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2 Out of 3 Salons Offer Monthly Cash Membership Options

Wednesday, August 13th, 2014

In a recent SmartTan.com poll, just under two-thirds of indoor tanning businesses said they offer month-by-month cash membership options as an alternative to continuous EFT memberships.

EFTs have become the foundation that many salons are built on, with many reporting around 30 percent of their income coming from these types of memberships. Some salons even refuse to sell individual sessions, finding that pushing people into memberships is more valuable, even though this will deter some portion of the potential clientele.

While EFTs are becoming the norm in many types of business, there’s still a segment of customer that are uncomfortable with having their information on file, don’t use credit cards at all, or don’t want to be committed to a membership. This is where monthly cash options come in to play. By offering a cash option, typically at a premium price, salons can rely on steady EFT revenue and still cater to the clients who remain weary of EFTs. Some salons also allow clients to avoid the premium pricing for this option by paying for an entire year, or other extended period, up front.

What you don’t want to do is make the cash option a more valuable option. There is undoubtedly a benefit to getting customers on an EFT membership, requiring them to actively decide to cancel the membership rather than simply letting it lapse. For what you give up in future commitment, you should make up for with increased margin on the monthly fee. The price point for the cash option should be set to make even those opposed to EFTs consider changing their mind.

But, even though these cash options can certainly benefit salons, a large portion of businesses still refrain from offering them choosing to forgo those few customers that are still unwilling to commit to an EFT and continue to push everyone into EFTs if they want the benefits of membership. It all depends on your specific market and how you want to position the business.


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