Intro: Do you feel like you were meant to have a kick-ass career as a hair stylist? Like you got into this industry to make big things happen?
Maybe you’re struggling to build a solid base and want some stability. Maybe you know social media is important, but it feels like a waste of time because you aren’t seeing any results. Maybe you’ve already had some amazing success but are craving more. Maybe you’re ready to truly enjoy the freedom and flexibility this industry has to offer.
Cutting and coloring skills will only get you so far, but to build a lifelong career as a wealthy stylist, it takes business skills and a serious marketing strategy. When you’re ready to quit just working in your business and start working on it, join us here where we share real success stories from real stylists.
I’m Britt Seva, social media and marketing strategist just for hair stylists, and this is the Thriving Stylist Podcast.
Britt Seva: What is up and welcome back to the Thriving Stylist Podcast. I’m your host, Britt Seva and today’s episode comes in from a listener like you. I’m so thankful that this listener reached out to me.
I’ve said this before, I’ll say it again. If you have a question you want me to answer on the podcast, if you leave me a rating or review on iTunes and in the comments, submit your question. That is where I pull a ton of the inspiration for upcoming podcast episodes and this just happens to be one of them.
This stylist reached out to me and said that they recently went through a price increase and it had a negative impact on their business. So I want to read you the story and then offer some coaching and some guidance as to prevent this situation from happening in the future, but also how to course-correct if you’re in this situation.
One of the things I’m big on talking about is the difference between proactive and reactive business management. So when something has gone wrong in our business, we don’t have a choice, but to be reactive. It’s already happened. So you’re reacting to the blender, right?
Ideally, we’re so proactive that we don’t have to get into that reactive mode, but you know, inevitably it’s going to happen from time to time. We’re not perfect. We’re simply human. Because of that, we have to learn how to navigate out of the funk and this episode is going to share with you how to prevent the funk from happening and then how to get your way out if it does arrive.
I’m going to change some of the details as I always do to protect this stylist’s identity. This person said, “I chose to raise my prices to thin out my client base so I wasn’t so booked out and could accept new guests that I was turning away. That worked. Yay!”, which is what I do coach to.
One of the things that is problematic for stylists to become successful like this person—I know this stylist, I’ve talked to this person several times, and I know that they’re really successful. And what happens is when you increase demand, it’s like that more money, more problems issue, where now you have more people who want to come in to see you than you can bring in.
And one of the things about business is that we never want to be in a position where we’re turning clients away. If you can share with me an example of a super successful multi-million dollar business that does that, I’d love to hear it. But for the most part, businesses that are successful are always taking in new business. It’s like, why would you not?
The reason why we get to a place where we can’t is because there’s something structurally wrong with the way we’re running our business as a stylist. In the 1980s, 1990s, we would say things like, “Oh, I have a full clientele,” and you meant it. Like you couldn’t take on any more. It’s not the 1980s or 90s anymore.
That was a time where people would become super loyal to a stylist and stay with them for like 25 years. How come? Because how hard was it to find a reputable stylist in 1991? Like, what did you do? You used the phone book, you asked around, you walked up and down the street and peered in salon windows and hoped that you found somebody who visually you felt like you trusted. There wasn’t a lot to go off of.
So if you found somebody who could cut or color or style your hair, you stuck with them because it was too hard to find anybody else. That’s not the era we’re living in anymore. So the idea of “I’ve got a full clientele. I’ve made it,” it’s just structurally not what’s up.
And that’s why I say we never want to get to a point in our business where we’re turning guests away. There always needs to be room for more. So this stylist said that they were at that place where they were blocked and they wanted to create room for more.
Now, this stylist did say that they are being coached by another coach. They’re in Thrivers Society, but they’re being coached by another coach as well, which I’m all for. But this is one of the things that can get a little tricky, is that the reason why there are a lot of business coaches in the industry is we all see things differently and that’s really good.
You need to find the business coach that resonates deeply with you. That’s the whole point. It’s like finding your perfect match. So this person was coached to raise the prices because other coach also believes like if your demand is too high and you’re turning away guests, you need to raise prices. So I don’t believe the advice was bad, but I want to talk about the execution and then where we go from here.
