Med Spa Device Buying Tips - Interview with Gina Graziano

Summary

Med Spa Success Strategies Podcast
Episode: Med Spa Device Buying Tips - Interview with Gina Graziano
Host: Ricky Shockley
Guest: Gina Graziano, Founder of MedSpa Matchmaker
Release Date: January 31, 2025

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Introduction

In this insightful episode of the Med Spa Success Strategies Podcast, host Ricky Shockley engages in a comprehensive discussion with Gina Graziano, the founder of MedSpa Matchmaker. Gina brings her extensive expertise in transforming med spa concepts into thriving clinical practices, offering invaluable advice on device purchasing, marketing strategies, and overall med spa management.

Common Mistakes in Device Purchases

Ricky Shockley opens the conversation by addressing a critical issue: the common pitfalls med spa owners encounter when purchasing aesthetic devices.

Gina Graziano emphasizes that the number one mistake is purchasing devices that do not align with the patient base. She states:

"The number one mistake people make when evaluating aesthetic devices is not buying the right device for their patient base."
[01:44]

This misalignment often occurs when sales representatives push devices like IPL without considering the specific needs and skin types of the spa’s clientele. Gina advises med spas to segment their patient population and select technologies—such as RF or laser devices—that best fit their demographic and local regulations.

Understanding Your Patient Base

For newer practices lacking an established patient base, Gina provides strategic approaches to identify patient interests:

1. Analyze Local Demographics: Understand the age range, average household income, and ethnic backgrounds of the local population. This data helps in selecting suitable treatments.

2. Competitive Analysis: Assess nearby med spas to avoid oversaturation of similar devices and identify unique offerings.

3. Utilize Intake Forms and Surveys: Incorporate questions about treatment interests to gather direct feedback from existing patients.

Gina elaborates:

"Age demographics and background demographics in terms of ethnicity is going to also point you whether RF device or a laser might be best practice."
[03:24]

Device Trialing and Patient Satisfaction

When considering a device purchase, Gina recommends conducting in-office trials. These trials, though limited in scope, help gauge patient comfort and satisfaction. She warns against significant financial commitments without firsthand experience:

"I always, I would never spend $150,000 without trying it. So I don't know how people do that. But some do."
[06:04]

Profitable Devices vs. Challenging Ones

Skin Rejuvenation and Hair Removal are highlighted as the most profitable and in-demand device categories, capturing 60-70% of the market. Gina advises new med spas to prioritize these areas before diversifying into less popular services like body contouring, which she notes has high refund rates and questionable profitability.

"Skin rejuvenation and hair removal are kind of like the two that capture probably 60, 70% of the market."
[07:34]

Conversely, body contouring devices, such as CoolSculpting, pose challenges due to complications like necrosis and adipose hyperplasia, making them less reliable income sources.

Brand Name Recognition vs. Device Performance

The debate between investing in brand-name devices versus the best-performing devices is addressed. Gina observes that popular devices often benefit from substantial marketing efforts, leading to higher customer inquiries based on brand recognition. However, as technologies mature, brand loyalty can diminish, making it essential to focus on the quality and efficacy of the device.

"If you have a good figurehead... people are more likely to listen to your recommendation versus a brand."
[15:56]

Pricing Strategies for Laser Hair Removal

Laser hair removal is discussed as a highly commoditized service, often subject to a race to the bottom in pricing. Gina acknowledges the difficulty in differentiating services based solely on device quality:

"It's tough because some of them kind of level the playing field where you're getting the same experience no matter where you're going."
[16:23]

She suggests using laser hair removal as a gateway service to attract clients, who can then be introduced to higher-margin treatments through effective relationship building and cross-selling strategies.

Device Financing and Debt Management

A significant portion of the discussion focuses on the complexities of device financing. Gina warns about the high-interest rates and stringent terms often associated with manufacturer financing, which can lead to substantial debt:

"Device loans are different... it's structured like a mortgage where it's all interest at the beginning."
[23:45]

She advocates for exploring bank financing options to secure better rates and urges med spa owners to thoroughly understand the terms before committing to manufacturer deals.

Additionally, Gina highlights the misconception surrounding marketing funds provided by device representatives, clarifying that these are often financed through high-interest loans rather than genuine marketing support.

Ensuring Device Profitability

To ensure the profitability of new devices, Gina outlines a strategic approach that begins three months before the device purchase:

1. Marketing Pre-Launch: Announce the upcoming device through info nights, email blasts, and social media to build anticipation.

2. Training and Staff Incentives: Ensure that staff are well-trained and motivated to promote the new device effectively.

3. Strategic Rollout Timing: Avoid launching services during off-peak times to maximize adoption.

4. Ongoing Marketing Investment: Allocate budgets for continuous marketing efforts post-purchase to drive steady patient flow.

Gina emphasizes the importance of incentivizing staff and maintaining a robust marketing strategy to sustain device profitability.

"Having a marketing strategy, I tell everybody, like your money spend is not done when you purchase the device."
[29:58]

General Best Practices for Successful Med Spas

Beyond device-specific advice, Gina shares key indicators of a successful med spa:

1. Revenue Distribution: Toxins should account for 45-50% of total revenue, with retail products contributing 5-7.5%.

2. Service Diversification: Embracing wellness trends like IV drips, exosomes, and medical weight loss can differentiate a spa and attract a broader clientele.

