Archive for the ‘Reasons Why Medical Spas Fail’ Category

Why Medical Spas Fail Reason # 9: Buying the Laser Before You Have a Business Plan

June 17, 2011 5 comments

In the film, Field of Dreams with Kevin Costner, the ghost would whisper, “Build it and they will come.”  Meaning all Kevin Costner needed to do was build the baseball stadium and the ghostly baseball players would come to play ball and people from all over would visit his farm and pay to watch them play.  Doctors often have the same mentality when it comes to buying laser equipment.  The idea, “Buy it and they will come,” is derivative of the Field of Dreams concept, that all you need to do is buy the laser and patients will ask for the treatment and you will make a lot of money with this device.

The reason most doctors don’t think about this is because they have not had to traditionally.  Most practices receive the great majority of their revenue from insurance companies, not from advertising their services.  The idea that they would need to spend a lot of money on advertising to bring patients through their door is a foreign concept in most cases for a lot of medical specialties.  This all changes when trying to generate aesthetic revenue because these procedures are not covered by insurance and the doctor needs to spend money on advertising to bring cosmetic clients through their door.

The smooth talking, good-looking, laser sales rep will show you some impressive numbers about the revenue you can generate with his/her laser, however they fail to mention exactly how you will get your telephone to ring, how your receptionist will effectively book those aesthetic consultations, and how you will close your consultations and sell thousands of dollars worth of aesthetic treatments.

The successful operation of an aesthetic practice does not happen by chance.  It requires careful planning, marketing, training and resource allocation.  Quite frankly, it requires a lot more work than most doctors are willing to put forth if they only knew of the work involved before they began the process.

Careful thought needs to be taken in creating a basic business plan and a realistic cash flow proforma of the first 12 months of operation.  You should project ultra-conservative numbers and determine if your investment will pay you the Return on Investment that you are expecting.  After you have done this, the LAST step in setting up an aesthetic practice is buying the laser equipment.

Vin Wells, MHSA

Why Medical Spas Fail Reason #8: Lack of Cash Flow Planning

June 16, 2011 1 comment

One common pitfall for medical spa owners is the failure to properly account for prepaid services, such as discounted packages of laser or light-based facial treatments.  If you sell a package of treatments up-front, you can have obligations against those treatments for up to 8 months out (e.g. Laser Hair or IPL).

If you spend all of the money from those packages now, then you will have future expenses against revenue that has been long-spent.  This places you in a negative cash position which requires that you play catch-up, although it is difficult to ever catch up if you manage your cash flow in this manner.  The only potential solution is to offer higher revenue, single treatment procedures such as laser lipolysis or fractional CO2 resurfacing so that you can obtain significant revenue from single, one-time treatments that will offset the money spent in commodity-based treatment packages (Laser Hair & IPL).

The best solution is to never get into this situation and maintain an adequate cash reserve at all times.  You can help keep track of outstanding liabilities by using an accrual-based accounting versus a cash-based method.  By doing so, you will quickly realize all of the up-front money received from laser packages has liabilities against it for up to 8 to 9 months out.

Maintaining business liquidity is extremely important because you will have months in which you are offering promotions and selling packages, and follow-up months in which you are fulfilling the packages that have already been purchased from months prior.  You need adequate cash to offset the expenses you will face down the road when it comes time to deliver the services clients have paid for in advance.

Vin Wells, MHSA

Why Medical Spas Fail Reason #7: Lack of Systems in Your Practice

June 16, 2011 3 comments

In the book, “The E-Myth Physician”, Michael Gerber teaches us that unless your practice can be duplicated, it will never run without you.  According to Gerber, if you don’t have systems, then your aesthetic business will ultimately fail because you as the owner must keep all of the plates spinning in order to keep everything functioning.  Unless you train your employees to operate your clinic without you always having to be looking over their shoulder, you and your business will suffer from burn-out.  Systems and procedures are necessary for the long-term success of any business.

Perhaps the hardest area for doctors to address in their aesthetic practices is daily operations.  In each practice there are hundreds of daily routines and processes that take place. These processes are the methods in which things get done by our team members (support staff, laser technicians and consultants). This includes how the phone is answered, how consultations are scheduled, who is responsible for what services, how payments are collected, what paperwork clients fill out, how clients are greeted when entering the office, how clients are placed into the treatment room, how aesthetic treatments are performed, how consultations are conducted and measured, how charts are pulled and organized, and who is ultimately responsible for what.

Each of these areas can have a significant effect on the experience a patient has in your clinic and the profitability of your practice.  The importance of these areas should not be under -estimated.  If you find yourself working longer hours, getting paid less, feeling less in control and not having fun, then you need to develop an E-Myth practice.

