Livingsocial $2800 worth work for $49. financially good move?

[TheClutch]

I got this email from Livingsocial a few days ago.

http://www.livingsocial.com/cities/85/deals/230222-2-800-toward-invisalign-plus-teeth-whitening

$2,800 Toward Invisalign Plus Post-Treatment Sapphire Teeth Whitening ($49) or In-Office Sapphire Teeth-Whitening Treatment ($129)

I know nothing about invisalign and whitening, but it is a huge discount about $2000 off. I know the goal is attracting more new patients, but is this still financially a good move?

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[thewingman]

I got this email from Livingsocial a few days ago.

http://www.livingsocial.com/cities/85/deals/230222-2-800-toward-invisalign-plus-teeth-whitening

$2,800 Toward Invisalign Plus Post-Treatment Sapphire Teeth Whitening ($49) or In-Office Sapphire Teeth-Whitening Treatment ($129)

I know nothing about invisalign and whitening, but it is a huge discount about $2000 off. I know the goal is attracting more new patients, but is this still financially a good move?

Or just jack up the price of treatment by $2,800, then give $2,800 off.

 

[mike3kgt]

I got this email from Livingsocial a few days ago.

http://www.livingsocial.com/cities/85/deals/230222-2-800-toward-invisalign-plus-teeth-whitening

$2,800 Toward Invisalign Plus Post-Treatment Sapphire Teeth Whitening ($49) or In-Office Sapphire Teeth-Whitening Treatment ($129)

I know nothing about invisalign and whitening, but it is a huge discount about $2000 off. I know the goal is attracting more new patients, but is this still financially a good move?

It would be a good deal if your "normal" fee for when these coupon patients come in is something like $8,000. Meaning, they still need to pay $5,200 .

 

[Firm]

The concept of these deals is not to make money. It's to drive traffic and cover expenses during down time. If you have no patients, you still have to pay for rent and staff. These deals cover that.

 

[beannaithe]

The thing about Invisalign too is that not everyone is ready to start treatment right away. You need to be have no decay/stable perio. So odds are you'd make some money off the deal if a patient needs a prophy (or SRP) plus a few restorations. The patient also needs to pay for records, like x-rays and potentially diagnostic models. Also, most people jack up the price of their Invisalign treatment to offset the discount that they're giving with the deal. Not really a bad idea to bring in some new business in a tough economy...

 

[TheClutch]

The concept of these deals is not to make money. It's to drive traffic and cover expenses during down time. If you have no patients, you still have to pay for rent and staff. These deals cover that.

The thing about Invisalign too is that not everyone is ready to start treatment right away. You need to be have no decay/stable perio. So odds are you'd make some money off the deal if a patient needs a prophy (or SRP) plus a few restorations. The patient also needs to pay for records, like x-rays and potentially diagnostic models. Also, most people jack up the price of their Invisalign treatment to offset the discount that they're giving with the deal. Not really a bad idea to bring in some new business in a tough economy...

Thank you for the great inputs!
Based on your comments, I wanna make some assumptions. Tell me if I am off.

So basically, this Invisalign deal is not designed to make profits, but rather to bring new patients or some patients (who often do not go to see dentists regularly or go to different dentists).

The deal can cover some fixed expenses, yet the profits come from other things like check-up and whatever filling/cavity a patient has and needs to do.

Then, it can be assumed that the practice is most likely a new practice. If it is a practice been there for a long time, the market in the area is pretty bad. The practice is in the nice area so I guess there is a lot of competition. (safe to assume that no??)

But to offset the discount ($2000), services have to a little bit more expensive. But then how many new patients need $2000 worth of work at the dental practice usually? Do you guys know?

Then does a practice owner expect to recover the cost and make profits down the road? maybe when patients return after half a year or a year later? If that's the case, wouldn't be too much of financial burden on the practice? a year or half a year is still a long time.

Also, does manufacturers provide dentists some sort of discounts/promotions for new practices? That would help the cost too.

just random wacky thoughts of mine.
love to hear from you guys!

 

[MowgliR]

Or just jack up the price of treatment by $2,800, then give $2,800 off.

That's what I was thinking...

