Is Dentistry retail and should you treat your practice as a retail business?

Lots of debate around this subject, so here’s my opinion.

No… dentistry is not retail and I justify this comment as follows.

The Definition of Retail is generally considered to be ‘The sale of goods to end users for use and consumption by the purchaser. Manufacturers sell large quantities of products to retailers, and retailers sell small quantities of those products to consumers.”

So, retailers sell products.

Now, in business there are generally considered 2 types of ‘market’:

  1. Products
  2. Services
Products
Products have a few distinguishing features about them:
  1. They are tangible and can be handled
  2. Because they are tangible they can be evaluated or ‘tried’ before purchase
  3. They can be made to stock and left on a shelf
  4. They can be returned after purchase if they are unsatisfactory
Services
Services on the other hand exhibit these features (1):
  1. They are intangible and so can not be handled
  2. Inseparability – this means there is simultaneous production and consumption. Like a teacher, as the words are spoken the service is ‘consumed’
  3. Variability – a service will vary according to who delivers it
  4. Perishability – a service has no ‘shelf life’ and can not be stored or returned
Products and Services are not dichotomies but are on a sliding scale (2) and purchases can have elements of both a service and a product – Apple are the masters at combining both these elements. (boy if only you knew how hard it was for me to say that!)
Because products and services are so different, purchasers will use a different set of ‘indicators’ to evaluate them. For a pure product they will simply ‘ask for a test drive’ and handle the product to see if it is fit to solve the their problem.
Services are a little more difficult to evaluate, so we tend to use the following to evaluate a service (3):
  • Reliability Ability to perform ‘the promise’ dependently and effectively
  • Responsiveness and Willingness to help customers 
  • Assurance – Knowledge of employees and ability to inspire trust
  • The physical evidence – staff, website, phone
  • Empathy – Caring and individualised attention to the customer
The above is often known by the mnemonic RRATE.
So, lets bring this back to dentistry.
  1. Can your patient physically hold, touch and evaluate their new smile, or healthier smile BEFORE they commit to buy?
  2. Can you make their new smile or healthier smile in advance – or will the patient evaluate your dentistry as they experience it in the chair?
  3. Would the dentistry that patient receives remain totally constant no matter who treated them?
  4. Can you ‘stock’ new and healthy smiles on the shelf?
If you answered NO to those questions, then we are in agreement… dentistry is a service!
So now we agree that dentistry is a service, we need to look at how it will be evaluated – the physical evidence or your practice, website and phone skills. Your reliability, do you do and say the same thing all the time? Are your staff responsive to new patient requests? Can you inspire trust – after all you are going to ask that new patient to lie on their back while you cover your face and prod them! And are you empathetic to their unique needs?
If dentistry is a service, and retail is about selling products then we have a mismatch if we consider dentistry a retail business.
Marketing
If a practice believes they are in retail they may be led to use marketing techniques suitable for retail, rather than marketing techniques that are suitable for a service which enable  a patient to evaluate that service prior to purchasing.
Marketing for products will generally be around convincing customers to buy that product, where as marketing for services is normally focused around allowing a customer to fully evaluate that service by providing evidence for  RRATE as described above. (Assuming we are marketing a specific service and not a brand)
What if things go wrong?
If a product goes wrong the tendency is to look for manufacturing defects, hence if a dental practice views itself as providing ‘products’ the tendency could be to do the same… and look for defects within the ‘manufacture’ 
However, a service that goes wrong will be viewed in a VERY different way with ‘gaps’  in the service delivery being highlighted – things such as a mismatch between the ‘promise’ and the ‘experience’ of the patient. Gaps between the marketing used and the actual service delivered. In fact there are 5 specific and clear ‘gaps’ (4) that a business should use to ‘fix’ a broken service…. very different to a business that makes a product and looks at the production line!
In my opinion the concept of viewing dentistry as a retailer is littered with problems, although if it gives a practice a kick up the proverbial to get going and be competitive then it may have its place!
So, where do you stand? Do you market your practice around the idea of products, or do you market your practice around the idea of a service?
Of course these are my opinions, and I am happy to debate this in an open forum to discuss the concepts further.
Thanks for reading… I’m off to run for cover!
Stay sharp,
Mark
References:
(1) Gummesson E (1999) ‘Total relationship marketing’ Oxford, Butterworth, Heinemann
(2) Shostack, G.L (1977) ‘Breaking free from products marketing’ Journal of Marketing, Vol 412, April pp73-80
(3) Zeithaml V A, Bitner M J (1996) “Services Marketing” McGraw Hill
(4) Parasuram A, Zeithaml V A, Berry L (1985) “A conceptual model of service quality and its implications for further research” Journal of Marketing Vol 49, Fall, pp41-50

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