When Scott Missad assumed ownership of the Gene Juarez Salons & Spas, with nine locations and an academy in Seattle, Washington, he knew he was gaining a revered brand and a fantastic team of employees. But as the co-leader of Strictly Business with Frank Gambuzza, Missad immediately began studying his new business and looking for new opportunities.
“When I got to Gene Juarez, I immediately started looking at where our business was and where it wasn’t and trying to identify opportunities,” says Missad. “Working with Dan Kosh, who used to be with L’Oreal, we started segmenting the business and looking at each segment—cuts, color, retail, massage, skincare, makeup and nails—as a separate business unit. Then we developed an individual business plan for each one.”
Shortly after making the move to Seattle, Missad had the chance to meet Mark Vadon, founder of Zulily.com, which helped him to look at the salon operation with fresh vision. “When I first met Mark, he seemed like a total surfer dude, so it was hard to wrap your head around the fact that he and Zulily made $700 million in their third year of business,” Missad says. “But he helped us realize that technology can do what you could never do personally when it comes to getting the word out about a new service or product. They talk to tens of thousands of customers at one time, where salons are used to selling via word-of-mouth or one person at a time.”
Communicating through technology also helps strengthen the loyalty a client has to the brand. While Missad believes the relationship between service providers and their clients is critical to the success of salon, he also believes it can’t be the only relationship the client has with a salon business. “It’s important that your brand speaks for itself and you don’t run your entire marketing plan through the word-of-mouth between stylists and clients,” he says. “A computer customer follows Apple, not Jeremy at the Genius Bar; and a diners choose to eat at Ruth Chris instead of following the waiter to wherever he now works—you want clients to feel the same way about your brand.”
With Gene Juarez now broken down into individual business units, the marketing team now designs some kind of compelling e-blast offer relative to one of those units each month. If the client clicks and opens the deal one month, the same offer isn’t sent to her again the following month—so clients doesn’t get the sense they’re being barraged with offers.
For example, the salon recently introduced a new formaldehyde-free straightening service. Tapping into the salon’s database, Missad and Kosh designed an eblast promotion that was delivered to any client who had ever had any kind of straightening service at one of the salons or who had purchased a product designed to control frizz, smooth hair or tame curls.
The promotional email offered clients their choice of a free travel-sized Kerastase product (value $20) when they purchased the new straightening service. Shelf talkers and stylist-to-client conversations about the service reinforced the eblast’s message. In the same amount of time the salon company used to sell 50 of the former straightening service, it’s now sold 500 of the new service at $300 a piece. “That’s in the neighborhood of 10 times more services sold,” says Missad, who says he’s fanatical about keeping score to know exactly how successful or not a promotion is.
The salon used the same eblast approach for its new referral program. Guests are send an eblast inviting them to register for the program online and to provide the salon with the names of four friends and their email addresses. The referred friend gets an email that says, “Your friend ‘Cathy’ recommends you to Jessie at Gene Juarez—please come in and see Jessie for a free treatment with haircut,” says Missad.
When the friend comes in the guest who referred them gets 50 percent off her next service. “If you do the math, you lose 50% on one visit for a new client who will visit 4-6 times a year assuming you successfully retain her,” says Missad. “That’s a great return for a half of a haircut.”