How Much? A Guide to Pricing Your Aesthetic Services
How much thought did you put into your treatment pricing? Did you check out local clinics and base it on what they charge? Or did you take a bottom up approach - working out your costs and adding on a decent profit margin? Have you re-visited your pricing strategy since you started your aesthetics business? Or are you a new aesthetics practitioner with no idea where to start?
If any of those apply to you, read on!
Most practitioners have a rather random approach to treatment pricing, often leaning on instinct and what other clinicians around them are charging to decide what they will charge.
Whilst this approach is common, there are a variety of tried-and-tested pricing strategies available to small service-based businesses, like aesthetic clinics, which help attract the kind of clients you’re looking to attract AND help maximise profitability.
Here are some main pricing strategies you could consider using in your aesthetics business:
Cost-based pricing: This strategy involves determining the price by considering the costs associated with providing the service, such as labour, materials, overhead expenses, and desired profit margin. This ensures that costs are covered while generating a reasonable profit.
Value-based pricing: With this approach, the price is set based on the perceived value of the service to the customer. Factors like the quality, uniqueness, convenience, and benefits of the service are taken into account. This strategy aims to capture the value customers place on the service and may justify higher prices.
Competitive pricing: Small service-based businesses may set prices based on their competitors' pricing levels. They might choose to match or undercut competitors' prices to attract customers. This strategy requires monitoring the market and adjusting prices accordingly to remain competitive. One pitfall of this approach is that costs can vary from business to business…if you rent a space in an expensive part of town, but price yourself against practitioners who work from home clinics, your profits won’t be as healthy as theirs.
Penetration pricing: This strategy involves setting lower prices initially to penetrate the market and attract a larger customer base. The aim is to gain market share quickly and then potentially increase prices once the business has established its presence. This is a risky approach in aesthetics, as your pricing might lead potential clients to view your services as budget or low quality.
Premium pricing: Some service-based businesses position themselves as offering premium or luxury services and charge higher prices accordingly. This strategy relies on creating a perception of exclusivity, high quality, or specialised expertise to justify the premium pricing.
Bundle pricing: Small service-based businesses can offer bundled services at a discounted price compared to purchasing each service individually. This strategy encourages customers to buy multiple services, increases average transaction value, and potentially builds loyalty. This is important to consider when creating your treatment menu. Often, it’s more time efficient to carry out multiple treatments in an appointment, to maximise profits.
Subscription or retainer pricing: Service-based businesses may offer subscription-based models or retainers where customers pay a fixed fee on a recurring basis for ongoing access to services or priority service. This strategy provides a predictable revenue stream and fosters long-term customer relationships. Setting up subscriptions that help you generate repeatable revenue and make life easier/treatments more affordable for your clients is a win-win! Think about packaging up treatment combinations that work beautifully together and build some subscription products. Here’s an example:
The Skin Subscription £100 / month - choose from:
At home skin care plan with products
one facial/chemical peel/dermaplane/LED treatment each month
one microneedling treatment every other month
The Super Skin Subscription £180 / month - choose from:
At home skin care plan with products + one facial/chemical peel/dermaplane/LED treatment each month
At home skin care plan with products + one microneedling treatment every other month
The Skin + Smooth Subscription £200 / month - choose from:
At home skin care plan with products + 3 wrinkle relaxing treatments per year
one facial/chemical peel/dermaplane/LED treatment each month + 3 wrinkle relaxing treatments per year
3 wrinkle relaxing treatments per year + one microneedling treatment every other month
It's important for you as an aesthetics practitioner to consider your target market, the competitive landscape, your overheads and costs and the customer value proposition when determining a pricing strategy.
Remember that you can experiment and adjust your prices over time, based on feedback and market conditions.