How Loyalty Rewards Help Local Barbershops Build a Better Business

6 months ago   •   3 min read

By Kristie Kwok

As a barbershop owner, you're probably familiar with the concept of loyalty rewards: You offer clients something special for choosing your chair so that they feel valued and keep coming back. It's a fun and simple way to honor customer loyalty.

When set up strategically, a rewards program can also bring game-changing benefits. In addition to building a repeat clientele, you can leverage it to attract new business and improve the way you run your barbershop.

Keeping your regulars.

Local barbershops sometimes pay more attention to getting new clients in, but the truth is that repeat customers are far more profitable. It costs more to acquire a new customer than it does to keep an existing one. Not only are repeat customers more likely to buy from you, but they'll also spend more than new customers—by an average of 31%, according to Invesp.

Additionally, per Deloitte's Consumer Review, boosting customer retention rates by just 5% can increase profits by anywhere from 25% to 95%.

Influencing client actions.

Apart from keeping regular customers happy, local barbershops can lean on thoughtfully designed loyalty rewards to achieve the following strategic goals:

  • Encourage customers to come to your shop more often. Reward visits by offering a freebie on their 10th haircut.
  • Increase the amount spent per visit. Consider using tiered points. Say you award clients 100 points for every $10 spent. If you charge $28 for a haircut, clients might be incentivized to buy a styling product for the full 300 points.
  • Drive-up sales of merchandise, new services, or gift cards. Award double or triple points for these purchases.
  • Take the pressure off busy periods. Award extra points for bookings during slower times.
  • Encourage appointments to be booked online. This will allow you to focus on giving the customer in your chair the best in-salon experience.

Bringing in new customers.

The best loyalty programs will get people talking, too. When customers are getting real value from their rewards, they'll rave about it to their circle. Word-of-mouth recommendation works wonders to bring in new business. According to Bizrate Insights, as much as 91% of shoppers read online reviews—further evidence that people crave social proof to support their buying decisions.

In line with this, you could include a "bring a friend" bonus to your rewards program to boost referrals. Or, entice new customers with a welcome offer—say, 100 extra points when they have their first haircut—to sweeten the deal.

Going digital.

The days of carrying around the classic punch card are numbered. If you would like to set up a loyalty program, going digital brings extra benefits.

  • Personalized experience: Customers are looking for companies to meet their individual needs. As Salesforce reports, 52% of customers expect offers to always be personalized and two-thirds want companies to understand their unique needs and expectations. A digital rewards program makes it easier to collect and analyze customer information, so you can cut through the clutter and figure out services and offers they love.
  • Better relationships: The best loyalty programs allow you to stay on your customers' radar by sending automatic reward offers for birthdays or if they haven't visited for a while.
  • Drive online engagement: Taking loyalty rewards online means you can give points for liking and sharing your posts or tagging your shop in photos. It can help you connect with a wider audience, strengthen your online presence, and extend your reach into new markets.

Why keeping rewards simple is a smart move.

Although some rewards programs have complicated rules, it pays to keep things simple. Based on its global survey, KPMG suggests brands will see a bigger return on investment from a loyalty program that's easy to use because customers simply won't engage if it's inconsistent or difficult to understand.

Seeing as local barbershops often cater to a broad range of customers of varying ages, rewarding by visit or amount spent is a great way to ensure the program is straightforward. Clients are likely to value redemption options they can use easily, such as a free or discounted haircut or beard trimming.

Offering loyalty rewards is an effective way to improve retention and boost your bottom line. Although the punch card was once ubiquitous, digital loyalty programs are fast becoming the norm for many local barbershops because they foster deeper engagement and are easy to manage for both owners and customers.

Spread the word

Keep reading