3. Staff Excellence: Hiring knowledgeable, personable staff and possibly dedicated sales personnel can enhance client interactions and boost sales.

Gina also recommends focusing on a balanced service mix to ensure steady revenue streams and long-term sustainability.

"We have to find that positioning somewhere in the middle."
[19:46]

Conclusion

In conclusion, Gina Graziano provides a wealth of knowledge for med spa owners navigating the complexities of device purchasing and overall business management. Her insights into aligning device choices with patient demographics, strategic marketing, effective financing, and maintaining service profitability offer a comprehensive roadmap for building a successful and financially stable med spa practice.

For those interested in further guidance, Gina can be reached at www.themedspa.matchmaker.com, where she offers complimentary consultations.

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Note: This summary captures the essence of the podcast episode, focusing on the core content and discussions between Ricky Shockley and Gina Graziano. Promotional segments and non-content sections have been excluded to maintain relevance and clarity.

Transcript

[Ricky Shockley]

Hi, everyone and welcome to the MedSpa Success Strategies podcast. I'm your host, Ricky shockley, owner of MedSpa Magic Marketing. And this is where MedSpa Aesthetics practice owners come to discover strategies and tactics that help them better market and manage their practices so they can grow, improve profitability and create greater impact for their teams and their patients. Today, I'm excited to be joined by Gina Graziano. As the visionary founder of MedSpa matchmaker Gina leverages her expertise and relentless drive to sculpt state of the art med spas from mere concepts into thriving clinical practices. She not only establishes but also elevates distinguished brands, infusing them with strategic marketing acumen and innovation in an increasingly lucrative aesthetic market. She's highly effective at separating the signal from the noise, and her insights and strategic foresight make her a sought after advisor among leading research firms like Alpha Insights and glg. Her influential role extends to advising private equity firms and and financial institutions, shaping the direction of the aesthetics field. Her forecasts and analyses are not just predictions, they're blueprints for the industry's future. Gina, thank you so much for joining us. We're excited to have you on the podcast.

[Gina Graziano]

Same here. Thanks for having me.

[Ricky Shockley]

Absolutely. So I know today we've got a few topics we really wanted to dive into. I'm really excited to dive into these topics because these are things that we've talked about on the podcast and just Lauren, like with our clients too. So excited to dig into this a little bit deeper. And I know at Gino, we kind of prepped and we went through the first couple questions and you're like, that's where I focus the bulk of my time. So maybe these are going to be topics that spin for us a little bit, but I'm confident that our listeners are going to get a ton of value from this. So the first thing we had on our list to discuss was where, and this is a very broad question, but where do people go wrong when making a device purchase? What things should they be looking out for?

[Gina Graziano]

Sure. I would say the number one mistake people make when evaluating aesthetic devices is not buying the right device for their patient base. And it sounds so preliminary, but you'll have a rep that'll walk in and tell you an IPL is the best thing ever and you need to have one in your practice. But you have a patient base of skin type 5 and 6 patients who are not appropriate for that device, or people that have a younger patient base who tend to buy more aggressive treatments because the before and after is amazing, but you're not understanding where your patients are in the lifecycle of aging. So it's really about understanding who is in your office, who is where is there a gap in your current offerings and what technology is best fit, whether it's RF or laser, whether it's ablative or non ablative. Those are where you have to start. And you have to understand by segmenting your patient population as well as your overall demographic in the area in which you practice. And then to kind of piggyback on that, understanding the laws in your state and who can perform what type of laser. I've seen that happen so many times where you have a Class 2 or a Class 3 laser and you have people in the office that actually aren't legally allowed to fire that without direct supervision. So really understanding your practice is where to start.

[Ricky Shockley]

Awesome. So branching off on that, Lauren, do you have any questions on that?

[Lauren]

Yeah, I guess my question would be if I was a practice owner, like where would I start in terms of figuring out what my patient base might be interested in if I was newer and maybe don't have as much of an established base, is there like a survey I should be doing or questions to ask things like that, Just where to start in terms of getting those answers?

[Gina Graziano]

Sure, if you're brand, brand new, the demographics of the town is generally a good place to start. So you know, we're looking mostly for people between the ages of 25 and 65. Those tend to make up about 80% of the market purchasing in aesthetics right now. You'd want to know what their average household income is. It's going to give you a marker for the types of treatments we should bring in. If people are geared towards the 25 to 35 year old bracket, we might do more things like toxin, entry level skin tightening treatments, lip filler, things that are more in line with that patient base. Where if my base is 55 to 65, I might do more corrective more than preventative types of treatments, more aggressive CO2 things like thread lifts, I might partner with a surgeon because that's the level that they're usually at in terms of the aging process. Um, so definitely age demographics, background demographics in terms of ethnicity is going to also point you whether RF device or a laser might be best practice because there's a lot of lasers that are not appropriate for darker skin types. They can actually grab the pigment, snatch the pigment off of the top of the skin rather than treating the pigment that we're trying to go after. So Those alone will give you some really good early markers. You also want to take a look at the med spas that are around you and the competition and what they're offering. We don't want 15 of the same device right next to each other. You might be able to offer the same treatment but a different name brand device and just differentiate and be able to buy different keywords and market a lot easier in that case. So yeah, I think demographics of the town and your surroundings is one way to get that information without having an established base. If you do have an established base or you're starting to see, you know, people come through the office, including things on your intake forms is a really easy way to gauge interest. It might be a great fit, but if the interest isn't there, you're not going to sell it either. So what your current population is asking for is really easily accounted for on an intake form or some sort of survey. You can also tease devices or new treatments by email blasts and other internal forms of communication, or set up a demonstration with your devices and offer free or reduced treatments. And that will usually show you who's going to come out of the woodwork and be interested in that type of service.

