Why “£99, One Area” Marketing Tactics Cannot Lead To A Sustainable Business!
In recent years we have seen a huge influx of healthcare practitioners developing their skills and starting new businesses in medical aesthetics. Whilst demand from patients also continues to increase, we may now be at a pivotal point in the market place, when supply begins to outstrip demand.
The global increase in sales of professional aesthetic products in 2012 over 2011 was 7.5% - with average patient retention rates estimated at 10%-30% and an estimated doubling of healthcare professionals delivering services.
This is clearly evidenced with the continued and increasing number of businesses offering “wrinkle relaxing injections” for £99. Whilst these adverts may be beneficial in recruiting patients they do not appear to show any evidence of recruiting quality patients or developing patient loyalty, hence these companies continue to require large advertising budgets to remain on the patient recruitment hamster wheel.
How to generate sustainable growth in the current marketplace?
Whilst it is necessary for all new businesses to attract new patients the key to any successful business is to keep them, maximising their value and ensure they refer new patients to you, from their network.
This article will explore strategies in patient retention and referral for a successful medical aesthetics practice.
As with all successful businesses change must start from within.
The service-profit chain establishes relationships between profitability, customer loyalty, employee satisfaction and productivity. The links in the chain (which should be regarded as propositions) are as follows: Profit and growth are stimulated primarily by customer loyalty. Loyalty is a direct result of customer satisfaction. Satisfaction is largely influenced by the value of services provided to customers. Value is created by satisfied, loyal, and productive employees. Employee satisfaction, in turn, results primarily from high-quality support services and policies that enable employees to deliver results to customers. The service-profit chain is also defined by a special kind of leadership that emphasises the importance of each employee and customer.
In relation to a medical aesthetics company, happy employees are more productive and deliver better service, leading to more satisfied patients, patient loyalty and referral which leads to growth and profitability.
How To Increase Internal Service Quality
To engage employees and ensure employee satisfaction the company has to build up the best possible internal quality through effective workplace design, job design, employee selection and development, employee rewards and recognition, and tools for serving customers.
Empower staff to take risks and learn; allow them to input and develop projects which they believe will grow the business, reward success but encourage learning from failure.
Encourage staff to develop relationships with customers; the person answering the phone, responding to emails or delivering marketing communication needs to know what customers want.
Develop a customer relationship management system; soft data is as equally important as hard medical data when it comes to getting to know your customers. This will allow you deeply understand customers and easily communicate with them.
How To Increase Employee Satisfaction
Employee loyalty is driven by employee satisfaction, ensure that staff know, embody and are involved in developing the company vision and strategy. Give them responsibility for delivering specific tactics relevant to their role. Satisfied and loyal employees are far more productive and will stick with you delivering excellent customer service to your patients.
Support tailored packages for personal development and training. Work with them to understand their goals and empower them to develop a plan.
Ensure they have the right tools for the job; access to web developers, access to marketing agencies, correct software to implement tactics, readily available resources to excel in their roles.
Embrace change! Out of date systems and processes may lead to frustration and impact productivity, encourage open dialogue and empower staff to improve systems.
Have a transparent business. Share company business performance reports, have a clear rewards system, foster an ownership for results culture.
Encourage self reflection; provide tools to allow employees to analyse their own productivity and contribution, encourage implementation of self identified areas for improvement.
Developing empowered, loyal and motivated employees will allow you to properly implement your “External Service Value”. £99 special offers do not convey good service or necessarily value but portray low cost which can often be associated with poor value.
Value Drives Customer Satisfaction
The primary determinant of customer satisfaction is perceived value – that the customer has gained more from the service than he or she thinks it is worth. Value often has an emotional aspect that makes an experience particularly memorable for the customer. The key to create value is the ability to bond emotionally with the customers and create emotional wow experiences. Underlying this is being very clear about the targeted service concept for the targeted customers.
When developing an external service proposition it is important to focus on what new and existing customers want to know, that you care for them personally and that you can fix their problem now!
In medical aesthetics the problems quality patients have is not that they are looking for low cost wrinkle relaxing. Understanding customers through soft data collection will soon reveal that their problems may be:
Need to feel more attractive: Looking for a new partner, competing with peers, life event impending, social aspirations.
