Over the past few months I have been speaking to hundreds of practices at live events and through our efforts here at BoomCloud. I see a lot of practices doing a one time 10% discounts for cash paying patients/ uninsured patients. I think there is good intention to this strategy but I believe it is flawed. When you implement a one time discount program in your office you are not focusing on building consistent loyalty & retention.
Dentistry is a long term relationship business. Why motivate patients to get one time discounts for being uninsured when you can create a long term relationship with them through a in-house membership program. They will get unlimited discounts and preventative care is included.
It also may be a great idea to drop the one time 10% discount altogether because it could be distracting patients from signing up for a higher quality program for their family.
How to increase value of your practice
If you were to sell your practice the next owner will want the following:
- Predictable recurring revenue: An in-house membership program will generate a recurring revenue stream for your practice, it will also help increase case acceptance. If you can show your recurring revenue and your case acceptance this will make a potential buyer motivated to buy your practice and it will also give you piece of mind when it comes to cash flow.
- Loyal Patient base: Patient loyalty makes a business successful. Think of Amazon Prime or Costco, they all have loyalty programs that generate a lot of customers and a lot of revenue. Amazon Prime is a billion dollar revenue stream and the average prime member spends over $1200 per year vs a non prime customer spends only $500. They same will happen to your practice when a patient becomes a member to your program.
- Active patients: Membership patients are going to be more active. When you spend money consistently on a monthly or yearly basis you are more likely to use and purchase more services on a regular basis. The other day I signed up for a car wash membership, I have always just washed my car at home but now I go to the car wash at least once a week. I have never spent money on a professional detail for one of my cars but now i do it every quarter because I get a discount for being a car wash member. I have become an active customer and active customers spend more.
I honestly do not like one time discounts because it is not a system or a program, we all know that patients need to see the dentists at least 2 times per year so why don’t you motivate them by getting them on an in-house membership program that automatically collects a monthly or yearly membership fee from them.
These are just a few examples there are countless more for creating and growing a membership program. I would encourage anyone who has a membership program or any who wants to start a program like this in your office to read my ebook and book a free demo and consultation from my team.