In this case study, we look at how Enrich Salons, a 54 center chain of salons, used Zenoti’s targeted marketing tools to double their average ticket size and reduced discounts from 30% to 22% on their campaigns. The result of their new marketing campaign – Enrich generated more than $100,000 in additional revenue.
We spoke to Sachin Kamat, Director of Customer Engagement, at Enrich.
At Enrich, most of our customers are members; as a membership benefit, they receive a flat 20% discount. So, when we run a festival offer to our customer base, we need to offer at least a 30% discount to make it interesting. This becomes a big drain on budgets. But, running such campaigns was an effective way to get customers in more often.
We’d typically run a vanilla campaign where we’d announce between one to four different offers at any given time. The offers hovered around a 30% discount and customers could choose which offer they wanted.
With our new campaign, we had 4 goals in mind.
1) The first was to create a targeted offer so that as many customers as possible received a benefit that was relevant to the services they come in for.
2) The second goal was to avoid giving away so much in discounts. Lowering the discount value from 30% amounts to big savings for us.
3) Typically, very few customers buy retail products. Our third goal was to sell more retail products.
4) The fourth goal was to send customers home with the proper home care products. When a customer came in for a hair color service, we targeted these folks with a product that ensures their home care regimen kept their hair color going for longer and ensures they’re happy with our in-salon service.
First we paired services with the right home care product into a package. If someone came in for a Pro-Keratin service, we wanted them to purchase the right shampoo and conditioner. If they came in for Highlights, we included the right product again.
We created over 60 packages, sometimes it was a single service, but more often it was multiple services that we paired with a single product.
The pricing for each package was simple, the customer paid for the services and they received the product for free. The discount value across the 60+ packages ranged from 20% to 45%. This was different from our earlier campaigns where we were giving a flat 30% discount on services.
The targeting feature made it possible for us to run multiple offers simultaneously. We created about 20 target segments for our customers based on their spending patterns and service history. And then sent emails to each segment announcing the offers that made most sense for them.
We also announced some of the offers on our website, on Facebook, posted the offers to our mobile app, printed posters and trained our staff on the campaign. Zenoti makes it easy to share the announcements on our online pages.
Now, our packages included a value add – the customer receives a retail product for free, but pays the regular price for services.
The campaign ran for 2 months and averaged at a 22% discount, this was 8% lower than old campaigns where we were giving away 30%. That savings in itself is significant.
We also doubled our average ticket size. Given that we had around the same number of redemptions – this is clearly a huge win for us. Enough so that upper management noticed the boost in numbers.
We reached all our goals – we reduced the discount we were giving away, sent people home with their home care products and also moved a high volume of retail products. We expect many of these customers to purchase their retail products from us going forward.
Billing was really simple. Zenoti’s POS maps the customer’s bill to the offer they received. Our receptionists didn’t have to do anything, everything was automated for them. That was important for us as it saves time and confusion, but also means that the system can’t be gamed. Zenoti ensured that customers received a coupon that they used to collect their products, which meant that any chance of pilferage was reduced.We also trained our employees on the offers. And we aligned their revenue sharing (commissions) with the campaign as well.
They had an incentive to encourage the package sale, which sometimes meant they had to sell an add-on service to the customer.Employees ended up making more on commissions, so they’re happy with the campaign. This is in contrast to our previous flat discounts where employees got less commissions.I also use the (ManageMySpa) Analytics to drill down into results – see what worked best and where I can leverage more from the campaigns.
Read more case studies to learn how businesses have grown with Zenoti.
To learn more about Zenoti, request a demo.
COVID-19 has been tough on businesses, and you probably had to close the doors without planning. But now, as you…