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Marketing Case Study For Customer Retention Campaigns:

Dye-licious Hair Salon

•Founded in Tempe, AZ in 2006 by Stephanie Metzger.

•With 10 years of experience in Nevada and a loyal clientele, Metzger faced a major challenge upon her husband’s job relocation to Tempe.

•Luckily, she was able to find a prime location on the corner of a busy shopping center.

Company Overview

•With only a few friends and family to start with, Stephanie focused on reaching new clients.

•She printed a large vinyl banner promoting her new client special of 50% off the first cut or dye.

•The banner brought in 50 new clients, and although it only cost $100, the steep discount resulted in very little profit.

Original Marketing Strategy

•Metzger had a plan in mind, however, and she knew the importance of building a relationship with her clients.

•After their first appointment, clients were able to select how they’d prefer to be contacted by Dye-licious (phone, email, etc.).

•Using a sophisticated CRM program, Dye-licious is able to contact each customer when it’s time for their next appointment.

•The system is also able to track client birthdays, anniversaries, and total money spent at the salon, which is used for special promotions.

Customer Retention Campaign

•6 months after opening its doors, Dye-licious retained 72% of its clientele.

•New clients are enticed by the banner outside promoting the first-time special, and the software helps the salon keep track of its clients.

•For a $5,000 investment (purchasing the software and the storefront advertising), Dye-licious reached over 500 new clients, 360 of which are still booking appointments.

Response

•Have a new customer special to get the attention of potential clients.

•Once you’ve gained a new customer, treat them like royalty. Don’t overlook the lifetime value of that customer.  •The customer that’s always looking for a discount isn’t one you want. Reward customers for their loyalty, but don’t cheapen your business in the process. •CRM software can be quite helpful as your business grows. Keep the lines of communication open so that customers understand that you value their business.

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