New Client Pricing vs Existing Client Pricing

Hello, my friend. Welcome back to the Modern Hairstylist podcast. So, today, we're gonna be talking about new clients versus existing clients and how you price your services for them. Now, this is gonna go into two different conversations today.

The first conversation is going to be about whether or not you should charge more for a new client service. Now, you could be charging more for a new client service for a plethora of different reasons, and I know that it's been something that, um, we've been talking a lot about in the industry over the past couple years, and I see a lot of people doing so. And for a long time, I thought that it made sense. You know?

Like, I want you to make s- I wanna make sure that you're getting paid for your time, and if you're gonna be spending an extra however long, and if you're going to be using however much more product for a new client, then it makes sense, possibly, to charge more for a new client service. However, there are particular nuances and things that you should definitely take in consideration when it comes to whether or not you should, because it could actually be of great benefit to you to actually not charge for a new client service. So, I'm gonna get into that today. Furthermore, we're gonna be talking about if you've been emotionally discounting.

So, if you've been charging, um, your clients who have been seeing you for five, 10, 20 years the same price that you were charging them the first time they came to see you, and they are paying less than what your new clients or your other existing clients are paying now, then I'm gonna address that today. I'm talk to you about why emotionally discounting is not okay, and also a great way to get yourself out of it and give you some really clear, beautiful verbiage for how you can confront those people and then start to balance out your existing clients and your new client pricing. So, if you're ready to get into it, gear up, my friend. It's gonna be a juicy episode of the Modern Hairstylist podcast.

Let's go. What's the tea, friend? My name's Hunter Donia, industry business educator for hairstylists, but my friends just call me Hunty. Whether it be growing your clientele, making more money, or automating and streamlining your systems, in the next 20 minutes or so, you'll be hearing realistic, actionable strategies to create a beautiful career for yourself behind the chair.

So, if you're ready to get into it, welcome to the Modern Hairstylist podcast. So, here's the tea. I really, truly believe that it is such a beautiful thing for us as service providers to be priced for our time, okay? And I'm, you know, go to my other pricing podcast episodes, I have plenty of them, if you wanna understand what I'm talking about here.

'Cause I'm not talking about, like, hourly. I'm just saying, like, being able to know that if I work from this time to this time and, and during these days, and I am fully booked with services during that day, no matter what service I have, I know I will make at least this amount of money. I think it's really powerful to be able to have that. Just like any other salaried person, right?

They would know that they would make X amount of money every month, non-negotiable, right? And then maybe overtime on top of that. For us, that's, that would be great to know that no matter what service I'm doing from, from this time to this time, I will make X amount of money in a day, at least, if I don't do any add-ons or if I don't sell any retail. So, with that, what has been a common strategy, right, in the past couple, uh, years is when you're pricing yourself for your time, you will take account for the fact that you may take a little bit longer with a new client.

And, you know, as a hairstylist, totally understand this, right? I mean, I teach to a lot of strategies that streamline that consultation process, like heavily, right? However, nonetheless, you know, you still are gonna wanna have a thorough consultation with a new client more than, maybe, an existing client. Now, I am very much of the belief that you should have a very in-depth, good-ass consultation with your existing clients, every single client, every single time.

Regardless, the difference is gonna be that you've literally never done this person's hair, right? And, you know, you, you, you're not gonna be talking about the service that you did last time. You're gonna be talking about service that they may have had with somebody else, and you're gonna have to dive deep, right, a little bit deeper. And so, that may take you a little bit more time.

Maybe you have to do some extra work, right? And, um, this could look like, I know, uh, uh, one of my students does this brilliantly and beautifully. She does a detox on every single one of her new clients, and it's a non-negotiable. It's like, "If you wanna be a new client with me, you have to get this detox.

It is what it is." And so, the tea is, is I totally understand wanting to charge for maybe the extra 30 minutes that you have on that service. But the tea is, I want you to also consider, right, 'cause I love knowing what you're gonna get. Ooh, I love knowing that you are going to get paid for your time regardless, right?

But what I also want us to consider is our return on our investment. We have to understand that maybe, yes, you're getting paid more on the front end, but what does that, what is that doing to your demand on your time? How many clients aren't coming to see you because that first appointment is more expensive than what they would budget for? Uh, how many clients are going on and saying, "Oh, this package is X dollars more, and that's too much money for me to commit."

