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Thriving Stylist Podcast
#377 - Winning pricing strategies in 2025
00:27:26
Are your salon prices keeping pace with reality, or are you unknowingly sabotaging your business? Today I dive deep into the crucial topic of winning pricing strategies for 2025, challenging the common myths that are holding stylists back at this...
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What is up? And welcome back to the Thriving Stylist podcast. I'm your host Britt Sieba and I wanted to be sure you heard we have a brand new totally free two hour online training. It kicks off March 17th. I'll be revealing our brand new marketing and retention funnels and breaking down how they both work. Lots of you listening to this are probably new to my show, which I love, love, love and you should absolutely register for this free strategic training where I'm covering lots of topics we can't dig into here on the podcast because they need visuals to support the training. But for those of you who are former thrivers who have been following you for years, you're the ones who really need to get in on this one. You can essentially throw all your old thrivers workbooks and trainings away because for the first time in a decade we've had to redesign the marketing and retention funnels because of how drastically consumer behavior has changed. In the last 18 months. You've maybe felt the change with clients canceling last minute or pushing out their visits. Or maybe demand is starting to soften. You've seen the dozens of videos from clients talking about how our industry has lost its way. The only way to change that behavior is to change our process. We don't need to slash our prices or give away anything else for free. We need to be more strategic. So we created a brand new free training. It's called the eight Steps to More Clients, More Income and Stronger Retention. The solution to client pricing, pushback, empty chairs and slow growth as a stylist. I want you to save your seat. Right now I'm teaching this free training three times with dates and times scheduled for March 17th and March 24th. We've got morning and afternoon so you can head to thriving stylist.com forward/8 steps and that's the number eight with the word S T P S to save your seat. We do expect these free trainings to fill the capacity and I will not be teaching this class again this year. So if you want in on this one, you're going to head to thriving stylist.com forward/8 steps to register today. I'll see you there.
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Do you feel like you were meant to have a kick ass career as a hairstylist? Like you got into this industry to make big things happen? Maybe you're struggling to build a solid base and want some stability. Maybe you know social media is important but it feels like a waste of time because you aren't seeing any results Maybe you've already had some amazing success but are craving more.
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Maybe you're ready to truly enjoy the.
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Freedom and flexibility this industry has to offer. Cutting and coloring skills will only get you so far, but to build a lifelong career as a wealthy stylist, it takes business skills and a serious marketing strategy. When you're ready to quit just working in your business and start working on it, join us here where we share real success stories from real stylists. I'm Brit Siva, social media and marketing strategist just for hairstylists, and this is the Thriving Stylist Podcast.
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What is up? And welcome back to the Thriving Stylist Podcast. I'm your host, Britt Siba, and today we're going to talk about winning pricing strategies in 2025. Disclosure. For some of you, you're gonna just feel like this is the episode you've been waiting for. And some of you are like, wait a second, what is happening here? So let me just explain exactly how the format of this episode is going to go. You know the saying, you can't always get what you want, but if you try sometimes, you might find you get what you need. This is going to be what you need. So I think what a lot of people want right now is the how. Like, how do I do it? What is the process? I have a resource for that. And then at the end of this episode, I'm going to share a few podcast episodes. They're going to give you the how 100%. This episode is dedicated to the why. I think if you listen to the how stuff before listening to this why one, you're going to go back to old habits and make bad decisions. This episode is going to be a little bit more facts and figures. It's going to be a little bit more mindset. It's going to be a little bit more reality check. So I'm going to share a lot of details, undisputed facts, some realities that I think are going to help you make stronger pricing decisions and also take like a really good, hard look at where your head is at when it comes to your pricing. What has your strategy been? How are you being influenced, and how is that impacting you? Like, I think it's going to bring up a lot of really important questions that every business owner should be asking themselves in this season. So let's dig in. We'll start with some facts. First of all, cost of living has risen at minimum 20% since 2021. So this is a undisputed fact. You can look at Forbes, Yahoo Finance, Wall Street Journal, pretty everywhere is reporting an increase. I've seen facts and figures of anywhere from 20% to 22%. So it's living somewhere within that range, kind of depending on where you look. But minimum cost of living has increased for all of us by 20% just to breathe in the universe that we live in today. So the world has gotten more expensive. And yes, it's for your clients too. I totally understand. All Americans are experiencing a 20% at minimum cost of living increase. Combine that with the fact that the cost of just doing business in our industry has increased by significantly more than that, and I want you to understand