This paper summarizes a buyer behavior simulation exercise centered on redesigning Stonewall Barbershop's business strategy. It covers the selection of a barber spa positioning strategy based on customer age-group preferences, the development of a value-added and luxury services portfolio informed by consumer data, and three-year financial projections showing significant revenue and client growth. The paper also identifies key external factors — including income, social class, reference groups, geographic culture, and customer loyalty dynamics — that must be considered when implementing a barbershop makeover strategy.
After analyzing the simulation's data and requirements, the most suitable solution for Stonewall Barbershop's makeover was identified. The first step involves selecting a positioning strategy. Given the circumstances, the barber spa model is the most appropriate option. The barber spa offers midrange services at midrange prices, striking an equitable balance between service quality and cost. In addition to traditional barbershop services, the barber spa also provides certain salon and spa-style services, making it the best option for appealing to both younger and older customers. This way, Stonewall Barbershop will retain its existing clientele while attracting new customers.
The barber spa is also the strongest choice because it is the most preferred barbershop format across key demographic segments: it is favored by 26% of customers aged 15 to 24 years, 27% of customers aged 25 to 34 years, and 26% of customers aged 35 to 44 years. At this stage, total costs reach $346,000.
The second step is building a services portfolio that differentiates the business. The following value-added services have been selected: hairstyle, color, pedicure, and manicure. These choices were made after studying customer perceptions of the salon experience. Beyond basic services — which are used by 100% of salon clients — customers also gravitate toward pedicure and manicure services (59% of customers). Hairstyle and color services are similarly essential, as they are now considered near-mandatory for any successful barbershop. At this point, financial projections are extremely favorable for the next three years.
Luxury services have also been incorporated into the portfolio, with massage services as the primary example. This choice is supported by strong customer preference data: 63% of customers use massage services, and 46% would be willing to pay for them. Understanding these consumer preferences was central to building a competitive and profitable service offering.
The total cost for this makeover adds up to $346,000 of the available $550,000 budget, with costs projected to decrease over the following years. Financial projections for the next three years are as follows: projected revenues of $939,000 in 2002; $1,174,000 in 2003; and $1,467,000 in 2004. The number of clients is also expected to grow significantly each year — from Stonewall Barbershop's current 800 clients to 2,552 clients in 2002, 3,190 in 2003, and 3,987 in 2004.
Several additional external factors must be taken into consideration. Customers' income — including its volume, dynamics, distribution over time, and purpose — is the primary constraint on buyer behavior. The temporal perspective also influences buyer behavior in ways the company cannot directly control.
Social factors relevant to the makeover strategy include social class and income, which are closely interrelated and shape customers' choices of barbershop style. The reference group — comprising family, friends, and colleagues — is another important external influence. Specifically, males aged 0 to 15 years are most influenced by their parents, males aged 15 to 24 years are most influenced by their friends, and males aged 35 to 44 years are most influenced by their colleagues. These dynamics align with well-established research on reference group influence in consumer decision-making.
"Regional culture and demographic analysis needs"
"Trust, pricing, and going beyond satisfaction"
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