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Curing the Cancellation Conundrum

June 25, 2019

TrueLark CEO Srivatsan Laxman, shared his thoughts to the MINDBODY customer community on how to minimize the financial and administrative burdens of cancellations.  

This is an important issue for salons, spas and fitness businesses.  You can check out the MINDBODY blog or read it here below. It will only take a couple of minutes – and might well be one of the most profitable things you do today.

Cancellations. Ugh.

Anyone running an appointment-based business knows that cancellations are a fact of life. An unpleasant fact—a fact all the same.

Data shows that nearly 30% of appointments are missed or canceled each year, and that is just in the beauty industry. If you consider the average turnover of a salon is $243k a year, that’s $67k revenue at risk each year. While all that revenue isn’t lost if you take re-scheduling into account, there is still the cost of missed revenue on no-shows, cost of employee downtime, and the cost of administrating the re-scheduling. However you measure it, it is a burden on our top and bottom line.

Beware of morning hours

TrueLark research shows that customers tend to call to cancel appointments either after hours (6 am to 9 am) or on Mondays, when many salons are closed. The second most ‘popular’ time that customers call to cancel is between 9 am to noon—often when the front desk is at its busiest setting up for the day, or just as the lunch break starts. An intelligent, intuitive text or web-based system can help solve this morning mayhem.

People don’t like conflict

Leaving a voicemail offers an easy route out of feeling the conflict when canceling appointments. However, when customers call out of hours or the call is missed because the front desk is too busy to answer, cancellation messages wallow in voicemail. If you can catch them in the moment, and technology can help here, it provides the opportunity to re-schedule—so securing the long-term revenue, and it provides the opportunity to give waitlist customers the opportunity to grab the spot—avoiding loss of immediate revenue.

Cash-rich/time-poor customers

Your clients want a super-fast rescheduling option. There are few things more likely to have a customer just ‘forget it’ than taking them through a cumbersome rescheduling process by phone. Offering a simple, digital, automated way to reschedule can easily solve this issue.

Reminders are only part of the solution

While automated reminders are great and proven to reduce no-shows, in some cases to 11%—it still represents 11% missed revenue opportunity and doesn’t solve the cost of the re-scheduling process. This is why technology solutions that not only send reminders but also offer fast and simple options to reschedule on the fly are key here in order to protect revenue and reduce operational costs.  

Google is your best friend…and worst enemy

It’s not just cancellations that cut into profit. While it is hard to measure missed opportunities, one thing for sure is that all the time and money invested in SEO (so your company name and number appears high in the search for your services) is wasted if the call isn’t answered immediately.  New consumers rarely wait when they have an immediate need.  If the call for information or appointment availability isn’t answered immediately, they will rarely leave a voicemail—instead, they’ll simply move to the next company on the google list.  So, it’s critical to get them in the moment.  

Text and chat

No, it’s not a new online dating service. The ability to text and/or chat online with a customer is key in today’s digital world.  It’s not just millennials that prefer to text rather than talk in real time, boomers too.  Research shows that 95% of millennials want appointment information and reminders by text.  Boomers aren’t far behind at 60%. And, if you’re not convinced about integrating intelligent chat into your website, consider the fact that ‘chatters’ are worth 4.5 times as much as website visitors who don’t chat. 

Some intelligence about intelligence

The term AI (artificial intelligence) assistants and chatbots are increasingly viewed as similar technology.  This is definitely not the case.  AI Assistants can learn over time and their capabilities grow—this is the true hallmark of an AI solution.  AI Assistants can be highly customized to individual business needs, including their brand style and tone. They respond to a vast range of customer inquiries quickly—learning as they go. They can also anticipate customer needs and seamlessly remind, book and RESCHEDULE appointments—all leading to positive customer engagement, increased productivity and greater profitability. This is not the case with chatbots which merely provide a linear phone tree interaction that takes a caller through a limited menu of options rather than an AI assistant that listens and understands the customer engagement from the get-go and engages in a meaningful, human-like conversation.

We’ve mentioned technology and automated, intelligent assistants several times in this post as a solution to solving the business impact of cancellations. It can also be a great benefit in securing the actual appointment, in bringing new customers in and maximizing the lifetime revenue potential of existing customers.  It doesn’t have to be expensive.  It should integrate easily with the current booking software in place.  It absolutely shouldn’t be complicated.


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