Calculating Your Client Retention Rate in the Spa and Salon Industry

As the owner or manager of a spa or salon, you know that increasing your client retention rate directly impacts your bottom line. When clients regularly rebook your services, your business benefits from stable revenue and increased profitability.

But you can’t improve what you don’t measure. Tracking client retention helps you identify what needs to change to keep more clients booking again. Learn how to calculate your current rates, which metrics to track, and how software like Meevo’s spa and salon management platform can simplify the process.

How to Measure Client Retention Rates for Spas and Salons

The most straightforward way to measure how well your spa or salon retains clients is to determine your client retention rate. This shows the percentage of guests who continue to return to your business. It’s an important metric, offering insight into whether you successfully keep clients after you’ve acquired them. In most cases, a high client retention rate translates to high profitability.

Client Retention Rate Formula

Here’s how to calculate client retention rate:

• Start with your beginning client count of a certain period (B).
• Add the number of new clients you acquired during this period (N).
• Note what your client count is at the end of this period (E).
• Use the following formula: [(E – N) ÷ B] × 100 = Retention Rate %.

Key Performance Indicators (KPIs)

Though useful, your retention rate is just the start. Let’s take a look at some other client retention metrics to use as KPIs for your salon or spa:

• New guests per month: This KPI measures the average number of new clients your business services monthly. It’s normal for salons or spas to experience client turnover at some point. Retaining your current base is important, but so is attracting new faces.
• New client retention: Once you’ve attracted new clients, you want to ensure they book at your business again. Your new client retention rate shows how many guests return for a second visit within 90 days of their initial appointment.
• Repeat client retention: With this metric, you can understand how many repeat guests are retained after their second visit. Happy regulars are the backbone of any successful salon or spa, bringing a steady income stream.
• Frequency of visit (FOV): Each visit generates service revenue and potential retail sales and strengthens the client’s connection to your business, so keeping track of your FOV is essential. This metric tells you how often clients return within a year. Increasing your FOV rate by just one more annual appointment among your clientele can boost your revenue by as much as 30%.
• Average ticket: This KPI measures the average dollar amount guests spend at your salon or spa per transaction. A high average ticket can indicate that you’ve built a loyal and engaged customer base who will gladly invest more in your services. Increasing your average ticket size can be a great way to drive additional revenue.
• Productivity: With this metric, businesses gain insight into how busy service providers are during operating hours. You want to aim for a productivity rate between 75% and 80%. Anything above could mean your team is too overwhelmed to focus on delivering exceptional experiences that keep your clients coming back.

What Is a Good Client Retention Rate for Spas and Salons?

Working out metrics like your salon or spa’s client retention rate and understanding how you compare to others in the industry gives you a point of reference to set achievable goals and track future progress.

• New client retention: While the industry average for retaining first-time visitors is 35%, you should aim for 50%. After all, who wants to be average?
• Repeat client retention: The typical salon or spa has a repeat client retention rate of 75%. However, you should set your goal for 85% or above.
• FOV: The industry average is 4.88 visits annually, but achieving 7–8 per client is ideal.

Regularly monitoring your KPIs is essential to stay on course toward your goals and gauge how well your retention strategies are working. But between clients, staff, and running your business, who has time to track numbers all day? That’s where client retention software, like Meevo’s salon and spa management solution, comes in.

How Can Meevo Help Spas and Salons Track Retention?

Meevo is a cloud-based management tool that simplifies the business side of beauty and wellness. This platform lets you keep an eye on your vital retention metrics without getting lost in complicated spreadsheets. Pull up data in seconds, understand your performance, and make better-informed business decisions. You’ll also have more time to focus on what matters most—delivering great services and growing your salon or spa.

Let’s explore how our software’s reporting features and customizable dashboard hub assist with retention tracking:

Access Top-Tier Salon & Spa Reports and Analytics

Meevo shows your spa or salon’s performance in real time, even across multiple locations. With the platform’s robust reporting capabilities, you won’t have to manually collect data and calculate retention rates.

Instead, you’ll have instant access to intricate reports displaying how many clients you retained and lost during a specified time. Simply pick a starting month, set your tracking period, and spot retention patterns impacting your business.

Make Data-Driven Decisions

Though you’ll have over 150 reports at your fingertips, Meevo’s customizable Advanced Dashboard provides an overview of everything from appointment traffic to memberships—whatever’s most important to you. These dashboards simplify complex data and help you make smarter decisions based on key metrics & trends without having to run individual reports.

A data-driven approach is vital to grow your business and keep your clients coming back. Understanding past patterns and trends gives insight into how your salon or spa can improve client retention.

View All Your KPIs in One Place

Meevo’s Smart Center lets you build a custom dashboard, meaning you decide which data appears front & center when you open the platform. Say goodbye to manually searching for key stats. Instead, when you combine crucial client retention KPIs like FOV, new client retention, and repeat client retention in one place, you can better understand your overall progress toward your goals with a quick glance.

How Can Spas and Salons Improve Retention Rates?

With the tools to calculate and track your spa or salon’s client retention rates, here are some strategies for improving your rates:

• Use guest surveys: Surveys give your clients a voice. Listening to what they have to say lets you catch concerns early, deliver the exact experience your guests want, and improve your NPS score.
• Create a loyalty program: Rewarding clients for returning to your salon or spa is a great way to create a culture of rebooking. Research shows that loyalty programs can deliver immense value, helping your business attract and retain more customers.
• Deliver a stellar client experience: Whether it’s their first visit or they’re a long-standing client, every guest who walks through your door should get VIP treatment. The more you show your clientele they’re valued, the more likely they’ll rebook with your spa or salon in the future.

Master Client Retention Calculation and Tracking with Meevo

Calculating and tracking your client retention performance is easy with the right software and tools. Meevo provides instant access to vital KPIs in an easy-to-understand format, making it simple to set your business up for success through smart, data-driven decisions.

Beyond helping you monitor crucial data relating to client acquisition and retention, our software can help boost this area of your business with features like hassle-free booking and membership programs.

Ready to get started? Schedule a demo today to see how Meevo can drive results for your spa or salon.