Professional Hair Care business: The “STYLE” side of CPG retailing – Part-I
Professional Hair Care - Retailing with style !
The first thought that always comes to mind whenever someone makes a mention of CPG industry - the traditional manufacturer-distributor-retailer business which works in tandem to deliver the goodies to the God in the entire chain - The Consumer! This traditional CPG-retailing is pretty well set over the ages and is perhaps one of the most revenue and employment generating businesses around the globe.
There is another cousin, Professional Hair Care business, which technically shares the same categorization - CPG-retailing, but is altogether different ballgame when it comes to sales and retailing.
To many of us, hair care translates into an application of shampoo and conditioner in the bathroom! But the fact is that there is whole lot of art-work that can go on your head and translates into much bigger revenues than just shampoo and conditioners!
Professional Hair Care is more a multi-billion dollar global industry and growing steadily. This fact is realized by the major CPG manufacturers and they have acquired big stakes in the Professional Hair Care by way of acquisitions during the last few years.
While the Hair Care industry gets a boost from the major CPG players to ride on the well established volumes and scales of the CPG logistics, there is also a different approach that the manufacturers have to take when it comes to marketing and selling these products.
Style matters!
Hair Care Salons are the place where the hair care products get consumed. But this consumption is not a simple “buy” from the end consumer, un-like the traditional retail store. These salons are run by artists who perform coloring and styling on the clients. The bottom line here is CLASS and STYLE! The more effective and customized the style for the client, the more repeat business and personal relationship it generates.
The same stands true for the manufacturer – salon relationship. It needs the personal touch. This is catered to by sales representatives from manufacturer / distributor paying scheduled visits to the salons and interacting with them constantly.
Incentives - Key business generators
Promotions, in this industry, are an essential growth driver. Salons are not volume-based retailers. While class and quality remain their key areas, they also depend on the offerings and discounts to maximize the cost saving opportunities. Promotions, like buy-1 get-1 free, get discounts or bonus on meeting certain volume or targets, new launch initiatives, etc. contribute heavily towards the sales to salons. Salon setups and customizations, which are big investments for salon owners, are also provided by the manufacturers as a financial aid, thereby winning over customer loyalty for future product sales – a win-win solution for both.
......will look at this business from a technology enablemnet perspective in Part-II of this blog
