Buying and Merchandising Business Operations Research Event Indianola DECA Chapter Melanie Willis Indianola High School 1304 East Second Avenue Indianola, Iowa 50125 Melanie Willis 1/14/2015

Table of Contents

I. Executive Summary ................................................................................... 1

II. Introduction ........................................................................................... 2-4

Description of the business ...................................................................................................... 2

Description of the community ................................................................................................. 3

Description of the business’ current target market ................................................................. 4

III. Research Methods used in the study ...................................................... 4-7

Description and rationale of research methodologies used to conduct the research study 4-5

Process used to conduct the select research methods .......................................................... 5-7

IV. Findings and Conclusions of the study .................................................8-10

Findings of the research study ............................................................................................. 8-9

Conclusions based on the findings ...................................................................................... 9-10

V. Proposed strategic plan ...................................................................... 10-13

Objectives and rationale of the proposed plan ................................................................... 10-11

Proposed activities and timelines ....................................................................................... 11-13

Proposed metrics or key performance indicators to measure plan effectiveness .................. 13

VI. Proposed Budget ...................................................................................... 14

VII. Bibliography ............................................................................................ 15

VIII. Appendix ............................................................................................. 16-19

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I. EXECUTIVE SUMMARY

This market research project will be focusing on increasing the amount of Baby Boomer customers existing at salon One Eighty. Over the past four years, the primary target market has been Millennials. My goal is to create events that draw Baby Boomers in, as well as continue to entertain the current customers. I also plan to adjust the marketing techniques in order to adapt to the needs of the older generation.

Research Methods Used in the Study

I sought to develop a thorough understanding of One Eighty’s goals, marketing, internal operations, and their external environment. Research is critical in order to perfect the proposed plan; therefore, I used a variety of sources to collect data: Secondary Research:

Collected statistics from QuickFacts.com Received a better understanding of the salon industry through many reliable

websites Primary Research:

Categorized information from One Eighty and its competitors’ websites Interviewed One Eighty’s owner, Jill Brommel Conducted a survey with over 150 respondents Consulted a focus group of 8 existing Baby Boomer customers

Findings and Conclusions of the Study

After collecting a mass amount of information from my research, I organized my findings in a detailed SWOT analysis. The major conclusions are as follows:

Strengths- variety of services, unique products Weaknesses- newer business, modern marketing Opportunities- location, varied services Threats- many other salons in Indianola, modern style

Proposed Strategic Plan

One Eighty has an amazing team of employees, astounding variety of services, and loyal customers that help it thrive. However, it is essential that the business’ clientele increases. The idea is to have as many Baby Boomers in the new clientele as possible. In order to do so, I have came up with a couple promotional activities that should draw the older generation into the salon.

Proposed Budget

Considering One Eighty is a local business, I kept the expenses minimal. The main cost will when the salon adjusts the advertising to be geared to the older generation, as well. Other costs will revolve around the events being hosted.

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II. INTRODUCTION

Description of the Business:

This market research project’s major focus will be on the operations of One

Eighty Salon and Day Spa, a young business currently targeting primarily Millennials.

The salon itself is modern, but the services and

products are that of which all ages could benefit

from. The products are very unique and the services

are all over the board. The proposed goal is to begin

to aim the marketing towards the Baby Boomers generation.

One Eighty was opened on January 8, 2011 and is owned by a young

entrepreneur, Jill Brommel. Jill attended massage therapy, esthetician(skin care),

cosmetology, and nail technology school. All of this extensive education was important

in order to offer many services and products to her clients. Jill’s salon is now recognized

as one of the most friendly and successful salons within Indianola.

Jill’s current focus is on building up each of her employee’s clientele. It is a

common known fact that salon customers stay loyal to a certain stylist if they are

satisfied. So this is a very important goal. She believes that this will benefit the business

as a whole. The primary goal for my project is to ensure that a majority of the new

clientele is from the generation of Baby Boomers.

