We catch up with Wahanda chief executive Lopo Champalimaud about the tech trends impacting the market, and what's in store for his salon bookings business this year.
What changes are you seeing in the way people book salon treatments?
The biggest change at the moment is mobile. We launched our first app in March. Today 35 to 40% of the business is mobile. Most of it’s app, some through mobile web. Add in iPads and it’d be close to 50%. So I’d say this year salons should be ready for even more mobile bookings. I think our business is probably going to be 80% mobile in a year’s time.
People are also booking very last minute. We’re already seeing 15% of our bookings happening within three hours of the appointment time and that’s growing. About 40% of bookings now happen outside salon opening times. So it’s last minute, it’s outside opening times, it’s all these times when it’s really difficult to market your business.
We’re starting to see the idea of yield management take off. About 25% of our bookings now happen within a pricing structure that varies depending on demand, and actually the smaller businesses have embraced that much faster than the larger hotel spa groups.
People mix and match more than they did so they’ll go to expensive places and cheaper places. I think consumers are getting comfortable with not having one provider; they’re moving around between salons and we’re seeing that more and more.
What’s next for Wahanda? Where will you focus investment for 2015?
We’re looking at international expansion and expect to be in six countries by June. We’ll also develop our UK business in three key areas. Firstly, growing the number of salons registered with the site; we add 700-800 new salons a month at the moment and currently have about 7,500 so it’s growing incredibly quickly. Secondly, we’re developing the software platform we have, and the third thing is to grow the consumer base. We’re making huge investments in consumer marketing; in the UK alone next year we expect to spendmore than £10million on marketing. We’re growing enormously at the moment. Business doubles every six months, in terms of every single measure including turnover, number of customers, number of businesses on board.
What’s to come in terms of technology?
We’re adding more and more tools that allow the salon or spa to use our software to manage their business. We’ve got some point of sale software in the pipeline and we’re also looking at launching a loyalty programme. We release new functionality every two weeks so we recently launched a gift card programme, which is the largest in the market – you can use it in 7,000 locations. And in the past year we’ve introduced smart discounting, customer relationship management functionality, and the ability to take bookings off a salon’s own website or Facebook page. All these tools are free for any salon that’s registered on our site. Our goal is to get as many salons as possible to embrace the digital revolution, so we deliver so much for free. We only take money [20% commission] from a salon if we book an appointment.
We’re also trying to add anything that makes it easier for the consumer to book online so we’re launching cancellations and reschedules; one of the things we hear most frequently from consumers is “not only do I want to be able to book it, I want to be able to cancel and reschedule”.
Is your aim to replace the need for salon or spa management software?
We already have 1,000s of salons who use our software for everything. Some choose not to – 80% of salons don’t use software at all and that figure’s not changed much over the years – it may have shifted by a percentage point or two but it’s very slow growth. We track that every day. So many salons are still using pen and paper. There are others for whom our software doesn’t do everything they need. The salons and spas that do use software are sometimes using very sophisticated tools but as we add more functionality to ours then yes, it’ll be easier for these guys to switch completely.
How are you marketing to consumers?
You’ll have seen our billboard ad campaign in the summer in London. We’ve replicated that in Manchester, Glasgow, Edinburgh and Leeds and you’ll see us moving to mass channel this year, specifically TV.
In the past two months alone we’ve done buses, tubes, taxis, billboard, radio, outdoor and experiential. We’ve been very focused on marketing online too so we do a lot of Google, Facebook, Twitter, Instagram, but I think TV is going to be one of the strongest channels for us.
How will you grow internationally?
We’re now the largest treatments booking site in the world and one thing I’m really proud of is we’re not a copycat of a US company. But we do operate pretty much only in the UK and Germany so our goal over the next year is to create a pan-European platform.
We’re targeting a few specific countries within Western Europe this year before looking worldwide. In some countries we’re in talks about acquisitions. When I go to a new county, I can give them technology, capital investment, operating know-how; I can give them a lot of things but ultimately it’s the local team that has to acquire the customer and convince salons to become part of the marketplace so it’s effectively a very local business model. So we’re either looking for strong partners to build up good teams, or existing teams to acquire, and that’s what we found with [German bookings site] SalonMeister, which we acquired in October.
How are you growing the UK team?
We’re hiring a data team because we want to expose data to salons on our system so they’ll be able to make better decisions about when to market, how to market, how to price. We also want to make it available to the press. Education is a big thing for us so we’re spending more time on training salons. We’ve ramped up our account manager team and appointed five full-time trainers.
They do business training in things like how to price services, and as the data team gets more sophisticated the training will grow too. We’d love to be able to tell a salon owner, “you should open up in this area, offering this kind of services at this price point because this is where the client is, this is what they’re demanding and this is what they expect to pay”. That’s where we’re trying to get to.
What treatment trends have you noticed from your bookings data?
We’ve recorded some really interesting seasonal variations. With waxing, for example, you think of it as a summer treatment but it spikes pre-Valentine’s day; bookings are 58% higher in February than the average month. It’s also high pre-Christmas, up 35% in late November and December. Tanning also peaks massively pre-Christmas, up 266% between mid November and mid December versus the rest of the year. Meanwhile, body treatments really peak in November and early December, when they are 70% higher than average. PB