Friday, July 30, 2010

Compensation Conundrums:
Can you really afford percentage-based compensation plans?

In a recent Tuesday Tip to our partners, we highlighted the need to accurately reward staff as it is highly motivational, but can also have consequences if not structured correctly. Here at SpaBooker, we were fortunate recently to have one of the industry’s most prominent consultants, Lisa Starr of Wynne Business, come and talk to us about that most crucial of business decisions – how to structure compensation for technical staff?

Years ago, with the advent of salons morphing into spas, percentage-based compensation plans became the norm; and the rates can vary wildly by region as well as by individual. So, how do you plan and manage your overhead when the variables are so significant? Well, unfortunately the answer to that for many spa and salon businesses is that they can’t. Often, paying staff too much of every dollar of income, and tying that income to the price charged to clients, has led to businesses being unable to make a profit and the long term impact of this is terminal for the business and therefore for the staff’s employment – not good for anyone.

Lisa suggests that salons and spas willing to buck the trend and pay a fixed dollar amount per service can reach a win-win situation; fair rates of pay for technical staff based on their skill set and knowledge, and the ability to charge what you need to for services without forever sharing a disproportionate amount. Owners who structure their business this way can afford to hire excellent customer service staff and employ multi-faceted marketing plans, ultimately leading to longevity and growth for both the business and the employees.

If businesses take the time to calculate their operational overheads and deduct them from gross profit, the resulting amount should not be more than they are paying employees. Sounds relatively basic , but it’s a practice that is not necessarily followed in every circumstance and Lisa’s mission is to help businesses in the industry become sustainable, profit-making enterprises where everyone flourishes.

Once you’ve done this, you can hire a new employee with confidence and present him or her with a more specific compensation plan that is built around weekly or annual earnings, like most other jobs in the world. We know there is a trend for a trained professional to walk into an interview with a proposed commission percentage, which can even exceed 50%. However, now you can know exactly what you can afford to pay employees regardless of their proposal. Ideally, these programs have tiers or levels that will allow technical staff to move up upon meeting specific performance criteria that are within their control, thus providing a career path where increases in compensation are self-generated.

The wrong compensation plan may enrich your staff but can put you in the poorhouse. Using advice directly from Lisa Starr, we have some questions for you that you can use to make sure your compensation plan is on the right track:
  • Does your compensation plan drive the right employee behaviors?
  • Does your menu reflect the ability to up sell and increase average ticket?
  • Are your performance appraisals tied to financial results?
  • Are you in control of your labor costs?
If you answered no to any of these, you may benefit from taking it back to basics and calculating exactly how much you can afford to pay your employees moving forward.

About Lisa Starr:
Lisa M. Starr has almost 30 years of experience in the beauty industry, and is currently the senior East Coast business consultant to new and existing spas and salons for Wynne Business, a leading spa consulting company in the US. Her knowledge and experience include business operations and finances, marketing and advertising, inventory management, human resource development, and business process improvement.

Monday, July 26, 2010

Want to go viral? SpaBooker makes it much easier than you think

Thanks to everyone who joined us for the Social Media Webinar – it was a big success and thanks to everyone for the great feedback. In fact, the average rating of the webinar by our attendees was 4+ stars (out of 5).

If you would like to watch the webinar on social media please click here (~25 minutes).

SpaBooker’s managing director, Daniel Lizio-Katzen, began the webinar by highlighting the size and growth of social media channels such as Facebook and Twitter. Facebook is certainly the most dominant player, but Twitter is growing quickly, with more people and businesses creating Twitter accounts every day. We ran a poll at the start of the Webinar to see just how many attendees were using Facebook and Twitter.

Take a look at the pie-charts below. You’ll see that, as expected, business use is lower than personal use, especially with Twitter. But don’t forget that the best way to promote your business is to have your messages ‘go viral’. That’s literally the spread of the message across friends of friends of friends etc… On Facebook it’s achieved by hitting ‘like’ and on Twitter by retweeting (RT). So, if you use your personal accounts to retweet and like Facebook posts, your friends may pick up on it and in turn pass it on. If their friends do the same, you’re starting to really amplify your message and that’s viral marketing!

During the Q&A, we had some recurring questions that may be useful in optimizing social media networks:

In order to connect my Facebook with other applications such as SpaBooker, where do I find my Facebook ID?

To find your Facebook page ID, simply go to your Facebook page. Next, hover over your profile picture. In the bottom of your browser window, you will find the page address, containing your ID. It will look similar to this:

The number following the equal sign is your ID.

How do I attach incentives such as promotions to people who book directly through Facebook or Twitter?

Using SpaBooker, you follow 6 simple steps to connect promotions with booking links listed on Facebook and Twitter:

1. Click on System Settings

2. Go to the “Specials” link

3. Find the Special you plan to promote

4. Select the “Promote” Link

5. In the window, you will find the short URL to provide for booking. Also, you can create a customized message to accompany the Tweet or posting.

6. Select “Send Now”

7. When a customer clicks the link posted to Facebook and Twitter, he or she will be directed to the booking engine and immediately notified that the promotion has been applied.

Friday, July 16, 2010

Have you been to a SpaBooker webinar yet? Checkout our next one on Social Media.

Our webinars continue to be a popular way for our partners and friends to keep up to date with the latest SpaBooker features, as well as learn about trends and what's to come.

If you've not attended a webinar yet, come along (virtually) on Wednesday, July 21st at 2pm EST/11am PST and have a look for yourself. It's free, informative and potentially highly valuable to you in the future.

Next week's webinar will be hosted by Daniel Lizio-Katzen, Managing Director of SpaBooker and resident Social Media Guru. Daniel will be demonstrating Facebook and Twitter techniques that put you ahead of your competition by widening your customer reach, promoting specials and filling appointment gaps.

SpaBooker's latest release has Facebook and Twitter integration built-in and Daniel will be showing you how to use it to boost your bottom line. To give you the inside scoop, he will specifically highlight:
  • Gaining more Twitter followers & Facebook Fans/Likes
  • Creating specials & promotions that go viral
  • Using SpaBooker's built in social media tools to track marketing effectiveness
  • Using social media to drive last minute appointment
You don't want you to miss this chance to hear about the top social media marketing tips! Register below and log in next week to check out how your next tweet can lead to additional revenue.

Daniel Lizio-Katzen

Tuesday, July 13, 2010

Really Big (Major) Release This Morning

You may have noticed that the blog has been a little quieter than usual over the last two weeks. Much of the reason is that we were polishing up our latest release.  SpaBooker version 6.2 rolled out earlier this morning. This has been our longest release cycle / sprint ever (104 days, whew) and we're proud to be introducing many exciting new features including:
  • Completely revamped point-of-sale module
  • Integrated social media marketing functionality
  • Simple smart-phone booking functionality for your customers
  • 100s of other features and updates
Thousands of developer hours were spent closing over 900 different tasks, so make sure to check out the Support section for detailed release notes and videos. We know you'll like what you see.