Massage therapists can be very generous. We donate our time and energy. We give of ourselves in the very nature of our work. We even give money away as a tool to grow our business.
Perhaps you have not realized that’s what you are doing.
Yet, every time you offer a discount in an effort to create more business for yourself, you are giving money away. That is not always a bad decision. How often, though, is it a strategic decision and how often is it done without deep thought?
Discounts are quick and easy—and everyone likes a deal, right? However, there are times when discounts aren’t a solid business decision:
• Because you don’t know how to market your practice
• Too many discounts
• Discounting too deeply
• Unclear and un-measurable goals
• Not tracking whether they work
• Offering them on the fly rather than thinking them through
• To cover your discomfort with money
• Assuming you have to because you’re new
Discounts can be a valuable promotional tool for a business, but you’ve got to make sure they are actually going to work for you.
5 Criteria to Design Discounts
There are five criteria I recommend using when designing discounts for your business:
1. Strategic: Any promotion you do should meet a need in your practice, especially a need for growth. It should also make sense for your business. Ask yourself: Is this discount clearly necessary to grow my business and is it likely to be successful?
2. Targeted: You can offer discounts for the general public. A first-timer discount is a common example. A better discount is targeted to a specific population you want to reach.
3. Purposeful: The point of most discounts is to fill your schedule. Push a little deeper into your motivation. Do you want to attract people during a specific time of the year? Would you like to encourage people to try a new service? Would you like to strengthen your bond with your clients? What specific goal do you have for this discount?
4. Time-bound: There is a place in a business for a standing (never-ending) discount. Two common examples are first-timer discounts and pre-paid package discounts. Be careful, though. Too many standing discounts hurts your cash flow and risks making you look like a desperate business.
Think about putting a start and end date on your discounts. Deadlines make it easier for you to track how well a discount worked. For example, if you want to attract people who live in a specific zip code, offer a three-month discount. Compare those three months to the previous three months and calculate how many additional appointments you booked from people in that zip code.
5. Right-priced: How much of a discount do you really need to offer? Do you want to match the low-cost franchise that just moved in down the street? (My advice? Don’t even try.) How much is enough but not too much? How much money can you actually afford to give away?
Think about the type of client you are trying to attract:
• Are they already open to the idea of receiving your service and simply need a little push? A small discount (5-10{6b2fa08d5993bc7e76ffaca7a3a295e96a3274ffb0576a302ceddffe26335ebd}) is often all you need.
• Are you on a mission to attract people who need to be convinced that massage is valuable? A big discount may bring them in but then you may have a significant education/motivation job to keep them coming back. That’s an uphill climb.
• If there is a large gap between your discounted rate and your regular rate, how can you help people be comfortable paying your higher rate (which you eventually want them to do)? The idea that “once they get a taste….” works well for drug dealers, less so for the rest of us.
Let’s explore how to apply these criteria to a common discount: friends and family.
Strategic: It may be, when you open and you’re trying to fill your schedule. However, it’s hard to grow a practice after the first year by offering discounts to friends and family.
Targeted: You’ll have to decide what the limits of friends and family are. Immediate family? Third cousins? In-laws? It gets even trickier when you’re figuring out how lenient you are with the friends designation. Is there a difference between friends and acquaintances? How about neighbors?
Purposeful: Offering a discount (especially to family) may be an expectation in your family or culture. In that case it may not matter if it meets the five criteria but it’s still worth thinking through.
If you’re doing it out of gratitude for their support (especially while in massage school), then I’d strongly encourage you to set a time limit on it (maybe your first year in practice?). If it’s because you feel guilty asking for money from friends and family, then step back and think carefully. Great business decisions are rarely made from a place of guilt.
What is your purpose for offering a friends and family discount? And how will you measure if it was successful?
Time-bound: Depending on your goal, you may have it as a standing discount. If you are actually hoping to grow your practice and create some cash flow when you’re starting out, then consider setting a time limit. First six months? First year? Or consider limiting the number of sessions they can receive per month, quarter or year.
Right-priced: This is where things can get sticky. What are the expectations of your friends and family? My brother-in-law refuses to let me pay him anything for his professional carpentry work because that’s not how his family does things. I’m uncomfortable receiving that much free work (and concerned about the expectation of matching his generosity with massage). So I don’t go to him for carpentry work.
Do your friends and family expect free massages? Will they be happy with a smaller discount, 5{6b2fa08d5993bc7e76ffaca7a3a295e96a3274ffb0576a302ceddffe26335ebd} to 10{6b2fa08d5993bc7e76ffaca7a3a295e96a3274ffb0576a302ceddffe26335ebd}? What kind of income do you need to generate? The purpose of your business is to take care of you and there is a limit to the number of hours of hands-on work we can do in a week. How much of a discount can you offer and still take care of yourself?
Do not automatically rule friends and family discounts out or in. Just as in every other discount, think carefully about how this will affect your business, your schedule and your cash flow.
Generally Good Advice for Discounts
Determine how much of your schedule you can afford to have filled by discounted sessions. What would happen if a majority of your appointments for a week or a month were filled with discounted sessions? How would you feel if you had to turn away full-price clients because your schedule was full of discount clients?
Discounts can be a way to practice a newly learned technique or skill. For example, if you’ve just taken a pregnancy massage course, a small and short-term discount for pregnant people may be a way to practice your newly minted skills.
Decide how many discounts you can have active at any time. You need to be able to keep track of how well they’re working. My limit is five. If you are not sure how many you can handle, limit yourself to one to three till you get more experience with discounts.
Never offer discounts out of panic or fear. Panic and fear are terrible foundations for any business decision. If you have a sudden strong urge to offer a discount, sit with that urge and ask yourself:
• Where is it coming from?
• Do I have big bills coming up and aren’t sure I have enough cash to pay them?
• Has there been some change in my personal life—financial or other—that leaves me feeling vulnerable?
• Have I recently had some important clients leave or finish their work with me? Am I afraid of an open schedule?
Do you have a powerful reaction to certain problems in the world and want to step in and help such people as veterans, the terminally ill, survivors of domestic abuse or other underserved populations? In this case, it’s even more important to think through the five criteria. Your heart is running strong; make sure your thinking mind is also helping with these decisions.
Discounts are a way to subtract something from your work. Consider adding instead. Can you offer longer sessions, special add-ons, bundled services, an expanded schedule, onsite services (rather than having them come to you), etc.? Can you give something to the people you want to attract—often for the same amount of money—rather than taking less for yourself? People love freebies as much as they love a discount.
In the end, just make sure any discounts you offer are working for you.
About the Author
Kelly Bowers is the owner of the Healing Arts Business Academy. She is the author of four books: “The Affordable Massage Handbook,” “The Accidental Business Owner,” “Can I Deduct That,” and “Between Doormat and Diva.” She is a regular presenter at national conferences, an instructor in professional training programs, and an NCBTMB Approved CE Provider. She lives in Durham, North Carolina.