It wasn’t too long ago that if somebody had a hearing challenge, then visiting a local clinic like yours was the only option for them.
- They knew you
- Therefore they trusted you
- And therefore they chose you.
It meant that your pricing could be simple, and much of the industry could almost have carbon-copy versions of each other’s pricing packages due to lack of competition, which was heavily dictated by the manufacturer’s recommendations.
Today, many clinics have the exact same structure.
- They have a premium option
- They have a mid-level option
- And they have a basic option.
The packages are heavily focused on the technology, with the only other explanation of what’s included in each package typically being the years of warranty and the level of care the patient receives. Mono is typically half the price of binaural, and the packages often share the exact level of technology that the patient will receive as part of their decision.
This approach is very simple for the patient to understand, and many highly successful private practices have been built upon it.
If you have a version of pricing as detailed above, then I commend you for being able to build a successful clinic upon this simplistic pricing. However, I also encourage you to read what I’m about to share, as there is a big opportunity to not just only future-proof your clinic but also grow your ASP and close rate significantly.
Why You Should STOP Using Traditional Pricing Packages
The truth is, the world has changed, yet these traditional pricing packages have not.Although a patient used to choose their local hearing care clinic and didn’t consider any other options, today’s patient is very different.
- They have more choice than ever before.
- They have the ability to research like never before.
- The data suggests they’re fussier than ever before.
You’re probably experiencing this yourself by having more educated patients walk through your door that have clearly done their research.
The big problem with your traditional pricing is that it doesn’t articulate what you actually deliver in exchange for the transaction.
It sells you short.
It only explains the level of technology that they’ll receive and the level of warranty, which means that you are very easy to price shop/run an apples vs. apples comparison against.
It plays to the narrative that a patient is buying a set of hearing aids and a few years’ warranty … the exact same thing that Costco offers direct-to-consumer offers and the cheap dispenser down the road offers.
You give patients no other way to value your offering other than the price … which means that they’re always going to make their decision based on who is the cheapest.
It’s not just preventing people from visiting you in the first place, but it’s also killing your close rate, as they want to price shop you believing that you solely sell “expensive” hearing aids … and your ASP is suffering as they struggle to understand the difference between technology levels.
Essentially, you’re a high-end steak restaurant that just says “Beef” on your menu … and people are scratching their heads as to why you charge significantly more than McDonald’s across the road.
It’s not just causing strain on the patient’s decision making process, but it’s also causing challenges across your business.
- You’re forced to heavily guard your pricing, resulting in your front desk being unable to answer reasonable price-related questions that cause them frustrations
- It leads to conversations where patients are confused about the $1,000+ difference between different levels of technology (and you end up in a confusing technical conversation comparing “fluxcapacators”)
- You can’t allow a patient to walk away with your pricing sheets in case they take it to a competitor, or you’re undercut by somebody else
- And it’s open to price shopping, as the patient could Google the same technology and almost definitely find a cheaper solution.
There’s a much better way to future-proof your pricing and feel an instantaneous benefit … and it’s simpler than you may think.
You Just Need to Tell the Truth
The truth is, you’re never going to be able to — or want to — compete on price.
The way you distance yourself from the apples vs. apples comparison with competitors is by simply telling the truth.
You and I know that hearing devices are only part of what the patient is purchasing when they work with you, and the real value is all the additional things that you do … yet traditional pricing plans do not incorporate these things.
For you to ensure that you can maximize close rate, become impossible to price shop, and build a pricing structure that helps a patient to understand all the things that you do that others do not, then you need to accurately articulate what a patient actually receives as part of each package.
It means that you move away from selling hearing AIDS and instead sell hearing CARE.
The way to do this is by developing service-focused treatment plans.
By pivoting to developing treatment plans, you can show the patient all the things that you do to help them to achieve better hearing (outside of the technology).
This means that the patient’s options do not just look much more attractive, but they also clearly highlight all the things that you do that competitors/alternative options do not, making it impossible to ever fairly price shop you.
Let me share an example with you:
NOTE: This example is situated on this clinic’s website for the world to see, as they’re not worried about competitors seeing their prices due to them being impossible to compete with.
Can you see why this is very different?The level of technology is only one line item (that is eight bullet points down).
The core of each package shares all the things that a patient gets outside of the hearing devices, including things like the number of years’ service they get, the advanced fitting process, the support if things go wrong, the custom earmolds, the access to remote consultations, and items such as a minimum guaranteed future trade-in value.
Also note that the level of service changes with each treatment plan – the only point of difference is not the technology level. The top package includes all the benefits, and then little by little, they’re removed or reduced toward the lower packages.
This approach delivers five big benefits:
1. It gives the patient more information to make a decision on which level of technology is right for them (it steers the conversation away from solely comparing technology).
