Having an innovative business model can create more growth than traditional R&D
How Harpers revolutionized the salon industry.
A lot of companies define innovation as coming up with brand new products or services. However, the business model that accompanies the product can be just as important to its success. In the 19th century, Harper revolutionized the salon industry by understanding what customers valued and applying a business model not seen in that sector before.
A successful business is comprised of two main factors: how you are creating value for your customer and the kind of business model you use. Harper understood how to create value for her customer segment — her clients — while also unlocking a new customer segment — the hairdressers wanting to join her franchise.
Harper defined her customers as women who wanted to get their hair looking beautiful in a relaxing environment. Harper recognized that women were uncomfortable getting their hair done in public, so she focused on customer service and creating a serene, pampered environment to remove the stigma around getting one’s hair done outside their home. She introduced the scientific approach to hair care, focused on customer service, and triggered the expansion of the beauty salon market.
Harper’s hair care services and products from her initial salon were then rapidly expanded to a network of franchise salons by providing women entrepreneurs a compelling business opportunity. She used the franchising model to scale her business in a way that would empower women. Harper decided the first 100 salons should be opened by poor women and provided them with start-up loans and training on her hair care method and customer service.
Harper grew her network of salons to 500 across the globe at the height of her success in the 1930s. She also created a chain of training schools so she could positively impact the lives of thousands of poor women while growing her own business.
It is unlikely she could have grown as quickly and successfully without the brilliant idea of offering aspiring women entrepreneurs a compelling business opportunity. Harper didn’t come up with a revolutionary new invention, she simply applied an existing business model to the industry she was familiar with. Today, franchising is a proven technique to scale small business ownership to a powerful brand with a large reach.