[Lauren]

Awesome.

[Ricky Shockley]

Yeah, that's, that's great. I like, I like the. Would you recommend that people are doing that? Are you able. I should probably know the answer to this question. Do the device reps generally allow you to do some sort of trialing in office where you can kind of get a feel for patient satisfaction or before you decide to make a device purchase?

[Gina Graziano]

For sure they will bring the device in usually for a couple of hours. So you're not going to be able to treat 10, 20 patients. And a lot of devices are multi treatment protocols. So that's definitely something to keep in mind. It's really about patient comfort, ease of the device, feel the ergonomics more so than the actual end result. But everybody's looking for a result at the end of the day so it's nice to have a few different people to try it on in case someone's a non responder, you know, across the general demographics of your practice. I always, I would never spend 150, 250,000 without trying it. So I don't know how people do that. But some, some do.

[Ricky Shockley]

Yeah, we, we had on a recent episode, Louis Frazena, really interesting episode, tons of cool tidbits and one of the things that came up on that episode is how do we gauge for like and I guess this is a good segue into the next question, when we're trying to figure out is this a device that my patients are going to really be excited about? And we know maybe we only have this sliver of a trial run and there's this uncertainty. I don't know if you have any ideas in this area, but one of the things that we talked about was looking at something like real self where you can look at patient satisfaction reviews of devices. So maybe that branches into our next question here, which is when we're trying to figure out, you know, specific devices, what are the things that. I don't know what you're able to say or not say in this regard, but what are the things that you think are hot right now that tend to be working well, are profitable? And maybe some of the areas and device types, at least, where you see people struggling to produce profitability.

[Gina Graziano]

Sure. Well, there's different segments of the market that are more popular. Right. So skin tightening and skin rejuvenation in general is the number one market in aesthetics. So if somebody is brand new, doesn't have any equipment, we're going to start with devices that can rejuvenate the skin. That's number one. If you start with something like a body contouring device or a women's sexual health device, you're already playing from behind because it's so far down in the list of what people are actually buying. So I think it's really important to start with the basics. Skin rejuvenation and hair removal are kind of like the two that capture probably 60, 70% of the market. Now there's different levels of skin rejuvenation and skin tightening. So again, we segment more non invasive or minimally invasive for the younger clientele base and then more corrective and aggressive and ablative for the older clientele base. So. So your demographics will kind of tell you if we're going to look at topical radio frequency versus radiofrequency, microneedling versus laser. I do think skin rejuvenation in general has a lot of very exciting technologies right now that are doing quite well. RF microneedling is one that's been doing well for about five years and we don't really see any signs of that slowing because it is so versatile and can treat everything from acne to scars to skin tightening. So. So there are a few companies that are really best in class for RF microneedling. Morpheus is probably one of the most well known name brands, but it does have some drawbacks in terms of pain and downtime. You get A great result from it. But not everybody needs that type of intense procedure. So there's a bunch of other really great ones. Lutronic, Ultra Secret, Bicutera, Potenza, Silferm are all very exciting technologies in that space for regular skin tightening just topically without breaking the skin. Softwave is an up and comer that a lot of people are quite happy with. You don't need any numbing cream, no downtime. So it's a very easy treatment to sell and it's quick. So the providers really like performing it, which is yet another consideration. And you have to have people on board selling these treatments or they're not going to sell or move in the practice. So all those skin tightening devices, whether, whether non invasive or semi invasive, I think are going to continue to grow and be a staple in every single practice. You also need kind of the classic lasers in most med spas, hair removal, intense false light, maybe something for vascularities if you tend to have an older patient base or you're seeing a lot of rosacea and redness in the practice. But as long as it can treat skin, it usually has a. A place where I find people get into a tough spot with devices is starting with something like a body contouring device, which this is an unpopular opinion, but they just don't do it for me. The body contouring treatments in general, they have the highest refund rate out of any treatment in aesthetics because it's so hard to find that patient that's within 10 pounds of their ideal weight, eats well exercises, has one stubborn area that they want to treat. Usually someone looking to non invasive body contouring instead of going the lipo route and it's just not appropriate a lot of times. So seeing a 20% reduction on yourself over six months, is that worth five or six grand? I'm unsure. So I find a lot of people struggle with body contouring. Coolsculpting still has a place, but inherently there's a lot of issues with cold technology, with necrosis, with adipose hyperplasia, where the fat actually gets bigger instead of shrinking. So I see a lot of people dealing with complications from coolsculpting. And after that we had a warm sculpting option called sculpsure from cynosure, which was a really tough one. A lot of people lost a lot of money in that machine. Just really doesn't work and it hurts like crazy. So people weren't getting to efficacious temperatures. So body contouring has a lot of issues and I would, I probably wouldn't go there for my first, second, or.

