From zero employees to 49, from no clients to 16,000, from one location, to a multi-location Salon and Day Spa business generating over 3 million per year.
On this week’s Relationship Marketing Weekly, relationship marketing expert Kody Bateman, interviews former 19 year Salon & Spa owner explains how incorporating a relationship marketing strategy turned her dream into one of the top 100 fastest growing salons in the country and the largest single standing Aveda Lifestyle Salon & Spa!
Kody Bateman: Hey everybody. This is Kody Bateman. Welcome to our weekly Relationship Marketing Show. We’re very excited today. We’re going to get started as quick as we can. We have a bundle of energy on the show today. We are so excited to have the one and only Ms. Darla DiGrandi. Welcome to the show, Darla.
Darla DiGrandi: Hi Kody. Thank you so much for having me.
Kody Bateman: Well, we’re so excited to have you here today. I’ve had the opportunity to visit with you many times and hear all the war stories over the years of how your entrepreneurialism has been incredible.
Without further ado everybody, I just want to introduce. Darla is from the salon and day spa industry and she was a superstar there. What’s interesting about this story is Darla started her business over 30 years ago and you were in your young 20s when you started this and built a very successful business over the next 19 years and then you exited out of this industry in 2008. So this story is going to kind of go back in time a little bit and we’re going to talk a little bit about what you did.
I got to share some of these numbers though because people got to understand. I mean what you did was pretty darn significant. We’re talking zero to 49 employees, from zero to 16,000 clients, from a two-chair salon to over – to five salons all in the Palm Springs, California area. You also sold premium items when your competition was selling at a discount and again, you started this in your early 20s and I got to tell you, I mean that’s pretty amazing, the accomplishments you did.
You did things different. I mean you did things different than your competition did. So without further ado, Darla, I’m going to have you just jump right in and talk to us about what did you do to build this enterprise.
Darla DiGrandi: Thank you so much Kody for having me. I really hope that I can connect with the listeners out there because I believe and I know for a fact that anybody can implement this type of marketing strategies into their businesses and be able to prosper and grow.
As a little girl, I had a dream. I wanted to have the largest, most expensive salon in town and I was the first day spa to open in our area, not connected to a resort, and I was a big dreamer. I had big visions. But I didn’t have any money. I was a young 20-something-year-old. I have just come out of beauty school. I worked in a salon and I was like, “I got to do this. I got to build these dreams. I can do this.”
So I got started in a two-chair. Then we started just hiring people and training them. But we started – we couldn’t afford real big advertising. It just wasn’t in our budget to be able to have big advertising until we made some money.
But from the very beginning, we implemented appreciation marketing and appreciation marketing is simple back in the ‘30s, a thank-you card, and they were usually little white postcards and it had a label on it that you printed out of a printer on your – and you stuck the label and you stuck in on a stamp and it just said in black and white ink, it said, “Thank you for visiting and we appreciate your business,” and then we would run reports every month and if they didn’t come in that next month, we would send them one that says, “Haven’t seen you in a while.”
So that started growing our business and then we could start to afford to doing other advertising like Yellow Pages and TV and all that kind of stuff back then because there were only 12 channels on TV and one Yellow Pages book. Now there’s a million.
We always tracked our numbers and the number one most solid source of customers came from referrals, came from word of mouth, from people that were already coming to us.
So as a kid, I always studied the Guinness Book of World Records. I was always into that. I was like I’m going to get in the Guinness Book of World Records. So I remember when they wrote a story about this guy that was the number one salesman and he was the number one salesman above all salesmen because he sent thank-you cards. He handwrote thank-you cards every day to people of his business.
So that’s how I grew it from the core and there’s this one quote that I can prove that everybody in business should understand. The number one reason why a customer leaves your business is not because of service or price and I proved it because our prices were the most expensive in town. We were always above everybody’s price and I was at school. I was an instructor for the State Board of Cosmetology. My people didn’t go to beauty school. I trained every single one of them.
So we were frying hair every day, doing bad haircuts and making people cry at the most expensive price. But they stayed with us because we always sent them a thank-you card and thanked them for being a part of our growth and for a part of our business always.
Kody Bateman: So that’s interesting. A couple of things that you said there. First of all, what amazes me is that you started really young. You were a young, young entrepreneur getting started and you were doing things from the beginning very much differently than your competition it sounds like. So what was your competition doing while you were doing these cards and things?
Darla DiGrandi: Competition was running promotions and giving discounts and offering specials. So I knew that I needed to do the opposite of what everybody else was doing because I wanted to raise my prices and I wanted to grow my salons bigger and bigger and bigger. So if you guys stop and think about it, why do you go somewhere? You don’t go there because of the price. You go there because you’re appreciated. So I’m raising my prices. I started out of beauty school. My haircuts are 20 something dollars.
