The Coffee Bean & Tea Leaf(CBTL), Business strategy case study
Marketing strategy for mobile hair cutting salon
1. Mobile hair cutting salon cum massage parlor. Today most of the products sold across the
counter deliver the Core benefits and Basic product benefits and sometimes on Expected product
benefits, but in most of the brand choice the consumer often makes a decision on the basis of
augmented product benefits and Potential product benefits. Core benefits offered are hair cuts
and body care. But, the augmented benefits from the service offers are that above two services
are blended into one mobile van and offered at a most convenient location. In the future such
service offers can be provided to individual family units as per their requirements.
The firm intends to achieve $5000 of sales per month from single mobile van. During
the first few months the expected sales target may be as low as $ 2000 to $3000. The company
intends to add new mobile vans from internal accruals within next six to eight months. The
company expects to Break-Even within six months of business operation. The expected fixed
cost to start a business is $25000.
The objective would be to serve the customers with an aim to exceed their expectations.
To increase the number of clients served by at least 20% each year through superior
performance, word-of-mouth referrals and local TV ads.
This type of business is a new concept not entirely new to the world but, it is still evolving and
many people need to understand it before they would think in terms of adopting it. Word-of-
mouth publicity will play a major role in making the customers loyal to such services. Local road
shows and Ads in local channels would certainly be handy strategic move to make the target
audience aware about the concept.
2. This being a very small business, political factors would not influence it much. USA is a free
economy with least political intervention of any kind.
Economic factors like income levels and growth in disposable would have considerable impact
because such service would not come very cheap. This being hair cut –cum- massage salon
would have to charge premium price from the customers availing it. When National economy
and personal income do not look on the brighter side, it would be a hard bargain to easily sell the
services to every individual.
Societal norms are still such that many people many would find it difficult to digest the concept
of mobile salon especially baby boomers. New generation people who are busy and have less
time can try the concept and could prove to be instrumental in making it popular. Role of opinion
leaders would be important to encourage the idea and infuse it among early adopters. Since,
service would be available at personal call; it would be marketing the concept of social
convenience and speedy service in minimum time. The slogan of “time is money” has to be
spread in social media and circles to understand its underlying meaning and to have wider social
impact.
Technology is certainly going to play a vital role. Internet, e-mail, and phone calls can be used to
have easy access with each and every customer. Customer data bank along with their preferences
and liking can easily be stored through a especial customized software. Customer Relationship
Management (CRM) can be employed by the mobile salon to dish out the best to the customers.
Scientific information on use of herbal cream, its suitability to particular skin, allergies, hair cut
design etc can be installed through the internet and its website to encourage potential customers
to adopt the concept of mobile van for hair cut and massage.
3. Men will typically make up 70-75% of the clientele because men have shorter hair and thus
require regular hair cuts at a faster rate than woman. Working people would be the target market
because they have less time to go to up market salon for their hair cuts. Mobile salon would be
more conveniently located at most appropriate time. While men would primarily turn up of hair
cuts and body massage, women would turn up for facial and other services.
Potential customers can be segmented as working men & women, children and house
wives as three segments. Timings would be different for the three segments. Working people
would be available in the morning, evening and on weekends at a particular locations. School
and college going children can be available even in the afternoons and non working or
housewives who do not constitute the major market would be always available.
Benefits would be different from traditional hair cutting salons as they can be called as
per the demands of customers of particular locality. Apart from hair cutting, skin care, and hair
massage or total body massage can be rendered to target segments. The prime benefits which
would segregate from other salons would be availability of vans at a call, especially in remote
localities.
The company would reap the benefit of first mover advantage
Since this would be a new concept of hair cut salon cum massage parlor, there are no competitors
in given area where the firm would start its operation. The competition would come from
traditional salons located in each area
For viability of this business Marketing Research is required to be conducted for Feasibility Study
Market Research (MR) is required to be conducted on selected town and with sample size of 200
people drawn randomly. From each locality sample size of 50 persons would be chosen
4. randomly and survey conducted through sets of five open ended questionnaires followed by
Multiple Choice Questions. The purpose of survey would be to know the need gap if any, exists
and then how to fill the gap through mobile hair cut cum massage salons. The purpose would be
to undertake an exploratory research to know the reason whether existing traditional salons
satisfy their needs. Secondly, number of people who would be attracted towards mobile salon
would help make an estimate of new market. Exploratory research need to be followed by
conclusive research to make an estimate of possible market and revenue generated from the
estimate.