[Ricky Shockley]

Third or fourth or fifth maybe, maybe. And Lauren, I know, I know that's been. Our experience from a marketing standpoint too is like those things tend to be really challenging. And you know, I don't have everybody else's data, but we have ours. And we got some really good insights from a contact we have at Allergan that, yeah, it's like a lot of practices have been struggling with selling those types of devices the last couple years.

[Lauren]

Yeah.

[Ricky Shockley]

And I tend to agree with that analysis. Like, it, it does seem like a tough sell from a marketing standpoint, especially in terms of getting people through the door as the, as the initial touch point. Like maybe you're selling some of those packages to the patients that already know like, and trust you. But I think it's really challenging to bring patients in for those services for sure.

[Gina Graziano]

And we start with our face, right? We can't cover up our face for the most part. So everybody's going to start here when it comes to esthetics and they're going to spend their money to look the best they can in their face before we worry about what we can cover, you know, nine months out of the year. So I think just from a business perspective, it just makes sense to not start there.

[Ricky Shockley]

This episode is brought to you by Med Spa Magic Marketing, my agency. We help Med spas and aesthetics practices grow with more effective marketing strategies. And I know that's a vague phrase, right? It's a vague claim. So I have an offer for you. I offer this to any new prospects if you're interested in exploring any of them. Another marketing option, a new agency, or just getting into Facebook ad, Instagram, Google Ads for the first time. I'd love to show you why we're different, what we're doing for clients. And we can do that via a one and a half hour planning session where I'll outline a specific marketing plan and I'll give you all of the blueprints that we would implement if we were to do business together. Now you can take that, use that on your own, hire someone else to help you execute it or work with us. We really don't hold anything back on that strategy call. And I think you'll have a lot of confidence in how you manage your marketing investment moving forward, understanding some of the nuances that can help you implement more effective marketing strategies for your business. So if you want to do that, you can go to medspa, magic marketing.com.

[Lauren]

So for people looking to like purchase a device in a certain area or take care of a certain thing or concern. Do you typically see that client bases know the name brands and are going more for the ones that are more popular, like for example, coolsculpting or the ones where it's RF microneedling or things like that, where they have multiple different types that can address those things like a skin pen or virtue, things like that. Do you see that having something that has the bigger name is usually the better way to go? Or the device that you really believe does the best and then try to sell why it's the best? Like which route do you typically see being the most productive?

[Gina Graziano]

That's a really good question. And there's, there's no perfect formula for that. I do find that as a device is super popular, as people are spending on marketing and as it's a known name, things like an msculpt, a coolsculpt, a Morpheus, um, those devices that have taken off. Oftentimes my practices will tell me people call and ask us for that by brand name. And it tends to be just those companies that have spent a lot in marketing to get there, which tends to be newer technology, right? CoolSculpting, first of its kind, cold fat reduction without surgery. Emsculpt. First time we started playing with EMS and getting muscle building, Morpheus was like the first one that really commoditized RF microneedling. And so I find when it's kicking open a new category, people are a little more brand loyal. If they know it, they trust it. But there are certain devices like hair removal, IPL veins that are maybe a little less sexy. They're not like the newest innovations. And people tend to be less brand loyal to things that have been around for quite some time. So I would say probably the five year mark of a product being out will tell you whether or not it's a brand or or not. We're seeing RF micro needling. It's been five years since Morpheus launched. Now people are far less brand loyal to that name because there's so many other options. And if you do have a good figurehead, like if you're a Durham or a Plastic that's a little more well known, people are more likely to listen to your recommendation versus a brand. If you're a med spa without that figurehead, that authority, people might be a little more brand focused than education focused. From my experience, that's a great takeaway.

[Ricky Shockley]

I think laser hair has come up a couple times here. Is there an issue with laser hair Removal being a race to the bottom in terms of price point, because it kind of has become so commoditized that people are just looking for the best deal, especially if they're coming in as the entry point. So I get if somebody's got like an existing relationship with you, then you can sell those people into your laser hair packages. But people that are coming in strictly for laser hair from the get go, do you find that a lot of people are price shopping that service? And there's been a race to the.

[Gina Graziano]

Bottom for price points 100%, especially with. With Groupon in general. So I'm in New York City. The first cosmetic treatment I had done When I was 18, 19 was laser hair removal. And so you bet. You know, I'm searching for the best possible deal. I'm not ready to spend thousands of dollars to not shave. Right. But I will spend thousands of dollars on my injector. Somebody that's skilled, trained, who I really care about, her hand. And so with devices, it's tough because some of them kind of level the playing field where you're getting the same experience no matter where you're going. And so you can't charge in the same way that you would for a surgery or for a filler where you're really paying for the hand of the person doing the treatment. So it is a lot more commoditized. Some companies do have minimum advertised pricing to prevent that race to the bottom. But with hair removal, no, you're going to be competing with everybody in this space. So it's more the gateway drug to get them to come in six times, 10 times, and hopefully you make a good enough relationship with that patient over the course of those treatments that you can bring them in for other things.

