Salon, spa & fitness
Salon Marketing ROI Calculator
Works marketing return, where the horizon has to cover the relationship.
Result
Simple payback, with no discounting and no financing cost. For anything large or long, money now is worth more than money later and a lender will want interest, both of which make the real return lower than this.
Get a Free Business AuditHow the calculation works
Margin on revenue attributable to the spend, divided by the spend, measured over a horizon long enough to include the repeat visits a retained client makes. A first-visit measurement understates return severely in a business where clients return every few weeks for years.
What moves the number
- Margin rather than revenue as the numerator.
- Horizon long enough to include repeat visits.
- Retention of the clients acquired.
- Referrals those clients generate.
Where this one goes wrong
Judging a campaign on first-visit revenue makes almost all salon marketing look unprofitable, particularly where an introductory discount was involved, and cutting on that basis removes the spend that was actually building the client base. Measure over the relationship. The qualification is that this only holds where retention is real, so the retention rate has to be measured rather than assumed before the longer horizon is used to justify spending.
Before you quote
- Measure over the client relationship, not the first visit.
- Use margin on actual retention, not assumed retention.
- Ask every new client how they found you.
Questions
About this calculator
Why does salon marketing look unprofitable?
Because it is usually judged on first-visit revenue, often after a discount. Clients return every few weeks for years, so a first-visit measurement understates the return severely and cutting on that basis removes what was building the base.
What horizon should be used?
Long enough to include the repeat visits a retained client makes, which in this trade means a year or more. The measurement is only honest if the retention rate used is your actual one rather than an optimistic assumption.
How should attribution be handled?
By asking every new client how they found the salon and recording it. It is simple, cheap and more reliable than tracking in a business where word of mouth and local visibility do much of the work.
The formula
payback = cost / (monthly gain - monthly running cost)
Put this calculator on your site
Free to embed. Paste this where you want it to appear. It stays up to date automatically because it loads from BDEVY.
Please keep the attribution line. It is the only thing we ask in return.
How to use this calculator
- Up-front cost ($). Enter your own figure; the page starts at $12,000.
- Extra gross profit per month ($). Enter your own figure; the page starts at $1,400.
- Extra running cost per month ($). Enter your own figure; the page starts at $220.
- Period to judge it over. Enter your own figure; the page starts at 36.
The result updates as you type, so you can try a figure, see what it does to payback period, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Up-front cost | $12,000 |
| Extra gross profit per month | $1,400 |
| Extra running cost per month | $220 |
| Period to judge it over | 36 |
What comes out
| Result | Value |
|---|---|
| Payback period main result | 10.2 |
| Net gain per month | $1,180 |
| Net return over the period | $30,480 |
| Return on investment | 254% |
It pays for itself in 10.2 months and returns $30,480 over 36 months, a 254% return.
How sensitive the answer is
Holding everything else steady and changing only up-front cost, this is what happens to payback period. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Up-front cost ($) | Payback period |
|---|---|
| $6,000 | 5.1 |
| $9,000 | 7.6 |
| $12,000 example above | 10.2 |
| $18,000 | 15.3 |
| $24,000 | 20.3 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Up-front cost ($)
- A money amount, starting at $12,000.
- Extra gross profit per month ($)
- A money amount, starting at $1,400.
- Extra running cost per month ($)
- A money amount, starting at $220.
- Period to judge it over
- A number, between 0 and 240, starting at 36.
What the results tell you
| Result | What it is |
|---|---|
| Payback period | The headline result. A decimal figure. |
| Net gain per month | A money figure. |
| Net return over the period | A money figure. |
| Return on investment | A percentage. |
Estimating is the easy part
The jobs you never hear about cost more than the ones you mis-measure. BDEVY builds the marketing, systems and automation that bring them in.