Marketing 101

Marketing 101
Define Your Own Marketing Success

by Katie Burland

In order to have a prosperous year, a salon owner must be prepared with a creative, well-organized marketing strategy--and an advertising budget large enough to accommodate the entire year's plans.

Many times, salon owners mistakenly assume they can be successful by focusing on either their marketing or their advertising. However, the most successful businesses realize the two go hand-in-hand, and are not just interchangeable elements.

Learn Your Terms

By definition, marketing is the act or process of selling or purchasing in a market; the process or technique of promoting, selling, and distributing a product or service; an aggregate of functions involved in moving goods from producer to consumer.

By definition, advertising is to make something known to; to make publicly and generally known; to announce publicly especially by a printed notice or a broadcast; to call public attention to especially by emphasizing desirable qualities so as to arouse a desire to buy or patronize; to promote.

Blast From The Past

The first step in planning marketing strategies for the year ahead is for the owner and staff to assess the previous tactics used during the past year and decide which were the most successful. In trying to determine the success of a specific promotion or advertisement, make sure to evaluate its ability to attract new customers, drive sales and increase profits.

Take a look back at the amount of money that was spent, in what areas, what time of the year, and in what form. If you've truly tested the waters, you will have a variety of information to work with--examining the effectiveness of your efforts with the local paper, Yellow Pages, radio, coupon mailers and other mediums.

Another resourceful strategy when trying to allocate the areas of spending is to survey the people who mean the most--your current salon customer base. Keep a piece of paper behind the desk and each time a customer comes to tan have the employee ask them to list their favorite picks for print, radio and television stations. This not only will help reveal the most popular choices but also will make the staff and customers feel as if they are a part of the decision-making process.

Before you make your plan for the year, find out as much as possible about the competition. Begin this process by collecting all tanning-related promotions found in the Yellow Pages, local papers, coupon mailers, radio and television commercials and surrounding school, business and local advertisements. It is also necessary to evaluate their equipment, atmosphere, and pricing structure as well as the professionalism and level of tanning knowledge of the staff.

This may be accomplished either by making telephone calls or by sending in a secret shopper to personally observe the environment. Learning what the competition has to offer helps a salon owner to confirm that the amount he or she is charging for tanning packages and memberships is justified. Verification can be achieved by comparing all aspects--and the level of standards--at your salon to what is being offered by surrounding local tanning facilities.

If, in your comparison, you learn that your prices are higher than those of your competitors, keep one important fact in mind; it is not always necessary to be the salon with the lowest prices in town. In fact, starting a 'bidding war' with the competition can be--and usually is--a huge mistake that is very difficult to reverse.

The best alternative is to make sure that the services being provided are at the highest level of standards possible. Then make it the priority of the salon and the staff to ensure that every customer understands the value of what is being offered--and how it is superior. New customers are especially important in this process since a majority of the people will begin by 'price shopping' at several locations before choosing a new tanning salon.

Money Matters

Once a salon has reviewed its marketing strategies, it's time to analyze the amount of money to allocate for the new year's advertising budget. This is a report that the salon owner can request from the accountant that should be easily accessible.

For the owner that does his or her own books, the advertising expenditures always should be kept separate and year-to-date totaled, so this will hopefully not be a difficult process. Take the total amount of money that was spent on advertising from Dec. 1, 2006 through Nov. 30, 2007. Divide this total by the gross income for the salon through the same dates. The result is the overall percent of the annual gross income that was devoted specifically to advertising.

This assignment is very simple to figure out and is essential in the process to be as efficient as possible with the funds. For example, a salon that grossed $150,000 and spent $8,000 in advertising will have spent 5 percent on its advertising budget for the year. The minimum consideration that a salon should spend in advertising in order to expect effective results is at least 3 percent of its annual gross income.

As the assessment of the budget is determined, a salon may choose to increase that amount anywhere from 5 percent to 7 percent. The focus of this growth should be the reflection of successful advertisements and promotions being increased. If this chain reaction works correctly, the effect should cause the gross sales to grow and therefore the amount dedicated to the advertising budget would get larger.

Full Speed Ahead

Once the information is compiled, put on those creative hats and design a marketing strategy that will make the upcoming year the most successful year that your salon has ever seen.

Good luck and have a wonderful season!