Need to look younger: Insecurity in current relationship or perhaps looking for career progression.
Low self esteem: Menopause or empty nesters
Physical correction: Birth or environmental defects, recent weight loss, correction following smoking cessation
Do You Really Want To Attract People With £99 To Spend On Becoming A More Fulfilled Individual?
It is reasonable to have multiple external service propositions targeted at different segments within your patient population or to geographically target marketing for patient recruitment, however having multiple propositions within your main strap line can cause confusion.
The 4 R’s: Recruitment, Retention, Repeat Business and Referrals
Profile all newly recruited customers during assessment, redesign clinic questionnaires to capture soft data, ensure all data captured is stored and easily accessible
Customer contact and follow up following initial enquiry regardless of method should be after 3 days, after 10 days after 14 days and then every 30 days. All customers should receive at least 4 targeted communications per year following initial transaction but no more than 12.
Avoid sampling and free or discounted offers, only 3% of patients will purchase following these offers and 30% will shop elsewhere 4. Increase value proposition through in depth problem identification (skin analysis, case study examples) and solution based selling.
Understand patient expectations, involve and empower them to take part in the journey to achieve goals, this may extend to lifestyle, fitness and nutrition advice as well as make up tips and should not be limited to only the services available in your clinic. Ask for feedback, qualitatively, most patients will tell you want you want to hear face to face, will opt for the mid to high area on quantitative questionnaires. Focus on one area of your business and ask one open question at a time, encourage in depth responses and listen actively!
Communicate transparently the feedback you have received and what you intend to do about it, celebrate the introduction of new or improved services and ask for feedback again.
Encourage referrals. This is the least expensive form of recruiting new customers and it should be encouraged and rewarded with all” A” customers, social media, open evenings, local events, loyalty cards, introduce a friend are some good examples of tactics to support this but so is a hand written Christmas card!
Profile your patients, income, lifestyle, needs, budget, family circumstances, expectations, hobbies, interests etc, this will help you understand their needs.
Segment your patients based on the above information – specifically target each segment with tailor made marketing tactics. Some may go to Ascot, others may be off to a hen weekend in Blackpool!
Rank your patients, identify your “A” customers - these customers will have been loyal longest (20% of customers will deliver 80% profit) they will be most likely to refer new patients, involve them in your business and reward them!
Loyal patients, loyal staff and referral are the back bone to any businesses success. Patients are not necessarily looking for low cost treatments but they certainly want good value from someone who understands them and cares for their needs. Businesses built on poor patient retention and high patient recruitment cannot also offer the time and understanding required to deliver quality medical consultation and treatment therefore will never be profitable and can result in patients having a bad experience or poor results. This is not a sustainable business model and is detrimental to the aesthetics industry as a whole. Successful medical businesses are built on Value, Quality and Loyalty!
Kline blogs, Injectibles – The Pointy Edge of the Non-invasive Aesthetic Products Market, but Body Contouring is Shaping it, Feels Kline (http://blogs.klinegroup.com, 2013) < http://blogs. klinegroup.com/2013/10/09/injectibles-the-pointy-edge-of-the- non-invasive-aesthetic-products-market-but-body-contouring- is-shaping-it-feels-kline/>
Consulting Room. firstname.lastname@example.org. Market data. 28 Feb 2014.
Heskett, James L., Sasser, W. Earl Jr., and Schlesinger, Leonard A., The Service Profit Chain: How Leading Companies Link Profit and Growth to Loyalty, Satisfaction, and Value, The Free Press (New York, 1997)
James L. Heskett, Thomas O. Jones, Gary W. Loveman, W. Earl Sasser, Jr., and Leonard A. Schlesinger, Putting the Service-Profit Chain to Work (hbr.org, 2008) http:// hbr.org/2008/07/putting-the-service-profit-chain-to-work/ar/1
Marsh D. ‘10 pathways to marketing success in challenging times’, Hearing Review, (6(6), 2009), pp. 32-34
Newman, MEJ, ‘Power laws, Pareto Distributions, and Zipf’s law’, (arxiv.org, 2006) http://arxiv.org/PS_cache/cond-mat/ pdf/0412/0412004v3.pdf [Accessed10 April 2011] (p. 11)