Selling great aesthetic value for a fair price is challenging for some practices. For instance, many aesthetics professionals struggle with selling new products and procedures because of their discomfort related to pricing. Since a newly released product or service begins its lifecycle at its highest price point, providers and staff members tend to balk when it comes to communicating product value to consumers and asking them for the sale without discounting the price.
But the problem isn’t really price, per se. Rather, it is a combination of issues, beginning with a lack of knowledge that prevents team members from effectively conveying product or service value to customers so the sale can be closed with confidence. Often compounding this hindrance is the absence of appropriate pricing guidelines, compensation structures that support selling value versus volume, and effective analytical systems for identifying problem areas. This article examines these four issues and provides tips on how to make the changes needed to build an aesthetics sales force confident in its ability to close transactions on high-value offerings without conceding to price reductions.
Let’s examine these four issues in more detail and explore some related success tips.
Team Members Need More Product Education
Staff members and providers frequently do not have all of the information necessary to sell great value at a fair price. Taking the time to properly educate team members will give them the confidence they need to communicate the value of products and procedures and effortlessly close these transactions. The staff and providers need to be able to communicate using the language of each product and/or procedure in a way that customers will understand. They should be able to answer these questions: 1. How is the product or procedure performed or applied? 2. What does a treatment entail? 3. Are there side effects from the product or procedure? 4. How soon will I see results from the product or procedure?
- Utilize the training and development offered by each product’s sales team to ensure a thorough understanding of the product and procedure.
- Role play with office staff members and providers to ensure they are comfortable discussing all areas related to the product or procedure.
- Ensure staff and providers understand and use the vocabulary for each product and procedure and communicate it correctly.
Compensation Structures Favor Selling Volume over Value
In the beginning, many staff and provider compensation plans are driven by sales dollars versus the profit of each service. Because of this, if a patient coordinator or doctor senses the possibility of losing a sale, too frequently he/she will begin to discount the service or procedure in a Hail Mary attempt to close the sale. A pricing discount is much easier than selling value. Most patients take their time when making a choice to purchase or when switching to a new product or service. In addition, most cosmetic patients have a history of purchases and will try to find openings to negotiate the price. Inexperienced office staff and providers will often panic when the customer “pushes back” and they will quickly resort to lowering the price.
- Create compensation plans that reward the sales of profitable products and services, not just on volume.
- Do not allow providers or physicians to discount services, or at minimum, limit their ability to reduce prices.
- Develop aesthetic pricing packages with discount guidelines for patients who purchase multiple procedures and/or services.
Pricing Guidelines are Not Effective and Applicable
If practices use historical data and plot a scatter diagram of price against volume, in most cases, there will be no meaningful relationship between price and the services provided. There are two possible reasons for this inconsistency:
1.) Specific pricing guidelines have never been established for the office staff or provider, or
2.) The pricing guidelines are not being followed by the office staff and providers.
- Create product and procedure pricing guidelines that the staff and provider must follow.
- Establish an exception process to allow the staff and providers to elevate consideration for a special price.
- Provide team members with tools to better succeed under new pricing guidelines, e.g., train them in effective closing techniques, and tap the resources of supporting companies to help them advance their sales acumen.
This brings us back to that new high-value product or procedure. This high value offering should not be discounted for any reason. By creating a “no discounting” policy, the temptation is now removed for staff and providers and will ensure a fair return.
Practice Does not Have Systems in Place to Assess Sales Issues
It is important to understand what to do if the product or procedure is not selling well or, on the flip side, if the product or procedure is selling too quickly. In these situations, the goal is to quickly determine why this is happening. Practices should be able to answer these questions: 1. Does the patient understand the “fair value” of this product or procedure? 2. Does this market segment value this product or service? 3. Are competitive alternatives being communicated correctly to the patient? 4. What are the alternative products or procedure to meet this need? 5. Do patients have monetary limitations that prevent them from moving forward?
- Conduct practice-specific competitive and market analyses to determine the major cause of the issue(s).
- Reevaluate the price for each product and procedure and adjust to “fair value.” In price-sensitive areas, practices may want to consider creating product and procedure packages to move patient to larger purchases at a lower package price.
- Implement a patient survey program to monitor patient feedback and discover how each customer perceived fair value during the consultation process.
Research reveals that patients are at their highest level of satisfaction with a product or service within the first few months of the purchase. Reinforcing the great outcome with a fair price will determine if the patient ultimately shares their experience with other potential patients. On average, a happy patient will tell three to five people about their purchase.
Selling value at a fair price is possible when practice team members are appropriately educated and compensation plans and pricing guidelines are structured to support selling value versus volume. Additional success is ensured with effective evaluative systems in place. By addressing the issues described in this article and implementing the provided success tips, providers and staff members will no longer find it difficult to communicate high value at a fair price and will be empowered to close their transactions with confidence. n
Elmer Books is a management consultant with the Allergan Practice Consulting Group, of Allergan, Inc., a specialty pharmaceutical company based in Irvine, CA. Mr. Books consults with dermatology and plastic surgery practices in the areas of financial analysis, practice valuations, practice efficiency, human resource issues, internal and external marketing, leadership training and team building, sales training, compensation, and other general practice management issues. He has more than 20 years of sales and management experience.