The Smart Chiropractor Podcast: Season 2, Episode 5 Summary

Episode Title: S2E5: Cover Your Monthly Expenses with Recurring Revenue
Hosts: Dr. Jeff Langmid & Dr. Jason Deutsch
Release Date: October 20, 2021
Description: This episode delves into the concept of recurring or subscription-based products within chiropractic practices, exploring their significance, benefits, and strategies for implementation to ensure business growth and financial stability.

1. Introduction to Recurring Revenue in Chiropractic Practices

In this episode, Dr. Jeff Langmid and Dr. Jason Deutsch focus on a pivotal strategy for chiropractic businesses: incorporating recurring or subscription-based products. Building on the themes of chiropractic marketing, clinical skills, and business growth, the hosts aim to equip chiropractors with the mindset and strategies necessary to embed recurring revenue streams into their practices.

Dr. Jason Deutsch opens the discussion by highlighting the season's focus on mindset and strategies essential for implementing product sales within chiropractic practices. He emphasizes that understanding recurring products is crucial for building and growing an effective e-commerce platform tailored to chiropractic services.

2. Understanding Recurring and Subscription Products

Defining Recurring Revenue:
Dr. Jason Deutsch initiates the conversation by defining recurring or subscription products. He uses the example of vitamin supplements to illustrate a simple subscription model: instead of a one-time purchase, patients subscribe to receive supplements every 30 days. This model transforms a one-time transaction into an ongoing relationship, ensuring continuous delivery of products until the patient chooses to cancel.

Dr. Jeff Langmid further elaborates on this concept, drawing parallels with successful subscription-based companies like Amazon and Dollar Shave Club. He explains that while selling a single product might seem easier, subscription models often prove more beneficial for both the provider and the consumer. For instance, a subscription ensures that patients consistently receive necessary products without the hassle of reordering manually.

Notable Quote:
At [01:03], Dr. Jeff Langmid states,
"If this is a product that somebody's going to want to take consistently for the year, then saying we're going to drop ship this to you every month automatically without any further hassle, effort or work is actually serving me more to get the outcome I want."

3. Benefits for Practitioners: Financial Stability and Business Growth

Predictable Revenue Streams:
One of the primary advantages of recurring revenue is the predictability it brings to a chiropractic practice’s finances. Dr. Jeff Langmid emphasizes that a steady inflow of subscription payments can cover monthly expenses more reliably than relying solely on new patient acquisitions. This stability is crucial, especially in uncertain market conditions where patient influx may fluctuate.

Long-Term Financial Value:
Recurring revenue models significantly enhance the financial valuation of a business. Dr. Langmid draws a comparison with the SaaS (Software as a Service) industry, highlighting that businesses with a robust subscription base are more attractive and valuable. He suggests that a chiropractic practice with consistent monthly revenue from subscriptions could potentially command a higher sale price, due to the guaranteed income streams.

Psychological Ease for Practitioners:
Implementing subscription models can alleviate the constant pressure to attract new patients. Dr. Langmid points out that many chiropractors operate from a place of financial desperation, which can inadvertently come across to patients. By securing recurring revenue, practitioners can operate with greater confidence and reduce the anxiety associated with fluctuating incomes.

Dr. Jason Deutsch adds that building a base of recurring subscribers leads to compounding revenue growth. As more patients subscribe, the revenue continues to grow exponentially without a corresponding increase in effort or resources. This compounding effect can transform a chiropractic practice’s financial health over time.

Notable Quote:
At [05:37], Dr. Jeff Langmid remarks,
"Every business owner's goal should be... to be guaranteed you're getting on base."
This underscores the importance of having a dependable revenue stream as a foundational business strategy.

4. Benefits for Patients: Convenience and Better Outcomes

Enhanced Patient Convenience:
Subscription models offer significant convenience for patients. Dr. Langmid illustrates this by comparing gym memberships that allow unlimited visits versus per-visit fees. Similarly, patients benefit from not having to remember to reorder essential products, ensuring they consistently use what they need for optimal health outcomes.

Improved Health Outcomes:
Regular consumption of recommended products, such as supplements or topical analgesics, can lead to better health outcomes. Dr. Langmid argues that by automating product delivery, patients are more likely to adhere to their health regimens, thereby experiencing more sustained and effective results.

Strengthened Practitioner-Patient Relationship:
Recurring revenue models facilitate ongoing engagement between practitioners and patients. Dr. Jason Deutsch notes that when patients subscribe to monthly products, they remain continuously involved with the practice beyond periodic adjustments or treatments. This sustained interaction enhances trust and loyalty, making patients more likely to follow recommendations and maintain their health routines.