As the salon industry is a competitive one, One Eighty must keep up with the

trends within the market. This includes offering a wide variety of services, events, and

products. The business will revitalize it’s current marketing efforts and evaluate their

existing customers by generations.

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Description of the Community:

The economic aspect of Indianola is rapidly increasing. It’s booming economy

consists of many businesses including the following: boutiques, bookstores, restaurants,

and nightlife facilities. Indianola is recognized as a

family-friendly small town with a lot to offer. One of its

biggest strengths is the private college, Simpson, residing

within Indianola.

The geographics of the business are well beyond

ideal. The area of Indianola is only 11.25 square miles, but only about 10 miles away

from Des Moines, Iowa’s state capital. The salon is located on the south side of

Indianola town square, right across the street from the courthouse. Near the location are

coffeehouses, a movie theater, bakeries, bookstores, and more. Just down the street is a

large residential neighborhood of condominiums and apartments.

The demographic information for Indianola was obtained through census.gov.

The town has a population of about 15,100. The median income for a household in the

town is $52,872, as of 2014. The crime rates in Indianola are lower than the average in

the United States, which is helpful to create a positive attitude within the business.

Socioeconomics in Indianola are strictly positive. Des Moines, a very close town,

is commonly voted on as one of the best places to live. Unemployment rates are going

down and education systems are extremely healthy. The small town is recognized as a

great place to raise a family.

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Description of the Business’ Mission and Target Market:

Currently, One Eighty is marketed as a trendy salon that is aimed at younger

customers. Their mission, as stated on their website, is “We want to give our clients

more than just a service here, we want to give them an experience.” One Eighty has done

their best getting involved in community events, most of them steered towards

Millennials. There are currently very few promotional activities.

Primary Target Market:

Demographics Women

Millennials

Psychographics Individuals looking for trendy styles

Individuals who like to support local business’

Geographics Indianola, Iowa

III. RESEARCH METHODS USED IN THE STUDY

Description and rationale of research methodologies selected

to conduct the research study

As the purpose of this project is to evaluate One Eighty’s marketing techniques

and aim them to a new generation, I employed several research methods to conduct

appropriate research. First, a tremendous amount of secondary research was used to get

a better understanding of the current trends within the salon market. I then conducted a

short but thorough survey to accurately determine opinions of current and potential

customers within the community. Furthermore, I began to get personally acquainted

with One Eighty’s owner, Jill Brommel. She was generous enough to answer some

questions through an interview, and gave some helpful feedback. Lastly, a focus group of

existing Baby Boomer customers was consulted on One Eighty’s current marketing

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techniques, appeal to their generation, ways to improve the advertising, and potential

promotional ideas.

Before I could create an adequate survey, I needed to do some research. I took

advantage of the information provided on probeauty.org and got a thorough

understanding of the current trends throuhgout the salon industry. The get a better

localized idea, I travelled into several salons in central Iowa. I appeared as just a

customer, and took note of the services/products they offered, as well as the marketing

they had implemented. Both of these preliminary research methods were very helpful

when choosing my primary methods.

In order to collect objective quantitative data from the market, I set the sample

target at 150 responses of varying demographics across Indianola. The survey idea was

selected as a research tool because of its effectiveness for conveying detailed questions

to a large sample group. I opened the survey up to all demographics in order to get

opinions on how to appeal further to the Baby Boomers. Later, this was more thoroughly

discussed through the method of the focus group. From these methods, I would be able

to determine what I should change to aim towards the new generation. The interview

with the business owner, Jill, would be helpful in order to discuss what she is currently

doing to reach out to the Baby Boomers.

Process used to conduct the selected research methods

Over the span of about 2 months, I conducted extensive research into the thriving

salon industry, the Baby Boomers target market, and also One Eighty’s current

marketing techniques. Furthermore, I analyzed Indianola’s census data on

quickfacts.gov to get a better understanding of the Baby Boomers residing in Indianola.

