What You Can Learn from Contenders
Competition in the salon industry is not necessarily a bad thing. Competition will keep you on your toes as a business owner. It will force you to get creative about how you approach your business model, identify your salon’s advantages, and constantly seek new ways to entice customers to book services at your salon. As counterintuitive as it may seem, competitors can help your salon grow.
Market research is one of the first steps a new business should take before even opening its doors. It helps you to decide how you will operate your salon and the factors that affect that. But while this is an initial step of starting any business, not many companies continue to monitor their competitors after their initial research. That’s a mistake you do not want to make.
Here are five reasons why understanding and monitoring your competition is important for the growth of your salon.
Reason #1: Don’t Reinvent the Wheel
Mistakes cost time and money, but it doesn’t have to be your time or your money that gets wasted. Not if you pay attention to your competitors’ past failures and use them as lessons for what not to do. While there’s something to be said for being the first to the finish on a new idea, it does not come without its costs. Experimentation often comes with failures, whereas observing a competitor’s strategies play out and witnessing the successes or failures of those efforts will give you a better idea of what the marketplace does and does not respond to.
Reason #2: Imitation Is the Best Form of Flattery
Building on Reason #1, entrepreneur and business strategist Tony Robbins often cites imitation as the vehicle of success. Proven formulas work. Identify what strategies are working for your competitors and model their behavior and you are likely to come to the same results.
That’s not to say you should copy their strategies exactly. You must consider any similarities or differences in location, client base, services offered and price point, etc. before moving forward with modeling any strategy. Your competition’s successes should be used as a guideline in developing your own strategies. The key is to observe what works and adjust to meet your salon’s and your clients’ needs.
Reason #3: Identify Opportunities
An analysis of your competitors’ business strategy will reveal which areas of the marketplace they are fulfilling, and which needs are left unmet. In the salon industry, there is guaranteed to be some overlap in services, but there are always opportunities left to discover, so find those open opportunities and go conquer them. For example, through your research, you should be able to identify your competitors’ target market and what type of customers they are trying to appeal to. Perhaps the opportunity for your salon is to market to and attract the customers your competitors have neglected.
Reason #4: Generate Leads
Somewhere along the way in your research, you are bound to come across some unhappy customers that were not quite satisfied with the services your competitors offered. These dissatisfied customers are likely looking for another salon, especially if your competitors are not as well versed in managing bad reviews and have not addressed their customers’ concerns. Not only can you learn from your competitors’ mistakes, but you can capitalize on them by using negative reviews of your competitors to generate clients leads for your own salon by offering them, hopefully, better service.
Reason #5: Discover Your Competitive Advantage
Perhaps the most important thing you will uncover in your competitive research is what sets your salon apart from all the rest. In learning more about other salons’ business models, you will figure out what differentiates your salon from theirs and be able to develop a strategy that aims to monetize those key differences. This is your competitive edge.
Keep Your Friends Close and Your Enemies Closer
By monitoring your competitors’ activity, their successes and failures, you can better position your salon in the marketplace. Your competitors can teach you what to do and what not to do and help uncover the hidden potential of your own salon. By learning from your competition, you save valuable time and energy you would have spent spinning your wheels just to come to the same conclusions. Use your competitors as models to identify what does and does not work in your market and for your customers (there will be some differences)—let them do the legwork to figure it out—and spend your time and energy identifying gaps in the marketplace that you can fill, generating leads, and using your unique competitive advantage to outshine your competition.