Boulevard Education Manager Skya Jones unpacks the metrics that help determine success
Success in business does not come down to the luck of the draw. It’s all about managing the numbers. And to effectively manage them, you have to know what you’re looking for. Your tech should track the most important metrics for success and allow you to measure the health of your business at a glance. If it isn’t, then it’s not helping you succeed.
Boulevard Education Manager Skya Jones took the stage at AmSpa 2024 to help self-care business owners better understand these key performance indicators (KPIs) and the role technology plays in tracking these metrics. Here are the key takeaways from her presentation.
What is a KPI?
Key performance indicators are a measure of how well you’re doing in achieving specific goals over time. Think of them as the secret sauce for measuring the performance of your business. By tracking specific KPIs, you’ll get a better idea of what’s working and what’s not — and how to address the areas for improvement.
Self-care entrepreneurs need to understand how their businesses are performing in order to make informed decisions. Manually tracking these metrics is slow and tedious. That time would be better spent supporting your providers and ensuring clients have a flawless experience. You should be able to lean on your technology to handle the reporting for you; if you can’t, it might be time to reevaluate your software.
So, what key performance indicators matter most for self-care businesses? Here are six that Skya thinks every self-care business should keep in mind.
6 KPIs you need to know
Service sales
It probably comes as no surprise that service sales top the list — after all, services are the foundation of successful self-care businesses. The way to grow a business is to sell services effectively at a healthy profit margin, which sounds simple on paper and is often much harder in practice. Keep in mind that your tech should do more than track sales. It should help you grow them.
Start with the point of booking. If your tech doesn’t allow for seamless online booking with minimal steps, chances are you’re going to miss a lot of clients. Make the booking process as frictionless as possible so potential clients don’t bounce off your tech. Also, if you offer enhancements and add-ons through the booking process, you can increase the ticket value of a client before they even arrive.
Your check-in should also be supported by your tech. Filling out forms and questionnaires is a lot of work for the client and can detract from the luxurious experience you want to create when they walk in your door. Your tech should allow them to complete the pre-appointment paperwork at home, on their own time.
Checking out should also be as seamless as possible. You want tech that will integrate with your payment system so that the right amounts are charged, the right discounts are applied, and you don’t have to call a client after the fact to correct a mistake.
Finally, you can boost your service sales KPI by following up with clients after their appointment. Schedule follow-ups and send reminders when it’s time for a refresh. If your tech isn’t automatically nudging clients to return to the salon, you’re missing out on an easy way to increase sales.
Revenue
For most self-care businesses, service sales are only a portion of overall business income. Revenue is the single most important measure of the health of your business and should be tracked separately. It refers to the total amount of income generated by your business in the course of normal operations. It’s a measure of how much you’re selling in services, goods, and more.
Don’t confuse revenue with profit, which is the amount that’s left after you subtract your expenses. Revenue is purely the total number you bring in.
Your tech should help you keep track of revenue and measure it over time. According to the American Med Spa Association, the average annual medical spa revenue in 2022 was $1,982,896. That’s a good target to aim for if you work in that vertical.
Retail sales
Some self-care business owners are hesitant about retail sales because they’re afraid of pushing expensive products on top of what may have already been a pricey procedure. But the fact is that clients want products to maintain their new looks between appointments. Be the trusted voice that points them to those products. You’re the expert, after all.
Leverage your technology to check your inventory and recommend products at checkout. You can also keep track of the products you discussed by leaving notes in client profiles. Empower your staff to make expert recommendations and boost your retail sales KPI.
Membership and package sales
Memberships are another important way to drive recurring revenue. The most successful businesses are often the ones that cater to their existing clients with luxurious membership benefits and custom service packages.
Give your clients the option to purchase packages while self-booking online or checking out in the salon. Want your staff to be able to upsell memberships or packages with a click? Your tech should do that. It should also allow for custom expiration dates, prepayment, and accommodating clients’ special needs.
When you track memberships and packages as a KPI, you see how effective you and your staff are at managing those upsells. This lets you gauge whether your offerings are resonating with clients or getting passed over.
No-show rates
It’s any self-care biz’s worst nightmare: losing out on expected revenue from a service or retail sale because a client is a no-show or cancels late. That’s why it’s important to have a clear cancellation policy and an all-in-one payment facilitator that supports your policy.
Don’t let your fear of client backlash keep you from strengthening your no-show and cancellation policies. It’s become an industry standard to have a method of payment on file so that you can hold deposits and protect your business and provider in the case of a no-show. Your technology should play a role in enforcing your policies and collecting any fees. You can also track whether those policies are reducing no-shows over time as intended.
Automated marketing-led bookings
Your time is valuable, and so is your staff’s. You want them to spend as much time as possible giving your clients a luxurious experience when they’re in the salon. Self-booking helps them do that by taking the load off the front desk. Clients can book themselves on their own time and with their own devices.
Marketing-led bookings take this to the next level of wow, with a self-booking overlay that lives on your site and is accessible directly from social media, search pages, or map apps. You can reach your clients wherever they are with your brand message and lead them directly into the self-booking process with just a click.
Without the right technology in place, tracking these critical KPIs can be a full-time job in itself. Make sure your software is working for you and streamlining as many aspects of your business as possible.