 

[TheClutch]

That's what I was thinking...

I feel like if your price is too high, then you lose patients to different competitors. People saying that dentistry is not a commodity, but money still matters a lot.

My other concerns are that if you raise the prices (let's say) by 20%. Do you raise the price for all the patients or the only living socials patients? etcc.
I don't know what is the best solution. I'm really hoping if someone can chime in.

Are there any case studies or published some sorta reading/article about Groupon/Living Social?

 

[DrDDSman]

Theres a link to a case study somewhere in this thread, take it with a grain of salt.
http://forums.studentdoctor.net/showthread.php?t=891591

I feel like if your price is too high, then you lose patients to different competitors. People saying that dentistry is not a commodity, but money still matters a lot.

My other concerns are that if you raise the prices (let's say) by 20%. Do you raise the price for all the patients or the only living socials patients? etcc.
I don't know what is the best solution. I'm really hoping if someone can chime in.

Are there any case studies or published some sorta reading/article about Groupon/Living Social?

 

[beannaithe]

Thank you for the great inputs!
Based on your comments, I wanna make some assumptions. Tell me if I am off.

So basically, this Invisalign deal is not designed to make profits, but rather to bring new patients or some patients (who often do not go to see dentists regularly or go to different dentists).

The deal can cover some fixed expenses, yet the profits come from other things like check-up and whatever filling/cavity a patient has and needs to do.

Then, it can be assumed that the practice is most likely a new practice. If it is a practice been there for a long time, the market in the area is pretty bad. The practice is in the nice area so I guess there is a lot of competition. (safe to assume that no??)

But to offset the discount ($2000), services have to a little bit more expensive. But then how many new patients need $2000 worth of work at the dental practice usually? Do you guys know?

Then does a practice owner expect to recover the cost and make profits down the road? maybe when patients return after half a year or a year later? If that's the case, wouldn't be too much of financial burden on the practice? a year or half a year is still a long time.

Also, does manufacturers provide dentists some sort of discounts/promotions for new practices? That would help the cost too.

just random wacky thoughts of mine.
love to hear from you guys!

It's a little of both. You're looking at $2k of work being probably prophy, FMX, a few restorations and a crown for a cash patient. So there is a potential for a new patient to need a fair bit of work prior to having Invisalign treatment.

The real trick of the Invisalign groupon is to get someone in the door and a body in the chair. If you're charging (average??), $7k for your Invisalign case and take $2.8k off. You're making $4.2k - lab fee of $1k. So you're making $3.2k off the Invisalign deal. So even though you've taken a big chunk out of your profits, you've made some money to help with your overhead. Plus, without the deal you're making $0.

Without the Groupon deal, you have no patient to do treatment on. With the Groupon deal, you have a patient to do treatment. Yes, you're "giving away" money in the discount. But with the discount, you're gaining a patient who is spending money on treatment.

So it boils down to : would you prefer a patient who is paying a smaller fee or no patient at all? In this economy, you're lucky to have the former.

 

[mike3kgt]

The real trick of the Invisalign groupon is to get someone in the door and a body in the chair. If you're charging (average??), $7k for your Invisalign case

I don't know anybody who is charging $7k for Invisalign, not even orthodontists. Not saying that there aren't some but I would imagine that most offices who are offering Groupons are somewhere in the $4-5k range normal fee.

 

[TheClutch]

sweet Thanks all for the comments.

 

[beannaithe]

I don't know anybody who is charging $7k for Invisalign, not even orthodontists. Not saying that there aren't some but I would imagine that most offices who are offering Groupons are somewhere in the $4-5k range normal fee.

Thanks for the heads up. My orthodontist does it and charges $7k. He's the only one that I've talked to about it, so I'm not sure what usual/normal fees are. $7k did seem kind of high!

 

[ortho lurker]

You're making $4.2k - lab fee of $1k.

The lab fee for Invisalign isn't $1k, it's more in the $1,600-1,800 range.

 

[mike3kgt]

Thanks for the heads up. My orthodontist does it and charges $7k. He's the only one that I've talked to about it, so I'm not sure what usual/normal fees are. $7k did seem kind of high!

Geeze... tough market out there man!