Below is a list of the areas that should be systemized within your aesthetic practice:

Operational Procedures

A. Pre-Opening Procedures
Business Opening Checklist & Timeline
Establishment of Business Guidelines
Securing a Location
Building Out Your Site
Setting Up Bank Accounts
Getting Insurance
Meeting Your Tax Obligations
Required List of Equipment
Initial Inventory
Conducting a Grand Opening

B. Human Resources
EEOC Guidelines
Laws Regarding Harassment
Immigration Reform Act
Wage & Labor Laws
Job Descriptions
Employee Profile
The Employment Application
The Interview Process
Introductory Period
Developing Personnel Policies
Employee Orientation
Time Reporting
Compensating Staff
Uniform / Dress Code
Performance Evaluations

C. Office Procedures
Suggested Office Hours
Customer Service
Client Retention
Daily Activities
Confirming Appointments
Checking Out First Time Clients
Checking Out Regular Clients
Accepting Payment
Processing Auto Debit Payments
Merchandising Retail Products
Inventory Management
Generating Business Reports
Maintaining the Office
Safety and Security

D. Sales
Scheduling New Client Appointments
Established Client Appointments
Greeting Clients
Conducting Consultations

D. Clinical Procedures
Clinical Certification
Treatment Programs
Greeting Regular Clients
Taking Clinical Photographs
Clinical Chart Documentation
Clinical Follow Up Calls
Laser Safety
Clinical Equipment Maintenance

F. Advertising
Calculating Advertising ROI
Internal Advertising Strategies
External Advertising Strategies
Required Advertising Expenditures
Public Relations
Community Involvement
Obtaining Advertising Approval

Written Medical
Treatment Protocols

Step by Step Clinical Treatment Protocols & Procedures
Laser Hair Reduction
NdYAG 1064
Photo Facial
Fractional Resurfacing
Spot Testing
Set-up & Operation of Soprano
Set-up & Operation of IPL
Care & Maintenance of Lasers
Infection Control
Exclusionary List
ST Handpiece
Eye Protection
Laser Safety Precautions
Laser Committe
Q Switch
Laser eyewear inspections
LSO Responsibilities
Laser Safety Index
Restylane and Juvederm
Jessner Peel
Tooth Whitening
Other Tx Index
Portrait PSR 3

Home Care Instructions

Hair Removal
Restylane and Juvederm
Jessner Peel
Tattoo Removal
Laser Vein
Accent Home Care
Teeth Whitening

Consent Forms

Arbitration Agreement
Hair Removal
Restylane and Juvederm
Jessner Peel
Tattoo Removal
Laser Vein
Accent Home Care
Tooth Whitening

Medspa Build Out
Full Color Floor Plan
Interior Elevations
Storefront Elevation
Interior Finish & Color Board
Interior Finish Schedule
Interior Finish Listing
Door & Frame Schedule
Glass & Glazing Products
Storefront Sign Panel
Lighting Fixture & Ceiling Information
Retail Display Elevations
Furniture Information & Prices
Cost Reduction Options
Vendor List

Clinical Chart

Chart Organization Guide
Master Chart Checklist
History & Physical Exam
Sclerotherapy Progress Notes
Microderm & Peels Progress
Laser Hair Progress Notes
Cosmetic Filler Progress Notes
Tattoo Removal Progress Notes
IPLProgress Notes
Portrait Follow-Up logs
Technician Daily Checklist
Fillers Flowsheet
Body Contouring Analysis
Hair Removal Flowsheet
IPL Flowsheet
Nd Yag Flowsheet
Accent Flowsheet
Fractional Flowsheet
Client Intake Profile
Portrait Treatment Log
Tattoo Removal Progress Notes

Administrative &
Employee Forms

Spreadsheet Cashflow ProForma
Automatic Payment Form
Package Treatment Plan
Treatment by Treatment Plan
Master Price Book
Front Desk Operations
Front Desk Certification Manual
Refund Policy
Opening Receptionist Checklist
Closing Receptionist Checklist
Employee Forms
Uniform Specifications
Employee Evaluation
Employee Warning Notice
Employee Status Change Form
Reference Check
Interview Report
Interview Questions
Application for Employment
Office Policy Manual
Orientation Checklist
Form I-9
Time Sheet
Vacation Request
Corrective At Will Action Notice
Employee Policies Handbook
Employee Accident Report

Business Plan

Executive Summary
Strategic Objectives
Mission Statement
Products and Services
Clinics in Operation
Consolidated Profit/Loss
Market Analysis Summary
Market Segmentation
Buying Patterns
Competitive Advantages
Physician Recruitment
Staff Recruitment
Staff Training
Marketing Strategy
Sales Strategy
Implementation Strategy
Management Team
Liability Protection
Funding Request & Overview
36 Month Pro Forma P&L
36 Month Expansion Pro Forma
Corporate Support Expenses
Cash Flow Per Clinic
Per Clinic Start Up Cost

This business plan successfully funded the build out of multliple aesthetic practices. It can also give your existing practice new ideas on how to improve and enhance your operational performance.

A template for these systems is available by following the link below.  It is called Medspa in a Box and it is offered by the following company:

Vin Wells, MHSA

Why Medical Spas Fail Reason #6: Poor Liability Protection

June 15, 2011 Leave a comment

Liability protection is not just about properly medical malpractice coverage, it’s about several layers of protection within your aesthetic practice that help to insulate you from the potential you will be sued.  While you can never completely protect yourself from lawsuits, the following areas can serve as extra layers of protection:

1) Newer, Safer Equipment.  The newer equipment on the market has become more user-friendly and safer to use.  Using older technology can be much more “expertise” driven and in the wrong hands, can have disastrous results.  Some of the problems with older technology is inadequate cooling on the skin, a lack of ongoing calibration and maintenance of the older equipment, and a poor user-friendly interface that helps ensure the operator provides a safe treatment.  While newer equipment can never replace someone who has been properly trained in the safe user of lasers, it goes a long way to help prevent adverse reactions from occurring in the first place.

