Kitomba blog

Do you know how successful your hair or beauty business really is? How do you measure that success?

In reality there are probably few salon or spa businesses that have a solid, measured approach to determining their success, and not doing so can make a huge difference to your bottom line and potential growth.

Sure, healthy revenue and breaking even are helpful metrics, but how can you tell that your business is performing well and growing – that it’s truly successful?

In addition to tracking your revenue, client metrics help to tell the real story about your business. We’ve put together our top five client metrics which are all accessible using salon and spa software reporting to help you measure your success.

Not only will you be able to see how your business is performing, but also what you need to work on to reach your growth goals and make your salon, spa or clinic more successful. 

1. Rebooking Rate

Rebooking your client after their appointment is hugely beneficial to all aspects of your business. For your team, it ensures a pre-booked column, job security and motivation from constantly being in demand. For your business, you’re securing future income so you can make important decisions with confidence.

Plus, an increase in visit frequency and a reduction in time, energy and money spent finding new clients will result in boosted profits. For your clients, regular visits mean you’ll develop better relationships, they’ll get appointment times that suit them best and their hair and beauty maintenance will be improved overall. Win-win!

However, the most important part of measuring your rebooking rate is how you’re defining it. Rebooking is defined as a future appointment made within 24 hours of the previous appointment. So rebooking your client before they leave the salon should be a priority because as soon as they walk out the door their chances of rebooking within that period dramatically decreases.

Encouraging your clients to book multiple appointments in advance is great for business as it will secure future appointments at the optimal frequency, which can have a positive impact on your rebooking rate and profits.

Benchmarking by Kitomba Salon and Spa Software has shown the average rebooking rate to be above 50% for the New Zealand hair industry, so use that as a starting point and become one of the savvy salons and spas that achieves well above that!

2. Retention rate

Client retention is all about creating loyal clients through providing high quality service and a fantastic experience. Loyal, long term clients are important to a business as they tend to spend more, cost less and make valuable referrals to new potential clients.

Just like rebooking, retention is also measured in time. If your client doesn’t make a future booking within 24 hours of their last appointment but they do book again, they are considered retained.

It’s important for your retention rate that you encourage your clients to book an appointment early. To do this, you can set up email or SMS messaging campaigns that automatically contact the client a specific amount of time after their last appointment to remind them to book in.

In addition to this, it’s also recommended for salons, spas and clinics to have online booking software available so clients can easily book their appointments online at any time, without needing to call you.

3. Client revisit period

The average period of time between your client’s appointments is your revisit period. The length of time between appointments has a huge impact on your annual revenue, and reducing it by even the shortest amount of time can result in a massive jump in revenue.

If you’re not quite convinced of the power of shortening your client revisit period, here’s an example:

If your annual revenue is $400,000 and your average revisit period is eight weeks, reducing it by one day (seven weeks and six days) will increase your annual revenue by $7,200!

That’s an incredible result, but imagine if you moved it by one week? Your annual revenue would increase by a massive $56,000!

When starting out with reducing your client revisit period we recommend beginning with the goal of reducing your revisit period by one day, then analyse the results of your efforts. Once you’ve found methods of reducing your revisit period that work, set goals for reducing that period even further.

When starting out we recommend trying to reduce your revisit period by one day, then analyse the results. We’re sure you’ll be impressed and as you become more confident you can reduce the period even further.

4. New client rate

Retaining clients and creating client loyalty is important to the overall success of your business, but obtaining new clients is also important. New clients are the lifeblood of any business, as they tie directly to revenue.

A consistent increase in clients allows you to be certain of business growth, and it also ensures that more potential clients are hearing about your business. Ensuring you’re acquiring new clients also covers any lost ones.

Your new client rate should be sitting at a minimum of 10%. Why? Because natural attrition sits at around 10%, which is a metric used to measure clients lost over a period of time who are not replaced. To counteract this, you need at least 10 percent of the clients stepping through your door to be new.

If your new client rate percentage is low and you regularly have gaps in your appointment book, maybe it’s time to kick off some marketing activities like running an ‘introduce a friend’ promotion or try some online advertising such as Google Ads or Facebook ads to acquire new clients.

On the flip side, if you find your new client rate is low but you’re fully booked weeks in advance, your business has reached capacity. It’s time to grow, so look at growing your team, or if you don’t have the space, you might need to move to a bigger premises so you can continue to scale your business.

Want to learn 100 ways to grow your salon, spa or clinic? Download our free ebook.

5. Client retail attachment

Increasing the percentage of clients that purchase retail products can seriously improve your bottom line. That’s because you’re using the opportunity to add value to each client appointment and increase the spend through retail.

The client retail attachment rate, also known as the attach rate, represents the number of secondary products or services sold as a direct or implied consequence of the sale of a primary product or service.

We suggest looking at your client retail attachment percentage to determine a goal for how much you want to increase this.

For example, if it’s sitting at 10%, why not challenge your team to increase this to 25%? That’s just a quarter of their clients that they need to convert, so it’s achievable. To make it work, be creative. Perhaps you can run a friendly competition between your stylists or therapists to see who can increase their percentage the most.

When it comes to this metric, it’s important to remember it’s not as hard as you think because you and your team are the specialists and you know what products match perfectly with your services.

Your clients are looking for guidance and direction when it comes to products, so if you’re shampooing a client tell them which shampoo you’re using and why you’ve chosen to use it in your salon. Ensure your client understands how much to use, and how to apply it.

This goes a long way in reinforcing the fact that they should be walking out the door with a product. Being successful in attaching retail to your services simply has a lot to do with your overall approach, and looking for ways to provide more value to your clients through helpful recommendations that fit seamlessly with the services they receive.

How to track your business’s success

All the business metrics listed above are essential for accurately tracking and analysing the success of your beauty business, whether you have a salon, spa or clinic.

But now that you know what to measure in order to accurately track your business’s success, how do you track and analyse these metrics easily, without requiring too much admin or using up your time?

That’s where specialised software comes in. You’ll need reliable software that has been designed specifically for the hair and beauty industry and can track all these metrics for you automatically, so all you’ll need to do is click a button to run the report to see how you’re progressing.

Kitomba Salon and Spa Software was created for salons, spas and clinics and gives owners and managers all the tools they need to successfully run their business – including being able to easily track, measure, analyse and compare the results of your business. 

To find out more about Kitomba software and how it can help you to grow your business, book your free demo. 

Want more tips for growing your business?

Read next: 

• How to set sales targets for your salon, spa or clinic 
• 8 ways to get more client referrals
• How to build your salon, spa or clinic’s brand on social media 

Editor’s note: This post was originally published on 8 Dec 2016 and has been completely revamped updated for accuracy and comprehensiveness.