Those of you who have been following my content over the years know that I am not a fan of discounting, especially when it comes to elective procedures. Analyses of several major categories including LASIK and breast augmentation have shown that lower prices do not translate to more procedures.
What surprised me, however, is the recent turnaround in consumer retail, which has been “ground zero” for discounting since the 1980s. This recent Wall Street Journal article clarifies one great outcome of the pandemic and the pressures on our supply chain. Major retailers were forced to cut inventory and break the vicious cycle of making too much stuff and then having to mark down the price to move the excess inventory … and make room for the next season’s goods.
Historically, this trained consumers to wait for the sale. The rise of discount stores (i.e. Walmart, Target) and e-commerce only accelerated this behavior. So learning that major players such as Macy’s and Ralph Lauren have seen positive results by cutting inventory is a big deal. One industry consultant put it bluntly: “Excessive discounting diminishes brand equity.” It’s true in retail and it’s equally true in the world of elective medicine.
This article, along with research showing the consumer shift from being “price sensitive” to becoming “quality sensitive,” should be all you need in terms of evidence to help your practice stop discounting. As one surgeon who has strong pricing integrity (meaning they do not discount) told me, “discounts are the heroin of marketing.” Easy to get hooked on and hard to get away from.
Indeed, it takes resolve and a willingness to understand what patients are really seeking, not just what they are saying when they ask for a discount. We cover this in Beyond Bedside Manner as part of the sixth value driver for the modern practice — the section on price.