2) A Very Client-Friendly Practice.  It is important that your practice develops client friendly procedures within your practice.  Some of these include:  all clients who have received a procedure should receive a follow up clinical telephone call the day after treatment to make sure they are responding well to treatment.   Research has shown that most malpractice problems arise when patients feel they have no other recourse but to sue.   You should encourage your customers to contact you if they are dissatisified for any reason.   If they have any concerns regarding their treatment, you want to hear from them.  Doctors are required to be accessible telephone if they need to contact any client who is concerned for any reason.

3) Consent Forms Signed by Each Client.  Prior to receiving any treatment at your clinic, your clients should be required to read and sign an informed consent form that explains the risks associated with the treatment they are undergoing.  Typical risks include blistering, hyperpigmentation, and hypopigmentation.   In the event any of these adverse events happen to any client, you have signed a consent form that documents the client was aware of the risks prior to undergoing treatment.  If legal action is taken, you will have the consent form as proof that the client was aware of the risks of treatment.  Adverse events are very rare, however, and typically resolve over time so there is no lasting negative effect.  If no permanent damage remains, then there is no case for legal action.

4) Using FDA Approved Devices and Cosmetic Substances.  It is important to use only FDA approved devices and substances.  If anything were to go wrong during the treatment, the fact that a client was given an FDA approved treatment limits your clinic’s liability dramatically.  As long as you follow the guidelines for use with those FDA approved substances and devices, you are on very safe ground.

5) The Issue of Permanent Damage.  In order for a malpractice suit to hold up in court, there must be evidence of permanent damage.  In virtually every case with non-invasive cosmetic procedures, any damage caused to the client is typically temporary.  A good example would be hyperpigmentation.  In every case, hyperpigmentation will go away, leaving NO causation for someone to sue the center.

6)  Onsite Physician Providers.  The vast majority of reported lawsuits stemming from cosmetic procedures have been performed by poorly trained non-physicians who did not receive adequate physician supervision.  Having an on-site physician who has been trained and certified to perform and supervise all clinical procedures allows you to bypass a lot of the potential pitfalls of a standard “Medspa”

7) Arbitration Agreement Signed by Each Patient.  A signed arbitration agreement should be required of every client prior that undergoes any treatment offered at your clinic.  The arbitration agreement requires that any dispute that arises between a client and your practice will be determined by submission to arbitration as provided by state law and not by a lawsuit.  Both parties give up their constitutional rights to have any dispute decided in a court of law before a jury, and instead are accepting the use of arbitration.

8)  Professional Liability Insurance.  The final layer of protection is professional liability insurance.  You want to make sure you have a policy that covers both the physician and all individuals who are performing any aesthetic treatment under the doctor’s supervision.  The good news is there are now many insurance programs available for aesthetic practices and the price for coverage is very competitively priced.

Vin Wells, MHSA

Why Medical Spas Fail Reason #5: No Physician Ownership

June 15, 2011 1 comment

If you don’t have a doctor involved in your medspa, this could be the kiss of death to your business.

A major key to success for aesthetic practices who have weathered the recession has been the use of doctor-owners who provide high-end treatments and oversee the care delivered at each clinic.  Doctors should be viewed as profit centers who provide a substantial amount of the high-end services offered at each clinic.  This allows you to provide treatments that many competitors cannot at their facilities such as CO2 Fractional Skin Resurfacing, Laser Lipolysis, Body Jet Body Contouring, Fat Grafting, Laser Tattoo Removal, and other physician-based treatments.

The use of doctor-owners also increases customer-confidence and is used as a strong selling point to customers as they build relationships of trust with the doctor and other staff members.  In the event of an adverse reaction or customer concern, the value of a dedicated, full time physician to address customers’ concerns cannot be underestimated.  The vast majority of reported lawsuits stemming from cosmetic procedures have been performed by poorly trained non-physicians who did not receive adequate physician supervision.

Vin Wells, MHSA

Why Medical Spas Fail Reason #4: Poor Aesthetic Consultations

June 14, 2011 1 comment

If you are like most aesthetic practices, you will be spending a considerable amount of money on advertising to try to get people through your doors.  As we have already discussed, you need to make sure you are spending your advertising effectively and that your receptionist is skillful in getting a consultation booked.  The next critical step is to conduct a quality consultation and that your client moves forward with treatment and pays you money.

You are doing our clients a HUGE disservice if you do not give them a thorough, quality consultation.  In addition, the quality of your services is judged during the initial consultation.  If you perform a poor consult, how can people expect that you provide exceptional service or results?  This step is what separates you from other aesthetic practices and establishes your credibility as a skin care expert.  It can also be the difference between having a profitable practice and failing miserably.

Tracking Data and Holding Employees Accountable

Employees conducting consultations should be held accountable for their performance and be rewarded if they do well.  Every practice should track consultation closing percentages and the average dollar collected per consultation booked.  If you aren’t tracking this information, the old adage holds true, “If you don’t know where you’re going, any road will get you there.”  You should hold regular meetings with your consultants to review their performance and help them establish future goals for improving along with training in areas of weakness they may have demonstrated.

The Right Person with the Right Skills

A quality consultation establishes a strong relationship that can pay large dividends for many years to come and requires significant positive energy and work.  You can’t delegate this responsibility to just anyone in your practice.  You need to make sure the right person with the right people skills is performing this critical step and that you incentivize him or her appropriately.  This person must find great personal satisfaction in helping the client achieve her aesthetic goals.  They should also be motivated by money and you need to provide proper incentives to make sure they commit the appropriate amount of energy during the consultation.  Aesthetic consultations is a sales process, plain and simple and you need to hire good salespeople.  This shouldn’t come as a surprise to anyone.

