Surviving the Recessionary Storm

One expert offers her list of tried and true do's and don'ts for vision correction marketing.

BY DAWN CAVANAUGH

As I walked through my door late one night last week, I called out, "I'm home!" then I heard a rumbling that seemed to be getting louder and louder. I turned the corner and saw my adventurous 5-year-old son, Charlie, decked out in head-to-toe skateboard attire and headed at me full throttle. He was so excited to see me that he forgot to stop, and his impact knocked us both in the air and then down for the count. Charlie is nicknamed the tornado, for obvious reasons.

As I stood up again, he remained on the floor, curled up in a ball and asking me to guess what he was. After a few attempts, he finally told me had had a tornado drill at school and had been taught what to do when a storm is approaching. He went on to share with me the step-by-step instructions that he had learned that day in pre-K to keep him safe from natural disasters. Later that night after I tucked Charlie in, I thought how his tornado drill related to marketing. Really!

Two years ago at the annual American Society of Cataract and Refractive Surgeons (ASCRS) meeting, I participated in a national board meeting with key industry leaders and administrators from some of the largest refractive surgery practices in the country. For more than 10 years I had been following statistical data on consumer confidence, unemployment, census and growing debt ratio per American household and for publicly traded companies in our industry. Opinion leaders were asking questions in a round-about way on procedure cost per eye, lowering fees, and monthly and quarterly variances had begun to be noticed as well.

It also appeared that certain practices were noticing higher denial rates as the credit problem began to surface. Prior to that ASCRS meeting, a Ph.D. in economics had warned me that once the financial conditions hit the international markets, the United States would feel the tightest squeeze.

Now fast-forward almost 2 years. We have all become familiar with the following grim statistics: The U.S. Department of Labor reported more than 3 million jobs were lost in 2008, with more than 1.5 million jobs lost between November 2008 and January 2009; consumer confidence in December 2007 maintained a score in the upper eighties, but plummeted to as low as the thirties by December 2008. Between the growing number of layoffs heard around the world each day, I would predict that 2009 will push even the most experienced manager to either sink or swim.

At Pepose Vision Institute, we have continued to reinvent ourselves. Believe me when I say that there are no hidden mirrors or smoke screens. Successful consideration of what I call the "do's" of refractive surgery marketing have yielded compounded returns. Practice of the "don'ts" can cause future problems.

The Do's vs. The Don'ts

Below are my suggestions for approaching some crucial marketing issues for the refractive practice.

■ Branding. First of all, do you feel you have branded the product you are marketing? If so, how do you know? How do you market your surgeon(s)? Those of us who have been involved in the refractive surgery industry for some time have seen technologies come and go. Yet our marketing strategy has remained consistent year after year. We do not market our vendor's name, laser or type of flap creation — we market our surgeons.

Dr. Pepose frequently tells me that it is sometimes difficult to even go out to dinner in a city the size of St. Louis without people coming up to him who have seen his face on multiple marketing mediums and want to ask him a question about their eyes.

The don'ts, the things that harm your efforts to brand your product, include marketing two-for-one specials, free limo ride on the day of your surgery, marketing externally the number of cases you have performed, offering a period of discount LASIK and guaranteeing 20/20 vision. Last but not least, never market rock-bottom prices; the tactic only cheapens your image and surgical expertise. Instead, market your outcomes, your subspecialty training and who will see your patients both preoperatively and postoperatively. Never begin price discounting based on what your competitors are advertising. Establish a plan on how you want to be branded in the marketplace and keep on target, recession or no recession.

Never, never stop marketing. If you do, all the money you spent marketing and driving your brand will be quickly forgotten. It will then require even more money, and time, to rebuild. Remember, in times of recession, media should be available at discounted pricing. Radio and television represent fantastic buying opportunities for the savvy marketer.

■ Tracking outcomes. Are you tracking your refractive outcomes? If so, how are you educating both prospective patients and existing patients? When I first met Dr. Pepose 10 years ago, I was impressed with both his clinical outcomes and low enhancement rate (below 3%). The practice's database now consists of more than 40,000 LASIK outcomes. These are summarized each month and updated so that all patients may view our surgical outcomes, not national statistics.

Most corporate vision correction centers will quote national statistics, based on large numbers of people who have had surgery at their network centers, by a host of different surgeons. Other vision correction providers may simply report the results forthcoming from the FDA clinical trial, which reflect the outcomes of the surgeons who were involved in these studies. Still others may report only those vision correction outcomes associated with low levels of myopia, or without astigmatism. We also display our outcomes all over our practice. And to give a thorough picture, we track our outcome data for post op day one, week one, month one, 6 weeks and 6 months.

We share the data with patients to show them exactly how many surgeries Dr. Pepose has done on patients with their same prescription.

■ Pricing structure. Establish an uncomplicated pricing structure and never let your competitors or the economy dictate your price point. Please step back and look around. How many strategically run businesses establish a price point and reinvent the wheel each month volumes change due to seasonality and economic conditions? Recession or no recession, we will never market price — only our surgeons and their experience.

As I follow the LASIK pricing index by eye, by state and by key metropolitan cities, I am amazed at both the fluctuation of price and the complex pricing mechanisms. Six months ago, a refractive marketing director called to see if I could assist his practice with re-engineering their fee for LASIK. He later sent me a pricing sheet that encompassed a full sheet of paper. There literally had to be 40+ different prices based on different choices. I asked this M.B.A. how this situation had evolved and he told me that their clinic wanted patients to participate in the choice and price of their treatment.

