Go Back   tanTALK - Tanning Salon Business Owners Community > TanTalk Central > General Tanning Industry Discussions

General Tanning Industry Discussions Tanning Salon Owners and Professionals in The Tanning Industry Discuss a wide Variety of Topics.

Reply
 
LinkBack Thread Tools
Old 05-05-2014, 05:59 PM   #1 (permalink)
 
Join Date: Dec 15 2008
Location: california
Posts: 163
Rep Power: 16 nvstan is on a distinguished road
Smile Memberships prices and contracts

First Question:
I am restructuring my memberships (EFT's) at my salons. What do you believe that is more effective:

A. 4-6 Month commitment with NO registration fee, lower monthly price point.

B. Month to month with NO Contract or commitment (EFT, cancellation need to be submitted by the 20th of each month), $25 registration fee, a slightly higher price points per membership ($10-$20 more).

A second question:
What price points do you find to be the most effective for the memberships, I do offer 4 levels of EFT's ? (lower level - Sundash 232,15 min - highest level - MATRIX L28, High pressure).
Currently my membership prices are $25, $59, $89 & $119.

Thanks in advance for everyone's feedback
nvstan is offline   Reply With Quote
Old 05-05-2014, 06:35 PM   #2 (permalink)
 
Join Date: Aug 21 2007
Location: San Jose, CA
Posts: 155
Rep Power: 17 uts-sj will become famous soon enough
Re: Memberships prices and contracts

We offer both A and B, and most end up going for B and never cancelling.

As far as the price points, they don't seem too far off without knowing level 2 and 3.

And just a side note because it's one of my pet peeves: if they agree to be auto debited until they cancel...that's a contract, no matter how you spin it.
uts-sj is offline   Reply With Quote
Old 05-05-2014, 06:54 PM   #3 (permalink)
 
Join Date: May 6 2009
Posts: 55
Rep Power: 0 Bronze1 is on a distinguished road
Re: Memberships prices and contracts

Can't wait to hear all the experts on this one :) in my opinion memberships, pricing, contracts or not are all pretty much a crapshoot anymore. A lot does depend on your preferred business model, competition, local economic factors. A couple things for sure: not any one approach works for every salon everywhere. DONT do anything just because some "expert" says to. DO your OWN thinking as best you can and make your decisions. Try and be very practical as to how much volume you think you can get in your door at different optional price points/memberships/fees, etc. and all the costs associated with these options and what you think that means to your business not just today but also into the future. Don't abandon being the salon you want or should be by doing anything just because someone else said so, think it through. It's your business, you pay the bills, you sit in the hot seat. Do what your head and gut tell you to do. Good Luck!
Bronze1 is offline   Reply With Quote
Old 05-06-2014, 11:52 AM   #4 (permalink)
 
Join Date: Apr 21 2004
Location: Frisco, TX
Posts: 1,502
Rep Power: 20 Steve Underhill has a spectacular aura about Steve Underhill has a spectacular aura about Steve Underhill has a spectacular aura about
Re: Memberships prices and contracts

Quote:
Originally Posted by nvstan View Post
First Question:
I am restructuring my memberships (EFT's) at my salons. What do you believe that is more effective:

A. 4-6 Month commitment with NO registration fee, lower monthly price point.

B. Month to month with NO Contract or commitment (EFT, cancellation need to be submitted by the 20th of each month), $25 registration fee, a slightly higher price points per membership ($10-$20 more).

A second question:
What price points do you find to be the most effective for the memberships, I do offer 4 levels of EFT's ? (lower level - Sundash 232,15 min - highest level - MATRIX L28, High pressure).
Currently my membership prices are $25, $59, $89 & $119.

Thanks in advance for everyone's feedback
Cancel anytime after the first 30 days with a 30 day cancellation works well, startup or membership fee is smart. I am not a fan of 4 levels of EFT because there will always be a level that gets little use. IMO it is best to have clear wide separation between levels plus it is best to keep it simple.