What skills do top consultants possess?

  • They have presence (energy, conviction, interest when speaking & listening)
  • They are good at relating to other people
  • They use good questions to uncover needs
  • They understand what the customer communicates in words, tone, and body language
  • They are good at customizing their products to the needs of the customer
  • They ask follow up questions to make sure the customer understands what they are saying
  • Understand and present the appropriate procedures with before/after benefits

Developing a Consultation Certification Program

To be a good consultant, you must become well-educated in the following areas:  skin anatomy, cosmetic skin diseases, current aesthetic treatments & technologies, light-based treatments (ablative & non – ablative), botox & cosmetic fillers, laser lipolysis, radio frequency technology (tightening, fat & cellulite), fractional skin resurfacing.  Even if you clinic does not perform all of these treatments, you need to be knowledgeable because chances are the client will be.  Most prospective clients have done their research in advance through the internet and if you’re not careful, they could very well have more knowledge than you.  If you aren’t knowledgeable in these areas, this will become very clear to the prospective client and will hurt your consultation performance.

There are plenty of good books out there that you can use as your curriculum and you can also have your staff develop quizzes and tests and hold regular meetings to get your entire staff knowledgeable regarding all of these areas.

Focus on High Dollar / High Margin Procedures

You have a limited time to spend with each client during a consultation.  You can easily spend one hour per consultation or more.  To maximize your time during these consultations, you need to make sure you understand your sources of greatest revenue.  You must focus on HIGH DOLLAR / HIGH MARGIN treatments.  Selling larger packages typically means combination therapy which results in happier clients.  It is important that you understand that your goal of increased revenue is aligned with the client wanting the best results possible Small packages or single treatments typically do not yield good results and the client walks away dissatisfied – never to return!!!

Do not pre-judge what the client wants, needs or how much she can spend.  Do not judge a book by its cover.  As a consultant, do not impose your project your value system onto the client.  Personally, I would rather spend $3,000 on a new HD TV, not on a package of facial rejuvenation treatments, however I am not the prospective client!  Give the client what her or she wants, not what you want.

Where to focus your energies

People are willing to spend big dollars to rejuvenate their face and sculpt their body.  Your skin analysis and consultations are designed to generate COMBO PACKAGES / HIGH DOLLAR SALES.  The amount of quality time you spend with clients is proportionate to the size of packages you sell them.  You want to spend at least one hour on facial consultations – if not more

Conduct a Quality Skin Analysis

Conducting a skin analysis is a critical step in the consultation process and it is how we get the client to open up regarding their perceived skin issues and problems.  There are many different types of equipment that’s out there that you can use as tools for the skin analysis. Some of the most simple yet effective tools are the following:  (1) a lighted mirror magnifier, (2) a Woods Lamp (3) a Video Skin Microscope.  We use these tools to help the client reveal to us what there most important skin issues are.  It is important to remember that the prospective client should be the one doing most of the talking while using these tools.  The client is ultimately the one “conducting” the skin analysis.  What are issues to you may not be issues to them.  You need to focus on their expressed issues!  After the skin analysis, we then determine the client’s hot buttons and help them prioritize their expressed issues.

Adding Systems To Your Consultation Process

Your chances to develop good consultants increase exponentially if you have developed systems to help your sales staff perform consultations.  In addition to a system for skin analysis, we have also developed other tools in our clinics to help our salespeople succeed.  We have developed PowerPoint presentations that the consultant can use to review how treatments work with the prospective client and show appropriate before and after photographs.  These presentations cover the same material every time and eliminate the variability of different expectations that can arise if each consultant is promising different results.  It is important to set the right expectations (number of treatments, potential side effects, good candidates for the procedure, etc.).  Having a system to present strengthens our expertise in the client’s eyes.

Closing the Sale

All of your work during the consultation is for nothing unless you can close the sale.  It is important that you close the sale with a timeline incentive that motivates the prospect to action.  If you don’t close them during the consultation, you only have a small chance (10-15%) of closing them later.  We typically give the client a free treatment if they commit to move forward on the day of their consultation.  It is important to place pressure on the client without it being a “hard sell” approach.

Another important approach is to give the client a choice between “YES” commitments.  An example of this would be:  You can pay for the entire package today and receive a $500 free treatment, or you can opt for the 6 month payment plan at $X per month, which option would work best for you?”

Items Needed for Consultations

We use the following tools for all of our consultations:  a Price Sheet, Client Profile Sheet, Skin Analysis Sheet, Suggested Treatment Plan, a Hand Calculator, Flat Screen TV or Projector, a computer to connect to TV or Projector, Consultation Power points, and Skin Analysis Equipment.

In summary, consultations require passion, energy, and intensity.  If any of your employees aren’t strong in these areas, they should not be performing consultations.  Consultations also require a systemized approach that ensures a certain level of consistency for each client who receives a consultation.  There is TOO MUCH at stake to leave consultations to chance or to someone who doesn’t care.

We offer FREE AESTHETIC CONSULTATION TRAINING on this website!  Please go to the following link for the training:

Vin Wells, MHSA

Why Medical Spas Fail Reason #3: Poor Telephone Conversion

June 14, 2011 2 comments

First impressions mean a lot.  And because the telephone represents most people’s first impression of your aesthetic practice, it could mean everything–if they don’t love what they hear, they’ll hang up and keep calling around till they find someplace that they will love.  And if a caller is not interested in what they hear within the first 30 seconds, you’ve lost them for good!

