Pros & Cons of Session / Hybrid / Package Pricing

Hello, my friend. Welcome back to The Modern Hairstylist Podcast. You know, it is so refreshing that in the past couple of years, our industry has embraced innovation and looking at different ways of doing business that may be more conducive to our goals, to what we're trying to accomplish, to try to stay ahead of the curve, right? And try to adapt with consumer behavior.

And some of the innovative ways that I feel like a lot of people, um, in the industry have been changing things or having conversations about, um, have to do with pricing, the way that we're pricing our services, how we actually come up with tho- those prices, and then also the structure of those prices as well. And what I've seen a big surgence of is session pricing, o- otherwise known as package pricing or hybrid pricing, I've even seen it being called. Whatever you wanna call it, I normally tend to call it session pricing. The first person who really fully introduced this to me was my girl Kimber Chapman.

Um, she came w- into the industry hot, uh, within our circles, um, and really blew a lot of people's minds with, uh, pushing the idea of session pricing, and, um, really opened up my eyes to the power of... the potential power of it as well, and I was able to implement it in my own business, and I saw massive beautiful results, not just for me but also for my clients' satisfaction as well. And then, that has brought me to coach a lot, hundreds of stylists, through implementing it through their own business. But that's not to say that it doesn't come with its cons.

There are definitely downsides to this pricing model, but on the flip side, there are tons of pros to it, and in this episode today, I'm gonna be going over both of them. I'm gonna be going over the downsides and the upsides when it comes to session pricing, and I'm gonna try my best to be as non-biased as possible. I know that I am somebody who prefers this pricing model. I'm somebody who preaches it.

However, I really do care about making sure that you make your own decisions, um, based upon your own unique circumstances, what you think is best as a, as a CEO. I think that's a very important muscle to always strengthen and to always rely on, is your own intuition and your own logic and, and, uh, when it comes to your decision-making with these types of things, and my job is not to tell you exactly what you need to do, but my job is to share with you these ideas, and if you would like to implement them, share with you how to do it correctly and how to do it in the best way possible based upon my experience and historical, uh, experience and then also consumer behavior. But at the end of the day, it's completely up to you, and so I wanna give you all the facts here today. I want to tell you what I've seen.

I wanna tell you, um, I've had stylists even de-transition from session pricing, and I'm gonna be sharing with you why I saw that one stylist de-transition as well too. So I'm gonna be giving it to you all today when it comes to session pricing. So if you're ready to get into it, 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. Okay, the tea is I wanna get into these pros and cons.

What we're gonna do is I'm gonna alternate between cons and pros, so I'm gonna give you a pro, then give you a con, then give you a pro, then give you a con. But before we do that, I do wanna give you a brief explanation of what session, package, or hybrid pricing is. Again, whatever you wanna call it. I'll be referring to it as session pricing the majority of the time, and I do have other episodes, which we'll make sure to link in the show notes below, about a little bit of a deeper dive of what this concept actually is and how it works.

But what session pricing is, is an all-inclusive package. It is something where, if you look at a traditional a la carte menu, for example, and you have a partial foil, a toner, a haircut, and a bond builder, all of those things have different prices to it, and you will charge somebody the total of each of those individual services that you carried out, right? Where session packaging would come into play or session pricing would come into play in comparison to that is all of that stuff would just be included in the one package, and then that is it, and then there's one price for that entire situation. So you're basically just taking away the different line items, and you're just making it so that you have this preset price for everything that you need to get that client from A to B, right?

From the where they're starting and the results that they want. So that is a short, brief explanation of session pricing. I hope that that makes sense. Again, you can check out other episodes that I have if you wanna dive deeper into the concept of what it actually is, but without further ado, let's get into the pros and the cons.

First and foremost, the pro that I would like to start with is that, and it's a pretty large one, is that this type of pricing is statistically preferred by your clients. Last summer, I ran a large survey across 500 women in the United States who specifically get their hair done at salons, right? So these are your clients. And 66% of those people said that they would prefer an all-inclusive package menu over a la carte or hourly.

