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Retail 2020: Hot Spots and Digital Trends

Heading into a holiday season like none other, ISBN members and partners share retail solutions to help drive salon revenue into 2021.

Where do beauty market leaders see potential bright spots for end-of-year sales? According to nationwide numbers released October 9 in the latest report from Kline Pro, a salon retail products and services database, some Q2 results indicate strong retail and revenue opportunities for Q4. Specifically, consumer mindset and habits could mean more stockpiling of essential hair and beauty care, along with an increased demand for gift sets and gift cards. 

  • Professional hair product sales in June 2020 were 98% of the June 2019 totals.
  • Sales of shampoos and conditioners were ahead of last year at +6% and +12%, respectively.
  • Hair care products that provide color care benefits saw a bump in the second quarter to 34% of the market, peaking in April at 43.7%. Since most salon doors were shuttered in April, ordering online and curbside pickup from salons became a lifeline.
  • Data shows that kits and multipacks of items for color care surged in this timeframe to 134% over a year ago, as stockpiling products became a reality.

    Industry bright spots from Q2, according to KlinePro.

  • Sales of gift cards in salons grew every month of Q2 for an overall revenue growth of 41.3%.

Debra Penzone, president of PENZONE Salons + Spas in Columbus, Ohio. recently led her entire team through a complete reimagining of the iconic, successful, 50-year brand, including a focus on connecting in unique spaces inside the four PENZONE locations. After COVID-19 hit, retooling retail, along with social distancing and other processes, became essential to redefining how to serve the community. She says PENZONE’s Q2 retail surges reflect the Kline Pro data, are driving Q4 holiday promotions, with early success:

  • Pent-up demand: “Retail sales boomed the first four weeks after the reopening, then tapered off slightly,” Penzone says.
  • Upgrade opportunity: To help recharge retail demand and improve access, PENZONE launched shoppenzone.com on September 1, offering a convenient (and on-brand) way for guests to buy online and have products shipped or waiting for pickup in the salons.
  • Promotion: “We’re running a “So Extra Retail Sale” in November to boost sales going into the holidays, with a Buy One, Get One 50% Off incentive.”
  • Quick start: “We just did a super early cyber sale, online only, to kick off holiday gift card sales a month earlier than our usual Cyber Monday sale, and crushed it, almost beating last year’s goal. It has been so positive to see the trust and confidence from our guests who are shopping so early.”
  • More gifting: “We are also introducing our very own Inspired Gifting sets—focusing on suggestive selling—for the holidays. These will be available in salons and online.”

ISBN board representative Jayne Morehouse, president of Jayne & Company and CEO of the Beauty Industry Report, sees salons embracing—and bringing a service spin—to e-commerce as a meaningful shift to the new retail reality.

“For years, perhaps decades, we’ve talked about bringing the brick-and-mortar experience online as the way to succeed with digital,” Morehouse says. “In light of COVID-19 and how shopping has changed as a result, fashion and beauty retailers have now flipped the equation—they’re creating ways to bring the digital experience to brick-and-mortar.”

What may have started as a reactionary scramble upon shutdown to retool retail options and add basic e-commerce has since evolved into competitive upgrades, some even offering online hair, skin and nail consultations through artificial intelligence and augmented reality technologies.

“Salons, spas and barber businesses are now using data and technology to ensure they know every customer. Their concerns, challenges, loves and dislikes intimately,” Morehouse adds, saying that ISBN members and other leading beauty business are uniquely positioned to do this. “You’ll want to update your CRM. It’s a great reason to call clients whom you haven’t seen since the shutdowns. And even if they haven’t missed a beat with their regular appointments, many people’s priorities have changed because of COVID. Let them know that’s okay, and you’re ready to pivot with them.”

Pro tip: “Include a complimentary online consultation with every gift certificate, so your team can get to know the lucky recipients—and guests can get to know you—before their appointment,” Morehouse advises. “It’s all about using technology to build a more personal connection with every client,” including retail usage and preferences.”

For the leaders at V’s Barbershop, rethinking retail came from the realization during closure that patrons couldn’t actually buy V’s products, says COO Emily Brown. “A lot of people really love the tonic, shave cream and other products we’ve come up with out of necessity for the stores and were asking for it. It opened our eyes that we had to do something beyond brick and mortar.”

Brown says V’s is working on a digital solution that will update the retail experience and structure while ensuring people still walk through the doors of nearly 50 V’s franchise stores across the country.

“Consumers’ habits and comfort levels have changed, whether purchasing groceries, booking a beard trim or buying grooming products. We have to adapt and get comfortable, too, and be sure our brands and our people are still at the forefront of their thoughts.”

Thinking ahead: Offering curbside pickup of retail products hasn’t really been an option for the high-end, mall-based locations of Gene Juarez Salons and Spas in Seattle, says Chairman Scott Missad, who is also president of ISBN. In addition to upgrades and an emphasis on e-commerce, Missad says the Gene Juarez team is working on other plan-ahead, onsite, retail alternatives.

“We’re working through a concept that allows guests to pre-order products, so they are waiting for them when they come in for their services,” he says. “In a perfect world, the consumer gets a confirmation email or text, clicks on a link on it, and sees all the products previously purchased or recommended by the stylist, can scroll and check off, prepay and pick up at the front desk or stylist station.”

Technology is going to be the driver of everything, Missad says. Steve Reiss of SalonInteractive, a turnkey e-commerce and marketing solution for the professional beauty supply channel that has set up online stores for thousands of salon businesses this year, agrees.

“The downturn has proved how much people truly care about their stylists, but behaviors have changed,” he says.

According to a recent forbes.com article, forecasts from Forrester, Deloitte and the National Retail Federation concur that 2020 is the year online holiday shopping will explode, with sales in popular gifting categories like health and beauty predicted to rise 23%. Some consumer surveys estimating as much as 70% of holiday shopping overall will happen online this year. And the timing is already different, Reiss says.

“Everybody is working to make things happen right now,” Reiss explains. “Amazon Prime Day was earlier, joined by Target Deal Days and everyone else’s versions. Retailers aren’t waiting for Black Friday or Cyber Monday, because in 2020, every day is cyber day.“

Research consistently shows salon clients really want and value specific advice from their stylists and solutions to their hair challenges, he adds. The opportunity is to find easy and new ways to share those recommendations, which Reiss says is the focus of SalonInteractive.

“For example, people are using QR codes again,” Reiss say. Like restaurants and other retailers quick to adapt, beauty groups can duplicate and amplify messaging to including a link to a salon’s online store or a specific promotion, then display it on tent cards at stations, at checkout, at the backbar, wherever signage can be placed, with a message of, “If you need this, we can deliver it directly to your house.”

The next phase of retail success, according to Reiss, comes from focusing on daily activities, and supporting new habits for stylist and consumer.

Imagine how powerful it would be if after each appointment, a client received a text or email from the salon with a personal product recommendation at the end of the day linking to that specific product on the salon’s online store, where it can be easily purchased and delivered directly to the customer’s home. “That’s business that the salon, not some third party retailer, has earned and that the salon deserves,” Reiss says.

Bottom line? Salons, spas and barbering businesses that promote strongly and early, offer online purchase options and innovation, and integrate digital solutions to enhance the brick and mortar service experience will be best positioned to thrive into recovery and the new year.

 

 

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Michele Musgrove

Michele Musgrove

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