Notable Quote:
At [08:20], Dr. Jeff Langmid shares,
"How would your practice be different if you could make sure that your expenses would at least be covered?"
This statement highlights the personal and professional benefits that recurring revenue can bring to both practitioners and their patients.

5. Implementing the Subscription Model: Practical Steps

Identifying Suitable Products:
The first step in implementing a subscription model is identifying which products are suitable for recurring delivery. Dr. Jason Deutsch suggests focusing on consumables that patients need to replenish regularly, such as supplements, topical analgesics, and kinesio tapes. These products are naturally aligned with a subscription model due to their ongoing usage.

Creating an Online Store:
Developing an online store, referred to as the "SmartCare store," is essential for managing subscriptions. Dr. Deutsch recommends curating a selection of favorite products that fit the criteria of being consumable, subscription-friendly, and beneficial to patients. This online platform serves as the central hub for patients to manage their subscriptions seamlessly.

Marketing and Communication:
Educating patients about the benefits of subscription services is crucial. Dr. Langmid emphasizes the importance of clear communication, ensuring that patients understand how subscription models can enhance their health outcomes by providing consistent access to necessary products without the hassle of reordering.

Technical Implementation:
Setting up the technical infrastructure to support subscriptions is vital. This includes integrating automated billing systems, managing inventory for recurring shipments, and ensuring a user-friendly interface for patients to easily subscribe, manage, or cancel their services.

Dr. Jason Deutsch further advises chiropractors to leverage existing patient databases, analyzing patient needs to tailor subscription offerings that align with their health requirements and preferences.

6. Strategic Product Curation for Subscription Services

Quality over Quantity:
Curating high-quality products that genuinely benefit patients is paramount. Dr. Langmid stresses the importance of selecting products based on their effectiveness and alignment with chiropractic health goals. This ensures that the subscription offerings are not just convenient but also add real value to patients’ health journeys.

DPR Filter – Demand, Profitability, Relevance:
To streamline product selection, the hosts recommend using a DPR filter:

• Demand: Assess whether there is a consistent demand for the product among the patient base.
• Profitability: Ensure that the product offers a reasonable profit margin to make the subscription model financially viable.
• Relevance: The product must be relevant to chiropractic care and contribute positively to patients' health.

By applying this filter, chiropractors can curate a library of "everyday products" that are essential, frequently used, and align with the overall health objectives of their practice.

Dr. Jason Deutsch mentions that focusing on consumable products like supplements and topical analgesics can create a stable and predictable revenue stream, as these items are regularly needed and consumed by patients.

Notable Quote:
At [17:57], Dr. Jeff Langmid states,
"Every business owner's goal should be... to make your life as financially stress free as possible."
This underscores the practical benefits of strategic product curation in achieving financial stability.

7. Psychological Aspects of Subscription Models

Consumer Psychology:
Understanding patient psychology is critical in implementing successful subscription models. Dr. Langmid discusses how patients often abandon one-time purchases due to forgetfulness or inconvenience. Subscription models mitigate this by automating the process, ensuring that patients continue to receive and use essential products without interruption.

Ease of Decision-Making:
Subscriptions simplify the purchasing decision for patients. Dr. Langmid explains that selling a continuous solution rather than a one-time product reduces the friction in the buying process. Patients are more likely to commit to a subscription when it offers a seamless experience and consistent access to the products they need.

Trust and Authority:
By offering subscriptions, chiropractors position themselves as trusted advisors in their patients' health journeys. Dr. Langmid warns against patients resorting to random purchases from large retailers like Amazon or Target. When chiropractors provide curated subscription services, they reinforce their authority and expertise, ensuring patients receive high-quality, reliable products.

Dr. Jason Deutsch adds that subscription models not only benefit practitioners but also empower patients by providing them with easy access to the essential products they require for maintaining their health.

Notable Quote:
At [23:32], Dr. Jason Deutsch emphasizes,
"If you're able to serve even just 10% of them by offering, by teaching and then inviting them to purchase through your channel, your platform, you're going to be cooking with gas pretty quickly here."

8. Future Implications for Chiropractic Practices

Transforming Business Operations:
Embracing subscription models can fundamentally transform how chiropractic practices operate. Dr. Langmid envisions a future where chiropractors are not solely reliant on new patient acquisitions but have a stable foundation of recurring revenue. This shift can lead to more strategic business decisions, enhanced patient care, and greater overall sustainability.

Changing Industry Perceptions:
By adopting recurring revenue models, chiropractors can alter the broader perception of the profession. Dr. Langmid points out that the chiropractic brand often suffers from misconceptions about its value and efficacy. Implementing subscription services can help reposition chiropractors as essential health advisors, thereby elevating the profession's status and credibility.

