Murphy’s Law: Percentage of (Business) Chair
Nurturing relationships with current clients is one way to generate more revenue
By Mark T. Murphy, DDS, FAGD
Laboratory owners know that retention saves valuable marketing dollars to spend elsewhere when you do not have to replace as many clients. The next most impactful sales strategy you can employ is to sell more to your existing clients. The impact can be huge. If you had a $1 million laboratory with 60 clients each spending just less than $1,400 per month and you got them each to buy just one more crown, implant, or other product from you at $150, you would grow your laboratory by more than 10% with no new customers. This article will outline three strategies to help you do just that.
Cross Sell to Clients
Several laboratories have cited the great success they have when they open up a conversation about the broader products and services they offer, often surprising existing clients who did not know they were full service or that they did implants. For some, “cross selling” becomes “cross telling.” Others may need to showcase their other offerings and demonstrate why they should be their preferred provider. Maybe you are local, faster, less expensive, or offer a level of quality that they desire. Craft a value proposition that makes it easy for them to do more business with your laboratory. Make sure you know what clients are currently buying. Run a report that shows products that are used by certain dentists and then classify them into anterior, posterior, removable, or implant categories. This allows you to open with the strength of what you do for them now and bridge to what you can do for them in the future.
The Average Dentist Uses 3.2 Laboratories
According to the American Dental Association’s 2008 Survey on the Use of Dental Labs, some dentists use as many as six dental laboratories. Ignoring the accounts receivable issues that might cause some dentists to use multiple laboratories, how can one laboratory concentrate more of a given dentist’s work with them? If they offer an incentive, the dentist may see an advantage to doing more work. Rewards programs work well because there is added value in accumulating more reward credits with one supplier. I fly 150,000 miles annually on Delta and have the highest SkyMiles Medallion status, Diamond. If I spread that out across American and United, I would never see free upgrades. It works. Hotels, restaurants, airlines, and so many other businesses have developed loyalty programs that your dentists will know well. Maybe they will even expect it.
Growing them grows you
Continuing education has always been a great way to interact with clients and strengthen relationships. Most CE offerings are clinical and technical, yet surveys indicate that dentists face different challenges beyond those areas. If you offered or sponsored a continuing education session that helped them solve their more common challenges, two wonderful things could happen. First, the dentist would appreciate that you saw more clearly what they needed and came to their aid. Second, with some behavioral obstacles out of the way, the dentist might be more successful and do more work. Their growth is your growth. If all of your dentists grew 10%, so would you.
Success is determined by commitment, not uncertainty. These three monthly average laboratory bill drivers work. There are no quick fixes that will outperform good hard work, but next time you feel that you are in a slump, go fishing in your own backyard.
About the Author
Mark T. Murphy, DDS, FAGD, is the Principal of FunktionalTracker.com and Lead Faculty for Clinical Education at MicroDental Laboratories.