[Ricky Shockley]

I love that advice. Yeah, go ahead, Lauren.

[Lauren]

I was just going to say that's generally exactly what we've seen. And it's hard to get people to understand that because I feel like a lot of practice owners really believe in why their lasers the best. But a lot of times it's hard to present that because the things that make them the best, right. Oh, it's pain free. There's no downtime. You can do it when you're tan. Those things a lot of them do. Right. So it still goes back to that cheap factor for sure. But I'm really more interested to dive into what you were saying about lasers being kind of a standard. Right. Like the injector is what you're buying the hand to do, the face, whereas it's a harder sell when maybe the laser is cheaper there and it's the same laser. So what do you kind of recommend to practices? Do you recommend be the cheapest and get them in or do you recommend build the relationship and then upsell or what's kind of your philosophy with that or your suggestion for practices?

[Gina Graziano]

I think it goes a lot with the brand that they're trying to create. So I have practices that are wildly successful being the budget option and they go for volume and they're packed all the time and the laser doesn't turn off and that is more valuable to them than the laser being used half of the time and still having our lease pay payment. Right. So it really depends on the number of lasers you have, number of providers, number of rooms and are you monetizing all of your rooms and providers? If the answer is no. I don't love discounts. I love additions for, you know, to make packages and memberships and things that are proprietary to add value versus just race to the bottom. But I think there's a balance between charging what you guys feel you know, should be charged versus having a machine that's empty half of the time. Like we still need people coming through the practice and the more reviews you get and the more traction you get with that service, the more people will organically be finding you and the more you spend on your marketing. Right. It's going to determine how many people are through your door. But if I have someone next door that's half the price. It's going to be an uphill battle. So it's about being aware, aware of your competition, aware of your patient base and aware of your brand. If you're a Lux brand, you're not going to discount, you know, if you're for the people you probably are. So we've got to find that positioning somewhere in the middle.

[Ricky Shockley]

I really like that concept. I've never really thought of laser hair. We, we talk about that concept. So I always mention my favorite quote in marketing is from a book called the Advertising Effect and it's action changes attitude faster than attitude changes action. Just the idea that the best way to shape the perception of a prospect is through experience. So how can we break down the barriers to create an experience so that we're their med spa of choice? And I never thought of it that way, but you're almost thinking of the laser hair device as I've got a. I can sell a service where I might not make much money. Maybe I'm breaking even after any customer acquisition cost from advertising. But I have that person in my seat, in my office six times. And if that person's an aesthetics client, you know, that's, that's an opportunity to build real loyalty there. Like it's giving us an opportunity to build a relationship. Because inherently you're coming back for multiple sessions to achieve the result.

[Gina Graziano]

Definitely do.

[Ricky Shockley]

Do you find that it's a challenge though to cross sell like for laser hair specifically those people into aesthetics? Because a lot of them are coming like, you know, for that specific need. They're not necessarily also a Botox client, for example.

[Gina Graziano]

Sure. Yes. And that's why I tend to like devices like laser hair removal that don't have a consumable on, so you can show people other parts of the business. So laser hair, yes, it's what people come in for. But a lot of times we use it to bolster a membership or a promotion and people get results from it. They're happy and you get them in multiple times for a treatment that does not take a lot of time if you have the right technology. So I look at it as a way to add value very quickly to another type of spend. If they're coming in for a facial, they can we give them a small area of hair removal as a one time courtesy and then they're gonna come back and buy it. Right. If they're scared to have a laser, it's their first procedure ever done, I can fire on them after they sign all their consents. Fire and let them feel it and see it and be comfortable with it. So it's just an easy service. And there's nothing else that people come in for off the bat and sign up for six to 10 sessions. There's just nothing else. So it's all in the way you teach your staff and train your staff how to communicate with the client and how to bring up other services organically. I always talk and teach my people to talk in the third person. You know, talk about the event they had, the facial they had, the IPL they had, you know, and just show your beautiful skin and just see what resonates. But you'll look at your patient's intake form and maybe they've checked off skin or you know, hair restoration on their head or brown spot removal. And if you ask for the right information, people will tell you what they're, what they're interested in.

[Ricky Shockley]

Is that a standard that people are always using that on their intake forms?

[Gina Graziano]

No.

[Ricky Shockley]

So that's a probably pretty important component. There is. Make sure your intake form actually asks about area of concern. So you're prepped for the conversation when they're in the consult room.

[Gina Graziano]

Yep, absolutely. And I have people, I tell them, if you're thinking about adding it within the year, put it on your form because, you know, I can't tell you how many times we've, we've not understood what we had in the practice until we started updating the forms. And really quickly you can see, all right, 50 people checked off, you know, vein treatments. Why are we not doing this here? You know, so it can spark something that isn't even in your, your mind's eye.

