The True Value of Micro-branding: One Practice’s Initiative
One practice’s experience offers important considerations for implementing a successful private label skin care line.
By: Steven Dayan, MD
Despite the potential benefits associated with product dispensing, some practices remain unconvinced of the rewards. Physicians often report being frustrated when patients ask for skin care recommendations and then purchase products elsewhere. Others find it increasingly common for patients to snap photos of recommended products with the stated intention to do “research” at home. In actuality, many of these patients return to the practice proudly boasting that they found those very skin care products online for a lower price. With the wide availability of many of the most popular professional medical skin care lines on the Internet, aesthetic physicians are fighting an unwinnable battle. Additionally, we cannot vouch for the safety and efficacy of products purchased online. Counterfeit products may be sold online, and, in fact, negative outcomes have been documented from the use of mislabeled products.
Taking stock of the situation, we determined that the best way to approach this skin care quandary was to be proactive. We decided to ensure best outcomes for both patients and our business by seeking a way to ensure that patients used top-quality products we researched, recommended, and provided with assurance of quality. We believed that the most appropriate response was to implement a micro-branding initiative, dispensing products branded to our practice. However, to determine whether or not this was viable, we formally evaluated and tracked our efforts.
We partnered with Topix Pharmaceuticals for our micro-branding initiative, based in large part on the company’s history and strong reputation for private label skin care. They also have vast experience in product formulation for many leading commercial brands.
We branded our line “Tried and True, a Dayan Wojak Evolution.” Terri Wojak, my lead aesthetician, has been a loyal employee, partner, and advisor for 10 years. Topix was delighted to work with us and also was interested in what our formal evaluation would find. With assistance and support from Topix we quickly determined our product names, completed our logos and product art work, and were ready to launch in just a few weeks (See the products on the next page).
Topix next sent a product educator to introduce our eight aestheticians and front desk staff to the line. To be honest, our team at first was resistant and skeptical, as they each already had their favorite go-to skin care brands and products.
In order to motivate staff, we made a business decision to increase aesthetician commission rates on the private label brand to 15 percent, compared to the 10 percent rate common to the other skin care lines. We remained sensitive to maintaining competitive margins for the business and were pleased that the pricing on the products was such that we were able to provide this commission increase on our line. We set out to evaluate the first consecutive 100 people to purchase a product from our private labeled line. The sample represents the first 100 purchasers, who all agreed to participate. They were not incentivized.
We surveyed both the patients (twice over a six -month period) and our aestheticians (once a month), assessing their satisfaction with the products, as well as their reason for purchasing and using the products.
We also evaluated the buying behaviors of the patients who purchased private label skin care. Specifically, we wanted to know if purchasing our micro-branded skin care would lead to other in-office aesthetic treatments, such as facials, fillers, neuromodulators, or laser procedures. We also looked at overall skin care sales.
To promote our micro-branding initiative we used a variety of creative marketing strategies that didn’t differ significantly from what we normally undertake for new product launches. We employed social media outreach, including Instagram, Facebook and SnapChat posts. We made adjustments to our website and undertook email campaigns to our database. Office collateral, signage, and contests were also important to get the word out.
Patient and Staff Response
It took just over 13 weeks to reach our first 100 Tried and True patients. Of the 100 patients surveyed:
• 99 reported satisfaction with the skin care products
• 99 stated that the surgeon’s endorsement of a product was very likely to impact their decision to purchase the product
• 99 patients said they would recommend our private label products to a friend.
• 91 patients reported feeling that private label products are better quality than those purchased over the counter.
• 85 said they believe the private label products are more potent than products sold at other practices.
Our private label brand led to 79 patients purchasing other in-office aesthetic procedures, twice the volume we saw with other skin care brands. It is hard to explain why private label purchasing patients are more likely to convert to other procedures in our office, but we surmise that it is due to greater loyalty to our office as well as a response to combined procedural/skin care promotional campaigns we offered.
Our experience shows that it may take up to three months to see the micro-branding initiative truly excel. It is noteworty that our most significant leap in sales came after a second in-office training at week 9. There was a direct correlation between in-service training and sales.
More impressive is the fact that by 14 weeks, our micro-branded line assumed one-third of all our skin care sales. By the completion of the 13- week evaluation when we surveyed our aestheticians, all eight corroborated the importance of training and also reported satisfaction with the micro-branded products. In fact, they reported believing that the micro-branded products sold at our practice are more potent than products sold over the counter or at other practices. Seven aestheticians stated that the physician’s endorsement of a product was very likely to impact their decision to sell it. But they all mentioned the need to see and believe in the results associated with a product prior to recommending it to their clients.
Our experience highlights the critically important role that staff buy-in plays in the success of a dispensing program. In retrospect, we likely did not pay ample attention to the time and patience needed to capture the hearts and minds of our staff, converting them to believers. The margins on the micro-branded products permitted us to increase the commission on these products, and we naively assumed that this incentive plus one training would immediately and directly increase sales. In considering this reality, I am heartened by the response we saw.
Topix facilitated the micro-branding initiative in an efficient and practice-friendly way. They provided education to staff and were willing to repeat and extend that education as needed. Once staff were familiar with the products, sales increased.
We feel comfortable that we partnered with a quality company in Topix, and once our aestheticians and patients were satisfied with the results, sales and retention rates rose incrementally. In fact, our overall sales of skin care were up 30 percent from the prior year.
What’s In a Name?
Aesthetic medicine is witnessing a creeping commoditization. As one response to this commoditization, our practice has made an effort to brand aesthetic procedures by combining multiple modalities into one treatment and giving it a unique “brand name.” From Subliminal Difference to DermaRich, Microsurfacing and TLC, we have found this is the best way to differentiate our practice from others and to combat commoditization. Therefore, it made sense for us to do the same with our skin care.
It is easy for consumers to buy skin care online today, and the doctor’s office is in danger of becoming less relevant to the process. We felt that a micro-branded skin care range was the next logical step to further distinguish and protect our practice, as well as to be sure that our patients were receiving the best overall care.
Our experience with micro-branding has been rewarding. The program was relatively easy to implement, and the overall outcome was very successful. While it took a few weeks to get our staff on board, we are now quite pleased that we went down this path with Topix.