However, if it was the existing guess price, they would be down to put, fit that into their budget, right? And I think it's really important to consider where you're at in your business. Like, if you're in your business and you're, like, yearning for new clients, like, if you're like, "Yep, I want new clients coming through the fricking door right now. Like, that's what I need and want more of," right, then I think it's super important to understand that you may want to invest a little bit of your time, sacrifice some of that time and not get paid for it, to create a long-term, loyal client who is going to continuously come back and pay you.

Otherwise, that client may not come through the door, right? And you'll be pushing people away, and you won't be t- you won't be making up for your lack of demand. It's important that you understand there is a little bit of sacrifice that goes into when you are growing your clientele and building your clientele.If you're at a point where you can 100% not have to worry about a million new guest requests coming through the door or you can 100% charge a new client price that's a little bit more expensive to account for the extra time that you're allotting, because your demand is already there and you're not yearning for those new clients, then by all means, dude, have those new client prices.

But the thing is, it is really difficult to exemplify on a website the difference between new client prices and existing client prices. It's been something that I have tried really diff- r- really hard to coach well to within my, uh, memberships and my programs, and I believe that the majority of the times we can get to a place where it's like, okay, this does make sense. However, it's really hard. It makes things a lot more complicated.

It makes your booking system more complicated, how people online book with you. Um, it makes your flows a little bit more difficult and 100%, it makes the messaging on your website a lot harder to lay out in a clean, streamlined way. You know what I mean? So there's a lot of benefits to not charging more for those new client prices 'cause it streamlines things so much better.

Now, I think the threshold for this, I think, is, like, if you aren't spending a significant amount more money or a significant amount more time on these new clients, then if you aren't, right, then don't charge for it anymore if you are looking to get new clients into your door, right? Like, just sacrifice your 30 minutes of time. You will still get paid. You will still be profitable on your service, and you'll be just fine.

If this is something where you are spending a lot of money on product to get this, this service done, maybe it's more than 30 minutes, I think more than 30 minutes is kind of, like, the rule of thumb for me. If it's past that, then yeah, you definitely probably should be charging for whatever that is, f- for whatever that looks like for that new client. And maybe this looks like for the detox example, right? Maybe this looks like not calling it necessarily, like, a first guest visit or a first-time visit.

Maybe it looks like calling the service, the service. Like, maybe you charge for a in-depth discovery consultation, and then furthermore, what I'm going to share with you too is, is maybe you, maybe you haven't streamlined your consultation as much as you possibly can. I know my students, not only do they have a very comprehensive digital consultation prior to the client coming in, but also, um, a form that the client is filling out before they even come into the door, closer to the appointment, that asks them other specific questions that can streamline that consultation process, right? So that way you don't have to spend as much time in that chair talking to that person.

And furthermore, right? They have systems in place that keep consultations consistent, don't allow them to forget anything, and have a system for the how they actually go about those conversations, right? So that makes sure that you're not wasting any time at all. It's so important as a CEO that you are not wasting any time at all and you're figuring out, how can I streamline these processes as much as possible to maximize profitability?

And when you do that, you might not feel like you h- s- have to spend an extra 15 to 30 minutes on a new client every single time, right? For me personally, I've never had to have this... I've never had this issue because I'm confident that I can take care of a new client in the same amount of time that I can take care of an existing client, right? I know that I'm very systematized with my consultation and my consultation takes me about the same time with a new client and an exis- and an existing client because I'm so systematized in the way that I go about it and I'm so efficient in my communication, right?

That's the place that I want you to be at and that is really what's gonna help you make it so that way you're not spending so much extra time on this new client. Another thing I'll hear a lot of the time is, "Oh, well, it's a new client and they, they came in for this and we, and I thought that they would be okay with that amount of time for what their inspiration pictures were, but then they ended up wanting something way more, so I had to spend extra time doing it." No, no, no, no, no, no, no, no. No.

You weren't reserved. The person did not reserve that much time with you, right? And unless you are down to charge more, uh, unless you are down to make sure that you have the time to, right, and you're okay with staying a little bit later, whatever it may be, you should not be having that extra space and time for a new client service, quote unquote, "just in case" that happens, right? That should not be the tea.

Because in that case, what we say is, "Oh my gosh, Susie, I love this. I love what we're talking about here. Uh, from what I'm hearing from what your goals are, um, I'm changing my mind a little bit about how much work this might actually take us to get to where you wanna go versus what I thought we would have. So I did book you for this today and this is what we can do in t- in this time that we have today.