this, that yes, while the world at large, while Americans at large are experiencing 20% cost of living increase, our industry is being hit in a different way. So I looked at, I got real deep in the Reddit threads and I'm having a real like moment with Reddit right now. There's some training coming to thrivers on Reddit too, which I'm excited about, but it's hanging in the threads. I was looking at my own salon centric ordering history and trying to kind of get a sense of how much more expensive has it gotten to be a hairstylist and looking at people expressing how their monthly expenses have changed when it comes to cost of color, cost of foils, cost of gloves, just overhead on running the business that we do. And then looking at my own spend history, you're looking at anywhere from a 50% to a 200% increase on what it costs to run business as a stylist, just overhead cost. So a 100% increase is a doubling of your expense. So if tube of color used to cost $5, if it increased by 100%, now it's $10. If it increased by 50%, it increased by 250, now it's 750. So any of this is pretty radical, right? And that's just cost of supplies when you look at rent and insurance and the car you have to lease, to drive, to work in or whatever, like the cost to live your life too. So overhead on your building or your rent that you have to pay the cost to do every single client, the cost of live your life like we're getting it from all sides as beauty professionals. So yes, we are experiencing the 20% cost of living increase that all Americans are feeling, compounded with the fact that the cost of running our industry specifically has gotten even more expensive. So knowing that, I have to ask you, how can you possibly be thinking about keeping your prices the same and still supporting this business that you have, like, a serious question. How do you intend to make this industry work for you if you're going to keep your prices the same? What is the plan? And a lot of people say, well, I don't know, I don't know, but I don't know what else to do. So operating from a place of I don't know, but I'm going to do it anyway is probably just about the most reckless place you can be in business. So you should never be making decisions about your pricing or your profit margins from a place of, I don't know, but I don't know what to do. That is the most dangerous thing that you could ever do with your business. And I think it's a place that a lot of stylists and salon owners are right now. So what's happened is we are getting this narrative from clients of, like, stylists have become too expensive. I can't believe they're charging this much. And then in turn, our comeback is it's gotten so much more expensive to run our business. And we're trying to, like, I think it's gain empathy. I'm not 100% sure what the intention is, or just be understood. Like, just be seen, heard, and understood, which is what most human beings want today. And so we're like, you have to understand, the cost of running our business has gotten so crazy and we didn't raise our prices for so long, and now we're in trouble. The reason why that falls on deaf ears is because every American is experiencing a higher cost of living. So when we say, you don't understand, it's gotten so much more expensive for us, it doesn't have the impact that you think it's going to because everybody feels like everything is more expensive, so it kind of lands like white noise. And then it also makes us just sound like poor business people. Like, well, I don't know why you didn't take care of this before, but not my problem that you didn't. It's just not a valid argument. And even if the argument was valid, we're not going to convince people to, like, shame come in and visit us like, oh, man, that's terrible. Gloves are more expensive. Yes, I should pay more to see you. Like, it's just never. That tactic doesn't work. I don't know of another business that's doing that with success. It's just not a viable strategy. So we're just in this position where we're afraid to either price ourselves out of our market or raise our prices, or work at a price point that allows us to sustain our business. And here's why. One, there's the ideology that it's better to keep all of my clients paying at least something than to lose them to somebody cheaper. And I understand the thought process of, like, it's better to have 100% of $10 than nothing at all, right? So it's like, well, I'd rather make the 10 bucks than get nothing. It's coming from such a place of lack, though. And here's the reality is it might actually not make sense for you to make the 10 bucks. Like, if you're operating from a place of business that you have no profit margin, you could be working hard, taking clients and losing money. So this idea of it's better to have something than nothing is actually not always the case in business. And it's how a lot of small businesses fail is believing that lie. Number two, some people, actually a lot of people implemented a cost of goods increase between 2021 and now that wasn't justified. So now you're losing clients and are worried about how to sustain. You're paying the delayed price, the delayed repercussion for a decision that was made in the last three years, the last 36 months, more than likely. So when I say cost of goods increase, that wasn't justified. I was very vocal about this, so I don't have to feel bad or walk it back at all. I have said from the start, you cannot just do a cost of goods increase. I feel for you. I just share the real statistics. If buying a tube of color for you has increased by 100%, damn it. Like, what are we going to do? Like, we have to figure out something that's not going to be viable. I'm not saying eat the cost, but it was never okay to just say the cost of running my business has gone up. I'm going to transfer that to you as the client. Figure it out. That was never a good business strategy, and now a lot of stylists are feeling the pain of that decision. Number three, you raised your prices by 20% and eliminated gratuity, and now you're priced 20% above your market