29% said a la carte, 5% said hourly, so I think that's super fascinating, right? If we want to be staying ahead of the curve and we want to be creating businesses that align with consumer behavior and also align with our own needs and wants, right, then session pricing seems to take the cake here as far as what your clients actually prefer from a statistical standpoint. Now, my next con is gonna kind of a little bit contradict it but kind of prove it even further. So the con...

The first con that I'll start out with is that it may detract clients who prefer to pick and choose or know exactly what they're paying for by line item. So, when I ran that same survey, the people who preferred a la carte said it's because they would like to pick and choose, right? So, this could be a con for you, like if this is the type of clientele that you feel like you have or that you attract, or the ones that you want, right? Or if you're just nervous about clients being upset in general, then this may be a con for you.

For me and plenty of my students, I don't really care for clients who want to pick and choose how I do my job, right? And I think that one of the biggest reasons why we've considered session package pricing, or even hourly pricing as well as we moved into this day and age, is because a la carte used to work with us, for us back in the day when our services and the results that our clients were looking for weren't so extensive. It's no longer just a partial foil and a haircut. It's a partial foil, and a toner, and a root shadow, and a bond builder, and a haircut, and a blowout, and a curling i- It's like, it's everything, right?

And a conditioning treatment. It's a lot nowadays. The, the standard from our clients has raised so much, and the types of services that we are carrying out are so much more extensive. And I think that that's why we are appreciating or considering these types of services, because it makes that- those large amount of processes a lot more simple to charge for, and it reduces the tons of line items that you're actually charging somebody, um, at the end of the day.

And so that being said, you know, you may have clients who prefer to pick and choose, but then you'll have, you'll have to explain to that client that, like, "Okay, well, if you don't wanna pay for a toner, then your highlights are gonna be brassy. If you don't wanna pay for a bond builder, then it may not be a good idea for you to get blonde, because your hair's gonna melt off," right? And so what that does is it takes away the power from you as the, the service provider, and it puts the power in the client's hands. That's another reason why I don't love hourly pricing.

So, that's another pro for session pricing is that you can take the benefit of the, of the way that you set up your pricing, possibly by charging for your time, but you remove the con of giving your client leverage over your pricing, right? Because hourly is something that is, is understandable and it's universal for you and the client, and you don't have any control over that per se, right? Your client will be like, "Okay, if you are done at three hours, then you are only gonna charge me for three hours, and that is it." Where with session pricing, let's say that you finish maybe at two and a half hours, right?

But you booked yourself for three hours. Then in that case, you would really be shorting yourself if you only charged for two and a half hours, because you could have been taking another service making you more money within that extra 30 minutes left, right? So, the cool thing about session pricing is that it puts the control and leverage back in your hands, because it's not subjective to the client. The client doesn't get to say, "Okay, I only want to pay for these things," or the client doesn't, doesn't, isn't assured that if you finish early, then they're gonna get a discount or something like that, right?

So, I feel like it really gives the stylist a lot of control. And I personally just don't w- want to work with clients who are going to pick and choose with me, or tell me how to do my job, or question how I'm doing things and how much everything is gonna cost. I'd rather just work with clients who are totally cool with the price that I'm giving them upfront, that's guaranteed, and that will include everything that I need to get from A to B without having to overexplain or oversell myself, right? Again, the con is it can detract clients who prefer to pick and choose, but do you really want those clients anyway, right Okay, so the next con and pro kind of go together.

And you know, it'll depend on the type of person that you are possibly, but it's super interesting how they kind of contradict each other. And how I came up with this was actually I saw one of my students detransition from session pricing because of this aspect. But the way that I view it is that actually we could have spun it around if we had set up the pricing properly, and if we had just done a little bit of mindset work. But a con could be the possibility of emotionally discounting if the person is booked for the session, but you take more time or use more product, right?

