The Christmas period is edging ever nearer, Christmas lights are up in the city centres, Christmas adverts are all over the TV and if you have followed the last two articles in this series you should be well on your way to being prepared for your best Christmas ever in your salon or beauty business.
The last two articles in this series have covered making the most of your retail sales at Christmas, maximising your ability to generate treament and service revenue in the run up to Christmas as well as a few hints and tips about using marketing to boost both these aspects of your business too.
In this article I am going to talk about the secret weapon – OK not so secret weapon – that can transform not only Christmas in your salon, but also give you an amazing head start to the best year you have ever had in your business.
Back at the beginning of Part One in this mini-series of articles I said I would show you how you can generate and bank one third of next years turnover in the run up to Christmas. In this article I will show you exactly how this is possible.
Gift Cards, Gift Certificates, Gift Vouchers, whatever you call them you probably already offer some form of gift voucher to your clients, but in my experience a lot of salons just do not make the most of such a powerful income source.
Can You REALLY Generate a Third of Next Years Business in the Next Six Weeks?
To prove that I am not making this up, I selected 35 clients at random that I already work with and analysed their data for sales in the six week run up to Christmas last year and then compared this with their existing business to date this year – from 1st January until today which is 16th November as I am writing.
The average percentage value of this years business sold in Gift Vouchers across all the sites in that six week period came to 22%, but 3 of the business I looked at were over 33% or one third of all revenue this year so far!
Note: I should point out that the lowest was 16%, but this is still a very respectable amount of business to generate in just 6 weeks of gift voucher sales.
Why are Gift Vouchers so Important?
First of all from a business point of view, gift vouchers are not revenue – lets just get that straight. You haven’t yet delivered a service or exchanged money for any goods, so a gift voucher can almost be considered a deposit against a future service. *(At least this is the case in the UK, but I believe most countries accounting procedures follow this principle.)*
On the one hand this isn’t so great because you can’t yet count this money as revenue for your business, on the other hand you do have the money in your bank account without yet having had to really do anything for it. Barring exceptional circumstances the recepient of that voucher will come in to redeem it and then it will become revenue.
So if you sell £5,000 of gift vouchers in the run up to Christmas that is effectively £5,000 of guaranteed bookings for next year!
Even better than this is that around 60% of gift voucher recepients actually spend more than the value of their voucher when they do come to redeem their gift.
So if we say that your average add on treatment or retail product is around £20 then that £5,000 of gift voucher sales in November and December actually becomes more realistically something like £6,500 or more in revenue when the vouchers are redeemed in 2016.
Of course not all gift voucher recepients will spend more money when they visit you. But another important factor is that around 20% of gift vouchers are never redeemed. So while this should never be your goal, as much as £1,000 of that £5,000 in gift vouchers sold will never require you to deliver a treatment at all.* [NOTE]
Christmas Gift Voucher Sales
You don’t need me to tell you that salon gift vouchers are a great Christmas present idea for lots of people. If you aren’t doing everything you can to maximise your gift voucher sales at Christmas time you are literally turning away money and clients for next year.
I hope you now understand the importance of gift vouchers as part of your Christmas business, so in the rest of this article I am going to share with you five ways to maximise those gift voucher sales and help get 2016 off to an amazing start.
(1) Make It Easy – Just like with retail products you want to make it as easy for someone to buy your gift vouchers as possible. Make sure that everyone who comes in for a treatment, walks past your salon, visits your website or facebook page clearly sees that you have Gift Vouchers available. Shout about your gift vouchers so everyone knows you have them to sell. Include them in your window displays or put a sign up outside your salon.
(2) Designed for Christmas – If you want to stand out from the crowd, make your Christmas gift vouchers that little bit special. This could be as simple as having some special vouchers printed up with a bit more of a Christmassy design to them or even a selection of Christmas designs so people can pick their favourite one for a more individual gift.
You might want to take it a step further and have the voucher presented in a special gift box so that it can be wrapped up and given as a present rather than simply handed over in an envelope. Maybe offer a gift wrapping service too so it becomes a truly ready made present. This may cost you tiny bit more, but if you are the only salon in your area who is doing this, shout about it and word will spread quickly and your gift voucher sales are going to go through the roof.
If you do go down the route of having specially designed vouchers, gift cards or boxes, add these to your visual displays as discussed in Part One so people can see what they look like and imagine who they might like to buy one for. Don’t just keep them hidden away behind reception.
(3) Give Options – You want to be able to sell gift vouchers for a specific treatment or package as well as being able to offer monetary value gift vouchers. When you have your gift vouchers printed you can have some printed up with their value on them, or simply with a space where you can write or print the name of the treatment or package that has been purchased.
Sometimes it is nicer to give and receive a voucher for a particular experience without the recepient having to know exactly how much the purchaser spent. Make sure you offer both options to your clients to meet their exact requirements.
(4) Product Knowledge – Just like with your retail products you would help your staff to know what retail products to recommend to people if they are buying a gift for a friend or family member, do the same with gift vouchers.
I have seen it so many times where someone has come in to a salon asking if they sell gift vouchers only then to not know whether to buy a voucher for a particular treatment or for a certain value or even how much to spend. Help these buyers out by having some simple questions to ask about the recipient, what they might like or dislike and then suggest what you would recommend and help them make a decision they are happy with. This will work a charm on men buying presents for wives, mums, sisters, girlfriends who don’t have a clue what to buy!
(5) Sell Online – If your salon software system has the capability I would highly recommend offering online gift voucher sales. I have seen this boost gift voucher sales by up to 25% as it means people can buy your gift vouchers without even visiting you if they are particularly busy. Even more importantly it means people can buy your gift vouchers 24 hours a day. Imagine coming in to your salon on a morning to discover you have sold £500 in vouchers since you closed up last night!
It is possible to sell gift vouchers online without it being managed by your software system through simple shopping cart software, but it then becomes a big job to manage this manually and I wouldn’t recommend it. Most good salon software systems should have some functionality to help with online gift voucher sales so speak to your supplier about this today.
Bonus Tip 1: Consider giving away low value gift vouchers at any Christmas events you are running, or with any treatments delivered in November or December. Make sure these are for a value worth redeeming, but of a low enough value that in order to redeem them the client would have to spend additional money with you.
Bonus Tip 2: Consider running a January promotion whereby any gift vouchers redeemed in January are worth 10% extra than the value of the voucher itself. This way it helps to fill your quiet appointment book in January while converting as much of that gift voucher money in to revenue as quickly as possible.
So there you go . . . in the past three articles I have touched on the key elements of The Beauty Business Money Triangle at Christmas time and I hope I have given you some actionable ideas to help make this Christmas your best ever.
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*It is important that your Gift Voucher Terms and Conditions are clearly printed or included with any Gift Vouchers you sell. It is most important that your gift vouchers have a clearly stated expiry date on them. This can be for as short or long a time as possible, but without that expiry date it can legally become difficult for your to consider that money as revenue should the gift voucher not be redeemed. My recommendation is 6 to 12 months and if you capture the email address or phone number of the recipient when the voucher is purchased its always a nice touch to remind the owner that the voucher is due to expire a month or so beforehand to give them a chance to come in.