You as the owner of the aesthetic practice have paid far too much in advertising dollars to hope your receptionist does a good job over the phone.  You can’t leave anything to chance, you could easily see all of your precious advertising money go right down the drain!  You need to convert a high percentage of prospective callers into scheduled consultation appointments.

How you answer the caller’s first question will set the tone for the rest of the conversation…and maybe the rest of the caller’s relationship with your aesthetic practice.   Most people who call in will ask you one or two questions either about the offer, the practitioner, prices, location, etc.  They ask these questions because they don’t know you, and they don’t know what else to ask.  These inquiries are the lifeblood of your aesthetic practice, and must be handled properly, using appropriate scripts.

Remember that your objective is to sell the appointment, not to sell a service over the phone.  Try not to veer away from the script and get into a detailed discussion of your services.  What is important is to defer the caller while keeping their trust.  Tell the prospect, “The consultant will explain all of the details to you after she’s had a chance to meet with you.”  The following principles are essential to converting callers to scheduled appointments at your aesthetic practice.

Principal #1:  Your Receptionists Must Be Knowledgeable Regarding Your Services

How much does your receptionist know about the aesthetic services offered at your practice?  If the answer is, “very little” then you need to make some radical changes in how you view your telephone help.  Whether for good or bad, callers expect your staff to be knowledgable about the services you offer.  Callers make a judgment on the quality of your services by the knowledge of your front desk staff.

If you have brochures on all of your treatments or if you have a website that explains your treatments, then you need to have your telephone receptionists study this information and TEST them on their knowledge of this information.  When someone asks them about how IPL works, they need to be able to provide a concise answer that addresses the question yet sets the stage for the caller to receive a scheduled consultation at your clinic.  I recommend that you establish weekly education meetings that require your staff to read material and take quizzes on the material.  You can get your staff involved by assigning a new staff member to develop the weekly quiz for the material you will be reviewing.

In addition to informational knowledge, there is no better way to help your receptionists become champions of your services but by receiving the treatments themselves.  This allows them to relate personal experiences of your treatments and help you pre-sell over the phone and book consultation appointments.

Principal #2  You Must Track and Record Your Telephone Calls.

You like your receptionists, but how do you know they are doing a good job?  Technology exists that allows you to record all incoming telephone calls into your practice and audit the responses your receptionists are giving to your prospective clients.  You can track your appointment conversion rates and assess how well your practice is doing in converting callers to appointments.  There are a number of services that allow you to audit your telephone calls, but what you really want is some savvy patient review marketing using a service like Podium.

Principal #3  You Must Incentivize Your Receptionists to Book Consultations

If you are converting at least 50% of all prospective callers into scheduled appointments, this is a good start, however it is only the beginning.  Your goal should be to continually improve your consultation booking percentage and reward your receptionists for doing a good job.  How do you incentivize your receptionists to book more consultations?  At our clinics one strategy that works very well is to pay your receptionist a base pay of $10-12 per hour and reward them for each new consultation they book during their shift.  This could be an incentive of $2 per consultation booked.  If the receptionist books 7 consultations during her shift, this results in an extra $14 they have made for the day and has increased their hourly pay from a base pay of $10 to $12 per hour to $12 to $14 per hour.

There are two caveats to this strategy:  (1) The Receptionist is in charge of tracking her own booked appointments in a log sheet if she wishes to be paid this bonus.  This makes your job of tracking a bit easier because the receptionist knows she must track the calls and report which consultations she booked for the day.  (2) In order for the receptionist to receive the $2 bonus per consultation booked, the booked consultation must actually show up for their appointment and receive a consultation.  This ensures the receptionist is setting up quality appointments and not just putting names on the schedule to receive extra pay.

Principle #4  The Receptionist Must Engage the Prospect. 

Help the prospect participate in the conversation.  When I consult with aesthetic practices, the biggest problem I see is the receptionist passively answering questions posed by the caller.  When the caller is done with his / her questions, often times the receptionist doesn’t know what to do or say!  Nothing could be further from what MUST be done to keep your medspa running profitably.

The key to success in converting an incoming inquiry call into a booked appointment is to establish value and win their trust.  You accomplish this through your ability to ENGAGE the prospect right up front in the call.  Simply put, this means that you must help the prospect participate in the conversation so that they can feel comfortable asking their questions.

Listen Attentively.  The key to engaging the prospect is to listen attentively to them.  Be certain that you have heard what the prospect has said.  Restate their idea in your own words to be sure you have it right, and to let the other person know that you understand.  Make them feel comfortable asking questions.

Establish a relationship up-front.  If you answer the prospect’s questions directly, without engaging them in at least a brief conversation about their needs and concerns, they will still feel unsure or suspicious, and often will be reluctant to set an appointment.  That’s because you haven’t established a relationship with the prospect up front.

Be a good conversationalist.  When you “break the ice” and make them feel that they can trust you, they will feel much more comfortable about coming to see you.  Breaking the ice will enable you to set appointments a much higher percentage of the time.  Thus you must have a sincere interest in the people who are calling.  You must be a very good conversationalist while being sales-oriented in booking an appointment for the prospect.  And you must know about your aesthetic practice’s services, the practitioners and technicians and their backgrounds and certifications.