So, let's say that you have somebody booked for that session and you end up using a lot more product, or you end up doing more services than you originally quoted for or allotted for for that session, then you may not feel super confident when you have this kind of guaranteed price upfront and then charging them the more amount of money that you maybe should for the amount of work that you did, right? And what I find with this, I mean, I think this is totally fair, right? And I think that this is going to happen no matter what. I think the way that you set up your sessions is super important to make sure that you have a fair maximum amount of product and time allotted and that you're priced properly for those things to make it so this doesn't happen very often.

And I also think that maybe this happens in one circumstance, right? Maybe you have a brand-new client. You book them for one session. That's the price that you guaranteed upfront, and that's the price that your client was expecting, and then it ended up being more than you thought it was going to be.

I think that it's best practice to just charge them the price that they expected that you talked about upfront, and then just share with them, "Hey, just so you know, this was a little bit more than I expected it to be, and I probably should be charging you a little bit more today, but I'm not going to. But for future reference, you probably will have to go up to the next package, or we'll have to charge you our extra time option," which is something that you can do with your sessions if, like, somebody doesn't fit within the next session, but you do need to charge them a little bit more for whatever reason, rightSure, like, you could be emotionally discounting a little bit when circumstances like that come up, but the tea is, is that I think it can be managed in a really reasonable way. And if you set up your pricing properly, making sure that you have plenty of time and space and product allotted for that price to make sure that you're profitable on the back end, I think you can avoid this in a lot of different ways. Now, on the flip side, I think that contradictorily, if that's a word, a pro is that you remove emotionally discounting.

You reduce the chance of you emotionally discounting. You hold yourself more accountable, you make it more easy for you to not emotionally discount, because your price is already set up to withstand the maximum of what is offered, even including the little add-ons that we may not feel super confident charging for every now and then, such as the bond builder or the toner or the root shadow, right? I found that this was a personal struggle for me sometimes when I was working as an employee in a W2 salon, and it's also a very frustrating thing for salon owners as well, when we don't charge for those little services. But those little services, like that extra $35 or that extra $20, it really does make such a difference and can cut really deeply into your profit margin if you're not charging for those things.

So, why don't we just build them into the price and then make sure that you just have one price that you are covered all together, and you don't have to explain yourself or worry about charging for those things, because you know that you've already done the work of making sure that they will be charged for with your base session price? So, I guess there is the possibility of you incidentally discounting, which I think could hap- is, is rare, and I think when it does happen, you can handle it in multiple ways to combat it. And then on the flip side, I think this can reduce the chance of you emotionally discounting, because you don't have to remember or deal with having to charge for every single little thing that you do, because it's already charged for with your base pricing for your package. Another con is that it may be perceived that your s- uh, services are more expensive than other hairstylists, which I think is interesting.

I think that- I think it's super interesting how a human being will- can, can perceive, like, a list of a la carte services and look at that and because they don't know what they're actually getting themselves into, because a lot of the times, a la carte menus are very hard for the normal general consumer to understand, especially now, right? Most general consumers, if they're looking for the more expensive services in today's day and age, don't understand that they don't just need the partial balayage. They also need the toner, they also need the root melt, they also need the bond builder, they also need the haircut, et cetera, et cetera. And so, you may have a client who goes onto a hairstylist website and sees, okay, a partial balayage is 100 bucks.

Great, that- and then I just have to pay 100 bucks. That's fantastic. But then they don't understand that when they actually come into the door and they actually have the consultation with you, it's actually gonna be $300, because you have to charge for all the other things, right? Because of this, you may have a client who goes onto a salon's website and they may think that it's going to be cheaper before they actually come into the door, which I think is setting up both the stylist and the client up for failure, right?