All right? We can get you from here to here and it'll set you up really beautifully for another session that you have with me where we can finish out and get you to the next step, right?" So that is how we manage making sure that we are taking our time and our estimated time very seriously. It's so important that you are confident that no matter what you're doing for the most part, what you're doing that you are very clear and that your timing is not going to be something that's just flexible and all over the board 'cause it's really hard for you to strategically plan and be analytical and make decisions and make pivots and changes when you have a bunch of different service timings for a bunch of different people.

Now I get it, maybe there are existing clients that have extra time, right, that do take extra time. That's totally fine. They're an existing client with you now. Now you can manage that.

Now you can pre-book it and they're willing to come back and spend that money and you've had the opportunity to sit with them face to face and share with them what that extra price is gonna be. But when it comes to a new client, right? In order to make sure that your demand is still high and you're getting those new clients into your chair, right? I do believe that it could be very beneficial for you to not charge extra for the, that first time visit, right?

Um, and to make sure that your appointments and your timing is as streamlined as possible so maybe you don't have to, um, h- spend any extra time with that new client, so that way you really truly do feel like you're still getting paid for your timeSo, that's my little rant about that. I'm gonna— wa— I really wanna reiterate, just to make sure that I'm clear, when it comes to anything over 30 minutes or if you're using a significant, I'm talking significant, more amount of product, then that's when, yeah, I'm okay with you definitely probably charging a little bit differently because I don't want you to, like, negatively profit, right? A- s- and that's just a little bit ridiculous. And then in that case, is it, do we have a first time visit price?

Is that what we're calling it? Or are we calling this, like, a, this is the service and then this is the other service that you get with me? So, like, it- let's say you wanna require a detox for new clients, right? Then it's like, you're getting this detox and then you're getting the service that you wanna get, right?

And that's what you're paying for. It's not just extra money because they're- it's their first visit in time with you, you know? It's a little bit d- different a story, right? But I think it's gonna depend on obviously what your specialty is, who you're serving, if you even want- if you even do detoxes or whatever, whatever your specific circumstance is, right?

So, make sure to take your specific circumstances in consideration when I'm talking about this as well too, and then make strategic decisions based upon what I'm talking about. The other T is, is you should have an excellent client experience that makes somebody want to come back, right? It's aggressively important that we are worried about optimizing our retention from the very beginning, and that goes into making sure that your pre-visit experience, your post-visit experience, and your in-the-chair experience are all excellent and you are filling in each and every one of those gaps and doing it in a way that it's easy for you, it's still nice and boundaried, you don't have to spend a shit ton of time doing it, but it is high level, next level, setting you apart from everybody else in the area. It's personalized, somebody can customize their experience with you, you make somebody feel like they're not just a number and that they are really taken care of and that you actually give a shit.

Those things is going to make it so. You sacrificing that 30 minutes of your time and not getting paid for it, that's what's gonna make it worth it for you because that person is going to stick with you for a very, very, very, very, very long time and they're gonna recommend their friends and their other ideal people to come to you, right? So, if we're nervous about sacrificing that 30 minutes, if you- if you're nervous that you're gonna get a new client in and you're not gonna be able to keep them, then that's when we wanna go like, okay, let's look at our client experience. How are we setting ourselves apart?

How are we making this as personal as possible and how are we making this person feel special without burning ourselves out, right? And that's exactly what I teach people to do in my programs. The next part of this conversation is the grandfathering prices, uh, conversation, right? And, you know, I- I- technically these could be two different podcast episodes, but I'm just gonna umbrella it, and I think that we should address this now 'cause I see it all the time and I hear about it all the time.

Like, I hear that, you know, emo- I'm emo- emotional discounting or guilty discounting or feeling like we're- somebody's so loyal to us and they've been seeing us for so long, so we should take care of them, honey, you are literally just continuously digging yourself a hole that is just getting deeper and deeper and deeper and deeper, and I want to very much, like, give you some empathy. Like, I feel like that would be a really difficult place to be in and I've been in similar situations before, like in earlier years, and truly, like, I get it. It's really hard for you to get out of that hole, especially if you've raised your prices plenty over the years and you've never raised it for this person. Maybe they've expressed to you that their budget is low, um, and they can't afford this, that, or the third.

Um, maybe you just really love them and you feel like not charging them as much is the right thing to do or a nice thing to do I'm going to I'm just gonna shoot that in the butt right now, honey. What about you? What about you? You have a budget.

You have a life. You have a family. You have food that you have to pay. You have bills that you have to pay.