Ask open-ended questions.  They key to being a successful telephone call handler is to ask good, open-ended questions.   Open-ended questions are those that cannot be answered yes or no, and tend to lead to a long reply on the part of the prospect.  Examples include:

  1. How long have you been considering this type of treatment?
  2. How long have you had this problem?
  3. When did you first notice the problem?
  4. What type of cosmetic services are you interested in?
  5. Does it seem to be getting worse?

Principle #5  Be Enthusiastic.

Be enthusiastic and caring in all that you say.  If it helps you to get the right attitude, think of the caller as a close friend who needs your help.

  1. Smile when you talk.  If may sound trite, but smile when you talk – this actually helps you to transmit a positive “vocal transmission.”  Top converters smile when they speak.
  2. Vary your tone and pitch.  Use the range of your voice to be louder, softer, faster, and slower – as it would sound naturally.  A monotone conversation will not sell anything.
  3. Develop a Strong Belief in Your Aesthetic Practice’s Services.  People like to be convinced.  They want to hear how “wonderful” something is, and they hear that through your enthusiasm, your glowing reports, and your personal endorsements.  Become a user of your aesthetic practice’s treatments so that you can tell clients your own first-hand experiences.

After answering questions, schedule the appointment.  After you’ve answered a question, assume the call is convinced, and go right into setting the appointment.  If the caller has another question, he or she will ask, so you don’t need to say, “Do you have any more questions?”  That will only make them think of one.

Principle #6  Be Prepared With Your Scripts.

  • Be Ready to Talk When You Answer the Phone.    It’s more important to be comfortable and ready to talk with a caller when you answer the phone than it is to answer on the first ring.  Be sure you’re at your desk with your script in front of you.
  • No one on hold for more than 30 seconds.  If you have too many calls to handle at once, and you have to put one (or several) on hold, make sure you come back at least once every 30 seconds to tell the caller that you’ll be right with them.  Studies show that after about 30 seconds on hold attention and interest falls dramatically.  If this is not possible, ask for their phone number so that you can call them back.
  • Know the scripts given to you by your aesthetic practice.  Know the scripts, but put it in your own words so that it feels natural to you.  Keep the call conversational, like you’re talking to a friend.  Speak the words cheerfully, as if welcoming guests to a party you’re giving.
  • Rehearse, rehearse, rehearse.  Go over the scenarios many times, both by yourself and by role-playing with someone else.  You may feel self-conscious at first, but that is exactly why you are rehearsing.  When the words become very natural to you, you are ready to take on real calls.
  • Understand what you’re saying.  You must understand every single word and concept, otherwise it really will sound like you’re reading a script.  Discuss and define every term before you talk to anyone.

Principle #7  Show Empathy.

Mirror the prospect’s mannerisms.  This means matching their tone and pace.  If they speak slowly, you do the same.  If they speak at a fast pace, you speed up slightly.

  • Try to ease their fears.  Remember that many people are a little intimidated when they have to call a new place.  Just like you, they want to make a good impression. So remember that they might already be uncomfortable so do what you can to ease their fears.
  • Listen to the prospect’s concerns (emotional hot buttons) and give them what they need as a solution.  Never forget that you are talking to a real person.  Though you will hear the same questions, objections and concerns over and over, they are expressing them for the first time.  Each call must be considered an individual event, not just a piece of your day.  Each prospect you talk to must be treated as an individual as well.
  • Show that you care about their concerns.  For instance, if the caller says, “I have to wait when I have an appointment” you can reply, “I know what you mean.   It makes me feel like my time doesn’t matter.”
  • Learn the name of your caller and use that name frequently.  It’ll make him or her feel more comfortable.
  • Listen carefully and empathetically to your caller, instead of just waiting until he or she stops speaking so that you can talk again.  Here’s a handy listening checklist:

1.      Think like the caller

2.      Don’t interrupt

3.      Listen for ideas, not words

4.      Interject occasionally, to indicate understanding of what the caller is saying

5.      Turn off personal worries

6.      React to ideas, not the person (you may not like the personality of the caller)

7.      Don’t’ jump to conclusions

Principal #8:  Follow a Basic Script

Below is a script we train our receptionists on and we expect them to study and become fluent in speaking.  By following this script it will dramatically increase your appointment conversion rate.  Please note the bold areas, these questions are critical.

Receptionist:  Thank you for calling (Practice Name), this is __________________ how may I help you?

Caller:  Yes, I’m calling about_________________________________.

If this is an established client, assist the client immediately with their question or need.  If this is a prospective client, proceed with the following dialogue:

Receptionist: That’s great!  Thank you for calling us.  I’ll be glad to answer that question for you.  May I ask your name first?

Prospect:  My name is:__________________.You get their name here so that you can use it to address them throughout the conversation.  This makes your conversation more personal.

Receptionist:  Thank you (prospect’s name). By the way, how did you hear about us?

Prospect:  From your (newspaper ad/ kiosk / passed by / other)

Receptionist:  (Prospect’ name), what was it that made you decide to call us?

Prospect:  (I’m tired of my wrinkles, I am tired of my unwanted facial hair, my friend spoke highly of you, etc.) – Draw them into additional conversation with this answer.

Receptionist:  Thanks for your help, (prospect’s name).  Okay, you wanted to find out more about (the reason for the prospect’s call) Example (laser hair removal price for the upper lip)  YOU NOW ANSWER THEIR QUESTION.

