5 Ways to Increase Customer Retention

Customer retention is essential for long-term success. Having a loyal base of customers who come back on a regular basis for appointments will sustain your business. Adding a new client is both more challenging, and more expensive, than encouraging an existing client to make a return visit. 

In fact, research shows that acquiring a new customer can be 10x as expensive as retaining a current client. Here are some other stats that show the value of client loyalty to your overall ROI: 

  • A 2% increase in customer retention can decrease costs by 10%.
  • Increasing retention rates by 5% increases profits by at least 25% and up to 95%.
  • Repeat customers spend 67% more on average than first-time customers.

However, it’s not always easy to get first-timers committed to coming back. So, what can salon and spa owners and managers do to encourage repeat visits and build lasting relationships with customers?

There are three key factors that play heavily into retention: experience, communications, and incentives. Here are 5 key tips you can use to retain new customers, drive additional business from existing customers, and cultivate a devoted fan base.

Tip 1: Email Marketing

Investing in a great in-person experience is something every business should be doing. But no matter how great your in-person experience is, customers need reminders to return. Email marketing is a great way to remind visitors how much they enjoyed your services, let them know that you’re thinking about them, and incentivize them to return with a special offer or fun event. 

Marketing automation tools, like Frederick, can make the process of nurturing a new customer easy to set up and scale, no matter how many people come through your doors.

Tip 2: Social Media Marketing

The beauty of social media is that it can be used to achieve many business goals including making it easier for customers to find your business, and encouraging retention. If your customer base is active on social media, there are a few things you can do to keep followers engaged and primed to do business with you again:

  • Follow them!
  • Like or reply to their mentions of your business.
  • Share content that customers find informative, interesting, or amusing.
  • Share photos your customers take at your business or after services. 
  • Address any customer service requests or negative comments in a timely, fair manner.
  • Promote your retention-related programs (see tips 3 & 4 below).

Tip 3: Appointment Series

Series are a simple way to get newer customers to keep coming back. For an appointment-based business, series can be progressive; a great example would entail creating a program of different skincare treatments to reverse sun damage. Or you could simply create a discounted block of appointments for a frequent service, such as bi-weekly manis or monthly hair trims. 

Tip 4: Membership Programs

Memberships are a great way to boost customer retention. Memberships can help your clients feel like VIPs by providing discounts, first dibs on their favorite appointment times, free add-ons, product samples, and full services as a reward for their exclusive patronage.

Tip 5: Software Management System 

Individually, all of the tactics we’ve discussed are great methods for service businesses to establish a simple and efficient customer retention strategy. However, those are a lot of separate lines you’re throwing out there and let’s face it – you’ve only got two hands! 

Having a management system will make it easier to track your clients and manage your retention efforts. For example, you can track customer services and purchases in Booker and offer memberships, specials and packages. A centralized system that tracks everything will make it easier to see which retention tactics are most effective with your customer base, and see their impact on your bottom line. 

About the Author

John Rigo

John Rigo is a content marketer with Booker. His areas of expertise are writing and market research. John brings a unique perspective to the blogosphere with his extensive background in publishing. He also has a love for small and local businesses – how they work, how they grow, and why they succeed.

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