The successful NZ startup aims to become Australian salon owners’ best friend.
If you’re running an airline, empty seats mean missed opportunities and lost revenue. The same goes for some other types of service businesses, such as hair and beauty salons.
Another similarity can be seen in consumer behaviour: less planning ahead, and more spontaneous and last-minute decisions.
New Zealand startup Flossie aims to bridge these two issues – but rather than aiming to provide a directory to all relevant businesses in an area, Flossie only admits selected salons.
“They must have a philosophy of customer first, be best-in-class for clinical practices such as cleanliness and decor, they must have a speciality of some description – for example ‘the best waxer in Hampton’ or ‘specialise in all organic products’ – and a willingness to be a true partner in business,” Flossie CEO Jenene Crossan told Business IT.
Consequently, salons must be recommended to Flossie by a customer. “Then we vet them via their online credentials and public information such as their website and social media channels. If we're satisfied that they could meet the grade, we will send in two testers to trial an appointment each. Once they pass that, we'll bring them on board,” she said.
Standards must be maintained. Crossan explained that “every booking is reviewed by the customer and we monitor these closely. If we see a standard drop, we'll redeploy the testing team and if need be we'll remove a salon.
“We also give them an opportunity to rectify or ‘make good’. What's critical here is that Flossie doesn't want all salons on board, we only want the best ones that we know will satisfy our customers' needs well – it's a massive point of difference to the generic market places that act more like directory listings.”
Business owners benefit because Flossie integrates with salon management systems in order to sell the excess inventory. Flossie works on a pre-paid basis, protecting salons from people who book but fail to arrive.
“Where once a salon owner could rely on the customer returning within a reasonable period of time, they may now only fill 65 percent of their capacity on a daily basis. And, more frighteningly, the 'no-show' levels have skyrocketed, leaving business owners frequently frustrated and out of pocket,” said Crossan.
Flossie was launched in New Zealand three years ago. On that side of the Tasman it has attracted 450 salons and 45,000 customers, and achieved $2.5 million in annualised revenue.
“Customers who book through Flossie come back to salons on average 15 times per year, comparative to traditionally where customers would come back eight times per year,” she said.
“Customers spend more on style vs. function; for example they'll buy trend related service items rather than just maintenance items, and we proactively market to them across multiple channels to facilitate this, which is free marketing to the salons.”
Flossie is moving into Australia during 2018, having launched in Melbourne and then expanding to Sydney. (Vaniday is already operating in those two markets.)
Salons can join Flossie at no cost. “We charge a commission on each booking and that fee is variable dependent on a variety of transactional factors such as frequency of customer purchase... [or if it is] a new or repeat customer,” Crossan said.