After a standout summer, here’s how the hair and beauty sector can prosper in Q4
UK households may be tightening their spending overall [i], but one industry that has had a fantastic summer is the hair and beauty sector. The latest Worldpay stats revealed in August[ii] that these UK businesses made £100m over the past few months. But now the sun is setting on a record-breaking summer [iii], what can spas, barbers, beauty shops and cosmetic stores do to keep growing?
By focusing on payments and reaching out to customers online, there could be ways to keep the sector thriving.
A standout summer
Although consumer retail spending fell 0.9% in July [iv], dropping an even bigger 1.2% in high street stores, the hair and beauty sector seemed to buck the trend. Worldpay’s figures revealed a year-on-year growth of 6% during the period May-July 2018. It seems like two very different events may have driven this fantastic performance.
We noticed a 7% increase in beauty-related spending versus last year in the week leading up to and after the royal wedding in May. That was matched by a 7.3% rise in the average number of beauty purchases during the first two weeks of cult reality TV show Love Island. Spending volumes in salons jumped by over 14% the day after the first episode aired on TV.
The question is, with both events fading into the distant past, what can the sector do to keep the momentum going as we enter the fourth quarter?
The good news is that there are plenty of things you as a business owner can do to promote your business. Consider social media as a potential first port of call. Carefully consider your prospective customers, which platforms you want to use, how you want to reach them and what you want to achieve. Developing a clear plan from the outset is a good idea as it will make your campaign sound more coherent. Things to consider are ‘how-to’ videos or other filmed content; competitions; and attractive photos.
Another possible avenue for growth is online sales. If you haven’t already considered e-commerce, then it’s worth remembering that the UK is Europe’s largest online retail market, worth €178 billion in 2017[v]. A fully functioning website with payment options gives you a chance to sell products direct to customers anywhere in the country or overseas. The beauty of the internet is that e-commerce never sleeps: with a site open and accepting payments for goods 24/7 it can help you start to maximise sales.
If your business isn’t into selling goods online, then a website could also be a useful channel for accepting reservations and appointments. Offering consumers a quick and easy way to do so will help to create a more customer-centric experience, and hopefully a greater chance that they’ll return.
Focus on payments
The customer experience is increasingly important if you want to try and improve the bottom line[vi]. This is true of your bricks and mortar, as well as online business. And as the last thing that a customer does before they leave your store, payments are worth taking time out to think about. Do you offer contactless payments? Nearly two-thirds (63%) of UK consumers want to “tap and go” for payments under £30, and there are already 199m cards in circulation, so it could be worth considering[vii].
How about smartphone payments? These take the same “tap and go” experience of contactless, but allow customers to pay by holding their smartphone near an approved card terminal. It’s also growing in popularity via new platforms like Android Pay and Apple Pay. Worldpay figures revealed a massive 328% year-on-year increase in spending via smartphones in-store from 2016 to 2017: with the amount spent reaching nearly £1bn (£975m)[viii]. Your payment service provider should be able to help you with all of the above. But beyond the technology, it’s also important to train your staff how to use it properly.
With the right strategy, you could crown a great summer with a Q4 to remember this year.