Industry value, average revenue, retention rates, and more
As the old saying goes, knowledge is power. In the hyper-competitive salon industry, you need the right information to guide your business. To help, we’ve compiled a list of essential salon trends and hair industry statistics to help you understand where things stand — and where things are headed — so you can make the best, most informed decisions for your salon.
13 key hair salon industry statistics
Value and revenue
With pandemic restrictions in the rear-view mirror for many salons, the industry has largely weathered the storm and come out stronger than ever. According to Global Market Insights, the global salon service industry is valued at $116 billion as of 2023. Projections show an estimated value of $187 billion by 2032, which is an expected compound annual growth rate (CAGR) of 5.5%.
The industry-wide average revenue for a salon in the U.S. is $245,000 a year, according to a report by Gitnux, which includes everything from one-chair salons to enterprises.
Salon profit margins are around 8.2%, which is in line with the national average for all industries. However, one report claims that profit margins may hover anywhere between 2% and 17% depending on how the salon brings in revenue and manages its expenses.
Business and employee breakdown
In addition to overall revenue growth, the number of salons in the U.S. continues to grow. According to IBISWorld, there are nearly 1.5 million hair and nail salons in the U.S. as of 2023, an almost 4% increase from the previous year.
Despite this large number of salons, self-employment is still the reality for many employees. As of 2023, there are approximately 1.3 million hair stylists in the U.S., while the average hair salon employs 1.3 people.
According to Glassdoor, salon owners' take-home salaries range from $115,000 to $215,000 per year, while salon assistant salaries range from $44,000 to $76,000 per year.
Almost 91% of stylists are women, according to Zippia.
Client retention
Clients have more salon choices available to them than ever before — and are happy to explore their options. According to a report by Boulevard, the average client retention rate from the first appointment to the second is 45% — and that number drops to 39% when comparing the first and third appointments.
This report — which analyzed data from over 11 million appointments and 4 million unique clients between January 2022 and March 2023 — also found that locking in the second appointment is critical for converting people into loyal clients. 70% of clients who book a second appointment are likely to book a third, and nearly 80% of clients who book a third appointment will book another shortly after. Top performers boosted that third appointment retention rate up to 85%.
3 salon trends for 2024 and beyond
Clients want seamless integration with their lives
The key to improving salon client retention rates is to meet clients where they are — and increasingly, that means on their phones.
The modern salon client is tech-savvy and embraces a digital life. They follow self-care influencers on TikTok and Instagram for the latest trends and advice. They post their own experiences to the same platforms, showing off their new look or sharing the experiences they’ve had at their local salon (both good and bad). These same clients want their booking experience to be as simple as posting online.
Additionally, your website should include a way to book an appointment — with booking forms that are mobile-friendly. Doing so won’t just make it easier for first-time clients to book with your salon over the competition; they’ll be more likely to rebook for their follow-up. According to Boulevard’s 2023 Salon Industry Client Retention Report, clients who use an online booking form are nearly 80% more likely to book their second appointment with the same salon — that’s nearly double the rate of walk-in appointments.
Plus, working with an online booking solution like Boulevard won’t just make it easy for your clients to set up appointments. It’ll seamlessly integrate with your scheduling flows, helping you optimize your stylists’ time and resources while providing a better client experience. It’s a win-win.
Expanded and personalized retail experiences
Offering hair and skin care products alongside your menu of services isn’t just an excellent way to increase revenue — it’s also an avenue for connecting with your clients on a deeper, personal level.
Your clients are willing and ready to buy hair products, skin care products, and more directly from your business. So, how can you leverage this desire in the coming years?
One way is to make your retail selection more accessible and easier to buy. Modern payment processors make setting up and integrating an e-commerce platform with your existing website easier, allowing you to take payments with popular credit cards or even PayPal. You can then link your e-commerce page with your live, in-store inventory so clients won’t have to second-guess whether their favorite products are in stock.
Then, you can close out the sale by offering local shipping or free pickup when clients swing by for their next appointment. Expanding your retail options makes shopping with a local salon more convenient than swinging by a big-box department store.
Personalization is another way to expand your retail offerings. Clients come to your salon to find new ways to express themselves with unique styles and colors. Their beauty needs are personal, and offering a personalized selection of retail products shows that you’re paying attention.
If you’re using client management software like Boulevard, you’re already tracking your clients' history with your salon. Embrace this information and assemble product bundles to supplement current visits and anticipate future needs. Leverage email marketing software to personalize your messaging and create deeper relationships with your clients at whatever scale you operate.
There’s significant buzz around AI, but temper expectations
It seems like everyone’s talking about artificial intelligence. Bigwigs are hyping it up as “the next big thing” and how it will “revolutionize” every industry they can think of — including salons.
But is there any truth to these claims? Will AI use become the next hot salon industry trend?
The answer is a bit more complicated than a simple “yes” or “no.”
In some ways, AI can be a boon for small salons looking to grow their businesses while remaining lean and keeping costs low. However, it’s important to understand what is actually “artificial intelligence” and what are tried-and-true tech features rebranded as AI.
The AI that most people are discussing — where you type in a prompt and a program like ChatGPT spits out a response — is known as “generative AI.” It’s essentially a highly technical chatbot trained on vast amounts of data to answer questions, help brainstorm ideas, or summarize emails. It’s impressive tech, but it’s not actually “intelligent,” acting in much the same way as the predictive text you see when typing a text message.
Tools like ChatGPT can be handy for salon owners who need a quick burst of inspiration, but you should be careful about relying on it too much. Text results from ChatGPT tend to sound very samey, which can make attempts to use AI to personalize content appear hollow. They can also be inaccurate, leading to frustrated clients as you get critical personal details wrong. Also, take caution when using any personal data within generative AI programs, as they tend to store this information for future processing.
Then there’s “AI washing,” which takes already-existing automation and data processing tools and tries to glam them up as part of the “AI revolution.” The tool itself may or may not be useful for your business. The trick, as always, is to look past the buzzy hype and focus on the concrete value proposition for your salon.
If you decide to use AI-powered tools to streamline operations, make sure to keep your expectations in check. Can they be helpful in certain circumstances? Sure. Will they change everything about how your salon does business? The jury is still out.
These are the stats and trends to keep in mind as you take your business to the end of the year and beyond. Use them as a guide, but remember — nobody knows your business better than you!
