tool in action
The Voodou salons in Liverpool have used the Salon Guru Late Deals tool longer than anyone else.
This is how they have used it to generate over £30,000 / $47,000 of new salon income and clients
in the last 12 months.
An introduction to Last Minute Voodou…..
Last Minute Voodou is an innovative solution created to address salon downtime.
It has generated over £30,000 and over 1,000 clients in the last 12 months.
Out of these 1,096 clients 67% have been new clients and 41% have returned for a full priced repeat visit, showing how Last Minute Voodou is also growing our existing clientele.
The success of Last Minute Voodou has been down to our award winning website and social media – in particular our Facebook page which now reaches over 17,000 people.
Excellent search engine optimisation means that Voodou is number 1 in the WORLD for the phrase “last minute hairdressing discounts” on Google – beating sites like Wahanda.
The background – their VERY busy salon Website…..
Voodou is a small chain of 4 salons and barber shops in Liverpool. We have been trading in Liverpool for over 30 years with MD Rob Webb at the helm since the beginning.
During this time the key to Voodou’s success has been one of continuous innovation. Over 10 years ago, the first salon website was created by Salon Guru and since then we have embraced the importance of on-line marketing and placed it at the heart of what we do. We are now developing our 5th generation website with Salon Guru and visits to the site average 30,000 a month – which is an incredible achievement.
Last year our incredibly busy and income-generating website was recognised by the UK hairdressing industry – winning both –
- the Creative Head “Best Online Salon”
- and the British Hairdressing Business Award for
“Best Salon Website”
This graph shows the incredible growth in web traffic to Voodou.co.uk since 2008Four years ago we also identified the importance of social media, particularly given our target audience of 20-35 year old students and young professionals. And with the expert guidance of Salon Guru we created a Facebook page and developed a strategy, which has led us to achieving over 17,000 facebook fans – probably one of the most ‘liked’ salons in the world.
The challenge of Salon Deals websites…..
However our success in keeping in tune and in touch with our clients has been against the backdrop of a declining global economy, with the North West of England being particularly affected by the UK recession and subsequent flat-lining economy. The recession has taken its toll on the hairdressing industry, with clients tightening their belts and cutting back on discretionary spending such as hair and beauty treatments.
Furthermore, the last four years have seen an explosion of so-called ‘deal websites’ – for example, Groupon, Wowcher and Living Social to name just a few.
These sites have successfully capitalised on consumers’ growing internet usage and growing appetite for deals with everyone at every social level watching what they spend. Groupon alone operates in over 48 countries, has over 200 million subscribers and is heavily used by consumers in cities across the UK including Liverpool.
Voodou is approached on a weekly basis by companies such as Groupon and the sales pitch is tempting – who wouldn’t want to guarantee a certain number of clients through the door, particularly on slow days at the beginning of the week? However, after further scrutiny of what’s involved it appears less enticing. The deep discounts required – 50% off or more – coupled with a share of the profits going to the deal company, leaves the salon involved breaking even, at best, and at worse, running the campaign at a loss. This may be a justified investment for a new start up salon looking to get their name out there and clients through the door, but for a more established business such as Voodou, it didn’t make any sense as it would squeeze already precious profits and risk devaluing the brand and the services we offer.
Further research only confirmed our own reservations about going down this route. The following is taken from a guest blog on America’s CNBC News website:
“Groupon’s pitch is brilliant: a merchant pays nothing up front and has no responsibility for crafting or delivering an offer. The company takes care of all that work and actually pays the merchant after the promotion is deployed. (What they avoid explaining) is that 100% of the gross margin is wiped out by the offer and another approximately 25% goes to Groupon for its fee.”
“The other problem with Groupon is that the bigger it gets the less it can help small businesses. The theory behind Groupon is a small business can get new potential customers to try them out by offering a really great deal. If the coupon buyers like what they get they might become a regular customer at regular price…But Groupon’s growth makes that result unlikely. Once the first e.g. pizza place runs a Groupon, every other independent will do the same and Groupon’s targeting algorithm will make sure that the buyer of any one pizza deal will be offered many more. Rather than gaining some new customers for those that offer deals Groupon effectively lowers the price of pizza, haircuts and other services in all its markets…Groupon does not really create more haircuts..it just rearranges who gets those visits and sucks 75% of the value away from the local merchants.”
Why 3rd Party Daily Deals are not an option for Voodou
Although Salon Deals Websites can attract a lot of new clients, we were not happy with the income they generated for the salon.
Salon Daily Deals Financial Model
Directors Cut and Finish normally £52
Discount 50% = £26
Approx 50% goes to Groupon = £13
Leaving just £13 of the original £52 to pay wages, overheads, V.A.T. etc
Our solution to compete with Salon Coupon websites….
In spite of our reservations regarding deal websites, ignoring the growing trend wasn’t an option for Voodou – we had to meet the challenge head on and so looked internally at how we could meet the needs of clients looking for a deal. We already offer great discounts on our services for specific groups of customers such as students or corporates, but these discounts have become the ‘norm’ and we knew that we had to come up with a stronger offer for those seeking Groupon style deals. The difficulty for us as a business was how to meet this client need without losing control, damaging the brand and eating into profits!
In the end the answer was obvious – with a database 40,000 strong, hits to the website of 30,000 per month and a Facebook page with 17,000 likes and growing, we knew we could get the message out to our clients and potential clients that Voodou offers discounted deals without the need to go through a 3rd party site and so, working with the experts at Salon Guru, Last Minute Voodou was born.