2. It makes you incomparable to competitors because nobody else line items this stuff, so it’s never going to be an apples vs. apples price comparison.
3. It positions you away from selling widgets – and in today’s world, if all you’re perceived to sell is retail devices, then you’re going to be in a pricing fight toward the bottom!
4. It increases close rate by giving more reassurance that the patient is in the right place and reduces the confusion resulting in a simpler buying decision.
5. It increases ASP with all the biggest benefits stacked toward your more premium packages, making it a more attractive option.
Although pricing is something that many clinics do not like to alter/play with, it is one of the most influential keys that you can turn that will make the biggest compounding difference to your bottom line. If you can increase the close rate by just 5% and collect an extra few hundred dollars per transaction, the difference to your end of year revenue and profit is significant.
How To Develop Your Custom Treatment Plans
Although there isn’t a simple paint-by-numbers framework, there are four big things to consider when developing your treatment plans.
#1 – Naming Your Treatment Plans
The first thing to define is how many treatment plans you’re going to have and what the name of each of them will be.
Naturally, you don’t want too much choice between packages.
If you went to Starbucks and they offered you super small, standard small, small, small-medium, medium, large-medium, small-large, large, extra-large, and super large … you would probably just grab a bottle of water.
We want to avoid overwhelm and ideally only have between 3-5 different treatment plans for a patient to choose from.
You can then define the names for each.
Remember, these are NOT levels of technology, so we want to avoid terms such as premium, superior, or basic.
Instead, you want them to sound like the name of an in-depth treatment plan.
Here are some examples that we’ve seen used in the past.
Of course, use the above as examples or define your own names.
#2 – Defining Your Line Items (What’s in Each Treatment Plan)
Here’s the tricky bit. You need to decide what line items go into each treatment plan.
However, you don’t have to reinvent the wheel. All you have to do is think about all the things that you currently do for patients that they currently don’t know you do until you do it!
Consider what they actually get throughout their journey, the types of appointments, how often you have their back, and the unique way you do things.
This may give you all the line items that you could ever need.
If you’re looking for some inspiration, then here’s some things to think about:
- Years of warranty – it should vary between the top and bottom package.
- Access to your level of care – once again, it should vary depending on the plan.
- Access to remote support – is this available to all or based on the plan?
- Custom earmolds – this could be included in your top plan and have an extra charge on the bottom plans.
- Contribution toward upgraded technology – could you build a $1,000 contribution toward upgrading technology within a timeframe like 36 or 48 months to anchor a future upgrade?
- What about VIP access to appointments for your top package?
You want to ensure there’s a gulf of difference between your highest package and your lowest package outside of technology, so consider what items can either be reduced (in terms of time/value) or removed.
#3 – Deciding Your Pricing
Once you have defined what is included in each treatment plan and the name, you then need to decide on pricing.
Although this is essentially repackaging your existing pricing packages, it does present you with an opportunity to review your existing pricing.
There are three things that you should consider:
1. Does your pricing look authentic or made up?Considering your treatment plan is a combination of services, make sure that the dollar amount is not a round number.A $5,500 treatment plan looks like it has been rounded up and estimated. Yet $5,540 looks like it’s well considered and calculated.It feels more genuine.
2. Could you squeeze some extra dollars?There is an opportunity in almost every clinic’s pricing to squeeze some extra dollars out of any transaction without it impacting the decision-making process.For example:The difference between somebody making a $5,590 decision and a $5,690 one is miniscule. Nobody is happy to pay $5,590 but $5,690 is out of reach. Consider these small areas where you may be able to squeeze some extra margin (which is all profit). It adds up.
3. Please don’t halve the mono cost.Remember, the entire narrative is to show all the value that happens outside of the widget, so it’s illogical to charge half for mono.If your treatment plan for mono is half the price, then it reinforces that all the value is within the widget (not your care).Your mono should be a slight decrease – not half.
#4 – Producing Attractive Assets
Once you have finalized your new treatment plans and you’re happy with them, then you need to have them designed into something that feels like part of the furniture of your clinic.
All too often do we see clinics that just have a lousy printed piece of paper that has been scanned to within an inch of its life – it does not represent a business asking for several thousands of dollars.
Instead, have a graphic designer make them look professional and turn them into something that is on-brand. Have them laminated and ensure that they feel like a core part of your clinic … these small differences make a difference.
This is work … and it’s uncomfortable.
Very few of us like change, especially when we’ve done something the same way for a long period of time.
However, as detailed in this article, I can guarantee that sticking to traditional pricing is not just going to make things more difficult in the future, but it’s also impacting your ASP and close rate right now.
It’s making a patient’s decision more difficult and causing needless strain to your team.
If you can give your pricing your attention, and implement a treatment plan style of pricing, then it’s a high pay-off activity that will serve you for years to come and make a large difference to your long-term success.
To listen to the complementary podcast to this article, click HERE.