When I retired, I was $100 for a bald man, Kody. If I cut your hair, it was 100 bucks. I’m not lying. I swear. God is my witness. We specialized in highlights. So it was 500 bucks to get your hair colored and highlighted and a cut to be with me. That was the most expensive around.
But we were booked for weeks in advance. Weeks out, you couldn’t get an appointment with us and that was because we knew how to make people feel important and appreciated by constantly thanking them and telling them how much we appreciate them. We even, as our salons grew, put male rooms in our salons with these big huge printing machines and we would go through boxes of labels like this and print like you wouldn’t believe cards of gratitude and appreciation and haven’t-seen-you and happy birthdays.
Kody Bateman: OK. So you mentioned something – because one of the questions I was going to ask you is what – in your early 20s, getting started out. Your competition, probably people that have been in the business a lot longer than you had and they’re doing it one way and I don’t know the proper way to say this, appropriate way to say this. But you had the guts to go do it a completely different way. You mentioned that one of your inspirations was the Guinness Book of World Records, the story of Joe Girard. I think you already mentioned that.
It’s amazing to me and I think that it is really important to those who are listening, especially if you’re a young entrepreneur. Personal development is huge. It’s important. You’ve always been a big advocate of that.
Learn from those books. You learned from the Guinness Book of World Records. You learned Joe Girard’s story and he did what you implemented and you had the faith that – there came a point where you had that faith in this. I mean a lot of faith in this because I mean that was a big gamble to take when everybody was doing something else.
Darla DiGrandi: Well, I knew that it worked because we had tracked it since the very beginning. We were already having positive results with it. You know, growing my salons up to having 49 hairdressers. The majority of my hairdressers in – or my employees, all of them, massage therapists, hairdressers, all kinds, receptionists, all kinds. They were young. They were like 15, 16, 17, 18, 19, 20, 21 years old. I mean these were young kids because I was at school.
So we even would teach them how to shake hands and look people in the eye and say their name by their first name and to say, “We appreciate you and thank you.” We taught these four principles to them and followed it through with all the way out to paper and yeah.
Kody Bateman: Excellent. So Darla, this – a lot of listeners are probably saying, “OK, this is cool and that’s great and it’s interesting that you had these big printing machines in your office and you had employees that actually stuffed envelopes and sent postcards all day all the time and obviously at work.” I mean we’ve already shared the numbers.
So you got out in 2008. A lot of listeners are sitting there saying, “Well, gee, from 2008 to today, the entire world has changed.” So how does this work today?
Darla DiGrandi: Well, let me just say one other thing. It worked so well back then that it turned me into a salon consultant and people used to pay me $30,000 to go into their salons and teach them how to implement this in their system so they could raise their prices, so they could become a high-end salon. That’s how great this works and so now fast forward, I run into your company and this system and I haven’t slept ever since then.
My brain constantly goes crazy because of all the things you can do today that you couldn’t do back then and I’m like, “Man, if we would have had this back then, I could have been doing some just beyond things,” because we always said, “I wish we could put a before and after picture on that card.” But you couldn’t do that back then. It didn’t exist. The technology wasn’t around. So now today I actually have some samples of some things just to give people visual aids.
I just want to repeat this quote for all you business people out there that are listening. “The number one reason why a customer will leave your business is not because of price or service.” So stop lowering your prices. It’s a perceived indifference that they think you don’t care about them and if you will just start showing gratitude – every time I see somebody make an Instagram post or a Facebook post bragging about their before and after pictures of the color that they did for a client, I go, “Oh my gosh. If you would take that one same single step that you’re doing.” You’re taking a picture from your phone and you’re posting it on Facebook. If you would take that picture from your phone and post it into this app and send it to them in the mail, you will change the entire dynamic of what you’re creating with that gratitude.
Kody Bateman: Now before you get into that, I want to touch on that because I think you said something really important. What is the difference between posting on Facebook and posting it in our app so that they receive a tangible card? What is the difference?
Darla DiGrandi: I will tell you exactly what it is. So when – back in ’08, ’07, ’06 is when email and Facebook and this great social media guide came around. OK? And it even happened to us and we didn’t realize it until we could look back on it. But we thought, “Oh, awesome!” Instant. No more renting, no more labels, no more employees, no more payroll, no more overhead, no more taxes. Awesome! We’re all in. Let’s start emailing everybody their thank-yous and let’s start posting Facebook posts and what happened is they completely removed the personal touch.
There is a huge difference when you see a Facebook post that says, “You look beautiful for 50. Thank you for coming to me to get your hair done,” than sending someone this in the mail, that they can hang on their bathroom wall.
