To my fellow members:
Unfortunately, I cannot attend this year’s VCA Executive Summit due to a conflict. I provide this letter directed at the leadership of VCA member companies and ask for your consideration of its content.
If you do not know me or of me, please allow me to introduce myself and my firm. Cleinman Performance Partners is the leading business development consultancy for larger optometry practices and the vendors who serve them. Our firm is comprised of over 30 professionals passionately dedicated to assisting our chosen clients to both recognize, and realize, all of their possibilities. From our headquarters in Oneonta, NY and with associates spread throughout North America, we provide a broad range of business development services including strategic planning, organizational development, financial management, education and transaction support. We have been doing so for 25 years and our client roster is a “Who’s Who” of North America’s strongest and most successful eyecare leaders. Our success as a consultancy is built upon my unique history of entrepreneurial activities in the industry, beginning in 1972. I have launched 26 companies and divisions of companies, most within the eyecare industry (so far). I have led organizations in the frame, lens processing, contact lens distribution, vision plan, publishing, buying group and consulting segments. Along the way, among other activities, I have been the founder of the first national optometry buying group (Co-Optics of America-1979), an early entry in the vision plan space (the predecessor to today’s Block Vision-1985), one of the first in-office lens innovators (Innotech-1992) and the first wisdom sharing network for optometrists (Cleinman Performance Network-2000). Firms that I have launched have earned millions for the investors who backed them. I share this information to humbly establish a platform for my observations as a student of our great industry, in which I have spent my entire career.
Today, I write this letter to ask my fellow industry leaders to consider what I believe to be a serious and systemic problem. A problem that is destroying our industry brand. A problem that robs us all of potential and possibilities and a problem that dramatically and negatively impacts the perception of every American about our industry’s offerings. I call your attention to the over-use of discounting as a marketing tool.
Discount. According to Webster’s the word has many meanings. But generally, when we think of the word as it relates to our industry, it’s “to offer for sale at a reduced price.” In both the retail and the B2B world, a discount generally is provided in exchange for something of value to the provider. For instance, a discount is used to move out merchandise (Inventory Reduction Sales), to entice a certain class of purchaser (Senior Citizens Discounts), to drive business to slow periods (“Blue Plate” Specials) or to increase volume (Frequent Buyer Discounts).
Our industry seems to live and breathe on discounting. Back in the late 1970s, with the advent of the first national buying group, I harnessed our industry’s standard discounting mechanics. That first discounting program for optometrists allowed members to purchase product at the deepest available discount; without meeting the standard volume requirements. But those discounts came with trade-offs. In exchange for the waived volume requirements were offsetting vendor benefits. For example, sold was sold; frames purchased at discount could not be returned. Orders were consolidated; members made a single phone call and placed all of their orders. The firm, in turn, consolidated those orders for transmittal to the supplier, thereby reducing the supplier’s costs. And all purchases were backed by bank guarantees; eliminating the vendor’s credit risk. Well, as these kinds of things often evolve in a competitive environment, most of those vendor benefits went largely by the wayside and today, buying groups are much different. In reality, for the most part, today few really get a discount…because virtually everyone gets a discount.
While not unique to our industry, today’s retailers and professionals have become conditioned to asking for discounts. It’s a way of life. SOP. Indeed, I believe that the number one searched word among ECPs is “free.” It seems that the most important question asked is “what’s my price?” So it stands to reason that this perspective would pass to retailing with pervasive discounting messages dominated by BOGO and other egregious crimes of brand development.
This situation was driven home to me several years ago when there appeared a television sitcom that had a scene set in an optometry office. The most dominate visual was a big sign saying “50% off.” How sad for our industry.
Does our industry lack marketing savvy? What else could possibly be the reason that everywhere we look, the word “discount” or the act of “discounting” prevails? Have we no creativity? Why is it that, with all the amazing technology that our industry delivers, we can’t convince the consumer to purchase our products and services without enormous discounting? Why is it that discounts prevail in an industry that delivers services and products to allay the number three most dominant fear in healthcare, loss of vision? Why do American consumers spend 50% more per capita on shoes than they do on our industry’s products and services? Why don’t we have the confidence to communicate our products and services with pride and not just price? As the saying goes, “in the absence of anything else, price prevails.” As an industry, we have so much to offer. But we’re not effectively communicating our offerings.
When our only significant industry offerings are at discount, what message do we send to the consumer?
For many years, these price oriented messages have been going out to our customers and patients. As a result, I believe that we have been very successful, as an industry, in changing the consumer’s definition of “discount.” They now think of “discount” differently from that first mentioned in this letter to that of another on Webster’s list.
I challenge our industry’s leaders to guide and assist your retail and professional partners to improving their marketing messages. We must look beyond discounting and find new ways of communicating and delivering value. We owe it to ourselves and to our universal “brand” to do that.
The walk of 1000 miles starts with a single step. What will you do different tomorrow?
Thank you for your consideration. Enjoy the meeting.