Outlook & Strategy for Dentistry: COVID-19 and Beyond

I’m going to get straight to the point. I fancy myself pretty creative, yet never in wildest dreams would I have dreamt up this dystopian scenario. Long lines made even longer by people staying six feet apart from each other…Our healthcare system is overwhelmed, our schools have closed, people are staying at home and dental practices of all sizes have effectively grinded to a halt as we continue to figure out how to best combat COVID-19. We are all hoping that the disruptions that we are facing in our country and around the world will end soon.

Dental practices and DSOs are facing an existential crisis, as the issues are seemingly endless…scrambling to deal with HR issues, loss of revenue, etc. Many are trying to figure out how to keep afloat until there’s more certainty about when to reopen, most likely after we have effectively dealt with COVID-19, but the big question remains, when?

With that as background, here are some observations that may be helpful to dentists and DSOs at this time. For many of our clients, we use Game Theory to get to the best possible business conclusions; and these are the questions and issues that we have on the table right now as we try to help our clients navigate through these unprecedented times. In many cases, I rely on history to bring to light some of these ideas, in others, years of scar tissue, and yet others, imagination. But nothing should be off the table right now, nothing. I hope you don’t mind; I am going to be direct and blunt in my outline below, but we have to rise to the moment together and we will!

1.   History Says This: History shows us that businesses successfully (and some of course not so successfully) adjusted after many jarring events including The Great Depression, World War II, the oil crisis in the 1970s, the S&L scandal, 911, the 2008 meltdown and so on. So, let’s use the past as best we can to guide our business into the future. Businesses have survived and thrived adapted through history’s misfortune. Your dental practice and DSO will come through this provided you adapt. 

2.   The Market Will Reprice: Mergers and acquisitions in the dental space will change. Both the appetite and pace of deals will change. There will be opportunities to buy in at lower valuations.

3.   Smart Money Has Options: Private equity may choose to sit out just a bit longer to allow for more certainty in the marketplace. On the other hand, if valuations are repriced, private equity activity may pick up. I am betting on the former.

4.   Doctors Are Back in the Game: For the first time in a long time and as a result of impending valuations coming back down to Earth, there will be more opportunity for doctor-to-doctor transactions because the entry point will become more accessible. Those dentists who are well-positioned with dollars, equity, business savvy or a combination of the latter will have opportunities to acquire.

5.   Repricing Dentistry: No one wants to talk about this, but I will. Regardless of what the Federal stimulus looks like, it won’t be enough to make a real difference in how people behave as they come back into the marketplace. How you position your practice(s) is critical at this time. For practices and DSOs with outstanding quality and brand equity, considering to compete on price to keep and expand market share may be a good idea to consider at this time. For those who do not want to consider repricing (and I am not suggesting you should) note that your competition may do so, and you need to be prepared with a strategic response. (Orthodontics, for example, is already under pressure from Smile Direct Club, and if I’m Smile Direct Club, I will recognize the moment and invest more in advertising because their message is already ubiquitous, and its price point and value proposition may resonate in this environment).

6.   Right Size Marketing (only 5 points, for now, there are many more):

a.   Organic Search Engine Optimization: Organic SEO has been, for at least the past 4-5 years, absolute BS for dentistry. Yet, many dental offices continue to drink the Kool-Aid that’s been all but thrown out by other industries years ago. Look, with most searches happening on mobile devices and the days of the screens behind us, Google is simply not going to show free links BEFORE its paid ads, maps and Google Business pages. So why not reallocate your organic SEO dollars to paid search or save the money? Note that a good chunk of your organic traffic is likely bot-driven, and please stop relying on your web company to give you “analytics.” Take no comfort in those unless you have wise counsel who’s working in your best interest to help you interpret and adjust your digital strategy.

b.   Facebook is a Disaster: Stop paying for organic Facebook posts as a standalone service. Organic Facebook posts are shown to about 2% of people on your business page if that’s not bad enough only about 2% of the 2% of people actually engage in your posts. That’s a “half-person!” Why does Facebook do this? They want you to boost your posts...OK. But to whom? There are certainly smarter ways to use Facebook but paying a company to only post for you outside of an integrated marketing plan is a waste of your money. 

c.   Evaluate Your Website Provider: Move your website to low-cost providers. Forgive the commercial, our sister company BrilliantPractice.com (not linking it because I feel guilty about the commercial) provides website hosting, maintenance, backup and updates for $85 a month. There are several other providers in the space who also do a good job. The days of paying an arm and leg for web services are over.  

d.   Follow People’s Behavior: Marketing is about understanding how people behave and convincing them to choose your practice. Make sure your marketing strategy is grounded in patient behavior. If you’re a specialist, make sure you understand the referral market. There’s no better time than now to recalibrate your marketing approach.

e.   Messaging: People may be ready to go back to the dentist, but some will delay dentistry because they may still be feeling anxiety related to COVID-19. When studying SARS, for example, anthropologists found that people suffered Agoraphobia (a type of anxiety disorder in which people experience fear and it drives them to avoid places or situations that might cause them to panic and make them feel trapped, helpless or embarrassed). The same type of anxiety may be prevalent when we recover from COVID-19. This leads us to conclude that our messaging across marketing platforms should be comforting and empathetic. It ought to skew female because we have to appeal to moms, who are the chief healthcare officers of the family, and make them feel comfortable.

I know the situation seems dire; we have to recognize and embrace that it’s also evolving. We can’t predict the day-to-day, but we can manage and be prepared to come out of the box strong once we get the green light. 

Preparation is our most precious weapon right now.