Tracking What Matters: The Top 5 KPIs for Medspa Growth and Retention

With medspas now at the forefront of the thriving global wellness economy, owners and operators are thinking less about proving their business model and establishing traction and more about sustaining and optimizing for the long haul.

The more the paradigm shifts in this direction, the more important it becomes to know your numbers and ensure they’re moving in the right direction. For medspas, knowing the right KPIs to monitor and continuously maximize them is essential to your business's long-term success. 

Before we go any further, let’s be clear: one of the things that makes this industry so vibrant is that no two businesses are the same. The goal here isn’t to tell you exactly what your numbers should look like—only you can determine that. Though we’ll provide some general benchmarks and aspirational targets, they’re not really the goal; the goal is simply to ensure that you’re focused on the right metrics and taking steps to ensure you’re moving them in the right direction. 

With that in mind, let’s examine the five KPIs every medspa should track and leverage right now. 

Average Revenue Per Appointment 

Perhaps no single KPI provides a better indicator of the health of your business than average revenue per appointment. This is a big ticket industry, and for good reason: the past few years have proven beyond doubt that medspas provide high-value services for which clients are willing to pay top dollar. In fact, according to data from Boulevard, the average ticket revenue per appointment in the U.S. is roughly $530. Whether you fall above or below that benchmark is less important than doing everything you can to maximize the revenue you’re bringing in with each appointment and aspiring to keep the needle moving constantly upward. 

One great way to do this is through add-on services. Across the industry, top-performing businesses are adding additional services to roughly one-third of all their appointments, translating to 63% higher median ticket values. Among the many ways to boost add-ons, optimizing your online booking flow to promote additional services (nearly half of all add-ons are booked online) and setting attainable add-on incentives for your staff are among the best. 

Client Retention Rate

Getting new clients in the door is a good thing; getting them to come back for a second (and third and fourth and fifth) appointment is how you go from good to great. That makes client retention rate an essential KPI. In an industry where the relationships are deeply personal, you should be aiming for a retention rate in the neighborhood of 60-70%. 

What are some things you can do to get there, aside from providing effective treatments and amazing service? Well (recurring theme alert), optimizing for online booking is again a great place to start. Data shows that clients who book their first appointment online are twice as likely to come back for second and third appointments as those who don’t. 

Automated text and email marketing is another great tool. Data shows that executing a simple campaign aimed at providing past clients with reminders to book is enough to generate a 5% increase in client retention rate, which is a big deal, since a 5% increase in retention rate generally translates to a 25% increase in revenue. 

Another great way to drive up your retention rate is through membership programs. Data shows that across the self-care industry, members book three times as many appointments and have an 88% higher client retention rate than non-members. If you’ve yet to get your membership program in gear, look no further than your client retention rate to find the motivation you need to get going. 

Data shows that executing a simple campaign aimed at providing past clients with reminders to book is enough to generate a 5% increase in client retention rate.Courtesy of DragonImages at Adobe StockStaff Utilization Rate 

This one is simple on the surface, but complex in practice. The simple part: the busier your staff, the better off your business. After all, time is your most precious resource, and you want as much of it as possible spent on activities that generate revenue for the business. The not-so-simple: optimizing your calendar in real-time to ensure ideal utilization of your staff’s time. 

This is where modern advances in technology can help, as some booking platforms now leverage historical data to suggest the most utilization-efficient appointment times. Take advantage, if you’re not already. Typically, I’ll advise medspas to aim for a utilization rate that’s no lower than 75% and ideally pushing up toward 90%. Anything lower is an indication that you need to drive more appointments or improve your scheduling efficiency (or, more likely, both). 

Online Booking Rate 

Unless you’ve skipped ahead, you’re already well-versed in the myriad data-based benefits that come from online booking: more add-ons, more revenue per appointment and higher retention rates, to name a few. So, I’ll use this section to extoll the experiential benefits of online booking. 

Online booking is core to a great client experience. When there’s a disruption to the client experience, it’s rarely on account of the treatment itself. Rather, it’s because it wasn’t easy to book an appointment online, or because there was a delay during check-in or check-out, or because the client never got a reminder about their next appointment. 

Leveraging online booking (ideally paired with integrated payments) is one of the fastest, easiest and least work-intensive ways to minimize unnecessary disruptions to the client experience. The more the merrier. While a 30-40% online booking rate probably puts you somewhere in the middle of the pack, you can and should think bigger. With today’s technology and an incredibly online clientele, don’t settle for anything less than 50%, and always be perpetually aiming higher. 

Pre-Booking Rate

Another one that’s simple in theory and challenging in practice, pre-booking is a powerful tool to drive business performance and a critical KPI every medspa should monitor and optimize. Put simply, an appointment booked weeks or months in advance is better than an appointment booked days or hours in advance—they’re stickier, more reliable and more likely to pick up add-on services as the date draws closer. 

But it takes work and commitment to drive your pre-booking rate up. Having a robust membership program is one great way to get going—members are far more likely to pre-book their appointments well in advance. Training your staff to encourage clients to book their next appointment as they’re closing out their current one is another effective technique, as is leveraging automated text and marketing campaigns that remind and encourage them to get a jump on getting their next appointment on the books. If you’re doing all these things well, pre-booking at least half of your appointments is a reasonable goal. 

The Best Gauge is You 

Now that I’ve just gotten done hitting you with a whole bunch of industry data and aspirational targets, I want to close by reminding you that when it comes to tracking metrics and determining where you need to be and where you can improve, the operative word is you. Should you relentlessly monitor and track these five KPIs? Absolutely. Should you use industry benchmarks as a guidepost? Of course. Do I or anyone else know your business and your clients better than you? Absolutely not. Monitor regularly, optimize like crazy, but never forget who knows your business best. 

About the Author

Skya Jones is a Medspa Education Manager and in-house aesthetics expert for Boulevard. She works directly with the company’s staff and medspa customers to help design memorable client experiences. Skya has more than seven years of experience in the beauty industry with a specific focus on medical aesthetics, as well as more than five years of experience in medspa leadership and management. Before joining Boulevard, Skya was a department lead for Bobbi Bullock Medical Esthetics. A certified nurse assistant, her career spans both clinical and business operations and includes stints as a manager at VitaNovu and a beauty advisor for Kohl’s. Skya’s go-to self-care routine is a relaxing facial or massage followed by meditation or yoga.