So this stylist says, “Yay. Now my clientele’s thinned a bit and I’m able to get in new guests, but now I have holes in my books and I’ve hit a slump in my new client request to fill those spots. I used to be able to fill them fast.”
Remember the reason that this stylist chose to have that price increase is because they were booked to the moon and back, and they had a ton of new guest requests and they couldn’t even fit them in.
Now this stylist is very smart and knows that they can’t be turning guests away. They need to always be bringing in new clientele, so they did this with the best intentions, but something wasn’t right, and that’s why this person reached out.
She says, “Is it normal? Do I need to go back and rework my funnel again? I’m working my dream schedule still and still making over my goal, but I wanted to hit my stretch goal.” And this person’s stretch goal is deep. This person’s stretch goal would put them at deep six figures, not quite multi-six figures, but deep six figures.
“I’m terrified that I’m missing that new client flood.” Okay, so first of all, you don’t need to be terrified. It just feels a little bit scary when this happens.
One of the things that this person was asking me is, “Is this normal and do I need to go back to rework my funnel?”
The word normal to me is like the word fair. I don’t love either of them. I think that they’re both really subjective words, but is it typical for someone to raise prices and lose demand? Only when there is something wrong with the price increase.
If the price increase was fully justified, fully aligned, and exactly how it should have been, no, you shouldn’t now see a decrease in new guest requests. That is a sign that like something went sideways, something wasn’t right, and I’m going to help dissect what wasn’t right.
But no, that’s not what we typically expect. This is why in Thrivers Society—I will do an upcoming podcast episode about this—we look at the seven factors of pricing and we make sure that the key indicators are there so that you can do the price increase in a way that you’re not going to feel that panic. You’re not going to be worried that it’s going to have a negative impact because I’ve seen price increases have negative impacts plenty of times. We always want to safe-proof the business so that it does not.
Now the thing that might need to happen, and it is part of what I’m going to coach to—when she says, “Do I need to rework my funnel again?” One of the things I talk about in my program, the Scaling Stylist Method, is the idea of elevating brand. So in Thriving Stylist Method, we create the baseline of branding, target market. We look at what all that looks like in the Scaling Stylist method, which is this stylist is right on the cusp of being there. We take it a step much, much further.
If you’ve been hanging with me for any length of time, you’ve probably noticed I’m on my fourth major rebrand in the last four years, because as my business levels up, the branding has to as well.
However, I don’t believe to this stylist that just reworking the funnel is necessarily going to change everything. But we are going to talk about why putting some focus there when you do start to scale is critical.
So then I chatted with her a little bit and then I said, “Do you know what indicators sparked that suggested price increase? And how did you determine by how much to raise?”
The stylist said, “I felt it was time to raise my prices again because I was booked out a month in advance and I wanted to be able to get in new clients that I had been turning away. I wanted to go gratuity-free because I wanted everything to be super transparent and very simple in pricing terms.”
And that I get, like I understand that quest for simplicity. Trust me, I get it.
So she says, “I tracked for seven weeks and found that every guest across the board tipped almost the same, 22%. Then I accounted for my 5% annual increase and went from $120 an hour to $150 an hour, no longer taking tips. I also increased my hourly because I removed double booking from my business.”
Okay, so that’s the basics of what went down. When we look at this from the bird’s eye view, a thousand feet above, this is a significant price increase. However, knowing the stylist, I understand the demand was there. It felt really right.
And one of the things we do talk about when we get to Scaling is what are the things that we can do to add systematic structure to our business. The challenge is, I think, the systematic structure came a bit too early. I don’t think that the clientele was ready for it yet. I’m not sure that your funnel was ready for it yet.
Let’s talk about what happened in the eyes of the clients. So what this person is saying is they lost some existing clients, but that was the goal. They wanted to thin their books a bit so that they could take on new business at a higher price point. So if you think about that logistically, like, okay, I want to lose some of the clients who are paying a hundred dollars so I can attract more of the ones that are paying $120.
