Ronan Perceval is the CEO of Phorest, the leading salon management software company in the UK and Ireland. Phorest stand on the intersection between the daily deal players (Groupon, Living Social, KGB Deals etc.) and salons, and earlier this year published some fascinating data about Groupon’s retention rate in this sector. I quizzed him on Groupon predictions, the salon industries and a few other areas.
FW: Groupon has had a pretty rocky performance since it IPO’d. How do you think they’ll perform in 2012?
RP: I don’t know how their share price will do but as a company I think they’ll become more profitable. In terms of growth in our industry I’m just not seeing the same number of new salons and spas using it. It looks like they will consolidate their position by trying to embed themselves further with their clients hence the OpenCal deal.
FW: Speaking of the OpenCal deal (which we both predicted), do you think there will be more acquisitions like this next year?
RP: I’m not sure this acquisition will work out for them. Mainly because its so generic. Most Groupon deals fall into 4 or 5 sectors and a general booking tool doesn’t work for salons AND for restaurants AND for hotels. Their business models are so different – a general tool that works for all of them ends up working for none of them. If we take the industry that we know most about – salons – hundreds of companies have tried a general booking tool but they’ve never succeeded – only specific booking applications have gained traction.
It makes sense at a board level but they’re going to need to buy specific vertical plays like Opentable etc to nail this OR develop OpenCal which I can’t see them doing.
FW: Do you think that your beauty salon clients are completely ‘done’ with daily deals at this stage? Is that just ‘so 2011’ for them?
RP: No, salons are definitely not finished with daily deals. The marketplace is still tough out there and salons need help with promotions. I think what Groupon has really done has opened salon owners’ eyes to the power of the internet. That really hadn’t been done before. I think its a pretty crude form of marketing really – blasting offers to email lists – but it had never been done on this scale before for a lot of service industries like salons and spas.
Next year I predict more sophisticated marketing tools will emerge for small companies like salons – particularly those that will attract quality customers (i.e. not the discount junkies).
FW: What pieces of technology or software are you seeing having the biggest impact amongst your customers?
RP: Our industry is quite old-school but the biggest change is definitely that all salon-owners now have smartphones. It’s funny, they tell our sales-team that they hate computers and don’t know how to use them…then they pull out an iPhone and look up something on Safari!
FW: You raised investment earlier in the year. What’s your feeling on the venture/investment scene in Ireland at the moment?
RP: There is still money out there but the Irish seed capital funds are being very conservative. There is very little support for true early stage startups like you see in the US with 500startups or SV Capital.
FW: What startups (if any) have caught your eye this year, and why?
You can follow Ronan on Twitter here.