Sakaduski Marketing Blog

For those of you who would rather read a good book than work (but would rather that the boss didn’t catch you at it), here’s a hilarious website that has taken great works (Fitzgerald, Twain, Dickinson, Tolstoy, etc.) and reduced them to PowerPoint presentations that, when viewed from a distance–say from the perspective of a boss strolling by–make it look as if you’re hard at work.

http://www.readatwork.com/

There is an excellent article in the Harvard Business School newsletter http://hbswk.hbs.edu/item/5957.html

on price increases.  The article is based on the (undoubtedly true) premise that, due to the nearly universal awareness of increasing oil prices and the cascading effects that is having on prices of consumer products, customers are more price conscious than ever.  As a result, people are looking for areas to cut back, reuse, postpone, or eliminate.

In the dental industry, the impact will likely be seen in several areas:

1. Dentists may postpone or eliminate discretionary expenditures, unless they can be depended upon to increase revenues.

2. Products linked to discretionary patient expenditures (such as whitening and cosmetic procedures) will likely take a downturn.

3. Dentists will be looking for deals (this may represent an opportunity for small companies able to undercut prices).  American companies will likely feel even more pressure from competitors in countries such as China that have lower labor costs.

4. Trade show attendance may drop even more, as dentists evaluate whether the expense is worth the value, when CE is readily available through other means.

5. The cost of a sales call will rise dramatically with increasing oil prices.  Companies able to sell online or through other means will have an advantage.

6. Customer behavior may change (both dental professionals and patients), so it will be harder to predict buying patterns.

7. Dealer relationships may take some heat as distributors try to keep costs down (or pass them on to vendors) while their sales expenses rise.  Vendors may also find dealers stretching out payment terms.

There have been a number of recent articles regarding the slowing of growth in the dental industry. Some of the dealers and manufacturers have seen slower sales in items such as braces, crowns, implants and veneers. This means a slowdown in spending for discretionary cosmetic procedures that often drive most of the profits in a high-volume practice. When the slowdown begins at the patient level, it means people are concerned about the future of the economy. You don’t hear people complaining about $3 milk or $3 bread, but everybody gripes about $4/gallon gas. We have seemed to have crossed a barrier once thought impenetrable. And I have not found anybody who thinks the price of gas is going down anytime soon. People know that $4 gas is not a good thing, and it gives them pause to consider where they can cut costs. So patients postpone procedures,dentists stop buying, dealers reduce inventory and manufacturers curtail production resulting in a general industry malaise.

Maybe there are some silver linings in these black clouds. Maybe we will see more products that are not marketed to make the dentist more money, but products that will make the practice better for staff and patients. Products that screen for oral cancer, for instance. Maybe we will see more movement to advertising on electronic media sites that offer great promotions and plenty of information to help the customer make an informed immediate buying decision (and I don’t mean silly videos showing people sitting poolside in dental chairs). And just maybe we will realize how inefficient dental trade shows (and dealer sales meetings) have become. Higher aifares, higher cab fares, higher hotel rates and higher convention costs to attract fewer attendees makes even less sense now than a year ago, and will make less sense a year from now.

It is hard to predict if and when the economy will improve dramatically anytime soon. What we may be seeing are permanent changes that will affect the way business is done over the next five-ten years. They may be just the kind of changes our industry needs.