Multi-Unit Salon, Spa and Barbershop Execs Reconnect at ISBN’s 2022 Conference
Senior executives from more than 30 multi-unit salon, spa and barbershop companies and the vendor partners who support their businesses celebrated “The Comeback,” at the International Salon Spa Business Network’s 2022 Conference. The first ISBN event in two years featured opportunities to reconnect, renew and restore themselves, their businesses and their industry relationships following two years of unprecedented challenges. ISBN represents more than 15,000 locations with more than 80,000 employees. The membership companies together earn more than $9 billion in annual revenue. ISBN champions four pillars—government relations, industry and consumer data, market intelligence and giving back.
“These have been the two most difficult years I’ve ever faced professionally,” ISBN President Scott Missad told attendees in opening the Conference. “But our industry and people are so resilient. I’m delighted to say that we’re back!!! It’s a ‘new normal’ and we’re different than we were before the pandemic, but we’re operating, we’re serving our clients and we’re ready to make money again.
“Our businesses are never going back to the way they were before the pandemic,” Missad continued. “We’re fast-forwarding five years. During this Conference, we’re stretching our thinking to discover how to take advantage of the future without looking back and deliver in unprecedented headwinds. Those include labor shortages, new work expectations, rampant inflation, supply chain uncertainty and consumers’ DIY trends. In addition, the new client experience is an enormous moving target being driven by technology. How do we maximize predictive analytics, so we’re in front of the new trends?
“The really good news is that there’s a clear abundance of demand for our services,” Missad concluded. “People really like what we do as beauty and wellness professionals. A changing landscape requires an evolving approach and pivoting solutions, so we can boldly move to the future as our industry and as our individual companies.”
Building relationships and memories
The ISBN Conference kicked off with four networking excursions to help members reconnect, renew and restore. Sponsored by CLIC and Boulevard, the activities included golf, hiking, a kayak outing and a catamaran adventure! Attendees mingled at a California Dream party sponsored by Kao, the Queen’s Diamond Reception with a Bridgerton theme sponsored by L’Oréal and a Reflection cocktail hour at the Estancia Pool & Spa.
Meet ISBN’s New Executive Director
This was the first conference produced by Jessica Iturralde, ISBN’s new executive director. Jessica focused on ensuring that every Member, Sponsor and Guest ha a positive, meaningful and fulfilling experience, and her hard work really paid off!
Leadership must be authentic
Keynote speaker Marcus Buckingham, co-head of the ADP Research Institute and NYTimes best-selling author of the new book, “Love + Work” (marcusbuckingham.com) spoke on, “How to create work you love for yourself and those you lead.”
“We want to follow people who are super authentic as leaders,” said Buckingham. “To that end, as leaders, you need to be able to step into your own power and own strength. But please don’t try to be perfect leaders. Find your ‘red threads’ and lead the way.
“When you strip away the accoutrements of work, it’s all about activity and relationships,” he added, noting that 16 to 17% of people are engaged in work. Why would they work for you? Can you build something where your talent can express the best of themselves?”
Buckingham noted that the most effective people share three insights:
- All take their loves seriously. That doesn’t mean they do what they love. Rather, they look for things they love every single day on their job. The most resilient doctors and nurses said in the end, 20% of what they do in a day is something they love to do. That’s the threshold. If you get below 20%, you’re a different person. A little love at work goes a long, long way. Tell your people you’re fascinated by what they love and how they can turn it into their contribution.
- Love is the catalyst for growth. Your red threads are where you grow the most. Focus on a growth mindset vs a fixed mindset for people. “The point isn’t growth or no growth. The point is answering where will you grow the most?” Buckingham explains. “Where will you get the most ROI on coaching time? When you are doing something you love, your brain chemistry changes.”
- Love grows only in response to another human being. We can help people learn how to discover how best they learn and grow. “A team is individual uniqueness coming together to form work, so make joining a team a really intentional part of onboarding,” explained Buckingham. “Why? 85% of people say they do their best work on teams.”
“Remember this: You step into leadership to get less control, not more control,” concluded Buckingham. “Leading is about engaging with a human and turning that into their contribution. When people come to work, they want to be seen. Pay attention to each person frequently. Pay attention to their uniqueness, eccentricity and weirdness. Those aren’t something you want to ‘fix.’ You want to help them turn those qualities into something beautiful for your guests and customers, that also help the team member stand out. Check in with each person for 15 minutes every week one on one. This is an important ritual, because the most powerful way to build a team is one by one.”