So does this person who's in your chair and complaining to you about money. It's the same shit. So, why are you choosing that person over yourself? Yes, we're grateful for our clients.

We love them. And guess how we fucking show them that we love them? With an excellent customer client experience because that is what they are paying us for, right? I don't remember the last time that I paid somebody to be friends with me or somebody paid me to be friends with them.

These aren't our friends, and I bet you when you, you know, have to have a hard time in your life for your business, you would see the true side of that client and they would not do you the same favor. I promise you that. We have to remember we are doing a service, s- a service that somebody is paying for, and at the end of the day, no matter how much we freaking love Suzie and we may feel bad for her in her current circumstance, this is a freaking business and we live in this shitty ass world where we have to play by the rules of business and of capitalism and making sure that we're taking care of ourselves too because you're not gonna have a fucking business if you aren't being profitable, right And if you're emotionally discounting a couple people, you are losing so much money in a year, money that not only you could take to take better care of yourself, but also money that you can reinvest into your business that will allow you to take care of Suzie better. Education, better amenities, whatever it may be.

If you're offering upgraded amenities and Suzie's still paying the same amount of money that she's been paying since you only offered water and coffee and now you're offering water, coffee, tea, soda, wine, Truly Hard Seltzers, right? Now if you're offering all that, guess what? Suzie is getting a discount on her service. She's getting a discount.

She's getting a major discount on top of the lower price that she's paying and you are getting- you are majorly, you are majorly losing in profit on that specific person because your expenses have gone up and she is not paying you any more for the same service, if not the higher elevated service that you're giving her nowSo, you want that money, you need that money per that person to serve that person better, because now you can afford to give Suzie amazing amenities while she's in the suite. You have elevated education that you know the latest and greatest technique for her personal hair type to make her feel absolutely amazing, right? You now have the business education to create that customer experience that makes her feel special, makes her feel loved, and makes an actual impact in her life. You are doing Suzie a freaking disservice by discounting her service.

You are doing her a disservice by discounting the service, I promise you. I literally promise you. So, how do we dig ourselves out of this hole now that we're at where we're at, right? It's been 30 years, we've done five, six, 30 price increases, and Suzie's still paying the same price.

"Hey, Suzie. So, I wanted to chat with you before we get started today about the service and the price that you're paying when you're coming to see me. I have been discounting your service with me for a very, very, very long time, and I originally did that because I felt like I ... you were really a loyal client and I really love you, and I felt like I wanted to take care of you.

At this point now, my price for the service that you get done with me is actually at this, and that is what the majority of other people are paying. And in order to make sure that I can still serve you to the standard that you deserve and to have a profitable b- profitable business that actually survives and lasts a long time, um, I, I am going to have to charge you this much money for this service moving forward. Today, I'm gonna honor the same price that we've been charging you. However, I wanted you to know for next time, this is what the price is gonna be moving forward.

What are your thoughts?" And if Suzie's upset, for whatever reason, we say, "Suzie, I totally understand, and I want you to know that, like, I really appreciate your loyalty. And what I hope is that I show you my appreciation for your loyalty by doi- giving you the best experience and, uh, service that I possibly can. However, if you feel as if th- that this price is out of your budget moving forward, I'd be happy to find more budgetable options for you in other hairstylists that I know can take really good care of you in the area.

Of course, I would hate to not see you anymore. Like, I've created a beautiful relationship with you over the past couple years, and I love getting to see you, hear about your kids, your family, and getting to take care of your hair. We has so much fun together here and I love that. But I totally understand if your budget can't, can't fit this price moving forward.

And again, I'd be happy to get you set up with somebody else who could, uh, take care of you for a lower price." That's how we handle that. And it may be a fucking shitty conversation, and it is one that you had to have one-to-one, right? If you've, if you're gonna be raising this price, like, double, 'cause a lot of the time that's what we're doing, right?

We're literally charging people, like, 50% because they've been grandfathered in. If we have to jump that price a lot, then that's the type of conversation we have to have, all right? So, so much love to you, my friend. Thank you for tuning into the Modern Hairstylist podcast.

No more emotional discounting. Be strategic with how you're considering how you are investing your time and how you are simplifying and streamline, streamlining your business, and how you are paying yourself and making sure that you're paid not just now, but also in the long term as well too, all right? So much love. Peace out, girl scout.

Have a blessed rest of your day, and I'll see you in the next episode. Bye-bye.

End of transcript. © 2023 Hunter Donia LLC.