Not just because, you know, the client i- is going to think that they're gonna be paying a different price than they actually are, but also, it's creating confusion for the client before they even decide if they wanna book for you- with you or not. So, with an a la carte menu, a traditional a la carte menu in the way that we traditionally lay them out on websites, sure, your client may think it's less expensive, because they may go onto a hairstylist website with sessions where it is the final guaranteed price the majority of the time. And yes, it's a lot more expensive. However, it includes all the things that that person actually needs and the, the, the price that actua- that person would actually pay anyways at the end of the day.

So I think that that really much weeds out anybody who does not have the budget for your services. Furthermore, gonna make sure that you don't emotionally discount when somebody comes in and they're like, "Oh, I wasn't expecting that price." Right? I've been there, right?

We've all done it, and it's been really scary to have to stand strong in that pricing when you have somebody in front of you who's like, "Oh, I really don't know. I was not expecting that." You know? I am a proactive versus reactive type of entrepreneur, and I just do not wanna set myself up for that type of situation.

So, although you may have clients who go onto a website and look at those sessions and it may seem- they may be perceived as more expensive, um, I think that it still is weeding out things and, and setting up those expectations really well up front. Not to mention, it really has to do with the way that you actually present your session pricing. To be able to exemplify and represent the actual value of the package, there's a lot of things that you can do on a website and on a service menu to make sure that the client understands what they're actually paying for and understands the value of what you're actually providing for the price. You can make the price, that final package price, look so much less expensive by just being able to exemplify the value of it, and there's tons of ways to do that, and I teach those things within my program.

Okay, another pro that we'll go into is that it's easier for a client to understand, because there's little to ponder or decipher. So I kind of touched on this a little bit in the last point, but when we have package pricing, it's really nice to be able to speak a c- a client's language and put things in kind of layman's terms, and it's also really great for them to not have to decipher whether or not, you know, they're gonna be paying for a toner or if they're gonna need a toner or whatever it may be, and this is without any communication between you and the client, right? Because you don't- you're, you're not able to be there for the client when they're perusing through different hairstylists and websites, whe- and when they're deciding who they wanna actually work with, right? And so your website and your service menu needs to do the talking for you, and a confused buyer doesn't buy, right?

Somebody who is confused is not going to want to commit to something.And so making sure that you have set out your package pricing in a way that makes sense to the client is important, and it can be easy to do if you have the right guidance and mentorship, like we provide within my program to get you set up for success. But I think that, nonetheless, it's a lot easier t- for new potential clients to understand and existing clients to understand as long as you've actually set it up correctly. A con for this is that it can be difficult to figure out and transition to.

This is definitely the biggest con. This can really stump people when they first decide that they wanna move over to session pricing. Like, I have seen hairstylists freak out about this. And I've also seen stylists, you know, v- although they were- went through the uncomfortability, although it was tough for them, get to the other side and feel so much better and so happy that they actually did it.

It's really difficult, especially if you've been doing hair for a while, to get out of the à la carte brain and, especially if you have a dif- a lot of different types of clients and a lot of different services that you offer, to really transition all of those things into these tight, bundled packages. It feels really uncomfortable, and it's difficult to grasp. But I believe, I know I'm biased, but I also s- have proof, you know, I've seen my students be able to actually accomplish this, that, again, with the right guidance and mentorship, that you can make it happen. I- I have not, I have yet to see anybody with a service menu that we were not able to simplify into packages in one way or another.

It is absolutely possible for you, as long as you have somebody who knows what the hell they're talking about and has seen all the case scenarios, such as myself. So I get it. Like, this can be a- a very difficult transition. It can be really hard to figure out how to transfer your current pricing over to package pricing.

But when you have the right strategies in place, when you understand what the theory is behind it, and you really break down your pricing into a very small, tiny, detailed level to fully understand it, because a lot of people, this is where people miss the mark all the time, is that they don't understand the current pricing that they actually have. And that is what's going to hold you back the most. And so, within my program, Pre-Visit Pathway, as of right now, we have a whole, uh, module about transitioning to session pricing. And it's optional.