Embrace the change
In the second keynote, Phillip Stutts, founder and CEO of Win BIG Media, a corporate marketing agency, and founder and executive chairman of Go BIG Media, a political marketing ad firm, shared, “What political marketers know that business marketers don’t.”
“57% of U.S. consumers look at the economy as poor right now. There’s lots of anxiety,” explained Stutts. “How do you get ahead of the consumer, so we don’t get cut? We see up to 10,000 ads per day both online and offline. You’re competing against 10,000 other businesses every day. According to Google, buyers now must see your ad up to 500 times before making a purchase.”
How do you break through? “By being relevant and unique to your customers—from their perspective, not yours. You might think you know what they want, but you won’t really know until you ask them, and then test the messaging. For example, a pest control company spent $1.8 million in marketing, yet lost market share. Why? They discounted everything. But their customers cared about safer products more than price. Once they changed the messaging, they broke every sales record in the history of the company. We’re in the most disruptive moment for all of our businesses. We must think differently.”
Never lose a customer again
“Twenty to 70% of customers will decide to stop doing business with you in the first 100 days—and most businesses don’t know what their number is,” said Joey Coleman, the third keynote, who helps organizations retain their best customers and turn them into raving fans. “Most businesses spend 8 to 10% of operating expenses on getting new customers in the door, but allocate no budget for keeping clients. They lose the opportunity for more dollars, share of wallet and especially referrals, as a customer usually needs to visit a business two to three times before making a referral. So how would your business look if every client who visited you came back? Research shows if you get the first 100 days right, you’ll have a customer for life.”
The problem is that many customers feel neglected after the sale is made. They don’t hear from the business until they book the next appointment. But across a wide range of industries, a 5% improvement in retention rates will yield a 25 to 100% increase in profits!
Coleman left attendees with two clear takeaways to change the customer and employee experience dramatically and grow both the top and bottom lines:
- Investigate: Most customers tell people online what matters to them and what they like. For example, when Coleman arrived at a company that wanted to do business with him, they had root beer waiting. They knew that’s the only thing he drinks other than water.
- Think differently and strategically about how you personalize your interactions with your customers. For example, take a customer a cake versus wishing them Happy Birthday on Facebook.
Concluded Coleman, “If you don’t prioritize your customers, someone else will.” He offers a First 100 Days Starter Kit. ISBN members can text First100 to 66866 to get it.
The Power of Working Together
ISBN Past President and current secretary Rhoda Olsen, vice chair of Great Clips Inc. Board of Directors, moderated the popular Mastermind sessions. They included Education Post Pandemic, Maximizing the Client Experience, Service Pricing and Inflationary Trends, Health of the Salon/Sustainability, Licensing Reform, Retail Product Changes and Direction and Retention.
Olsen also updated attendees on important government relationship initiatives under the Future of the Beauty Industry Coalition, of which ISBN is a member. Those initiatives include license for license mobility, pre-graduate testing, reduction in cosmetology hours needed for licensure and support of online education. She also discussed the Compact Initiative. Olsen recommended that attendees join the FBIC at fbic.org. It’s free!
Attendees and sponsors shared some of their best “Big Ideas,” during a session moderated by V’s Barbershop’s Emily Brown.
- Ulta’s Nick Stenson shared that the company launched Glam Lab before COVID, but picked up steam after COVID because of a different need.
- In light of supply chain challenges, Jenny Bayer, director of salons/national accounts for Direct Beauty Express, said they stopped focusing on out-of-stocks and started talking about product categories. That shifted the conversation from defense to offense.
- Steve Hockett, CEO of Great Clips with over 4,000 locations, said they took advantages of the opportunities COVID presented to drive change. To provide constant communication, the company focused on video messaging. “I was never on video prior to COVID. Now I’ve delivered over 50 videos to our team and am forever on video. The storytelling you can achieve through video is the best form of communication you could imagine.”
- Birds Barbershop eliminated the front desk without compromise, according to co-founder Jayson Rapaport. Now, they can reinvest the $800,000 they spent on front desk hiring, training and turnover every year. “Plus, I think stylists will sell more products directly, instead of handing that off to the front desk,” he added.
