Hey everyone, it’s Meg Ann Lee! We are back this week with part two of our 2025 beauty industry discussion. In part one, I covered the TikTok “toner-gate” drama and how these online reviews could be a good reality check for us to reflect on the perceived value in our beauty business. In this week’s blog post, we will be discussing understanding our target market’s budget, because budgeting for beauty services has been a HOT TOPIC online. I’m a full time hair stylist who thinks the “charge your worth” movement is over. If you are looking for a little encouragement in your beauty biz in 2025, this beauty industry series is for you!
Everything is Supply and Demand
Depending on your specific financial situation, some of you can afford to work 15 hours a week, schedule full of clients or not, make some Instagram content and call it good (honestly, no hate but you’re the exception here). Some of you need to work 40+ hours a week WITH a full chair, no time for social media marketing or business organization to be able to pay your bills. Understanding your market and how to apply supply and demand into your business is EVERYTHING.
You can lower your supply (hours you work) to compound your lower demand into a shorter amount of time, which would allow you to raise your prices; but think about the WHY behind doing this. Is your initial demand low because your skills just aren’t there? Clients don’t know about your business? Or don’t see the value in your services? Then you are not a service provider who should work less and raise your prices because that is where this “price gouging” narrative online is coming from. My advice here is you should actually work more at a lower price point to PRACTICE your skills to get better and then you can give yourself a deserving raise every year or as your skill progress and there’s more awareness of your business. The “charge your worth” movement is over. You need to charge based on how much it costs to run your business and create a profit. THEN, go up from there once you have created demand for yourself.
Clients Budgeting for Your “Luxury” Beauty Business In This Economy
One education tip I always remember hearing educators say is “let your client shop with their wallet not yours”. Essentially meaning you don’t know your clients’ finances and just because you, as a service provider, can’t afford a $500 color service doesn’t mean they can’t or don’t want to spend that! I 100% understand this BUT you must actually know the numbers in the market for this to work in your favor. In the last 5 years our industry has morphed into this “luxury” service industry. We started saying “Charge your worth”, thinking that we all should be offering “luxury” services, making 150k a year like the Instagram hairstylists we follow.
LET’S BE SO FOR REAL RIGHT NOW
We are not them and a lot of our clients cannot afford “luxury” services on a regular basis. Now, I know if you’re a beauty service provider you might be thinking, “well then they aren’t my target market, I’m marketing towards a luxury clientele”…. Are you though? If you live where I live let’s look at the stats! According to the Eau Claire Development and Data USA the median household income in the area is about $64,000 and a yearly household average being around $83,000. I made a chart breaking down a budget using the lower number on what that looks like for the average family living in Eau Claire (2 adults, 1 child) after taxes with a take home pay of $4,160.
So, let’s say a client wants to get their hair done every 8 weeks.. according to that chart they have maaaybe $100-150? If you’re a hairstylist reading this, I’m sure your thinking well I can’t even do a full highlight, toner haircut for under $100…and no, you probably shouldn’t be. So where is the disconnect here?
The client either saves up and gets their hair done less frequently at a higher price or they may choose to get services every 8 weeks at a lower price point.
This is how we have to think about our services. If you have LESS frequency from your clients, you will need MORE clients coming to you to fill your hours. If you specialize in clipper/short haircuts (3-4wks), root retouches(4-5wks), or haircuts(6wks), you will need LESS regular clients than someone who specializes in lived in/low maintenance colors which can be 10-12+ wks apart. This thought process comes into play when choosing where you work and the business model you want to have. Think higher price/lower volume is like specialty salons or lower price/higher volume is like walk in salons. If your clients need more “affordable” services create an express service menu for them! Shorter appointment times, more frequent if they choose.
SERVE YOUR MARKET.
Ideally we would all love to be high price/high volume offering “luxury” services but not all of us can do that with the market, that’s just the reality. What we should be shooting for is MATCHING our skill level with our price point for the market we are trying to serve. Some of you will truly be the “luxury” service providers at the high price point. But the reality is we won’t all be. THAT’S OKAY. You can still be profitable in your business doing “affordable” services if you are marketing to the right clients who come to see you at the right frequency.
I hope you are starting to reflect on your business practices, hours, pricing and overhead costs! In part three we will go over how to figure out how much your services cost you as a service provider and how to decide if you should be working independently or not <3
The post The Beauty Industry in 2025: A Discussion With Meg Ann Lee (Part 2) – Understanding the Market appeared first on Around the 715.
