Today’s entry is part 4 of the business plan , where you identify your customers.
Their demographics, buying patterns and most importantly your competitors.
Hair Oasis will be targeting two diverse groups of customers. Hair Oasis will work hard to distinctly appeal to each of these groups. By focusing on more than one group, Hair Oasis is lowering their risk that in a downturn one group will negatively effect the company.
4.1 Market Segmentation
Hair Oasis will target two different market segments:
- Men. Men have shorter hair requiring a faster, simpler job.
- Females who cannot afford an upscale salon. Women tend to favor a female specific upscale salon if they can afford it. There is not often a difference in quality of an upscale salon relative to a family hair salon other than a upscale salon will tend to pamper you more, only accepts appointments, and the facility is generally a bit plusher. Someone who is fiscally responsible as opposed to someone who likes opulence will favor a family style salon.
4.2 Target Market Segment Strategy
Hair Oasis will target each of the two groups separately.
The males will be targeted by offering, a quick and convenient service. Because men tend to have shorter hair, they usually require haircuts more often. If they are getting a cut every four weeks and work normal business hours, most barbers are closed when the male customers have free time. Hair Oasis will cater to males with evening hours, no appointments necessary, and quick turn around times.
Generally females prefer the allure of upscale salons, however, not everyone can afford this luxury. For this reason Hair Oasis will provide the same quality hair styling, without the expensive price. Hair Oasis will target these customers by emphasizing the sophisticated, ultra-hip styling that Oasis can offer.
4.3 Service Business Analysis
The “hair” service industry is fairly diverse. On one end of the spectrum you have the traditional barber, on the other end you have the fashionable boutique salons. Somewhere in between there are independent hair stylists, franchise barbers and stylists, and beauty salons
4.4 Competition and Buying Patterns
Hair Oasis competitors include:
- Traditional barbers. They rarely serve appointments, it is generally a walk-in service. While barbers are usually willing to provide whatever cut you are interested, they are generally providing straight forward haircuts, typically on the conservative side. The advantages of a barber is they are inexpensive and easy to use. Their disadvantages is often conservative styling capacities, sometimes a long wait as the barber may be an old timer who enjoys to chit chat.
- Franchised salons. An example of this would be Supercuts, Jean Yip Hair and Monsoon. In essence this is a franchised version of Hair Oasis. The advantage of this style is the store will be the same from location to location and some people like this predictability.
- Independent salons. These shops typically focus on a specific niche and do not serve a wide group of customers. The advantages to these could be an independent salon that fulfills all of your needs. The disadvantage is that because they tend to be more focused, more often than not this type of salon will not offer exactly what customers are looking for.
The buying patterns of men and women are quite different. Typically men are more price or convenience sensitive. Men typically care less about the task of getting their hair cut. For them whatever is easiest or available wanted styles works best. Women on the other hand are more caught up in hair styling and tend to bond more with their stylists. Because they bond more, they are much more loyal to their stylist. Once a stylist has earned their trust they are more willing to blindly put their hair in the stylists hands.