That’s smart. That’s very smart business. So that part wasn’t incorrect. That was right. The challenge was now this stylist is in the position where they’ve lost some of the clients who were paying the previous rate and now they’re not attracting enough clients who want the new rate, and I want to explain why I think that happened.
This was not a straight-up pricing increase. This was a structural change, and it was a hefty one. One of the things I always talk about on the podcast is the idea of perception and perception is the reality. So whatever a client sees or a prospective new client sees and assumes, that is the truth. Even if you know in your mind, like, “No, no, no, there’s this other piece and you’re not getting it,” it doesn’t matter. You don’t get that grace of reaching out to everybody who finds you on social and doesn’t book because their perception was off. The perception is dictated by what you present and if people are choosing to go the other way, it’s because the perception was the perceived value isn’t there.
So when this person was so booked out to the moon and back, and was seeing a ton of new guest requests, they were at the rate of $120 an hour. The rate is now $150 an hour, so the rate went up in the eyes of the client by 27%, right? This person’s said, “I was looking and gratuities were around 22%, and then I added on my additional 5% increase,” so that is a 27% increase across the board.
When we look at it like that, the guest who was seeing the pricing on the website before was seeing like, okay, I could come in and this person does a session-based pricing and hourly model, which I think is great.
In my pricing method, I talk about three different ways to price: hourly, session-based, and a la carte, and I have tools that allow you to do all three. I’m fine with whatever you choose. The method to me doesn’t matter as much as the execution.
So the clients had gotten used to seeing $120 an hour. Now their perception is $150 an hour. However, this stylist is incredibly talented and specializes in a lot of color, so generally speaking, you’re going to be there for multiple hours. If I want to get my roots done and a haircut, it went from $240 for that experience to $300, so it’s $60 more to get the same result.
That’s hefty. That’s significant. And I understand that the purpose was to thin, and then we could say in our eyes, but like, “No, no, no, but the client was paying it anyway,” right? Because the gratuity was there so they were already spending it.
So the fact that it’s now bundled in shouldn’t make a difference, but the pro is the way that the consumer sees gratuity is a suggested cost, not a fixed cost. So a fixed cost is the cost of the services being rendered, right? The haircut price is the haircut price, the color price is the color price. That’s it.
Tips are technically subjective, like when I go to a restaurant, I’m going to tip 20% or more. However, there was a time, it actually happened to be Mother’s Day where we went out for a family breakfast and we sat down to eat this beautiful meal. My husband had, no joke, like a three-inch metal hexagonal bolt in his eggs. It was one of the most repulsive things I’ve ever seen. What ended up being determined was that the bolts fell from the hood warmer into his food, and somehow, nobody noticed it when it was brought to the table. We noticed it in about two seconds and reported it to the server and was like, “You know, I think that there’s a bolt in his food. If we could get this replaced, that’d be great.”
“Oh my gosh. Yes, yes, no problem,” brought it back, but it’s Mother’s Day brunch, so it’s hectic. So we’re all sitting there, our food’s getting cold waiting for my husband’s plate to come because we’re not going to eat without him. Like we’ve been here for hours now, waiting to get sat, and it’s like, we’re going to wait. We’re going to do this meal properly.
His piping hot plate comes. We eat our mediocre warm food. He eats his breakfast. The bill comes. There’s his bolt omelet is not taken off the bill, which to me was the least they could have done. Are you kidding? It really spoiled the entire meal.
This happened years ago and I’m still talking about it. So we’re expected to—you can’t even knock off that $14 egg plate after it was served with a bolt and we all had to sit and eat cold eggs because we were waiting for it.
Instead, I paid for that omelet and on a bill that was probably like 250 bucks because it was extended family—there’s probably 10 of us there—we tipped nothing. And that is atypical for me. That is very rare for me. But that’s the subjective opportunity of so long as you treat us right, we’re going to take care of you and then some.
I am a typical 20% plus tipper, but if you serve me a bolt in my eggs, don’t really apologize, don’t take the $14 meal off, and then the rest of us eat a cold breakfast, why would I pay 20% more from that? That was a horrible experience.
