- Brands seeking to diversify their portfolio and create a long-term profitable investment may find the spa channel attractive.
- The spa channel comprises niche channels such as nail care, skin care, hair cutting, coloring and replacement, whole body wellness and more.
- The salon and spa environment is fiercely loyal and exclusive.
- Products developed for this channel must appeal both to the consumer and the professionals on the front line of client service. n Brands must be in it for the long haul to succeed and profit.
Expanding into a new marketplace can be daunting, but it is a necessary element to increase clientele and grow revenue. The U.S. professional beauty channel services a large and diverse demographic and can hold a world of opportunity for brands that are looking to diversify their portfolio and create a long-term and profitable investment.
With multiple niches within one channel, including specializations in skin care, nail care, hair cutting, coloring and replacement, as well as whole-body wellness, the salon and spa industry is a vibrant and growing component of the U.S. economy. The most recent reporting from the Bureau of Labor Statistics shows that the industry includes more than 1.1 million total establishments and annual sales of more than $44 billion.
The overall beauty retail category in the U.S. posted sales of about $43 billion in the most recent data, according to the Professional Beauty Association’s (PBA) Business of Beauty: Defining the Future of Beauty Retailing report, with salon hair care products making up one-third of that market. The report estimates that retail sales within the salon currently exceed $2.5 billion and are expected to grow substantially in the coming years.
With continued growth year-over-year, the professional beauty industry has proven traditionally resilient to economic shifts and downturns, growing relatively faster than most industries, and is often the last arena in which cash-strapped customers choose to curtail spending. This presents a very real opportunity for brands carrying related beauty products, especially those that have already established name recognition in more traditional retail channels, to be part of this explosive growth.
Build Loyalty and They Will Come
The salon and spa environment is one of fierce loyalty and exclusivity. It is an innovative industry of luxury and high margins, likely untapped by most brand managers. Getting your products on the shelves of the salon/spa gives your brand exclusivity and a professional designation that can add uniqueness and expertise that most over-the-counter retail channels can’t offer.
Salon/spa clients often form personal and long-lasting relationships with their licensed professional hairdressers and estheticians. Clients surveyed for PBA’s Business of Beauty report nearly unanimously state that they depend on their hairdresser and esthetician for education and look to them as the authority on retail products for their hair, skin and nails.
They generally trust and will buy what the professional recommends. This can be especially beneficial when launching new products as word of mouth marketing, both between beauty professional stylist/esthetician and client and among fellow professionals, can be particularly helpful in an overall marketing strategy within salons and spas.
Just as clients are loyal to their hairdresser and esthetician/licensed professional, salon/spa owners and professionals genuinely care about the products their customers are purchasing and can be fiercely devoted to the brands they offer their clients. Most salons and spas carry only a small selection of their preferred brands.
To be successful, you will need to form a trusting partnership with owners, and continue to foster that partnership, to convince them that your products are worthy of display in their establishment. Get your brand on their must-have list for clients and you will likely see your products flying off the shelf.
However, that loyalty doesn’t come overnight. Brands entering the salon/spa channel must be prepared to educate salon and spa professionals on the benefits of their products and offer the marketing tools and support to help owners and professionals be successful in the working salon/spa environment.
To appeal to owners, it is essential to know the industry inside and out, be on top of industry and consumer trends, be honest and transparent, and have the solutions to any obstacles owners feel they will face, such as educating staff and customers on why your product is the right choice. They must feel that carrying your product is a unique opportunity to not only increase their retail revenue, but positively impact the well-being of their clients and staff.
Be the Brand They Will Sell
Salon/spa professionals are first and foremost dedicated to their craft. Although the retail aspect of the industry is incredibly important to the growth and sustainability of the establishment, and is often the key profit driver for most salons, it is often overlooked by professionals working with clients who may not be as well versed in sales techniques as professionals in a strictly retail setting.
In fact, it has been reported that nearly 71% of salon/spa clients leave the establishment without receiving any product recommendation at all. Educating the salon/spa professional and creating excitement, and possibly implementing incentive programs, will help to ensure they are comfortable and more likely to recommend your products to their clients.
Competing for loyalty amongst already established and prominent salon/spa brands, especially if you are breaking into this market with little or no connections, will not be an easy task. A brand must have the dedication, support, financial stability, and ability to react to challenges and new trends to make the investment a success and grow business.
You are not only marketing your product to the consumer but to the salon/spa owner and the professionals on the front line of client service. Education and making your products accessible through attractive packaging and in-house marketing and point-of-purchase displays are crucial to successful retailing in this channel.
Success Requires Dedication
The salon/spa marketplace is promising, but fragmented, with many brands competing for a coveted spot on the salon/spa shelf. Salon/spa owners and professionals working behind the chair do not give their loyalty to brands easily.
Dedication to the industry and its professionals is key. As a brand, there is ample potential to be part of this prosperous, growing and relatively untapped channel, but you have to be in it for the long haul to make it work and make it profitable.