again. I expressed concerns about this strategy many years ago. It's another thing I don't feel like I have to walk it back on. This was my number one concern with this method from the start. I said it works great when the market is high and it's going to come back to bite you when the market goes Low. And when you look at living as an American for the last hundred years, there is a cycle of success and growth followed by, I don't want to use the word depression because we haven't had like a true depression by definition for almost or well, for a hundred years. But a dip, there is a dip every 10 years and has been for a long, long for all of our lifetimes. So we had to know the market was going to go low again. And now what you've done is, by the way, when we did the thing where we were like, I'm eliminated gratuity and raising my prices by 20%, you did not eliminate it. You locked it down, you guaranteed it for yourself and we called it something different, but that is what happened. Gratuity is a subjective form of payment. Rate of service is an anticipated payment. When we combine those things, the end result is, yes, you can verbally say, I don't support tipping culture and I don't accept gratuities, but what you've actually done is priced yourself 20% above market. You have guaranteed that additional revenue for yourself, which felt great when times were good, but now there is a possibility probability that you're 20% above your market. Now, some people did this and they're still pulling it off. And the people who did this and are still pulling it off did not just eliminate gratuity and raise prices by 20%. They did a bunch of other things. But what happened was some people just heard this concept and ran with it without doing any of the other things. And now they're in trouble. Because when clients are reviewing you, while they might love your values and viewpoint, if they can't afford you, they can't afford you. It doesn't overcome that issue. Now those are some of the big issues that are happening right now. That mindset of it's better to have something than nothing. That idea of I did a cost of goods increase, it didn't make sense, or I priced myself above my market, now what am I supposed to do? Or. Or here's another one. My demand used to be higher, so I used to be able to command this price point. Now my demand is not as high. Do I need to shift my price point backwards? Like, these are the real questions we're having right now. Now, on the flip side, there's also a lot of people who are having no issues right now. There is a decent sized section of the industry, a few hundred thousand people where demand is sky high. Life is so good, their business is better than it's ever been there's no pricing pushback and they have mass of pressure on their schedule because so many people want to come in. And it's not because they're a discount stylist or they've done anything wonky like that. Like these sales are literally doing better in business than they've ever done before in their lives. Here's I'm going to share a couple stories. This is from Rebecca, who said recently this program is just what I needed to get my business to the next level. I was on a bit of a high when I got my final numbers for 2024. I closed the year at 130 grand, $30,000 more than 2023. So this stylist increased revenue by an average of like $2,700 a month throughout all of 2024 and is still growing. So increased revenue by 30% year over year. And then says, I just published my website. I'm very happy with it. Now that I'm done with my website, I'm excited to continue working through all the other Thriver Society modules. So there are people seeing huge growth like this. Allison just shared in our thriving leadership community that in 2024 salon revenue grew by 37%. Arjita shared, In January 2025, they had the highest sales ever in their career. 20 new guest requests, three new Google reviews, one Yelp review. Four of the clients found them on Google, five to six were referrals and the rest were from Facebook. So that's not a new stylist. That's not like, oh, well, that person probably had tons of time on their books. No, this is somebody who's been in the industry for 15 years and had 20 new guest requests and an insurmountable demand. People's revenue, stylists, salon owners, revenue is growing at large and at scale and they are seeing this intense demand they've never seen before. Because while a lot of clients are choosing not to go to stylists making a certain batch of decisions, they are flocking to stylists and salons who are making a different batch of decisions. And this is that great divide. This is the haves and the have nots. So when you say like, I don't understand, like, Brit, you just told us these three stories and I could go on and on and on with others who are having the same. But when you say like, you know, that's nice of you to say, Brit, but I'm not seeing that. Like, the chatter I see on social media is different. I shared on the Great Divide podcast that There's a lot of stylists who are celebrating privately because they don't feel like they can talk about their success publicly because they'll be shamed. I got so many DMs from stylists who were like, that's me. I'm the stylist who's doing super well and doesn't feel like I can even enter the conversation because the backlash would be so massive. Nobody wants to celebrate with me. Nobody wants to hear it because everybody's feeling so defeated. I get it. That makes sense. And, like, when you're in a low, having somebody else being like, I had the best year ever, like, it doesn't feel good. You're like, well, that's nice for you. What am I doing wrong? It only kind of doubles down on the fact of, like, perfect. So I'm just broken. It's the opposite of affirming. It's less inspiring. When the industry at large is kind of in a place of struggle. For me to say, like, a couple hundred thousand people are having the best year of their career, it can feel discouraging. And so the people who are doing super well, they're not necessarily, like, sharing their