[Ricky Shockley]

Yeah, cool. Great takeaway. I think shifting the gear into the next thing that's come up a lot is the, the expense of these, of these products. I think in our experience what happens sometimes or maybe even often is people have a grandiose vision of what this laser product is going to do for them. They maybe get a sales pitch from the rep that paints this very idealistic projection of what they're going to get per session. And then maybe it includes the assumption that they're actually booked for sessions on the device. And then one of the things that we just see a lot is people struggling with their over leveraged in debt. And in large part it's based in device devices. I know you said there are a lot of misconceptions around device financing, so I wanted to talk about that a little bit and get your thoughts.

[Gina Graziano]

Sure. So device financing works a lot differently than any other financing I've seen. And I've been an aesthetic rep and in sales for about 18 years in this field. Device loans are different. So there are two types of companies. Ones that will allow you to lease and ones that make you purchase the machine. The companies that allow you to lease tend to be lower cost machines. You'll lock in for maybe six months at a time. The pressure is very low to bring on one of those devices because you're not locked in forever. But I rarely see those really take off within a practice. I'm talking about Venus Devices. Roar Devices. Even Aviclear from Cuterra has come up with a new model where it's more of a cost share and a very low upfront cost for the device. And what I find is that practices don't feel the need to invest in all this marketing and all this training or really talk about it in the office. It's not their focus because they're not committed to that device. So in general, I find people are less excited about those and push them less. And they tend to be devices that Aren't like brand new technology or anything super exciting. So the other side is all the major companies, your qterras, your inmodes, your lutronics, cynosures, your btls that operate in a way that you commit to the machine, but it's structured as a lease with a dollar buyout at the end. And these contracts can be three years or five years. Most people do five. And a lot of times you'll have a no prepayment penalty after a year. So you could pay off the device, the rest of the device without seeing interest through all the way is what the paperwork kind of reads. But in actuality you are paying usually 12 or 14% interest. And it's structured like a mortgage where it's all interest at the beginning. So when you go to pay off your device a year later, you still have the full principal and then some. Which I think there needs to be a lot more clarity and honesty around the way we finance these devices. They make you personally guarantee it. Most times, even if your rep tells you that's not the case, you need to read the fine print because a lot of times you're putting up your house and your business to leverage this device. Now, it's not all doom and gloom. People make a lot of money on devices, but it's just something to really understand what you're locking into. And you will get way better rates through your bank. It's just going to take four or six weeks and time kills all deals. And you're probably trying to buy at a show. So you get kind of forced into using the company financing, which is tough. I think the biggest misconception around the financing is when people get checks back for marketing from their reps and they financed a piece of equipment. I spent a lot of time educating on this with my clients because I just think it's horrible that this happens to my people. But if you finance a machine for $150,000 and you get a check back for $50,000 from your device rep, which happens all the time, you are paying interest and you are financing that money, it's not money back for marketing, it's money that you are paying to take out and use back in your practice. So what that tells me for getting 50 grand back is that we have a 33% margin that you could have negotiated down that laser for. So all my laser apps are probably going to not be too happy with me after this, after this webinar. But I think it's really important to understand you can get a better price for your device, pay less overall, lock into less debt and pay way less interest if you have somebody helping you negotiate your devices. So you really need to understand the interest rate you're paying, what you're locking into, what you're guaranteeing, and exactly how what you're paying to get your own money back.

[Lauren]

So that being said, do you typically recommend waiting to get into device sales until you feel like you're in a more comfortable place with your business, rather than the new med spa that wants to open the door and or maybe doesn't have a whole lot of business and picking a laser that they feel confident in?

[Gina Graziano]

I think devices are essential to the profitability of the practice, especially where we are now as a society. In the US the number of med spots has doubled since 2018. We were at 5500. Now we're at 10, 8 and climbing. A lot of the people that open new med spas, especially since COVID are nurse practitioners and PAs, depending on the state because they can go out on their own now. And a lot of lending companies do not lend to non MDs or people with under 2 years in business. So I actually think the legacy med spas have an advantage by having equipment right now because there's a lot of people that can't get it or won't be approved for it, especially with where interest rates are at present time. So I don't think it's necessarily a wrong choice to start with equipment, but it needs to be an informed decision on which piece of equipment you're bringing in and it should not be two, three, four devices to start.

[Ricky Shockley]

Hey there. Wanted to briefly interrupt the episode to make a quick ask. If you're a podcast listener, it would mean the world to us if you leave a review for the podcast, whether that's on itunes or Spotify. It's something I hadn't really remembered or thought of asking for, but it does help us show up more frequently so that we can reach more people with the information that we're providing. So it'd mean the world to us if you'd leave a review on itunes or Spotify. If you're listening on audio, if you're watching on YouTube, make sure to hit the subscribe button so you're in the loop for future videos. And you, you don't miss any of the content that we're putting out. So start lean and in terms of doing those projections. So we talked about doing your due diligence. What devices maybe to start with which to stay away from knowing your market things like that, how to finance the device. Let's say you've checked all those boxes to the best of your ability. How do you do your best to ensure profitability of that device knowing that you have to overcome that, you know, that pretty big loan payment to at least be breaking even. Because I know, you know, after that thing's paid off, it's all icing on the cake, you're going to make money. But a lot of med spas that we find that are struggling, they're in that window where they're still making the payment and they're struggling to sell the device. So kind of branching into the sales conversation or you know, the pre qualification of how do you ensure profitability? What are your thoughts there?