The other packages that you offer to compliment your memberships will determine how effective your EFT program is.
__________________
Stephen Underhill
Consultant
steve@smuconsulting.com
Steve Underhill is offline   Reply With Quote
Old 05-06-2014, 02:58 PM   #5 (permalink)
 
Join Date: Mar 18 2005
Location: GA
Posts: 1,153
Rep Power: 20 peach will become famous soon enough
Re: Memberships prices and contracts

Why have the "B" plan that requires no real commitment? Isn't that what EFT is supposed to be all about? How does that increase sales or level out your revenue stream? Oh, I know, sign em up and hope they forget about it.
peach is offline   Reply With Quote
Old 05-06-2014, 09:45 PM   #6 (permalink)
 
Join Date: Dec 15 2008
Location: california
Posts: 163
Rep Power: 16 nvstan is on a distinguished road
Re: Memberships prices and contracts

Well, the reason for introducing option "B" after years of offering only option "A" is the market changing due to competition and customer demands. Big salon chains as Palm beach tanning and At The Beach came in and introduced an aggressive EFT program with No commitment. And honestly I discovered that it draw a lot of new members once you remove the time commitment (even though they eventually stay for the same amount of time) and focus in creative ways to retain them (great specials and incentive for members only, EFT pricing, etc).
The only big question is the retention percentage after the season and that's why I am still examining option A vs option B.
Sometimes you have be open to evolve with the time, your market and your customers demands before its too late.
nvstan is offline   Reply With Quote
Old 05-07-2014, 06:20 AM   #7 (permalink)
Team TanTalk
 
Join Date: Nov 23 2004
Location: ITA Member & Berman Supporter!
Posts: 3,136
Rep Power: 25 sunsally has a reputation beyond repute sunsally has a reputation beyond repute sunsally has a reputation beyond repute sunsally has a reputation beyond repute sunsally has a reputation beyond repute sunsally has a reputation beyond repute sunsally has a reputation beyond repute sunsally has a reputation beyond repute sunsally has a reputation beyond repute sunsally has a reputation beyond repute sunsally has a reputation beyond repute
Re: Memberships prices and contracts

Don't offer two choices of EFT - add confusion, and irritation by the customer ('cause they will want to pick what they perceive as the "best" features of both).


Option B.

Sign up Fee - $25-35. I like when they then get this back in "credits" on their account to use for upgrades. Encourages them to get used to upgrading from the get go - and takes away ANY objection over sign up. Don't "waive" it for promotions (as some salons do) - just double or triple their "credits". Win-win.

For price points -- the most "sensitive" is Level 1 - this is the one most often promoted by other salons because it is cheapest. I would have THAT at "market rates" -- usually $18.88/19.88 ish.


Your other levels, without knowing where you are or what your L2 and L3 beds are sound reasonable - maybe a little on the high side. EFT, generally, is about 30-50% off of a walk-in month. You will notice that PBT and ATB are probably more in the $20/$40/$60/$80 range. So make sure your price points make sense compared to your walk-in pricing, your competition - and what you can afford.
sunsally is offline   Reply With Quote
Old 05-07-2014, 07:24 AM   #8 (permalink)
 
Join Date: Mar 18 2005
Location: GA
Posts: 1,153
Rep Power: 20 peach will become famous soon enough
Re: Memberships prices and contracts

But, these explanations do not answer my question; and that is, What are you as a salon owner really getting out of offering an EFT? You are discounting your service for no good reason, people can cancel at anytime, and you pay a processing company for the EFT service, then what the ____?

As I have said, This whole EFT thing is a GIMMICK being driven by big players in this industry. You either play by THEIR rules or you get run over. I say,the heck with them.
peach is offline   Reply With Quote
Old 05-07-2014, 08:53 AM   #9 (permalink)
 
Join Date: May 6 2009
Posts: 55
Rep Power: 0 Bronze1 is on a distinguished road
Re: Memberships prices and contracts