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Lastly, I examined One Eighty’s competitors in great detail, including the ways that they

are marketing towards Baby Boomers. I aimed to understand what the industry as a

whole was doing, and how One Eighty could compete.

A good amount of my primary research was received through my survey. I

created my survey through Google Docs and distributed it through school

announcements, Facebook, and at the salon itself. In order to create my ten survey

questions, I considered my prior secondary research data, One Eighty’s current

marketing, and overall, what would need to be done to create an effective plan:

Question Justification

What is your gender? This question was designed to help gain some

basic demographic data from each respondent.

How old are you? This question was designed to help gain some

basic demographic data from each respondent, as

well as find out what generation could be targeted

for this project.

What is your income

range?

This question regards demographic information

and also allows us to understand if the target

market is seeking cheap or quality services.

How did you hear

about One Eighty

salon?

This allowed me to receive feedback from the

salons current marketing techniques.

Have you ‘liked’ One

Eighty’s Facebook

page?

The purpose of this question was to get a better

idea of who One Eighty’s marketing techniques

was reaching.

Would you follow One

Eighty on Twitter, if

they had one?

Considering that Twitter is a new social media

site, this question helped to determine if it would

be helpful to even the older generation.

What do you look for

in a day spa?

Here I was aiming to determine in One Eighty

offers all of the services that customers are looking

for.

Do you see One

Eighty’s services as

relaxing, necessary, or

both?

Within this question, I was looking to find out if

the age and opinion on services correlated

whatsoever.

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Would you attend a

“girls day” event at the

spa?

The idea of this question was to propose an idea of

a promotional event and see what the interest in it

revealed.

Have you ever bought

products from the

salon?

This question was designed to analyze the

merchandising of beauty products happening at

One Eighty.

After a little over one month, I reached my goal of 150 responses and actually

went above, at 182 replies. This was very helpful in making sure my

sample group represented the actual population. After closing my

survey, I was able to use the tools offered by meta-chart.com to

create several charts to help examine the data (APPENDIX 1.1-2.1).

Concurrent with my survey distribution, I used a focus group to compare my

proposed ideas with existing customers above the age of 51. In order to gather 8

participants, I placed a sign up sheet at the salon, and offered free lunch over the

discussion. We talked about a number of topics related to the salon, as well as my

proposed plans. This focus group was held within the salon on an evening that they were

closed. I assured the individuals that their identities would be kept anonymous, and that

their honest opinions would be expected.

Once I had finished the focus group, I sat down with the salon’s owner, Jill, to

discuss what she was currently doing to increase Baby Boomer customers. We had

previously discussed certain topics through email and phone conversations, but it is

more helpful to have an actual face to face conversation. Many pieces of information

were collected to help establish a better idea of what needs to be done to increase Baby

Boomer customers.

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IV. FINDINGS AND CONCLUSIONS OF THE STUDY

Findings of the research study

Through this study I was able to collect a mass amount of information on One

Eighty’s internal operations, as well as their external environment. This information was

collected through secondary research, as well as all of my primary methods. To organize

my findings, I arranged them in the form of a SWOT analysis.

Strengths

Finding Explanation

Word-of-

mouth appeal

54% of people asked said they heard of One Eighty through

other people. This shows that One Eighty’s image is very

respected in the community

Wide variety

of services

Every person asked was looking for a salon with more than

one service to offer

One Eighty has many employees with different abilities for

services to offer

Unique

products

About 54% of people asked said that they have bought

products from One Eighty

The focus group made many comments about how helpful and

unique One Eighty’s beauty products are.

Weaknesses

Finding Explanation

Newer

business

One Eighty’s name isn’t as well known as other salons,

considering it is newer.

Creates a disadvantage when building a clientele

Useless

website

No marketing is done through the website

Modern

marketing

One Eighty does not advertise through newspaper or mail,

which are two main places to target the older generation.