[Gina Graziano]

Sure. So I think it starts three months before you buy the device. So, you know, it's making sure people know that it's coming out, launching a specialist, getting your model set up, doing info nights ahead of having that device in the office. I really try to make this a not an emotional decision but a really, you know, a really data driven decision within the practice. So not to get swept up in end of quarter sales and things like that. Really we have to do it at the time. That's right. We don't launch a hair removal in June when we're going into summer and nobody's getting laser for three months. Right. Like we have to be smart about the rollout. So it's introducing it to your patient base well before you bring it into the office. Filming your demo days and creating content with it, polling people, putting it on your intake forms once you've actually bought it. Getting trained as soon as possible. Usually if we buy at the end of the quarter or the end of the year like a lot of people do, you're then behind hundreds of practices to get trained. So I actually like buying at the beginning of a quarter or middle of a quarter so you're not in a queue to get trained. Sometimes I've seen four or five, six weeks when that's cutting into your lease payment and you're not even trained on the device. So that's super important. Having a marketing strategy, I tell everybody, like your money spend is not done when you purchase the device. You have to buy keywords, you have to spend on social media marketing to let people know you offer it and start strong. We usually do some sort of intro offer, timed and one time only throughout the year where there's a discount or some sort of value add for being some of the first people to use it or to Be able to use photos and video testimonials on your Instagram pages or what have you. And then incentivizing your staff, it's a necessary thing. People are motivated by money. It's just the world we're in. So giving them a commission, giving them a target, and if they hit that, there's either a monetary goal, a day off, you know, something to incentivize and keep it top of mind. And then I work with a lot of people and institute art of a consult training and forms. So every time there's a new patient consult, we have a standardized form that walks through everything we have in the practice and it's grouped. So wrinkle reduction, I've got all of my options. Hair, you know, hair removal, I have all my options. Brown spot crushing, I have all my options. And so if somebody presents and gives me an aesthetic concern, I have everything in front of me that can treat that. And obviously our devices are at the top because they require typically less skilled providers, which means less money out of my pocket as a business owner. And then I make sure I pay off my note. So I think just incentivizing, constantly talking about it, putting out content, investing in marketing, and just making sure that the rollout doesn't happen or start after we bought the device.

[Ricky Shockley]

Yeah, I think that's the, the unfortunate position we're in sometimes too is we're having the conversation of, oh my gosh, I have no money, I spent it on this device. And then you have no money to market. So make sure as you're getting into this, you're budgeting for marketing and you've got that. That's a great, you know, especially thinking about the first 12 months. What a great plan to understand timelines and how to get traction with your device. I love that. Any other questions, Lauren, you have on the device, that stuff specifically. I think that was great insight, Gina. Like, we've been wanting to talk about this on the podcast for a long time. It's come up so frequently and we've never been able to talk to somebody that really specializes in this end. So it was great getting to pick your brain on those things. But Lauren, did you have anything else on the device side?

[Lauren]

Nope, I think that covers this. Super helpful, Gina. Thank you.

[Ricky Shockley]

I had one final question, but any other thoughts on the device sales that we missed or device purchase decision making process?

[Gina Graziano]

You know, I would, I would just also recommend that anybody evaluating a device asks to talk to a couple of doctors that are actually using it. The rep will have Your list of their best people that are going to tell you it's amazing. But if you go on the locator, that's my best like advice to people. Go on the locator and find two random people and call them and ask them about the device, the support from the company, how is their rep, you know, how our patients responding to it and get real time feedback. It might sound and look amazing and it might be by a company that's done other things that are best in class. But I find companies really focus on and have one or two really great things and the rest of the portfolio is kind of like. So there's a lot to consider there and I think actual experience with advice is really important.

[Ricky Shockley]

So yeah, on that note, we talked about kind of referencing real stuff. Is there a way to get a gauge that you know of to kind of get a feel for like, hey, what is, what is actual patient, patient satisfaction from this device? So you don't get in a situation where you kind of sold a bill of goods and then six months down the road you realize, oh, people hate this and it doesn't really do what it was supposed to do.

[Gina Graziano]

Yeah.

[Ricky Shockley]

Any way to gauge that going into.

[Gina Graziano]

It real self is probably your best bet to get every type of review for a specific treatment or device. Honestly, it's a little skewed because obviously they show, you know, patients that are affiliated with doctors that pay the most money to be on the site. It's just what it, what it is where, you know. But I would say real stuff is a really great resource. And then I, I know a lot of my practices post on forums for med spa owners or local business owners in the area. And if you post on that, you know, has anybody had really good experiences with this device? People are pretty open to sharing, you know, if their patients love it or hate it or their staff loves it and hates it. So just use your social networks and you always have the locators. If you, if you don't have many contacts in the area, if you're new.