strategies because it's a little bit off color from the conversation that's happening right now. And so they feel uncomfortable by even talking about it because there is a fear of getting bad reviews and retaliation and being iced out. So these people who are doing really well are celebrating privately and are just kind of head down, grinding it out, enjoying the success. Everybody in this industry can see success like that at scale, so long as everyone chooses to make the right decisions. So when we look at stylists who are playing scared and are delaying price increases when. Listen, the facts are, if the cost of living has increased by 20% and your cost of goods has increased by 50% or 100% or 150% or 200% or more, or even just 10%. If the way you're living your life is getting more expensive and you're choosing to stay the same, you will lose. I don't know how else to say that. Like, you'll lose personally, you'll lose professionally. You can't undercut and win. And I shared. I think this was on an episode in 2023, I talked about Ninja Turtles. And I was like, if you're a kid of the 90s, this will make sense for you. I was. And I called it the Ninja Turtle strategy. Because I said, watch, there's going to be this almost like a counterbalance of a Lot of stylists, thousands of stylists who are going to choose to kind of live in the gutter and they're going to undercut and they're going to undercharge and it's going to be coming from the place of I'd rather have my salon filled, even if it's people paying bottom dollar so that at least I'm not slow, that's going to end really badly. You are going to be running on razor thin margins. Your mental and emotional health is going to be barely sustainable, barely viable. So yeah, psychologically, your chair might be filled, your wallet will be empty, your emotions will be drained and you will be attracting the most bargain hunting clientele of your life. It's just not sustainable. And it will feel good for a time. If you're doing that strategy, trust me, it'll feel good for a year, but in a year you'll come back around and be like, I can't do this anymore. I know. And then the stylists who didn't go that direction and position themselves as the low cost leader are going to have done things better and you're going to have to claw your way back to the middle to come on out of that strategy. It's just not sustainable, viable or something that's going to work long term. So if you're the stylist who's thinking, if I keep my prices the same, I'm doing myself a favor, like I'm just going to chill, I'm just going to watch, I'm going to wait because in time clients are going to start feeling better about paying more. No, I don't, I literally don't know what you're waiting for. Like we're waiting to raise our prices. Until what? Until what happens? I want you to look back historically at the cost of anything. Washers and dryers, cars, a bundle of bananas, gas, a loaf of bread, a home. Go back and look at the cost of any good, or service for that matter and show me the data on when the cost of something has gone up and then gone back down and sustained. You won't find an example. So when we as stylists are deciding, I'm going to hold off on my raising my prices and just stay here. Until what? I just don't understand what we're waiting for. Until the economy recovers. When the economy recovers is like a really tricky word too. When the economy shifts and changes and confidence rebuilds, it doesn't mean that like then you'll be able to raise your prices by $15 a service. No. People are gonna be like, wait, what are you doing? You're delaying the inevitable. That's not gonna be a working strategy. We have to take the increases when they make sense and when our business needs them. So if you're a stylist and you're in the position where you're like, I'm holding off on a price increase, and it would be $5, but I'm not sure that this is for me, let's talk about the $5 increase. Let's say you're listening to this and you're like, damn, Britt. Like, maybe I am somebody who's been living in fear and I've made some of these choices and I'm in a financial bind, but my demand is waning and maybe I should take a $5 increase. We'll talk about when to know if you should take an increase or not. We'll get to that at the end here. But let's say you're like, okay, I realize I do need one, but I'm scared. That's okay. Like, fear is a very normal feeling. And I don't think you should just tuck your fear in your back pocket and push forward. Like, you should come from an educated place. But I want to talk about the impact of a five dollar increase. So the average guest sees a stylist 5.8 times a year. So when we're at the place where we're saying my clientele can't handle a $5 price increase, that is about $29 per year in impact to a client coming in to see you $29 per year. We're not even even $3 a month. Like, it's so minimal. So often when we say, like, well, don't minimize $5. Like, people are on a budget. And for somebody to have to pay $5 more for a haircut, I understand. Like, maybe they do have to put the box of cereal back on the shelf when they're grocery shopping with their kid. I've been that mom, my daughter knows that life. We did that thing. I know how hard that is, how painful it is. I'm not minimizing that at all. And like, when there are clients who are like, if I pay $5 more for my haircut, I can't buy the Lucky Charms, or I can't put gas in my car. It's a problem. And I don't want to minimize that. That's not what this is about. What I want to understand are the facts. And the fact is that the average American spends 30% of their income on discretionary spending. So not on putting a roof over their head, not putting gas in their gas tank, not making sure the water bill is paid, not making sure the electricity bill is paid. Not any of that stuff. That is life essentials. 