Sales & Marketing

The Power of Data – How It Will Change The Course Of The Industry in 2022

3 min

The Power of Data – How It Will Change The Course Of The Industry in 2022

The article was originally published on American Spa on Dec 8, 2021 as part of their “Wellness Trends to Watch in 2022” special report.

The hottest trend in the salon and spa industry isn’t a technique or a product, it is data.

And with 2022 on the horizon, salon and spa owners need to make use of the right data to get a clear picture of their business’s health and refocus their strategy for the year ahead. 

Fortunately, many business owners already have a wealth of data about their customers, marketing channels, sales volume and staff performance at their disposal. In fact, we have never been more armed with data than we are today. Still, not everyone appreciates how to get the most value from it. Using data-driven insight will give your business a significant edge over its competitors, enable you to set ambitious goals and grow confidently.  

Successful business owners will use data-driven insights in 5 key areas to drive growth:

1. Daily Operations and Productivity 

Time is often the most precious resource in a salon or spa.  Make sure it is being used effectively. However, remember that sustainable revenue growth comes from maximizing a combination of services and retail.  

Average ticket value is a central indicator of your business success. This demonstrates if you are getting maximum value from every client interaction. Consistently strong average ticket sizes per day, and per staffer, are a good measure of how well you’ve nurtured long-term client relationships. Clients will be more open to adding on additional services when they have felt consulted on a personalized treatment plan.

  • Daily Total Sales (services and retail)
  • Average Ticket Value (services and retail)
  • Retail to Service Ratio (number of product units purchased per service appointment)
  • Bookings vs Total Available Appointment Slots (utilization)
  • Gift Card Sales, if available

Pro tip: By carefully monitoring the balance between sales and efficiency, you can identify areas where service providers have a low utilization rate. This way you can coach them to provide great service in a more timely manner. 

2. Client Relationships

Naturally, a full appointment book looks like a good sign. However, the sheer number of clients who come through the door isn’t all that matters. Depending on your business goals, you’ll want to understand the type of clients who are booking and what is motivating them. 

  • Number of Clients
  • Client Visit Frequency
  • New Client vs Repeat Client Bookings (retention rate)
  • Pre-booking vs No-Show Rates

Pro tip: Encouraging clients to pre-book their next appointment before they leave is one of the most reliable ways to generate steady revenue. But this needs to be a team effort– literally. Although Salon management tools can remind clients to rebook via text, staff should still prompt a rebooking conversation at the end of a service. 

3. Staff Management

Your staff is the face of your brand. They need to deliver a consistently positive experience for clients. They also play a vital part in executing your strategic initiatives,  like recommending the right retail products.  Setting meaningful goals is essential to keeping staff motivated and maintaining a thriving employee-manager relationship. 

  • Booking Rate Per Employee (utilization)
  • Service Sales
  • Retail Sales
  • Rebooking Rate
  • Average Ticket Price

Pro tip: Set stretch goals that are still attainable, based on past performance. Offer incentives to make the challenge worthwhile. Provide coaching to both reinforce their successes and to encourage and educate staff if they struggle.

4. Marketing

We aren’t all born business gurus. Performance data can clearly identify where you’re being effective, and what needs attention.  

  • Website Traffic
  • Email Open Rate
  • Email Click-Through Rate
  • Social Media Followers and Engagement (account insights)
  • Online Reputation (5-star reviews and referrals)

Pro tip: These only tell part of the story.  Correlating spikes in other metrics, such as the number of new clients within a month or sales of a particular discounted retail product, can also help you gauge the effectiveness of your marketing efforts.

5. Long-Term Growth

Start by leveraging MOM (month-over-month) data insights about the various facets of your business. Once this is a habit, it is time to take the long-term view on what growth and success means. 

This kind of YOY (year-over-year) analysis of your business’s health can include things like: resource planning for peak season, marketing with discount offers during slow periods and managing your product inventory to match demand throughout the year.  Long-term strategy should also include a plan for how you will find, educate and retain the best staff, who your clients love.

Data is just that, numbers on a screen unless you can act on the insights they provide. 

Tools such as Phorest Salon Software‘s management, marketing & reporting features make it easy for salon and spa owners to view these metrics, and act on them quickly. See how we compare to other salon software here.

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