The COVID-19 pandemic and subsequent lockdown period have given South Africa’s hair and beauty industry a black eye. The industry has been bruised after being shut down for more than two months. The current Level 3 regulations have offered some respite, with barbershops and hair salons finally allowed to trade again. But reopening their doors comes with plenty of strings (or rather, regulations) attached to ensure their patrons’ safety. Let’s take a closer look at the impact of COVID-19 on the beauty industry and how businesses will need to adapt to a ‘new normal’.
Hair-raising statistics
Looking at the current global beauty industry statistics may force us to reconsider our definition of the word “essential”. According to research group McKinsey, the industry generates an eye-popping $500 billion in annual sales. Due to the current COVID crisis, the global beauty industry can expect to lose up to 30% in revenue this year. Experts estimate that the US market could fall by as much as 35% if a second coronavirus wave were to occur.
If global trends are anything to go by, we can expect a similar decline in South Africa. According to Statista, the local beauty industry generated roughly $190 million in 2019 and was projected to increase to $238 million in 2020 (that’s almost R4 billion at current exchange rates!). A revenue decline of 30% would represent a massive hit to the South African economy and most certainly result in thousands of job losses.
The doors are open, but restrictions abound
The easing of lockdown restrictions has resulted in barber shops, hair salons, nail bars and other similar services being allowed to open their doors once more. But before booking that manicure or scheduling your next haircut, note that these businesses will be subject to stringent conditions. For example, salons must ensure that there are sufficient sanitization facilities for customers as they enter the premises. Barbers and stylists must also wear face shields when serving their clients.
The challenges for the beauty industry extend beyond simply meeting the new safety regulations. While barbers and hairdressers are open for trade, many customers may be apprehensive about going for a cut at their favourite stylist. With many customers still sceptical of venturing out due to the contagiousness of the virus, many businesses may struggle to regularly fill their seats. Many of these businesses, especially those of an informal nature, still rely on walk-in clients and may suffer due to lack of customers flowing through their doors.
Finding solutions
Given the current situation, it is clear that the beauty industry will need to look at novel ways of attracting new customers and retaining existing ones. Businesses may need to reconsider their marketing strategies in the light of the current restrictions or face the prospect of permanently shutting their doors.
Many barbers, stylists and make-up artists have taken their services online during this period. Several businesses have now begun to incorporate tutorials into their service offering, teaching people some DIY grooming and make-up techniques in return for a small fee. If current trends prove to be true, many customers may opt to do their grooming at home for the foreseeable future. Offering these tutorials can help reach clients who prefer to stay indoors.
Several businesses have also taken to offering ‘at-home’ services, going out to see clients in the privacy of their homes instead of waiting for customers to come to them. By doing this, barbers and stylists can limit the contact that comes along with clients in a salon or barbershop.
Companies who sell beauty care products are starting to shift from the conventional ‘brick-and-mortar’ stores to online sales. While online sales have not yet made up for the lack of store sales, we can certainly expect sales of the online variety to grow considerably going forward.
Taking the beauty industry online
Several beauty-care businesses have turned to digital platforms to grow their customer bases. An ever-increasing number of barber shops, beauty salons and nail bars promote the products and services through various social media outlets. While these platforms may be great for promoting awareness about a particular business, it may not always yield the returns that one expects.
Online marketplaces present a fantastic place for businesses to engage with individual customers on a great scale. For example, UBU International offers businesses the opportunity to list their businesses in a vibrant Marketplace, potentially exposing that business to thousands of new customers. This presents hair salons, barber shops, nail bars and similar businesses to grow their client bases exponentially.
In addition to the client acquisition potential, UBU also offers a mobile payment wallet to handle all digital payments, so businesses don’t have to worry about facilitating payments themselves. Customers can ‘order’ or book their appointment, pay via the mobile wallet and show up. UBU’s loyalty program allows for instant cashback rewards too, meaning that customers have an extra incentive for engaging with vendors.
The ‘pay-and-deliver’ option allows for customers to book and pay for the services of a barber, stylist, nail specialist or even a tattooist and have that service ‘delivered’ to their home. Businesses can further promote their products and services through by offering discounts and special deals. It is the perfect solution for any business seeking to attract new customers and encourage loyalty among existing ones.
Change is inevitable
It has become clear that the beauty industry will need to adapt to a new way of doing business to survive. The pandemic has ensured that the existing way of operating is no longer sustainable. The current regulations are not going to disappear any time soon, and barber shops, hair salons and the rest of the industry need to realign their businesses to comply with the new reality. This all sounds quite gloomy, but fear not. The beauty industry has the opportunity to expand in ways that they may not have previously considered. By implementing some of the solutions discussed, the industry has a chance to not only solidify themselves for the present but also position themselves to succeed in the future.
Find out more about how UBU can help your business weather the storm and read our COVID-19 Survival Guide for Small Businesses for more tips and strategies for ultimately ensuring success.