[Ricky Shockley]

Yeah, that was phenomenal. I hope everybody that purchases a device watches this video. That was such great, great advice. Gina, my last question was just you're obviously in the industry, you've worked with a ton of practices outside of just devices. Any tidbits of general advice for what you see successful med spas doing really well? There are a couple of things that you identify as. These are the common themes of the high performing practices and these are the things that you see the practices that are struggling or constantly struggling with.

[Gina Graziano]

Sure. So in general, there are some markers. When I first work with my clients, I'll go through their books with them and just look for some general ranges of the types of services that they're providing. And I find toxin needs to be between 45 and 50% of your total revenues to be kind of on level. Toxin and injectable patients feed the rest of the practice and they happen to be the services that you're going to compete on probably most practically price wise as a med spa. Everybody does Botox, everybody does filler. Right. Not everybody has a device, but that is where you're going to compete. So you need to have a healthy influx of injectable and filler patients to sustain. Then I look at things like retail should be 5 to 7.5% of the total revenue. Are we missing the mark? There are people not taking that, that take home home. I look at conversion rates. Are we keeping people every 3, 4 months current with their toxin or is that trail? So we'll look at some, some percentages and make sure that they're in line, but there's really no one size fits all answer. Right now it's like the Wild West. There's 15 competitors on every block in every town. So it's about segmenting and making things a little different. You don't want to be a carbon copy of every spa, but we'll look for those markers to make sure you have a healthy mix of people coming through the door. I do find that people that are embracing more of the wellness angle right now are doing quite well. So people doing drips, nad using exosomes, using polynucleotides and peptides, people that are doing medical weight loss and just kind of embracing the trends right now. Those tend to attract new people and be a differentiator or those that partner up with more non traditional doctors, functional medicine doctors, OB GYNs, where there's a really focused segment of patients, those people tend to do really well. So just some best practice is there?

[Ricky Shockley]

Yeah. Cool. Very cool. Yeah. And that's, that's kind of interesting too. Like with the wellness and the holistic side, do you find that most of the people that are doing well there, there? It's the, it's still like the injectables or other things that are feeding those as kind of cross sells. So it's still kind of that you're just building your patient database by. You've got 40, 50% of your revenue coming in from people that originally came in for a Botox. Appointment and then they're seeing, you know, things about the IV drips and your weight loss program. And it's just a great additional revenue source for the practice in that case, for sure.

[Gina Graziano]

You know, we have a lot of segmented options here in the US now. There are people that just do IVs, right. And there's whole chains now of people that are just doing IVs or just doing the wellness side. So you don't want to be a master of none and do absolutely everything under the sun. But if it's, if it appeals to your patient base and they can get it with you and they trust you, just a way to keep all the dollars, you know, in the practice and be able to discount and cross sell based on memberships.

[Lauren]

Yeah, I guess a big part too, of the takeaway from this, at least that I keep picking up on, is you got to have good staff in office. You got to have people that know what they're talking about, somebody that's likable, somebody that you know is a good conversation, a good consultation, a good cross sell, those kind of things. So educating your staff and making sure that your staff is incentivized and up to date and performing well is crucial to kind of that success across the board, really.

[Gina Graziano]

Right. For sure. I'll say. One of the things that's been really positive for a lot of my clients is adding a sales person into the mix. So clinicians are clinicians and they're great at what they do, they're great at treating people. And inherently, people that are really caring are not like the type A sales people. Right. We're two separate sides of the spectrum. And I think the med spas that are embracing that the right person to close the sale might not be the same person that treats is a really important distinction, I think, especially as we're selling higher value services and devices or packages and memberships, we're talking about thousands and thousands of dollars. So if you have a great practice manager or just a good salesperson that can do the consultation or aid the practitioner in the consultation and then handle the money when the practitioner leaves, that alone is probably going to increase you 10 or 15% because it's taking all that pressure off of the person that's actually prescribing.

[Lauren]

I love that insight.

[Gina Graziano]

It's been a really fun, like, new insight for me this year.

[Lauren]

Yeah. Yeah.

[Ricky Shockley]

That's a very cool idea.

[Lauren]

That's awesome.

[Ricky Shockley]

Well, Gina, thank you so much. We appreciate it. This was a great interview. I know everyone's gonna get a ton of value from it. People wanna work with you. Where can they find out more about you? We'll make sure that everything's in the show notes as well.

[Gina Graziano]

Thank you. Yes, you can find me at my consulting website. It's www.themedspa. matchmaker.com. There you can book a 30 minute complimentary with me via my calendly links. That's right on the contact page. We'd love to hear from you. Thanks for the opportunity guys.

[Lauren]

Thanks. Yeah.

[Ricky Shockley]

Thank you Gina.

[Lauren]

We hope to see you again and talk with you. We appreciate you.

[Gina Graziano]

Thank you.

[Ricky Shockley]

Thanks everyone for tuning in. This podcast is a production of Med Spa Magic Marketing. If your Med Spa or aesthetic practice is in need of digital marketing services, help with advertising on Facebook, Instagram, Google lead generation and booking more appointments, please visit Medspamagicmarketing.com.