by Mark Laughlin

When you get past your ribbon cutting ceremony with the mayor and Chamber of Commerce president, what do you have planned for the masses?  Are you operating under the build it and they will come philosophy?  If you do, you might find yourself spinning your wheels coming out of the gate.

Too many franchisers help seal your doom by pounding you with the word “quality”.  They ask you to sell your service or product based on quality never price.  Don’t get me wrong; quality is critical!  A lack of it, and the customer won’t be back.  But, it’s NOT what gets them through the door the first time!

How the heck is anyone going to find out about you?  You need some advertising sizzle!  Put some serious thought into what you can use as a loss leader to get some foot traffic into your place of business. 

I want you to make hot … hot … hot outrageous offers to turn the table in your favor.  I want you to, from time to time, offer hot … hot … hot deals to keep the turn styles clicking. 

Do not; do not run coupons for “10% off” as your “big” promotion.  I have only seen this successfully used on limited occasions with established high volume locations.  (Did you take your sister to the prom also?)  Make a substantial offer to the masses!

I recently relocated from the Midwest to the West.  Among other things, I needed to find a new barber in short order. 

A few days after we moved in, I received a Val-Pak coupon mailer.  I opened it up, and went through the packet.  I pulled out three coupons: two for pizza and a double coupon for discount haircuts at Great Clips. 

A month went by, and I mentioned to my wife that the haircut coupon was expiring on the next day.  We decided to make Great Clips one of our stops the following day.   We had two coupons for a $6.95 haircut.  I was used to normally paying $11 to $14 plus tip for a haircut.  This was a good deal.

We walked up to the door around 12:30 and counted six people sitting in chairs waiting to get their haircut.  We decided to do several other errands and stop back, hoping the lunch hour haircut rush would subside.  Around 1:30 we walked back in and no one was waiting. 

In the past when I had gone into a Sports Clips or Super Cuts, they asked me for my first name and phone number only.  This time Great Clips asked for our first and last names, address and phone number.

While getting my locks sheared, I was able to find out from the shift manager that this particular store was coming up on its two-year anniversary.  I counted eight chairs and six stylists working.  By the time I was done, there were five people up front waiting to get their haircut.  Two other people had also walked in, but didn’t want to wait and left.

I inquired and found out that the shift manager was averaging twenty-five cuts per shift compared to the ten she used to do at a competitors shop.  I asked her how many Val-Pak zones they dropped.  She told me all four of them (40,000 total households).  I asked her if they were getting a 1% redemption rate, which would be 400 coupons.  She told me it was more than that, maybe 500. 

This was a good deal for Great Clips considering they probably paid around $1,200 for the four zones.  500 coupons redeemed for $6.95 produced $3,475 in revenues.  I’d take that pay back from a coupon vendor anytime. Not to mention, the continual revenue stream from the new customers you just converted to regular customers.

She then told me of what I will call a “stair-step” coupon program they had used.  They started out doing haircuts for the Grand Opening at $2.95, and then climbed the price to $4.95, and then finally to $6.95.  They stretched this escalating price coupon program out for twelve weeks, all the time collecting names, addresses and phone numbers.

This owner now has the option of calling clients and/or mailing specials directly to clients. 

When I got my next Val-Pak envelope, I noticed that Great Clips was not in it.  I looked at my old Val-Pak coupon’s expiration date and found it was still good for two more weeks.  This was smart advertising!  This Great Clips operator opted not to run in back-to-back months, but extended the “shelf life” of his coupon by extending the expiration date well into the next Val Pak mailing.

If you do run in consecutive months with a Val-Pak type vendor, ALWAYS keep your expiration date two to three weeks beyond the release of the next packet.  This doubles the amount of coupons you have on the street for that overlap period.  And don’t be nasty if a client tries to redeem a coupon that just recently expired; just accept it.  This is viewed as a “kind benevolent act” and you might just make a lifetime client out of them for doing it. 

Was I happy with my haircut experience?  Yes 

Would I go back and pay $11 if I couldn’t find a coupon?  Yes.

When I arrived home later that day, I did some investigative work.  I opened up my yellow pages to check out the haircutting competition.  First, I looked under “Barber Shops”, and then “Beauty Salon”.  There were around forty competitors, counting all the “ma and pa” shops.  There were six other franchise hair salons, besides Great Clips.

Great Clips was the ONLY major franchise represented that did NOT have a display ad.  They kept their ad simple with four key lines that included store hours, their toll free 800 number and the corporate website.  They got their message across without dumping huge advertising dollars into the yellow page pit.

Also, Great Clips was the only player in that Val-Pak envelope.  Why? 

Since Val-Pak was the ONLY coupon type book in existence in our marketplace (the advertising options are very limited in this area), why would Fantastic Sam’s, Super Cuts, all four Cost Cutter locations AND all the “ma and pa” stores miss the Val-Pak bandwagon in this marketplace?

Unless the rules just changed, Val-Pak does not offer exclusivity in their packets.  What I mean is if you’re selling pizzas, you could have four other competitors selling pizzas with coupons stuffed in that envelope along with yours.  I don’t get it, where were the other players?

When someone does something right they deserve a pat on the back.  Good job Great Clips!  I even liked the handsome discounts you give military personnel; their everyday price was $9 instead of the normal $11.

You also spent your advertising dollars well!  You’re not fueling the yellow page pit and you’re riding the wave all the way to the beach with your Val-Pak coupon expiration dates.

You got me in the door with a HOT offer, two years after you opened, by using the third pricing step of your coupon program ($2.95, $4.95, $6.95).  The $6.95 rate is $4.05 off your normal $11 price.  That’s a 36.7% discount! 

Substantial offers get recognized!  I don’t think this operator took his sister to homecoming or prom!

For all of you primarily selling QUALITY, 10% of  $11.00 is $1.10.  Ohhhhhh boy! Ohhhhhh boy!  Ohhhhhh boy!  10% off!  I’m going to camp outside your front door and wait for you to open in the morning!  Ohhhhhh boy!

If you’re running eight chairs with six stylists, all working at 2 on a windy Friday afternoon, you’re busy and someone else in town isn’t.  Looks like you’re hot … hot … hot, and they’re not … not … not!  Your Grand Opening prices got your business launched very successfully!

Great Clips, you’ve got my full name, address and my phone number.  Whether you utilize this to your advantage in the future is up to you.  Hope I hear from you, I’ll be real impressed then! 

About two weeks after we got our first haircuts in our new town I received a special mailer from Great Clips.  It contained two coupons for discounted haircuts for new move INS to the area. Great Clips was the only operator in our town that bothered to use the new homeowners list to their advantage.  We used both of the coupons on our second visit and brought along our son who was home from college and paid regular retail for his haircut.

On my third visit to Great Clips I paid the regular retail for my haircut.  While paying the stylist she informed me that if I called the 800 number on the bottom of the receipt and spent 3 or 4 minutes doing a customer service survey I would receive a discount on my next haircut.  When I got back to my office I called the 800 number and completed the survey in about 3 minutes.  I was given a special number for participating in the survey, which I could redeem for $2.00 off on my next haircut. 

What are YOU going to do to get business coming through your doors?

HOT … HOT … HOT; or not … not … not?  -- It’s your business.