And I understand there was a busy day and all of the moving pieces, but we hold onto that subjective cost for things like that, right? And so when we eliminate the subjective cost and make it a fixed cost, it does leave a feeling in the consumer’s mouth.
It’s why we don’t tip our dentist or our doctor. We’re thankful for them. You go into the doctor’s office and sometimes they have holiday cards up on the bulletin board because people are thankful, but you don’t leave a tip for that because we see doctors and lawyers and all of those kind of roles as fixed cost.
We are a service-based industry. Subjective cost has been a part of the way things have been run. I’m not saying that subjective costs at some point won’t go anywhere, but when you combine all of these pieces, as the perception from the guest was that they had been paying $120 an hour. Now it’s $150.
I will say the verbiage is very clear on this person’s website and social and everything that like no tips, it’s all good. This is everything, like you will know exactly how much you have to pay when you walk out the door. It feels different to the client.
To this stylist, it almost feels like their prices only went up 5%, not 27% because they were getting a 22% gratuity. So for the stylist, it feels like my gosh, this isn’t even a whole lot to stomach, but can you see how on paper, like go ahead and even write this down, write $240 on one piece of paper and $300 on another. I want you to feel the emotions you feel when you look at the difference between those two numbers.
Have you ever been maybe shopping for a special occasion, like suit jacket or full suit or a dress or anything, and you know, we look at prices and maybe one of the dresses was $240 and one was $300 and you liked both of them, but in your mind, you’re like, “This is a one-time event. I have other things I need to pay for.”
Often, we’re swayed to the $240 if we like both of them, unless the $300 is that much better. And that’s where I’m leading into with this.
You have to understand, to this stylist at the subjective cost of $26 an hour, which is what you were averaging for gratuity, is now rolled into fixed cost, which is okay, but you need to justify it because the perception is the reality.
There’s a story I shared on the podcast, this is probably a couple years ago. Now I was talking to my best friend Caroline and she had come to see a stylist and she called me after her hair was done. And she said, “Explain to me this,” because she knows what I do for a living, so every once in a while she’d have a question for me.
So she’d say, “Explain to me this. I just went and got my hair done. I walked out the door. It looks exactly the same today as it did eight weeks ago. Why did I pay $20 more?” And I was like, “Okay, simmer down. I’m sure that that stylist took a class or maybe they’re using better products. Maybe their demand has increased. Like that person deserves a raise too.”
And my friend was like, “While I get that, for me, the end result is the same. I don’t feel like she’s doing anything improved. I don’t feel like I’m getting anything else for it.” So her wandering eye starts to pop up. She starts to ask herself, can I get a comparable result for 20 bucks less elsewhere? It creates that level of insecurity that maybe wasn’t there before.
Long story short, my friend ended up sticking with that stylist. She got over it and ended it up deciding to stay there. But you have to realize these are the things that come up for people, right? Thinking about like, am I going to pay $60 more, $100 more to see this person? How do I justify it being worth it?
Here are things that often don’t carry justified weight in a client’s mind: additional conditioning treatments. I love a conditioning treatment. I’m all about selling them. However, when we say like everybody gets a conditioning treatment, it becomes what?
Chips and salsa, like I always talk about.
If you’re not familiar with my chips and salsa analogy, I always say, when we go to my favorite Mexican restaurant in town, it’s a sit-down restaurant, family-style. I absolutely love it. Literally. Part of the reason we go there is they have the best salsa in the world. Sometimes I buy the salsa just to take home ‘cause I’m so in love with it. But when I sit down and I’m going to have like my enchilada plate or whatever, I assume I’m getting free chips and salsa. That is just the assumption.
I can’t remember the last time I went to a great Mexican restaurant, and chips and salsa wasn’t part of the experience. When we go to our favorite takeout burrito joints, at the end you get your two burritos and then the bag of chips and salsa. It’s just part of the experience.
When you go to McDonald’s, you’re getting fries with your meal, right? It’s just part of how it goes.