The Financial Model Last Minute Voodou
Directors Cut and Finish normally £52
Discount 30% = £36
No Fees to third parties
Leaving £36 of the original £52 to pay wages, overheads, V.A.T. etc
More benefits of managing our own Salon Deals / Coupons:
- We control when the discounted appointments are and at what level
- We aren’t overrun with deal appointments
- We maintain brand integrity
- We are more likely to attract clients that buy into the Voodou brand and not just ‘deal’ shoppers
How our Salon Deals / Coupons work…..
We have created a page on our website for Last Minute Voodou – www.voodou.co.uk/late-deals
Each Friday we review the following week’s appointments and identify potential quiet times for each of the four salons.
We agree the number of discounted appointments (deals) and the level of stylist and discount to be offered and these are then posted onto the website (click the image to enlarge).
On the Last Minute Voodou page it shows each salon and the deals available.The Last Minute Voodou page invites clients to click to claim the deal and in a pop-form they are then asked to provide their name, email address and mobile number. Each claim deducts 1 from the number of deals still available.
Once a client has ‘claimed’ a deal they are sent an automatic “thank you” email with details of their deal.
The email lets clients know that they can ring the salon themselves if they have not been contacted which ensures that we have given each client every possible chance to get themselves booked in for their deal.
As soon as the salons receive a claimed deal they attempt to contact the client to arrange the appointment. Full pre-payment for the service is required helping us to ensure that we are minimising the number of ‘no-shows’.
Just last month, we added a new feature to help our reception teams, a Last Minute Voodou desktop app called the Claims Manager. This shows the current status of all active deals and those that have been claimed for a particular salons. It allows the receptionists to update the status to ‘booked’ or ‘cancelled’ and also record up to 3 sets of initials of staff members who tried to make contact with that client. This means we can always see which claims are still waiting to be booked-in and need another phone call to the client.
After 3 attempted calls we have a button for “email client” which automatically sends the client an email saying “we have been unable to contact you – please reclaim the Last Minute Voodou deal”.
This new system is also much less time-consuming for the Head Office who were contacting each salon on a daily basis to check progress on calling claimants. As the Claims Manager is live all salons and Head Office have an up-to date view on the deals status.
With four salons and a team of over ten receptionists, one of our biggest problems was getting clients booked in for the deal they’d claimed if they didn’t answer after the first phone call. The new system has been fantastic at minimising the number of clients who claim a deal but don’t get booked into one of the salons.
How we plan to develop Last Minute Voodou this year…..
We are currently working with Salon Guru on an automated pre-payment system via PayPal making the whole process seamless.
Next month we are also planning to integrate Last Minute Voodou with our new in salon system. This means the deals will be fully managed by Head Office.
As the new salon system includes live appointment pages for each salon on one system, Head Office can call any clients claiming a deal and book them into any salons – at the available times shown.
With the help of the Claims Manager app Last Minute Voodou has improved immensely, but we are excited to see the next stage work even better.
We are also planning to add in an option for clients to receive their claimed notification via text messages instead of email which will work better for some of our clients. This will all run automatically off the new in-salon system where client mobile numbers will be recorded and linked to their Last Minute Voodou account.
The Marketing Support for our Salon Deals…..
Webpage and SEO
We have worked hard with Salon Guru on the salon’s webpage Search Engine Optimisation to ensure that anyone searching for hairdressing deals on-line are directed to the Voodou website.
We currently rank number 1 in the world on Google for “last minute hairdressing deals” and “last minute hairdressing discounts” beating big sites like Wahanda. As shown below in a screen-grab of Google –
Our excellent search engine rank helps bring an average of over 3,000 people a month to the Last Minute Voodou webpage
We feature Last Minute Voodou deals every week on our Facebook page with daily posts. In addition we pay to boost the post on a Friday to ensure that it is seen by on average 20,000 people. The cost of a Facebook boosted post is typically £40.
Our monthly e-mail goes out to our database of 40,000 clients and Last Minute Voodou features regularly on this e-newsletter.
The Last Minute Voodou financial results…..
Last Minute Voodou has proved to be an incredible business success since it was created and has these very impressive statistics for the past 12 months :
Visitors to the Last Minute Voodou webpage: average 3,000 people a month
Total deals claimed: 1,144
Total money taken in-salon: £32,845
Total number of Last Minute Voodou clients: 1,096 (96% of claimed deals were used)
Number of Last Minute Voodou clients new to the salon: 734 (67% of deals were for new clients)
Number of new salon clients from Last Minute Voodou who returned for a second full-price appointment: 449 (61% return rate)
From these figures we can see the impact Last Minute Voodou has had on our salons over the last 12 months. It shows that not only is the innovation solving our problem quieter days in the salons but bringing us new, loyal clients willing to rebook with our stylists.
Despite the preconception that clients coming into the salon on a Last Minute Deal will not buy retail or upgrade their service, our statistics prove otherwise.
- Average offered price of Last Minute deal: £23.45
- Average actual spend for a Last Minute deal: £29.97
Last Minute Voodou not only fills our stylist’s appointments in the quieter days at the start of the week, but also contributes to the expansion of our overall number of clients.
Comparative figures Quarter 1 2013 compared to Quarter 1 2012 –
- Hairdressing Salon clients: 48% increase
- Beauty Salon clients: 44% increase
Last Minute Voodou is an incredible business innovation that has generated over £30,000 in new income and over 1,000 clients.
It has also attracted many new clients who return for future appointments.