After I finished my remarks, Bosco followed. He had been given the task of explaining why
they were all going to be giving away the product. As usual, he was magnificent.
“Remember when I used to tell you all to burn your studios down years ago?” Bosco shouted out. “I
meant it too! Cutting hair earned you
$35 an hour and selling hair better than tripled that! A lot of people in this room called me an
idiot when I told you that, but do you think I’m an idiot now?” A big laugh greeted that remark, as well as
some good-natured boos. “Well, even if
you do,” Bosco continued, “you have to admit that you’re making a hell of a lot
more money today. Giving the hair away
is just the next step because think about it, what is the hair
anyway? It’s nothing! You can take it out of the box, show it to
the prospective client and ask him if he wants it. But that’s not what he wants. He wants his hair back and that thing you
just pulled out sure as hell doesn’t look like a new head of hair. But that’s what you promised him when you
booked him to come into your studio, so you have to give him what he needs and he
needs his hair back. You have to get
him addicted to that hair; like a junky on cocaine!”
Keith always winced when Bosco said stuff like that, but it
was extremely effective and the studio owners ate it up.
“You’re offering him a fantasy. That thing in the box is nothing like a
fantasy though, but that’s what you’ve been trying to sell him all of these
years. You have to make him forget about
the hair you’re trying to sell him and the best way to do that is for you to
forget about it too. In terms of making the sale, it’s as meaningless as the
dye process you use to blend the unit with his existing hair. It’s as useless as the bonding agent you use
to put the unit on his head. The
components that make up a hair replacement do nothing to help you close the
sale.
“Your prospect has come to you because he rejects the idea
that his physical appearance reflects who he really is. He doesn’t want to be a middle-aged schlump
at 30! That’s what he thinks he looks
like though! What you’re marketing here
is a dream and dreams can’t be about bonding cement, dyes, and hair that comes
in a box. You have to let him know that
you understand that by not making those things the issue. What you need to sell instead is a
membership. For years, we’ve called that
a “service contract”. But what were you
servicing? It was the unit! The emphasis was always on the hair, instead
of the client and his fantasy. That has
to change. From now on, you don’t make
money on the hair. You make it on
keeping your members happy. My point is:
Why bother trying to charge him for the hair?
What you should making money on is keeping him looking the way he wants
to see himself.
“We’re suggesting that you charge an annual fee of $3000, for
the membership.”
Bosco drew the last three words out and paused. He waited.
It seemed like a long time before anyone spoke and that’s what Bosco was
hoping for. One thing he knew was that a
void has to be filled and in a room filled with entrepreneurs, someone was
bound to have an opinion that was bursting to be expressed. This time it was Frank Rotella. He put his
hand in the air and Bosco pointed to him immediately.
“Bosco? I get why
SlipNot likes this. But how do we make sure that our overhead doesn’t get out
of whack? If a client already comes to
us 8 times a year and gets his unit replaced maybe 4 times a year, this could
double the number of units that we have to buy to keep him happy.”
“Did everyone hear Frank?” Bosco boomed. “It’s a great question and it goes to the
heart of what we’re trying to do here.
Frank, you’re gonna buy more units from us because you’re gonna sell
more memberships. If you pick up an
extra 12 clients a year and your increased overhead is a few more units per
client, what does it matter? Hell, we’ve
even built in an extra $500 over what you’ve been charging these guys for
service to cover the membership.
You’ll even make money on that!
“The important thing you’re offering with membership is
superior service that’s aimed specifically at the client’s needs. It’s true that some guys are going to come in
once a month and demand a new unit every time they do. That’s okay. The new price structure we’re suggesting
takes that into account and makes sure that you’re compensated. But I want you to think carefully about what
it will mean to you and to your business when you realize that all of the
clients…I mean, ‘members’, that take you up on this will be very happy campers
indeed. You know how valuable a client
is if he sticks around for 3 or 4 years.
How much better would it be if you were able to retain him for 5 or 6?
“As we all know, the cost of a new client is high, at least
$1000. You have to buy the creative, run
the advertising, follow the leads, book the appointments, buy the product, and
pay your staff before you make a buck for yourself. A grand sounds good when you add all of that
up! The new membership program gives you
an honest shot at retaining your client for a longer period of time, which in
turn makes you more money. Why does he
want to stay? Because you’re keeping his
dream alive. You’re maintaining the
image he has of himself. He has to have
it. He has become addicted to the hair,
in no small part because you have not made the hair the issue.”
Bosco stood silently as the attendees murmured to one
another. Finally, it was Sasha who spoke
up.
“I don’t know about the rest of you,” she said, “But I’m in!”
The next episode of SlipNot will be published on October 6th.
If you'd like to read SlipNot in its entirety, GO HERE.
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