The eft model and low pricing in general in the long run has seriously injured the industry. While some salons maybe try to overprice, that is a very small percentage and few of them actually manage to sustain those prices ongoing, due to competition and supply and demand. Most salons are not in this group. Most salons are not over-priced, they are very price-sensitive due to competitive pressure, economy, etc. When the industry was growing and available volumes were increasing or at least larger to offset the lower pricing it worked. But now as that overall volume continues to be reduced the model has in effect devalued our industry's product at the same time as demand decreases. Bad combination. Doesn't matter if you are a large chain or independent. As long as salons in any area offer low-priced eft's, or too low pricing in whichever way, to an extent, other salons must also offer it to be competitive. For a little while yet, attrition may continue to provide enough volume for salons that are left standing to survive on the low prices. But this same attrition is also diminishing the legitimacy and value of our industry and is actually hurting the salons that are still left by decreasing consumer participation in our industry, even though most of them don't know it because they are stuck in thinking they are better off now because they picked up some business from the salon that closed down the street. The day of reckoning is here or almost here, and our industry is now seeing the high price being paid for this deal with the devil on eft's and lower pricing. All this bantor about so-called "proper business structure" and "proper pricing structure", is ok but flawed and incomplete because it is based in short-sighted thinking that only deals with any salon's potential short-term survival. It does absolutely nothing to further the sustainability of the industry itself and everyone in it.
We are not the fitness industry or other industry with a more stable/potentially growing customer base as an industry to support our pricing/marketing methods. The challenge is real, and I'm not convinced anyone, including the larger chains or our "consultant experts" currently has a model, that taken as is , is truly both competitive for today AND sustainable long-term. I wish that weren't the case.
Bronze1 is offline   Reply With Quote
Old 05-07-2014, 10:30 AM   #10 (permalink)
 
Join Date: Mar 18 2005
Location: GA
Posts: 1,153
Rep Power: 20 peach will become famous soon enough
Re: Memberships prices and contracts

Quote:
Originally Posted by Bronze1 View Post
The eft model and low pricing in general in the long run has seriously injured the industry. While some salons maybe try to overprice, that is a very small percentage and few of them actually manage to sustain those prices ongoing, due to competition and supply and demand. Most salons are not in this group. Most salons are not over-priced, they are very price-sensitive due to competitive pressure, economy, etc. When the industry was growing and available volumes were increasing or at least larger to offset the lower pricing it worked. But now as that overall volume continues to be reduced the model has in effect devalued our industry's product at the same time as demand decreases. Bad combination. Doesn't matter if you are a large chain or independent. As long as salons in any area offer low-priced eft's, or too low pricing in whichever way, to an extent, other salons must also offer it to be competitive. For a little while yet, attrition may continue to provide enough volume for salons that are left standing to survive on the low prices. But this same attrition is also diminishing the legitimacy and value of our industry and is actually hurting the salons that are still left by decreasing consumer participation in our industry, even though most of them don't know it because they are stuck in thinking they are better off now because they picked up some business from the salon that closed down the street. The day of reckoning is here or almost here, and our industry is now seeing the high price being paid for this deal with the devil on eft's and lower pricing. All this bantor about so-called "proper business structure" and "proper pricing structure", is ok but flawed and incomplete because it is based in short-sighted thinking that only deals with any salon's potential short-term survival. It does absolutely nothing to further the sustainability of the industry itself and everyone in it.
We are not the fitness industry or other industry with a more stable/potentially growing customer base as an industry to support our pricing/marketing methods. The challenge is real, and I'm not convinced anyone, including the larger chains or our "consultant experts" currently has a model, that taken as is , is truly both competitive for today AND sustainable long-term. I wish that weren't the case.
AMEN! Couldn't have said it any better. There is just no other way to say it-EFT is devaluing the Tanning service, adding extra costs, and playing right into the hands of those who want to wipe out smaller operators and corner the tanning market.

That is why I have always said, as an indy, BE DIFFERENT, Do not go with the flow, going with the flow will eventually kill you and your business.

In my opinion the future of indoor tanning is not threatened by the Derm industry or Obamacare taxes, as much as it is by the 10-12 huge companies fighting for control of the industry.
peach is offline   Reply With Quote
Reply

Bookmarks

Tags
eft club , memberships



Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On

Similar Threads
Thread Thread Starter Forum Replies Last Post
Contracts electrictanman Tanning Salon Management 4 12-16-2003 01:43 PM
Printing Contracts.... Nichole74 Technology Forum 5 09-27-2002 09:38 AM
yearly memberships- contracts? t-electric General Tanning Industry Discussions 7 09-18-2001 08:22 PM
Contracts CHUNN Technology Forum 4 01-03-2001 05:51 PM


All times are GMT -5. The time now is 06:30 AM.


Powered by vBulletin® Version 3.7.2
Copyright ©2000 - 2024, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0
Copyright 2009 - tanTALK.com

click here for advertising info!