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Contingency planning is necessary for businesses of all sizes, and that includes dental practices. Some contingencies, such as natural disasters or physical plant problems, have fairly straightforward solutions. Financial disasters, though, are something that few businesses can plan for.
All businesses require a steady stream of income. The current United States tax code makes it inadvisable to keep a lot of cash on hand. That’s why businesses have lines of credit that they can draw on as needed. But those lines of credit have to be paid back, which is a double whammy in the event of a sudden downturn in revenue.
Most dentists don’t think in terms of a sharp drop in their incomes, and history is on their side, for the most part. They’re more likely to experience a slow erosion of the volume of new patients and of the average case value. But dentists can’t control a sudden influx of new competition. For practices that aren’t positioned properly, new competition can spell financial disaster.
What’s In Your Pockets?
Dentists with deep pockets can probably weather an upturn in competition. Those dentists can increase their marketing to keep the new patient stream at least fairly steady. But, they can’t put out that kind of increased expenditure forever.
Just as important as deep pockets – a luxury that not all practices enjoy – is the quality of the patients that you attract. You’ll make a lot more money, and more predictable money, off the lifetime value of long-term patients than you will from a stream of price-shoppers, one-and-dones, and insurance-driven patients. Those long-term patients are your bulwark against increased competition.
Attracting and retaining those better patients is the best growth plan for almost all non-specialist dentists. And it also serves a contingency plan in the event of increased competition or general financial downturn such as the country experienced in 2009.
Getting the Cream of the Crop
In any given market, some 20 percent of your prospects have the means and the willingness to pay more for a dentist they like, relate to, and trust. Traditional dental marketing won’t get you those prospects. They’re far less motivated by price than they are by their expectations of the kind of experience they can have with you and your practice.
Attracting better patients, the ones who will stay, pay, and refer, requires a different approach. First and foremost, your prospects need reasons to choose you rather than another from among the great mass of dentists. Your marketing will need to position you as expert, relatable, and concerned about their welfare.
Take a look at your current website. Does it focus on the procedures you offer, or does it emphasize the benefits to your prospects of having those procedures done by you? Far too many dentists still market to impress other dentists, loading their websites with technical terms that prospects won’t understand and don’t care about.
In its broadest sense, dentistry alleviates pain and discomfort, removes reasons to be embarrassed, and improves lives. Focus your marketing on addressing those things that important to patients and you’ll be able to attract and keep more and better patients.
And with those patients, your practice will be more financially resilient in the face of increased competition or economic woes.