Anasazi Exclusive Salon Was Founded

Anasazi Exclusive Salon was founded due to the need of better service for professional hair salons. Anasazi was established in October 1992 by Sue Krukonis, Bob Lupinacci, and Dwight Miller. The company is targeting the professional hair-care market that was estimated to be approximately & 3 billion in 1993 in consumer sales. Their strategy was based on bypassing independent distributors and address directly to the professional hairstyle salons with their professional hairstyle salon products.

From the beginning, the company's founders were preoccupied with the company's future and evolution by focusing on creating a healthy corporate culture. This is how honesty became a key word for Anasazi's philosophy. The next step in the company's development was raising the capital for it. The initial capital, that reached $1.7 million, was gathered through an SBA loan and an equity investment from Iowa Products Development, a state funded venture capital firm. However, this amount of money was only enough for beginning the activity. In order to expand product development, to implement internal systems and controls, and to intensify the sales and marketing campaign, the company needed more funds that came in October 1994.

Anasazi is very preoccupied with the quality of its products. The company provides a high-quality, all-natural product line that focuses on creating new in-salon professional services. Anasazi's products address to specific hair care problems and they must be prescribed by professional personnel. Anasazi's product line is consisted of six categories of products. Each product category comes into two different forms: the treatment for salon use only and the shampoo and conditioner for home use, that are meant to support and enhance the effects of in-salon treatments. Regarding Anasazi's product positioning, the company's products seem to be the perfect response to the clients' needs: individual solutions for each hair-type and problems.

The company's product distribution is based on bypassing major distributors and going for direct distribution. This has proven to be a great strategic plan for Anasazi. Going directly to the end-users, helped Anasazi reduce costs and time, build a solid relationship with the salons, which will increase the company's sales on medium and long-term. The 5-year goal for Anasazi was to target the top 20% of the 175,000 salons in the United States. Anasazi is trying to maintain its relationship with both independents and chains, in order to prevent the company's dependence on any of the two. In order to develop the business, Anasazi implemented the TAPS Program (Training, Advertising, Perks, and Samples). Through another program, called "Brandchise," Anasazi ensures exclusivity and protection to the member salons. The company is confronted with giant competitors, like: Matrix Essentials, Paul Mitchell, Nexxus, L'Oreal's Redken, Aveda, Sebastian, Zotos International.

The company has significantly developed since its establishment: it has developed a 25 products line, its products are used in 1,200 salons that bring $3.6 million revenues for Anasazi, the company is training 85 educators and over 3,500 hairdressers in using the products. Also, the company has installed a sophisticated MIS system in order to support customer service and information needs. The company's strategy for the future is based on refocusing, refining, reinforcing, and re-instilling investor confidence.

The company's immediate success was due to the direct distribution system. Bypassing intermediaries between Anasazi and professional salons helped reduce the company's costs and time. Also the company has built a strong relationship with these salons based on trust.

The recommendation for the company's future strategy should be based on Anasazi's strengths: the company's direct distribution system and its products. These strengths should be exploited to a maximum in the near future. First of all, Anasazi should continue the direct distribution system and expand it. The company's expansion process should include regions Europe, like France, Great Britain, and Germany, where there is great preoccupation for hair-care professional products and also the financial means required for purchasing the company's products.

Anasazi should expand its product line, especially the products for home use, which now incorporate shampoos and conditioners only. Non-professional clients would be more than interested in acquiring other types of hair-care products for home use that the company does not manufacture yet. These new products for home use could be recommended by professional hairstylists in professional salons, which will increase the customers' trust in Anasazi's products.

Another aspect that has not been taken into consideration very much until now and that requires special future attention is advertising. The company's sales and market share cannot increase if the products are not advertised properly. After expanding the product line to other hair-care products for home use, the company should implement a very aggressive advertising campaign. The advertising campaign should focus on emphasizing the most important features of Anasazi's products: their high quality and the fact that they are all-natural. The high quality of these products could be presented in visits at the company's plants, its laboratories, discussions with the company's top specialists that implicate in creating such products. Also, the campaign should be based on emphasizing the other aspect, the all-natural attribute that these products also have. Nowadays, many people care a great deal about using all-natural beauty products, especially for hair-care. The company should exploit this aspect, given the fact that Anasazi's products meet such requirements. But customers must be aware of this, therefore a complex advertising system is required.

In order to become a more important presence on the customers' buying options, Anasazi must build a stronger image. In order to accomplish this objective, the company should follow L'Oreal's and other beauty products companies' example: Anasazi should hire one of the female stars of the moment for advertising the company's products and therefore, for becoming the company's image.