30%. Pick any American on the street. All of them, on average, spend 30% of their paycheck on discretionary. So discretionary could be going out and picking up McDonald's for dinner. It could be going shopping and buying a new pair of shoes. It could be getting a haircut. And I use this example over and over. If you've listened to the podcast before, you've probably heard me talk about it before. When my family and I were at our darkest darkest. When my husband and I were sharing a 1993 Mazda and this was not that long ago, the car was like 30 years old at the time. It was breaking down in real time. Living in a 700 square foot duplex, he and I were sleeping on the couch because there weren't enough bedrooms to go around. Like when we were at our lowest of lows, I still got my nails done. Anybody who was around me or worked with me will tell you that because it was that important. And my husband never argued against it. I never thought twice about was just something that I needed for my mental health and my confidence and whatever. It was like my little slice of me. And so would it have been smarter to put. At the time, it was like 25 bucks for a fill. I would wish we were paying that now. Everything's inflated, right? But would that 25 have been better spent? Put in my gas tank, maybe, or buying groceries at the grocery store, maybe. But it was discretionary. And I decided it was important for me. When you're looking at a price increase, whether it's $5, whether it's $10, whatever, it's not about saying, oh my gosh, I can't believe I'm now charging $70 for a haircut. It's not about the whole 70, it's about the incremental increase of the 5 or the 10. And are you worth it in the eyes of your clients to pay a little bit more? When we look at the stylists who are growing really well right now, man, if they're worth it, like, they are worth it. They're so worth it. Where it's like, I will pay an extra $5 all day long because you are so worth an extra 10, you're so worth an extra 15, you could charge an extra 20. And I'd still be here. And when you're getting pushback or friction debating a 5 or a $10 increase, I just encourage you to look below the surface and ask why am I in such a fragile place where that's going to make it or break it? Just something to really think about. The other thing I want to tell you is if you've been listening for a long time, a $5 price increase is not going to be revolutionary for you as a stylist either. I could say that with confidence. Often when people are having demand issues, a more inexperienced coach will be like, oh my gosh, you have super high demand. Raise your prices. That's so dangerous. And that's not always the right solution. You have to take a more holistic look at a business before you raise a and so when we're looking at how to know if you should raise your prices, I want you to listen to podcast episode 221. It's called the Seven Factors of Determining your price point. That's going to help a lot.284 is pricing do's and don'ts in today's economy. That's going to help massively. 348 the new approach to talking pricing with clients. You're going to absolutely love that one. Especially if you're like, I don't know about this whole $5 price increase Britt is talking about. 348 is going to change your perspective. And then 350. Does the loyalty pricing model work or fail? Listen to all of those. 221. 284, 348 and 350. And if you Google thriving stylist podcast 221 thriving stylist podcast 284, all of those things are going to come up. So I want you to make sure that you listen to those episodes. And if you are somebody who's struggling with demand, it's not necessarily about your price at all. And the more stylists I get in and like really get nitty gritty with, I was just coaching somebody kind of one to one the other day and I was looking at their website and their pricing and their demand and their revenue and everything. And I told her, I said, it's not your price point. This person's a pretty significant price point, like more in the luxury market. And she was like, I think I might need a reduction. And I was like, that's not it. That's not where you're failing at all. And when we took it, what was failing it was the Worth it factor. I was like, when I look at how you're presented and when I ask you about your guest experience, there's not enough worth it. It's not about your skill or your experience or the end result or whatever. If I'm a client and I'm debating is this worth it or not, the worth it piece just isn't quite there. And like I said, it's not about the talent, it's not about the result. It's not. It wasn't even about the guest experience. Like the guest experience was amazing. It just wasn't worth it. One more little fact in case I haven't convinced you yet. The average American's income grew by 4% in 2023 over 2022 and an estimated 4.5% in 2024 over 2023. Unemployment is still under 5% in this country. So did cost of living go up? Yes. Are wages increasing? Yes. Is unemployment still down? Yes. And there is a lot of chatter. There is a lot of pressure. People are getting laid off. All of that is totally true. A lot of the fear around spending is truly fear based thinking. There is more money in the US economy than there's ever been historically. Five times over. Look that up. I've reported it for years. It's in a lot of my keynote presentations. Widely sourced. There's an abundance of income in the US economy right now and it's not just being held by the 1%. It's everywhere. People are not haven't stopped spending. They're much more particular where they spend it. You have to be the person that they want to spend it with. So don't hold off on price increases. Your business and your life can't afford it. I want you to focus on value. If you're not showing off what makes you different, no one will know what makes you different. And something has to make you different. I hope this has gotten your wheels turning a little bit. I hope you're feeling a little bit more priced and confident and I hope that we're kind of getting over that fear of I'm going to hold off until cuz someday isn't coming and I don't know what we're holding off for. We have to get smart about the way we run our business. So much love happy business building and I'll see you on the next one.