It's a bonus module. You don't have to go through it to be successful with the program. But if you wanna transition, then we have it for you. And we go through a step-by-step process of, first, making sure that we actually break down and fully understand your pricing that you have now, what that looks like per hour for you, et cetera, et cetera.

And then, once we have that understanding, transitioning and creating your new packages becomes a lot easier. So there's a- tons of things- tons of things that we can do to make sure that it's not a crazy, uncomfortable process, right? I have other things listed here that I feel like I've already talked about a little bit with the other ones. So, like, other pros could be, like, allows for you to be sure you can do what you need to do as the professional to achieve the desired result without having to over-explain yourself or sell different line item services, right?

So you don't have to explain and sell the toner, right? You just have it built in. You- you can just do the damn thing, right? Um, you're setting expectations for budget upfront, which makes things more predictable for both you and the client.

I already talked about that a little bit. Much easier and cleaner to present on a website. Talked about that a little bit, but I'll dive deeper into that as well. Like, you know, instead of having a massive list of services, you maybe just have to list out, like, five different blocks of services, and they can, and you can make them look really pretty too.

Like, it can look very visually nice, um, if you lay them out in a- in a great way. Another pro is, it's priced to be sure that you make the same amount of money no matter what type of service you're doing. So I find that a lot of people, particularly with à la carte menus, are very resentful of certain services. So like, they'll be like, "Oh my God, I wish that I wasn't doing this haircut right now, and if I was, it- because I could be doing a color while this haircut is booked with me," right?

So you'll have a haircut that books in the middle of your day, and you're like, "Damn, a color could've booked there, and I could've made more money on that color." Session pricing and the- and depending on how you price your sessions, but this is how I recommend that you do it. With session pricing, you're making sure that you're priced evenly across the board because you can use your time to make sure that your pricing is based on your time, right? So whether you are, you know, a- as, uh, whether you're taking a haircut, whether you're taking a color, whatever it may be, you're priced for the time.

So if you are working for an hour, then no matter what service you're doing with that- i- within that hour, you're gonna get paid the same amount within that hour, which creates a lot of predictable income for you, my friend. And that's something that's very rare within this industry, and something that's very common in normal salaried jobs. People know exactly how much they're gonna make if they're working per hour, right? Why shouldn't we?

And so, when we use session pricing, and we use the concept of hourly pricing to put into our package pricing, then we can make sure that we're getting paid the same amount of money no matter what services we're doing. So like, how nice would it be to know, "If I am booked with people this week, then I know I will make X amount of money at least," right? Like, "I will at least make X amount of money." Like, that is so nice.

Instead of all this different unpredictability, maybe you wouldn't be so resentful of those cheaper services if they were not just p- priced properly for your time, right? Maybe they, maybe they wouldn't be something that you want to eliminate or that you hate doing. I think that this can make your experience behind the chair a lot less burnout-y because you feel like you're actually getting, in return, the money that you deserve for the service and the work that you're putting into things. So I think the way that we price things makes things a lot more predictable and easy and fair for you across the board as well.

Another con could be that it may be difficult for you to explain these things to your clients when you've possibly been doing h- their hair for a really long time, and you, uh, have been having the same menu and maybe similar pricing for a long time. It can be difficult sometimes to transition clients into new things, right? It just is what it is. I think having a community and a mentor who has seen that, who has walked hundreds of stylists through those things, such as myself, shameless plug, can be really, really helpful.

I teach my students great verbiage for how to transition people into those things, um, and how to a- actually explain it. I actually have an entire podcast episode about it, how to transition y- uh, how to get your clients on board with your new pricing model. Um, and I also have other podcast episodes about how to get your clients on board with whatever oth- other changes that you're making as well. There's great professional ways about going about it.

Without that mentorship, yes, it can be difficult to explain. I mean, it can be difficult, like, to explain even with a mentorship, right? But I think that those uncomfortable conversations and figuring tha- those things out and just being as prepared as possible is important, right? But I think it's also inevitable.