All calls lead to an appointment

We would be happy to get all of your questions answered about:_________, this normally begins with a free consultation at our center.    What day of the week is best for you?

Are mornings, afternoons or evenings best?

I’m not sure if that will work.  If you don’t mind, may I put you on hold?  I’ll see what arrangements I can make.

Thanks for holding.  It looks like I was able to squeeze you in on (Day) at (time).

In summary, having a strategy behind your telephone answering and training your staff well, you can dramatically increase your appointment conversion rates and your clinics profitability.  With no plan in place, you are leaving too much to chance and throwing precious dollars down the drain!

Vin Wells, MHSA

Why Medical Spas Fail Reason #2: Poor Advertising or Not Enough Advertising

June 14, 2011 Leave a comment

Advertising is one of the biggest challenges facing an aesthetic practice because it is such a moving target.  There are so many variables that determine a successful advertising campaign.  In addition, what may generate a response at one point stops working eventually and you need to create a new strategy.  How do you know if you have “poor advertising?”  Where the “rubber hits the road” is your Return on Investment (ROI).  As a general rule of thumb, for every ONE dollar you spend, you NEED to get at least FOUR dollars back, if not more (a 4 to 1 ROI).  Why is this?  The key reason is that you STILL have all of your other overhead to cover.  If your advertising just pays for itself (a 1:1 ROI), then you will quickly be out of business.  Let’s use a simple example.  If I am investing $1,000 per month in Google Adwords, my expectation is to get at least $4,000 back in CASH revenue for my practice from that advertising expense (a 4:1 ROI).  If I just got $1,000 back (a 1:1 ROI), then all I’ve done is paid for the advertising and I still have all of my other overhead to cover (including those leases on equipment that I paid TOP DOLLAR for).

If you find an ad source is generating a 4:1 response, then you can often RAMP UP this advertising and generate more dollars.  What you begin to do is eliminate underperforming forms of advertising and invest MORE money in advertising strategies that are working. Whatever you’re advertising, you need to make sure you have enough margin built into the service you are advertising that it will be profitable.  You could sure advertise a special on $10 facials, however it may be difficult to make a good ROI on this type of service.  I always like to advertise the BIG GUNs services such as laser lipolysis, Thermage, Accent, etc.  These are services in which there is enough margin to make it worth your while and will help ensure a high ROI.

The greatest advice I have to give in this area is this:  YOU NEED TO COPIUSLY TRACK YOUR REFERRAL SOURCES.  Every call that comes in and every consultation that is booked needs to be assigned the correct referral source.  In our clinics, we require that when booking the consultation, a required field is to ask the caller how they heard about our clinic.  This referral source is fresh in the callers mind and it is now locked into the client’s information.  Our software program allows us to track how much revenue we generate by each referral source.  In this manner, it allows us to make intelligent decisions on advertising.  If advertising is not working (at least a 4:1 ROI), we pull the plug quickly.  Forget about “brand building” which is what the big boys do such as Coca Cola and Microsoft, we want and need DIRECT RESPONSE ADVERTISING to stay in business.  The key definition to direct response advertising is advertising that is designed to do one thing:  GET YOUR PHONE TO RING AND BRING MONEY THROUGH THE DOOR.

Not every prospective client calling your practice books an appoint, so there are now excellent ways to track EVERY referral source.  There are internet services available that allow you to assign individual telephone numbers, including toll free numbers to EVERY advertising piece you broadcast to your audience.  This allows you to capture key information such as:  (a) Total Calls Generated From Every Ad You Publish by day of the week, by the hour, and a myriad of other criteria.  In addition, since you know how much you are spending on your advertising, these services will also calculate your COST PER CALL.  As an example, if you are paying $1,000 per month for newspaper advertising and the total number of telephone calls you received from that ad source is 20 calls, then ($1,000 / 20 calls = $50 per call).  From my experience if you can get your cost per call below $50, then you are doing something right to get your telephone to ring.

What I also like about these services is you can actually record the telephone calls coming in to your practice.  How is your receptionist answering the phone?  How are her techniques?  Is she effectively booking 60 to 70% of prospective clients into booked appointments? Does she have an accurate grasp of the technology to answer basic questions?  Call tracking services such as these become INVAULABLE TO YOUR PRACTICE.  The reality is this.  You’re spending A LOT of money to get your phone to ring, you need to make sure you are capitalizing on this.

Since most practices don’t track their advertising, they are constantly shooting in the dark and trying new things without knowing what is truly working, except anecdotally.  One bad experience with a large outlay of advertising dollars without a lot of money in return can cause the doctor to retreat in fear and not do any advertising at all or very little advertising.  This becomes a downward spiral if you stop investing in advertising altogether.  It becomes a death sentence if you cease to invest in new leads for your practice.

External Advertising

External advertising represents advertising to people who are not currently your clients.  Traditional forms of advertising have become less effective such as newspaper and the yellow pages.  Subscribership continues to fall away as is evident with several large newspapers going out of business.  When is the last time you used a yellow page phone book to find what you’re looking for?  The reality is the internet is completely replacing most of these traditional forms of advertising.

From my experience, you can save a lot of money by utilizing Internet Advertising.  There are several courses online that teach you how to do your own Google Adwords Advertising.  If you want to save significant money in the long run, you should develop this expertise in-house versus outsourcing this to an outside company.  In addition, many new internet mediums have exploded into the marketplace such as Facebook.  These new mediums have generated significant leads for the clinics I have associated with and are worth investigating.