- Supporting new talent was key at Gene Juarez Salon & Spas, according to Katie Trent, president. “We made a fundamental shift as a leadership team,” she explained. “We stopped focusing on the rocks stars and now we drive everything in the company around our new artists. We created a new menu called New Talent Services. We also eliminated our training contracts. We said, ‘We want you here because you want to be here.’ In addition, for 50 years, to work at Gene Juarez, you had to specialize in cuts or color. We did away with specializing, which allowed us to attract more stylists. Finally, as our biggest gamble and biggest success, we increased our base commission and made stylists eligible for an increased every 6 months based on four achievable KPIs. They are thrilled.”
Industry Trends Panel
Jayson Rapaport, co-founder, Birds Barbershop, moderated a panel on industry trends. Here are some of the discoveries.
- “Pricing and pay have both increased—in some cases, $10 to $15 per cut,” said Jim Valenzuela, founder and CEO of V’s Barbershop. “We tell employees that we must earn the new price. In return, they want flexible scheduling and to be able to express their individuality behind the chair.”
Valenzuela also focused on the importance of consistent regulation to level the playing field and remove the burden from salons and barbershops that “play by the rules.”
- “We’ve noticed our customers’ salons are back to about 90% of pre-pandemic revenues,” said Matt Dann, co-founder and CEO, Boulevard. “Previously, the average number of stylists was 11 per salon. Today, it’s nine. But while they’re down in team members, they’re up 15% in revenues. Salons have learned to do more with less. As a result, pre-booking is much more important. If you think a client will no-show, don’t pre-book them.”
- “Really quick treatments make clients feel great while taking no extra time for the stylist or client,” said Wayne Grund, co-founder and CEO of Surface. “In August 2020, our treatment sales were up 44 points. It’s as simple as identifying the clients who will spend a little more on themselves in the salon and then will want to take the product home. A 10-minute color glaze at the chair is another hot service.”
Added Wayne, “We support a culture of hope in salons. We want to help them be part of something that’s giving back. I loved the phrase, ‘Are you interested or committed?’ Do your employees know you’re committed to helping them have a better life? Young stylists don’t know what their red thread is yet. We can help them discover that through soft skills training.”
Wayne also discussed the trend of states reducing hours required for cosmetology school. “Reducing hours puts the responsibility to provide advanced training on the manufacturer,” he commented. “At Surface, we are happy to provide that and offer certifications in curls, thinning hair and much more.”
- “The frequency of salons visits is down 20%, while pre-booking sits at 49%,” said Eileen Healy, vice president, field sales, SalonCentric. “Unfortunately, cancellations and no shows are up sharply, and salons are losing tens of thousands of dollars per week as a result. I know one salon that lost over $500,000 in cancellations and no-shows last year. As a result, salons are requiring clients to have credit cards on file and are charging 50% of the service fee when clients cancel within 24 hours or the full charge for a no-show unless the guest is very loyal or there’s a special circumstance. Some are applying the fees to the next service, while others are not.”
According to Healy, technology is supporting the client experience. Guests expect text reminders and will choose a salon because it offers online booking. Virtual consultations continue to be popular.
Added Healy, “Right now, recruiting staff is a bigger challenge than attracting guests. Having 5-Star Google reviews impacts both. 75% of people won’t go to a business that has fewer than 4 Stars. Ask your clients to post a review before they leave.”
- “During the pandemic, consumers developed a focus on self-help and wellness,” said Dr. Alex Capano, chief science officer, Green & Gold. “As part of that trend, CBD products have become long-stay staples. I like to think of them as the new retinol or vitamin C because of their therapeutic value for everything from pain to dry skin. It’s a winner for the both the client and the service provider.”
Bethany Hornthal, co-founder and executive director, and Sydney Berry, a 50-year veteran of the professional beauty industry who is a 30-plus-year cancer warrior, updated attendees on the HairToStay Cooler Heads Prevail campaign. The goal is to help stop hair loss associated with chemotherapy, so that stylists never have to do another “chemo cut” for their clients again.
Save the date
The next ISBN Conference is scheduled for April 23-25, 2023, at the brand new Loews Hotel in Coral Gables, FL. Watch for more details at www.salonspanetwork.org.