It's inevitable for you to have to deal with uncomfortability and, um, having difficulty explaining yourself when you're nervous about a change. You know what I mean? It just is what it is. It's things that we have to go through as CEOs.

And it only helps you grow, right? And again, as long as you're as prepared as possible, you understand the theory, and you understand how you came to your pricing, right, and you understand and you prepare for how you're gonna roll that out to your clients, I don't think that this has to be a- a make-or-break con for you, per se. Okay, I have... Those are all my cons.

I have two more pros for you, and I think they're really, really big pros. So, another pro with this, where you're bo- where you're priced for your time but it's not hourly pricing, is you can still build your average ticket, which is important and very powerful. So, in, uh, when h- what... Normally, traditionally, we look at hourly pricing and we're like, "Okay, whatever the client wants, they're gonna get, uh, as long as they pay this hourly price," right?

Then what happens is, is we... Normally, we lose the opportunity to raise the amount of money that we make in a day by selling add-ons such as conditioning treatments and extra-long scalp massages. The great thing about package pricing is that you have this base price, but you're not necessarily saying that anything that we do within this time is included. We're saying that this is the session that we guarantee.

These are the things that... This is the result that I can get you within this session. If you want something extra, such as a conditioning treatment or e- an extra-long scalp massage, then those things aren't included in that package, and you can get them on an a la carte, add-on menu basis, right? So you're still able to build on top of that base price, which is really, really powerful.

Last but not least, and I think that this is so, such a massive pro, so I'm glad that we saved it till the end. It's a really massive, big, important pro, is it makes online booking 10 times easier and foolproof for you and the client because there's not a million different options to choose from, and the client only has to choose one or max, max, and rarely two services to be able to book the right thing, the right amount of time for the right price, right? 71% of clients prefer to book their appointment online, but what will ruin that is if your online booking is confusing or hard to navigate. And online booking has a ton of benefits.

I mean, I have tons of episodes talking about the em- uh, how important and amazing online booking is. But it, uh, it's so important that you set it up as a service provider in a way that is, is creating a great customer experience. And the way that you actually price your services and present your services w- in those circumstances is going to be the make or break for if that is a great customer experience or not and if you can actually reap the benefits of online booking. A lot of people will implement online booking and it goes wild for them and it's not a good time for their clients or themselves and then they throw it to the wayside, losing all the potential that it actually has for you and your business.

When in reality, if you just set up your online booking correctly, then you would be able to really, really, really maximize the potential that it has. And that does not mean that you have to have sessions to make it work for you. That is not what I'm saying at all. I teach people how to implement online booking and trust it, whether you have session pricing or not.

But if you do have session pricing, it makes it just that much easier, um, and that much better to make your online booking effective. So, it makes your online booking 10 times easier for you and the client, which I think is a really, really big pro. Okay, my friend, I know I was a little bit all over the place, but I- I went through my entire list. I think I touched on all the really important points.

Again, I have other episodes about session pricing, so if you wanna dive deeper into the concepts, then you can go ahead and check those out. We're gonna link some of those in the show notes. So much love to you. I hope that you appreciated this episode of the Modern Hair Stylist podcast.

If you did, subscribe. Subscribe to the Modern Hair Stylist podcast. Leave a five-star testimonial and post it on your Instagram story if you found this episode to be insightful. I would really appreciate it.

It helps us reach other hairstylists just like you. I am trying to help this industry get ahead of the times. I am trying to take my Gen Z ass and pull it forward so that way, we can make sure that we uphold our standard of professionalism, that we all get to read the benefits of the true potential that this industry has to offer us. So thank you so much for helping me in my mission in doing that by sharing the podcast with other people and doing those small things to support us.

So much love to you, my friend. Peace out, girl scout. Bye-bye.

End of transcript. © 2024 Hunter Donia LLC.