When somebody sees a Facebook post or an Instagram post, it’s gone. In an instant, it’s gone. When somebody gets this in the mail, when they open this up, it goes right to their hearts. The biggest thing you got to do in business is get from someone’s head to their heart. OK? So when – you will never have someone call you on a Facebook post and say, “Oh my gosh, that Facebook post made me cry. I’m sitting right here in tears. I’ve never had anything so nice done.” But you send somebody a card like this – this is one that I actually tore off because I’ve had it for so long and I wanted to keep it. I threw away the card. But I kept the picture and I have tons of examples I can show Kody. But I don’t want to take up all the time.
Kody Bateman: Well, that’s amazing. Appreciation you can touch.
Darla DiGrandi: Absolutely.
Kody Bateman: Appreciation you can touch and you proved it. You proved it in the olden days and today you’re consulting other companies with the systems that we have and it’s very, very exciting stuff.
Now one final question. I cannot imagine a salon person listening to you on this show and not wanting to get back with the person that shared this show with them and getting something set up because we have systems to help you do this.
However, as you know, there’s going to be salon owners that are – whatever. They’re late adopters or whatever. What would you say to a salon person that doesn’t think that it’s important to do this kind of stuff? I mean how would you get over that objection?
Darla DiGrandi: Well, we all have to advertise to try and attract people into our life. You’re going to spend a bunch of money on Yellow Pages or TV or prints or ads or flyers and all that is cold market advertising. If you stop and think about any successful business on the planet – I don’t care if it’s a church. I don’t care if it’s an author. I don’t care if it’s Walmart or whatever, a restaurant, a salon. Any business whatsoever, any person, thing or place that is successful has a large network of people that are fans, supporters, customers, whatever. They’re all people that believe in because they like and love the person that is the creator of it.
Where did those people come from? They came from somebody else telling them or inviting them into or referring them. Where did those people come from? Someone else telling them or inviting them or referring them. They didn’t come from a Yellow Pages ad and Yellow Pages ad and a Yellow Pages ad. So stop and think about that. Appreciation and referral marketing, you can eliminate every other type of marketing on the planet and you will now attract people into your life through other people telling other people about you. Just try it. Just try it for a month.
Kody Bateman: Well, you proved it in your numbers. You built it years ago. You’re consulting companies today and helping them turn their businesses around. Certainly people want to listen to what you have to say because it does work and the proof is in the printout and when companies succeed, that’s what it’s all about and we just want to applaud you, Darla, your passion and your desire to help companies be successful and we really appreciate that about you. As we exit off today, any final words of wisdom that you can share with us? Go ahead.
Darla DiGrandi: I would love to. Can I take two minutes?
Kody Bateman: Go ahead. You bet.
Darla DiGrandi: You guys. I just want to show you some samples of cards just so you can understand the power. Imagine if this was your little hair salon and you sent this as a thank-you and you put the before and after picture of the person inside with a little message. This is just a picture from your phone with a message. I know this is not hair but it gives you the idea. This is just business, plain and simple. Imagine a little girl coming in and getting their first haircut for her birthday and you sent this picture to her.
She’s going to keep this card and you’re going to have her as a client for the rest of her life. She’s going to show all of her friends these cards. When somebody comes in as a wedding and gets their wedding done and you’re going to do the whole wedding ceremony or maybe prom or graduation, you’re already taking pictures that you’re going to put on Instagram. Put them in a big card and send them pictures of their experience, of their moment or put it on a calendar and let it stare in front of them for the whole year, so that they’re thinking of you for the whole year.
These are so cheap, less than $2 from an app on your phone, to their mailbox. You don’t print it, stuff it, stamp it. You don’t do anything. The company does it all for you and to be able to do that for $2, when you’re making 150 percent return on the person, if you think about the haircut being $100 or even $50, it only costs you 33 cents to do the haircut with a squirt of shampoo and you’re sending a less than $2 card to someone for a memory like this, you’re stellar. You stand out from the crowd or just say thank you or what if you see someone – this is my daughter doing my hair. How cute is that? This could be a hairdresser doing a customer’s hair. Anyway, before and after pictures for permanent makeup. I can go on and on.
Kody Bateman: Incredible, incredible stuff, Darla. Thank you so much. Next time, we might have to do a one-hour show so that you can spend much more time talking about all these great, great golden nuggets you’ve shared today. So we appreciate you being on the show.
You will be interested to tune in next week and all of you will be interested to tune in next week. We have an internet marketer next week that we’re going to interview and my goodness, she has built a $50,000-a-week business selling products over the internet and she uses an offline system, our offline system to follow up people.
So she does all of her business online but uses appreciation people can touch or offline systems to actually implement and to grow her business. So stay tuned next week, next Wednesday, and we will have that interview and Darla, thank you again. I appreciate so much having you on here today and take care everybody. We will see you next week.