Technological Integration:
The integration of technology is crucial for the success of subscription models. Dr. Langmid encourages chiropractors to leverage digital tools and platforms to manage subscriptions effectively, ensuring a smooth and efficient experience for both practitioners and patients. This technological adoption can also facilitate data-driven decision-making, enhancing the overall effectiveness of the subscription strategy.

Ethical Considerations and Service Commitment:
Ethics play a significant role in the implementation of subscription models. Dr. Langmid insists that chiropractors must prioritize patients' needs over mere profitability. Subscriptions should be offered only for products that genuinely benefit patients, ensuring that the practice maintains its commitment to ethical care and patient well-being.

Sustainable Business Practices:
Recurring revenue models contribute to the long-term sustainability of chiropractic practices. Dr. Langmid envisions a scenario where, instead of constantly striving to attract new patients, chiropractors can focus on providing high-quality, ongoing care to a stable patient base. This approach not only enhances business resilience but also fosters stronger, more meaningful patient relationships.

Notable Quote:
At [15:14], Dr. Jason Deutsch explains,
"Topical analgesics would be one, tape would be another, or supplements would be another. So you just think about those three categories..."
This highlights the practical categorization of subscription products that chiropractors can implement.

9. Conclusion and Forward Look

In wrapping up the episode, Dr. Jason Deutsch reiterates the importance of subscriptions as foundational elements for building a successful e-commerce strategy within chiropractic practices. He encourages listeners to explore the Smart Chiropractor website for additional resources and to engage with their online store offerings.

Dr. Jeff Langmid closes by reinforcing the transformative potential of recurring revenue models, urging chiropractors to embrace these strategies to enhance both their business operations and patient care.

Dr. Jason Deutsch concludes with a call to action, inviting listeners to subscribe to the podcast, leave reviews, and utilize the resources provided by The Smart Chiropractor to implement effective e-commerce strategies.

Key Takeaways

1. Recurring Revenue Models: Implementing subscription-based products can provide chiropractors with predictable and stable income streams, reducing the constant pressure to acquire new patients.

2. Patient Convenience and Better Health Outcomes: Subscriptions enhance patient convenience by automating the delivery of essential products, leading to better adherence to health regimens and improved outcomes.

3. Strategic Product Selection: Curating high-quality, consumable products that align with chiropractic care and applying the DPR (Demand, Profitability, Relevance) filter ensures that subscription offerings are both beneficial to patients and financially viable.

4. Enhanced Practitioner-Patient Relationships: Subscription models foster ongoing engagement, strengthening trust and loyalty between chiropractors and their patients.

5. Ethical Commitment: Chiropractors must prioritize ethical considerations by offering subscriptions only for products that genuinely benefit patients, reinforcing their role as trusted health advisors.

6. Technological Integration: Leveraging digital tools and platforms is essential for managing subscriptions effectively and ensuring a seamless experience for both practitioners and patients.

7. Future-Proofing Practices: Embracing recurring revenue models positions chiropractic practices for long-term sustainability and growth, transforming industry perceptions and elevating professional credibility.

Notable Quotes:

• Dr. Jeff Langmid at [01:03]:
  "If this is a product that somebody's going to want to take consistently for the year, then saying we're going to drop ship this to you every month automatically without any further hassle, effort or work is actually serving me more to get the outcome I want."

• Dr. Jeff Langmid at [05:37]:
  "Every business owner's goal should be... to be guaranteed you're getting on base."

• Dr. Jeff Langmid at [08:20]:
  "How would your practice be different if you could make sure that your expenses would at least be covered?"

• Dr. Jeff Langmid at [17:57]:
  "Every business owner's goal should be... to make your life as financially stress free as possible."

• Dr. Jason Deutsch at [15:14]:
  "Topical analgesics would be one, tape would be another, or supplements would be another. So you just think about those three categories..."

• Dr. Jason Deutsch at [23:32]:
  "If you're able to serve even just 10% of them by offering, by teaching and then inviting them to purchase through your channel, your platform, you're going to be cooking with gas pretty quickly here."

Final Thoughts:

Season 2, Episode 5 of The Smart Chiropractor Podcast provides chiropractors with a comprehensive guide to integrating recurring revenue streams into their practices. By adopting subscription-based models, chiropractors can achieve greater financial stability, enhance patient convenience, and foster stronger practitioner-patient relationships. The hosts underscore the importance of strategic product selection, ethical considerations, and technological integration to ensure the successful implementation of these models. This episode serves as an essential resource for chiropractors seeking to evolve their business practices and secure long-term growth.