NEW GAME
The new game of dentistry is based on the following changes:
1. The dental economy was significantly affected by the
recession of 2008–2009. While the U.S. economy has
recovered following the housing crisis, dentistry hasn’t fully
bounced back. The Great Recession has ushered in a host
of game changers that are permanently altering the
profession, leading to increased competition in all areas
of dentistry.
2. Patients have changed the way they think and behave
regarding dental care and dental practices. As I explain in
my seminars, the public now views dentistry more like a
retail business. There are thousands of dental practices in
shopping centers and malls. These offices advertise regularly,
promoting various specials to win over new customers
(patients), using many of the same strategies employed by
department stores, supermarkets and other retail outlets.
So what are some of the new consumer behaviors?
Patients will leave practices if they change their insurance
and it isn’t accepted by the current practice. They don’t
view having regular hygiene care every six months as
absolutely necessary. Some patients will even try to negotiate
fees. This may be related to the fact that most consumers
don’t expect to pay full price for many products and services.
3. Since 1997, 12 new dental schools have opened, resulting
in an increased supply of dentists. In addition, older dentists
are postponing retirement to make up for declining revenue
and insufficient retirement savings. Whenever the supply
of dentists goes up, competition increases as well.
4. Dental insurance companies are continuing to decrease
reimbursements. I believe that in the near future all dental
insurance will be dropping to the PPO level of payment,
and we are seeing increased numbers of companies moving
in this direction. Lower reimbursements drive down practice
revenue and profitability.
5. Dental support organizations (DSOs) continue to grow.
These practices advertise heavily, offer expanded hours,
provide a wide range of general and specialty services
under one roof, and participate in most dental insurance
plans. Many consumers prefer the convenience of one-stop
dental shopping offered by large practices. DSOs will continue
to grow in the decade ahead, intensifying competition for
new patients. However, I believe there’s plenty of room for
private practices to thrive in this new dental economy.
Success depends on how well each practice is operated
and managed.
There are other game changers that can be included in this list,
but the main point is that we are in a new game. Fortunately,
there are best models available for dentists to compete
successfully in this changing landscape.
NEW RULES
Prior to the Great Recession, the profession benefited from a
low supply of dentists and high demand for dental services
enabling nearly all practice owners to grow their practices. As a
result of the game changers, that situation has reversed itself.
Today, there are more dentists competing for a smaller pool of
patients. To succeed in this new environment, you need to be
aware of the new rules, which include:
1. More business skills are required.
In the pre-recession past when growth was automatic,
dentists didn’t have to focus as much on the business side
of dentistry. Today, that’s no longer true. Dentists need to
be both expert clinicians and CEOs to thrive in this new era.
2. Customer service matters more than ever.
Being “just another dental practice” isn’t good enough
anymore. In today’s crowded dental marketplace, you want
to stand out from the competition. Exceptional customer
service is always a differentiator, especially with new
patients. It separates you from the rest of the pack. When
you amaze your patients with “WOW” customer service,
they’ll tell their friends about your practice, post positive
reviews online and serve as volunteers in your guerilla
marketing team. Great customer service reverberates
throughout your community and enables your practice
to more easily realize its growth potential.
3. You have to do more with what you have.
As the competition for new patients heats up, focus on
building stronger relationships with your current patients
by promoting comprehensive care that addresses immediate
and long-term needs… emphasizing the full range of
services, including cosmetic treatment… and providing
great customer service that elicits more word-of-mouth
referrals. Of course, you still need to implement effective
marketing strategies to reach new patients, but don’t
overlook the patients who have already chosen your
practice as their “home” for oral health care.
THE NEW PLAYBOOK
You can’t rely on yesterday’s playbook to succeed in today’s
new game. Ten years ago, dental practices could get by with
haphazard systems, processes and protocols. You may not have
been at a top practice, but you still could muddle through and
do fairly well. That’s no longer true. Too much has changed in
the intervening years. Fortunately, you still can achieve great
success as a dentist, but you have to do it differently than in
the past.
In Hershey on April 28, 2018, I’ll be discussing the three-step
Levin Group Method, which our consulting clients use to
dramatically grow their practices. Let me provide a little
preview of my presentation. The new playbook includes these
three steps:
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