Check out this deal from Medical Spa MD for a special deal on a Podium patient review marketing account.

Internal Advertising

Internal advertising represents advertising to your own client database.  We all know that it costs a lot more to obtain a new client that to retain one.  If we assume you are providing the best possible service to retain your clients, the missing piece in most practices is developing a system to advertise to your own clients and keep them coming back.  If you have clients who love your clinic and your services, they welcome your offers and they want to hear from you!  Continue to send them special offers available to “established clients” only to make them feel special.  Your ROI on your warm list of clients will be substantially higher than mailing to a “cold” list of people you are trying to obtain as new clients.  It is not unusual to receive a 10 to 1 ROI or higher with this group.

The amazing part of this, your advertising in this area doesn’t have to be expensive.  It can be a very simple letter or postcard or even telephone call.  Mailing out a simple letter that you mail-merge with your database personalizes your contact with the client and helps them feel unique.  You can promote new services and aesthetic devices you have recently acquired and offer “members only” pricing your database.  Emailing your clients is also good, but I have found my response rate drops off too dramatically to just rely on emails alone.  Emails should be coupled with a physical mailing such as a letter.

There are also services available that allow you to upload your list of clients to an online database.  You can then record a single telephone call and broadcast this single message to all of your clients!  It is an amazing tool that can really add a personal touch to your practice and leverage your time.  The doctor would record the call, thanking the client for their business and informing them of new services and offers available.  The message is only left on voice mail so the client doesn’t know it was a recording.  It is an exceptional service and I highly recommend it.  It ends up costing you approximatley 0.06 cents per phone number.

Vin Wells, MHSA


Why Medical Spas Fail Reason #1: Paying Too Much for Equipment and Build-Out

June 14, 2011 1 comment
Investing in an aesthetic practice can be very costly.  You can easily drop $700,000 to over a million to get your practice established.  Paying top dollar for new equipment allows peace of mind with warranty protection, but it comes at a very high cost.  While it is true that most used laser equipment is no longer under a manufacturer’s warranty, research has shown that you are almost ALWAYS better off buying used equipment and paying out of pocket for maintenance and repairs versus buying new and having it covered under warranty.  You are simply paying too high of a premium for the luxury of buying new.  If peace of mind is the issue, then buy a back-up piece of equipment at a 70% discount that you can rely on when your primary equipment goes down.  The reality is you will still be paying less than buying the brand new piece of equipment.

The key to this issue is to identify the companies who repair the used equipment you are considering to purchase.  Ask them to quote you prices on repairs and warranties if you have them.  Also make sure that parts are readily available for this equipment and that the equipment manufacture does not hold a monopoly on spare parts.  You need to do this footwork BEFORE you buy.  After you buy it can be too late and you may be taking too large of a risk.

You also need to find out which laser manufacturers are user-friendly to pre-owned equipment.  Some manufacturers can charge you a laser “RECERTIFICATION FEE.”  Recertification fees are sometimes required by the manufacture if the laser device is sold to someone else.  The laser manufactures claim it is to ensure the device has not been tampered with, however the real reason is to protect the manufacturer from being undersold by doctors looking to sell their used equipment.  Charging a “recertification fee” levels the playing field between the new and used price.  These fees can be as high as $25,000.

Sadly, most aesthetic equipment becomes obsolete 2 or 3 years after the initial purchase, however most leases on that same equipment last for 5 or 6 years.  In the world of aesthetics, technology is evolving at a rapid pace.  This evolution also means that technology does not remain useful for very long.  It’s a hard pill to swallow when you continue to make monthly lease payments on equipment that has become a “doorstop” inside your practice.  If you’ve paid top dollar for that equipment, it just makes that pill you’re swallowing even the more bitter.

Let’s use an example to illustrate this point.  If your practice buys a new Laser Gadget and your competitor buys the same Laser Gadget pre-owned at a 70% discount, your competitor has a large competitive advantage over you.  His fixed costs on capital equipment are 70% less than yours which means higher profit margins for him.  He also has the ability to offer lower treatment prices and potentially put you out of business.  You also have the option to match his lower prices, but you will need to compensate for the higher costs you are paying on that equipment by having a higher treatment volume.  If you choose to keep your prices higher, then you will need to somehow differentiate your practice from the competition by offering other “value-added” benefits that justify your higher prices.  This could be “Board Certified Dermatologist” or “Onsite Physician” etc.

If you feel strongly about buying new laser equipment versus used, do not accept the sticker price presented to you by your laser sales rep.  You must understand that everything is negotiable.  Do not accept a 1 year warranty, ask for a 3 year warranty.  If they are not negotiable on the price, then ask for a “DEMO” unit.  Demo is normally code word for a discounted price.  In most cases, demo units are not even used pieces of equipment, but it allows the manufacturer to legitimately sell you a new piece of equipment at a much lower price while maintaining their price integrity.

Regarding clinic build out, my recommendation is to find a medspa location that is already built out.  There are hundreds of medspas that have gone out of business.  In most cases they have ALREADY spent HUGE bucks to create a beautiful facility.  They have already spent the big bucks for tenant improvement.  You can pick these built-out locations for FREE.  Don’t invest this money yourself.  Find a realtor in your city who specializes in renting medical office space along with retail space.  He should have a good lay of the land on what is available.  You will be surprised with what gem locations are available.

Vin Wells, MHSA