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Opportunities

Finding Explanation

Great

location

Considering it is in the middle of town, the focus group said

how convenient it is.

The owner, Jill, made comments about how many new

customers get brought in when events are held on the square.

Services

more varied

A lot of competitors around town only offer one category of

beauty services.

One Eighty makes it easy to get all of your needs in one place.

Threats

Finding Explanation

Many salons

in Indianola

There are many other business’ within the same market and

geographic.

Modern style This makes it difficult to bring in the older generation

Conclusions based on the findings

Despite their existing Baby Boomer customers, One Eighty has many strengths

that can provide them with a significant competitive advantage in the salon industry.

With their wide variety of services, great location, and unique products, One Eighty has

the ability to reach a much wider market. The key is to showcase their strengths in front

of the Baby Boomers.

From the findings, I found that the technology and modern appeal of One Eighty

are the initial reasons most Baby Boomers are turned away from the salon. The major

focus will be to convert the current advertising into obsolete marketing in order to

accommodate to the needs of the older generation. They also need to put major effort

into creating events that will draw the new target market in.

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One Eighty has done a great job adjusting quickly to all of the trends occurring in

the salon industry. It is now time to avoid the threat of other salons taking the Baby

Boomer customers, and give them a reason to stop into their salon.

Proposed Target Market:

Demographics Women

Baby Boomers

Psychographics Individuals interested in relaxation services

Individuals looking for decently priced salon services

Geographics Warren County Area

V. PROPOSED STRATEGIC PLAN

Objectives and rationale of the proposed plan:

Through extensive research into the operations of One Eighty, it is clear that

some promotional events must be held in order to draw Baby Boomers into the salon.

The easiest way to draw their attention, will be for existing customers to bring their

elder loved ones into the salon. That is why I have planned two events that will greatly

assist with this goal. The idea of the events are to reach a sample of the older generation

that will practice the word-of-mouth advertising to their family and friends.

One Eighty’s biggest challenge is going to be drawing the attention of the older

generation without the initial help of their existing customers. In order to broaden the

target market, the salon needs to rejuvenate the marketing techniques. That is why I

plan to create advertisements through the newspaper and direct mailing. The events will

be advertised through flyers and Facebook, in order to reach both target markets.

While the salon name is being spoke of around the community, I also want to

emphasize the amount of services offered within One Eighty. It seems as if even existing

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customers aren’t even aware of the variety of services, which is one of One Eighty’s

biggest advantages. That is the reason each of these events will show examples of all

kinds of unique services One Eighty has to offer.

Proposed activities and timelines

One Eighty needs to quickly and effectively implement promotional activities and

new marketing techniques in order to reach the Baby Boomer audience. Although the

Millennials are staying intrigued in the salon, it is crucial to get that same engagement

from the Baby Boomers. In order to do so, I have came up with two different events that

One Eighty will host in order to gain some recognition from the Baby Boomers. Brief

advertisemets for the events are as follow:

The events will bring a small profit to the salon, but should provide many new

clients. In the long run, they will benefit the business tremendously. The events take

One Eighty Salon will be hosting a Mother-Daughter Spa Day! This event will

be for Mother’s Day 2015, Saturday, May 9th from 1-4 pm. For both the Mother and

Daughter, it will be a total cost of $50. This will include a Mani/Pedi, hair styled,

make-up artist, tour of all services offered and a snack. To accommodate space, the

maximum amount of people will be 30. Advertising for this event will begin in April,

consisting of flyers and Facebook posts.

One Eighty Salon is hosting is Ladie’s Spa Day! The first Ladies Spa Day will be

held on Sunday, April 19th from 1-4pm. The day will include a 10 minute specific

body part massage, mani OR pedi, hair styled, tour of all services offered, and a

snack. The price of all of this is $30/person. To accommodate space, the maximum

amount of people will be 30. Advertising for this event will begin in March,

consisting of flyers and Facebook posts.

