There’s been a lot of chatter about it in my career. It’s been something that I have never actually implemented in my own business and I’m going to tell you why.

But first, what is a salon membership? Basically, your clients sign up for a certain amount of time. It could be 3 months or 6 months or 12 months. Obviously a longer period of time is more desirable, because the client is locked in for a longer period of time coming back regularly to your salon for their treatments. They are paying you a regular (weekly, fortnightly or monthly) amount. It is an agreed amount in the beginning of the contract and it’s usually for a dollar amount of services per month or per week or an amount of time or a set service. For example, they may agree to pay for a 60 minute lash refill once a fortnight or in the case of a hair salon, 3 blow waves a month or 1 blow wave a week.

The reason that people sign up to memberships is usually there are some sort of added incentives. The biggest one being that it is cheaper. A lot of salons will discount their regular price for the services that the client is signing up to receive on a regular basis for a discounted price so that it gets them to sign up for a long time. There’s got to be some sort of bigger incentive for the client to want to sign up for a long time and be locked in to coming back to your salon regularly. You might add some extra little bonuses in though like prizes or extra perks or bonuses. They might receive a certain amount of treatments for free or a discount on products for example. Some salons that offer memberships will also give their clients a percentage off any retail that they buy while they are a member. 

So now that you know what a membership is, I want to talk about the reasons why you would implement one in your business.

It’s important to note that you don’t have to have just have one membership program; you might have a few different ones to suit different clients. 

A big PRO is that it makes it easier to retain your clientele. You lock your clients in for 6 months and they are paying you a regular amount into your business bank account. And you’re going to retain them for that 6 months because they’ve signed a contract. It also provides consistent cash flow through the year. So if you are worried about things quietening down in winter, or perhaps in January after the busy few months leading up to Christmas, you are locking in that consistent cash flow so it’s a little bit more easy to predict what your revenues going to be and also it’s easier to protect appointment bookings because in theory, you would hope that these people that are on memberships have pre booked all of their appointments. So those are the two biggest reasons that you would implement a membership offering in your salon.

Now the CONS and also why I haven’t done it in my salon. Basically, I believe that you should be trying to get your clients to rebook and just organically retain as many clients as you possibly can. I don’t feel that I would I ever really need a membership or a contract signed by my client to keep them coming back to my salon. I would like to think that my salon is a place that people want to keep returning to. My team is great, the level of service is fantastic, the product that they’re receiving is exactly as described or goes beyond what they’re expecting. So for all of those reasons your client should be happy and should return and for this reason I just don’t feel that it’s necessary to implement memberships into your business. If you already have a high client retention rate (70-75% or above), I really don’t feel you need to implement memberships to keep keep people coming back because really, you’re just kissing your profit goodbye, especially if you’ve signed them up with a discounted rate.

Another CON is when you are already booked and you implement a membership program. It can be very hard if these people have pre booked their appointments and then they want to change them last minute. We already know that it’s quite difficult if you are consistently booked and people are shuffling around their appointments last minute and you can’t fit them back in. And when you have clients that have paid for memberships or they’ve pre paid for their appointments, essentially, they’re probably going to get pretty upset if you can’t accommodate their appointment change requests. Or if they cancel last minute and then try and book back in the following week for a longer appointment or if they want to cut down their long appointment to a couple of smaller ones. It’s adds extra complications if you are already quite booked out. I also don’t like to think that I’m “locking” people in to coming back. I don’t want to get them to sign anything to promise that they’re going to come back. I want them to come back of their own accord and I want them to come back because the product that I am providing and that I’m selling is fantastic and the experience that they’re having within my business is fantastic as well. I also really don’t like giving away profit for no reason, especially if your business is already quite heavily booked. And you’ve got lots of returning clientele. 

So they are my reasons that I haven’t implemented a membership program ever. I have thought about it quite a few times over the years. I’ve had coaches in the past that have suggested to me, I’ve actually had coaching clients of mine that have had other coaches suggested to them, and I believe it might be a good idea for someone who is just starting out and they are trying to attract new recurring clientele and you offer a fantastic package membership, which is 12 months worth of the agreed service at a discounted rate say and they get a discount off retail and an extra treatment or a gift voucher or something like that. So there’s a couple of added perks and it locks them in and boom, when you’re starting out you’ve got consistent cash flow and recurring clientele and it’s easy to sort of build up on that. But for any established business that is already quite consistently booked out, like I said, 70% or more of the time, I really don’t feel that a membership is the answer to growing your business. There’s other ways that you can grow and scale your business that will actually be a lot more beneficial for you and your business. 

But if you are going to implement a membership system into your salon, you really need to make sure that you have airtight terms and conditions. And I wouldn’t just copy these off the internet. I wouldn’t get them off another salon owner. You really need to invest in a solicitor or a lawyer, depending where you are in the world. We call them solicitors here in Australia. But you need to invest in one that is going to write some really airtight terms and conditions for a contract for your membership. You want to really lay out exactly what they are going to receive for the money that they’re paying and how often they’re paying and how will be paid, and what happens if they do cancel or need to reschedule etc. So that that’s the biggest thing you need to do in the beginning.

And if you are going to implement memberships, and you need to make sure you’re doing it for the right reasons. Like I said, if you’re already consistently booked, it’s not really something that I believe is going to grow your business in the right way. You’re going to be giving away profit and it can be quite stressful if you are, you know having to pander to your members needs first because they have already pre paid for all of their appointments. You also need to use a recurring payment provider; there’s a few different ones depending where you are, but you certainly don’t want to be managing regular weekly payments. You don’t want to have to be going through your bank account and making sure that these direct debits are all coming in and you let me tell you when you are not used to having to chase up payments and invoices it’s not a fun job as beauty service providers or hair service providers. We’re used to being paid on the spot as soon as you complete the service and it can be very easy for members to let payments lapse and you’re so busy working in your business that you just don’t have time to chase up outstanding payments. It can be very confrontational and difficult to have that awkward conversation with people about any money that’s owed to you and your business, so make sure that you sign up for some sort of recurring payment provider that will actually do the chasing for you if a payment bounces or there’s insufficient funds in that person’s bank account it will automatically try again a day later or three days later. It’ll keep trying a number of times and then that recurring payment provider will actually chase that client up for you. You don’t have to do it yourself. You also need to take into account merchant fees on that kind of facility as well. So if you are offering your memberships for a discounted price and adding in extra perks, and then you’re adding merchant fees and things like that on top, you really need to make sure that you are still making a profit on that service and that you’re not just implementing a membership for the sake of it or because somebody told you it was a good idea. You really need to work out your pricing properly. Know your numbers and make sure that you are still profitable in that service with your members and that you don’t undercut yourself just to secure recurring clientele because like I said, there are better ways to keep your clients coming back. And you don’t have to discount anything at all.

Lauren x