When we just lump in conditioning treatments and we’re like, “Everybody gets one!”, it’s chips and salsa. That perceived value isn’t there versus when you’re selling it or you’re doing a promotion for it, or you’re bringing in a new technology, you can lump in that perceived value and there’s a talking point, but it’s positioned really differently.
So if it’s just part of what you do, the client is going to be looking at you and comparing you to everybody else they find online at the interest level and saying like, “Eh, is it worth $60 for me to get the conditioning treatment?”
These are just the things that come up in their mind. In my eyes, yes, I believe deeply in professional conditioning treatments, but I’m not the average client, so we have to think about what the average client is seeing and thinking as they’re making these considerations.
My advice to this stylist and to anybody who’s been in this position is to really say, okay, what can I do to level up the way that I am positioned in my marketplace so that my perceived value is worth it? Because let’s be honest, there are plenty of stylists charging more than $150 an hour.
I don’t think this stylist is necessarily overpriced, but you just had a massive 27% increase in the eye of the consumer. So to them, it’s a little bit shocking. So we need to justify it and to justify it, you show up on social more, the volume of your content increases, the layout of your website improves and cleans and streamlines, right? The way that the guest feels when they’re in your chair.
Now you said you’re eliminating double booking, which is huge. That’s huge for perceived value. The challenge is the new guest, which is who you said you’re really feeling like isn’t coming in, didn’t know double booking was a part of it before. They weren’t expecting it now. So to them, that’s irrelevant. I love that you did it. I think it’s great.
But how do you double down externally, like on the external levels of your funnel, that when you come in to see me, you get all me, I’m all in on you. How do you verbalize what makes you exceptional?
Which to me leads right into the Scaling Stylist Method because in the Scaling Stylist Method, we talk about things like X factor, Zone of Genius.
X factors are something I think people get really confused about. People think X factors are like, “I’m talented.” “I’m double certified.” “I’m super funny.” “I’m caring.” “I’m trustworthy.” “I’m empathetic.” “I’m a good listener.” “I give a great scalp massage.” No, none of those things are X factors because as I listed that, a lot of you were like, “Oh my gosh, are you reading my mind? I’m all of those things.” I know you’re all of those things. That’s why they’re not X factors. They’re just part of the formula for being a great stylist so we have to double down on what are the things that we can do to better position you so that you live in this price adjustment in a way that it’s still so obvious that you’re the number one choice.
There are plenty of people charging at this ticket level. I don’t have an issue with what you’re charging at all. Like full disclosure, I think that you are in the right price point. The challenge is the perception to the clients was that was a very aggressive play all at once. I probably wouldn’t have done it all in one shot. I would’ve layered it a little bit differently. I personally wouldn’t have eliminated the gratuity. I would’ve left that subjective cost in. I think you would actually make more money with it, but now that you’re here and you’re in it, what I would say is start making those external changes so that it’s very clear and obvious perception-wise that you are that $150 an hour, like dang-this-is-worth-it stylist for these people to see.
That’s what’s going to make the huge, huge difference. Really live in that as the way you show up on social, the way you show up on your website, the way that you’re creating awareness of your business, double down on that. Your clients in the chair should feel so clearly that you’re a cut above so that those referrals are coming in.
My question to you is when the clients are in your chair, are you explaining to them all the perks and benefits? Or are you just chatting about what happened last weekend? Are you sitting there and talking about like, “Hey, just as a reminder, I add X, Y, and Z to our color, and the reason I do that is most stylists don’t. The reason why they don’t is blah, blah, blah.” Like you have to be educating through the visit. You have to be reminding of that perceived value if we’re going to live in this price point until we get that client flow and demand back.
The way to get that client flow and demand back is you need to level up by 27% on social. You need to level up by 27% on your website, to live in that 27% increase. It was a big one. You’ve earned it, but now you need to rock it.
I hope this has been helpful for everybody, particularly to the incredible soul who wrote into me. I adore you and your business. I think you know this, I’m your number one fan, cheering you on so big and you’ve got this.
So as always, so much love, happy business building, and I’ll see you on the next one.