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place in the late spring, so advertising will begin in Feburary. These events will be aimed

towards Baby Boomers, but certainly not limited to them. The idea is that daughters will

bring their older mothers into salon for Mother’s Day and the women will like what they

experience. the This table refers only to the advertising that will be done for the events.

Concurrent with these two events, the form of advertising also needs to be

addressed. I plan to move away from only online advertising and practice some of the

old-fashioned ways. One Eighty will place advertisements in the local newspaper and

begin a direct mailing list. Side note, I decided not to hire a marketing technician due to

the fact that Jill, the salon’s owner, is confident in designing her own advertisements.

After these advertisements begin, the salon employees will start asking new clients how

they heard about the salon. This table refers to the advertisement primarily targeting

Baby Boomers.

Promotion Ladies’ Spa Day Mother-Daughter Day Baby Boomers

Outreach

February Create Ad for Flyer Create Ad for Flyer Create Newspaper

Advertisement

March Handout Flyers

around

community/Post

Facebook Event

Handout Flyers around

community

Begin running

Newspaper ad-

bimonthly for one

year

April Month of Event Post Facebook Event Create Postcard Ad

May Survey for Feedback Month of Event Mail to potential

older customers

June - Survey for Feedback Ask new customers

how they found out

about One Eighty

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Proposed metrics or key performance indicators to measure

plan effectiveness:

In order to evaluate the effectiveness of the proposed activities, we will conduct

surveys for customer feedback. This will allow us to get their direct opinions and see

where we can improve. The clientele is already being closely watched to ensure growth is

happening. This will continue until the business feels it no longer needs to increase their

clientele.

To further engage the target market of Baby Boomers and create interest among

the older audiences beyond this specific timeline, the salon will continue a regular

advertisement in the local newspaper. This will keep a steady increase of customers over

51 years old. I will measure this increase by making note of the new clinetle three

months after the final event. This evaluation will occur in August.

In order to ensure that the existing customers become more aware of services

offered at One Eighty, I will establish current data that shows the amount of

appointments for all services as of now. In August, I will get the data once again and

make note of the difference over time. I will also take count of the amount of each

Media Direct Mail Newspaper

February Create design for

postcard

Create design for full page ad

March Create a mailing list Begin running ad- bimonthly for one year

April Send out postcards -

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product brand bought from One Eighty and caculate the difference of profit on each one

with the same timeline.

VI. PROPOSED BUDGET

Costs associated with proposed strategies

Considering that One Eighty is a local business, the costs remain modest in order

to maintain a steady profit. The following costs are that of which result from converting

marketing from online to manual.

Media Description Total Cost

Flyers(Staples) Staples 6 cents per full page

(.06 x 500) x 2 events

$60.00

Newspaper Ads Record Herald- Indianola local paper

26 times

$915.00

Postcard Quantity: 500

Standard Size(4.25x6)

Color front- b&w back

$129.00

Total Cost $1,104.00

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VII. BIBLIOGRAPHY

"Graphing/Chartingand General Data Visualization App." Create, Customize and

Download/share. N.p., n.d. Web. 09 Feb. 2015.

"Pricing, Postcard Printing & Mailing, Direct Mail." Pricing, Postcard Printing &

Mailing, Direct Mail. N.p., n.d. Web. 09 Feb. 2015.

The Indianola Record-Herald And Its Companion, Shopper, The Extra, Is Read By More

Than 21,000, Adults Every Month In Warren County. The, and Newspaper Is

Distributed To 6,057 Subscribers On. 2012 Record-Herald (n.d.): n. pag. Web.

"United States Census Bureau." Iowa QuickFacts from the US Census Bureau. N.p., n.d.

Web. 09 Feb. 2015.

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VIII. APPENDIX 1.1

1.2

1.3

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1.4

1.5

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1.6

1.7

1.8

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`

1.9

2.1