The scariest thing about this proposal is that it left the patient deciding the laser, how the flap would be created, surgeon's rate at a publicly traded LASIK company, surgeon's rate at his or her private practice, LASIK by prescription, custom vs. non-custom, etc.

Now for those of us who pride ourselves in understanding the numbers, how could anyone memorize these data to present to a patient, let alone audit the quotes? After reviewing this pricing maze, I was shocked. My client indicated that the few charts he had pulled since I inquired about the quote sheet had in fact been quoted incorrectly, which was not in the favor of the surgical practice. He was encouraged to share this with his practice, although I am unsure of the outcome. I asked how he tracked that the quotes were correct. He laughed and replied that his practice was not tracking that the quotes are correct. Yikes!

My strategy is simple when it comes to price. First perform a pro forma and understand all of your costs and, more importantly, what you want the net per eye to be. Why would a practice let the patient choose the laser treatment, flap method, or option for custom vs. non-custom? Patients aren't clinically trained as ophthalmic surgeons to understand the best treatment they should receive. I've recently heard from a major ophthalmic malpractice insurance carrier that they have begun to see an uptick of almost 20% in malpractice claims filed since the recession began, so avoid these options as you revisit your fee schedule and your fee per refractive procedure.

Shop the top dermatology and plastic surgical practices in your market to see how they present price. You will learn what I have learned: Surgical outcomes drive patients to your practice more effectively than any tiered pricing system. The numbers do not lie. After 9/11, I was asked if we should lower the price for LASIK. My answer was no, we should raise the price. So we did, and both our price and fee structure have remained the same since October 2001. For every three eyes that the local discounters performed in our market, we performed one. Any bets on who generated more LASIK procedures and who will weather the economic downturn?

■ Internal marketing. A big "don't" is, don't neglect this! Internal marketing is as important as external marketing and costs far less. When we designed and then moved into our new facility, we focused on each and every detail. From the moment patients walk into our large two-story atrium, they are greeted by a kiosk, which allows them to touch the screen and push the type of exam or surgery they are having. The kiosk then prints out on the screen directions for their destination.

A personal message was taped by our medical director welcoming them to our institute and reviewing both our commitment to their vision correction for a lifetime and our mission statement. Patient testimonials and hallway after hallway proudly display both staff and physician credentialing. All patient waiting areas, including our lobby, were set up for wi-fi.

We wanted to create an atmosphere where patients and their family members felt comfortable. We wanted them to be able to bring work with them, surf the Internet or check their e-mail as they wait on their friends or family members to be seen or to have surgery. We wired patient video systems into each lane, diagnostic testing room and waiting area in order to further educate patients on both their pathology and Pepose Vision Institute. More than 55 flat-screen televisions play from opening to close throughout our practice. We even have them in our optical, educating patients on polarized versus non-polarized lenses.

The entire facility was wired overhead, including our ambulatory surgical center, to play music by generation and type. Music is pre-selected based on patient pathology. For example, for LASIK patients, we play ’80s music and rock; for premium IOL patients, Sinatra and country. We follow the same principle with the movies we show. For example, we play new-release movies for LASIK patients. Since we consider the premium IOL channel the next generation of refractive surgery, we play the older classic movies, including the entire series of Elvis Presley films. We actually have patients go back to the waiting rooms to watch the movies after they have been seen. Some even come back later in the day to watch movies!

We have also created video feeds so that our patients can watch their family member's surgery through glass windows, or on flat-screen monitors. For family members who cannot be there on the day of surgery, we have a secure Internet portal for them to log on to so they can watch it in progress. Large flat-screen televisions were also installed in all surgical operating rooms, so that the surgeons' work may be displayed for all to see. This also allows the surgeons to train cornea fellows and nurses on different surgical techniques.

We try to take every opportunity to engage our patients. For example, we seek their votes on the best Halloween pumpkins we display in our practice during the month of October, and on homemade ginger-bread houses decorated by our staff and physicians. We give patients a Web link with a unique ID number to fill out satisfaction surveys, which we receive in real time. Thus, we can review the data instantly, rather than once or twice a year. Each staff member encourages patients to tell us how we can better serve their needs. Remember, patient satisfaction in all areas of your clinic is what drives word-of-mouth surgical referrals.

As for the "don'ts" in this department: Don't forget to ask yourself, as you walk through your practice, if your facility projects what your external marketing, mission statement express. Most importantly, ask yourself if it is a place where you would send your friends and family. If not, you have a lot of work ahead of you.

Get a Plan

So get the key decision makers together and create and implement your strategy to not just survive, but come out swinging. Most managers understand what needs to be improved upon to create an even better refractive surgical clinic. Someone once told me what doesn't kill you will make you stronger. For now, our country will most likely be in recession until the housing market stabilizes.

The good news is that there will be a significant pent up demand for refractive surgery; the bad news is that if you don't have a plan you will never survive the storm. OM

Dawn Cavanaugh is COO at Pepose Vision Institute, Chesterfield, Mo. She also sits on the board of Care Credit and consults for Bausch & Lomb, AMOVISX and Alcon. Prior to joining Pepose Vision Institute, she worked as a consultant for both ophthalmic practices and ASCs for 10 years, as well as holding the position of COO of the country's largest vitreoretinal clinic and ASC. She may be reached at dcavanaugh@peposevision.com.