eyecare by the numbers

The Real Definition of Discounting

Alan Cleinman

According to Webster’s Dictionary, the word “discount” has many meanings. But, 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 (e.g., inventory reduction sales), to entice a certain class of purchaser (e.g., senior citizen discounts), to drive business in slow periods (e.g., “Blue Plate” specials), or to increase volume (e.g., frequent buyer discounts).

Our industry, however, seems to live and breathe on discounting. Back in the late 1970s, I harnessed our industry’s standard discounting mechanics with the first national buying group. That program for optometrists allowed members to purchase product at the deepest available discount without meeting standard volume requirements.

But those discounts came with trade-offs that also benefitted vendors. For example, frames purchased at discount could not be returned. Orders were consolidated, so members could make a single phone call to place all of their orders. The firm, in turn, consolidated those orders for transmittal to the supplier, thereby reducing the supplier’s costs. In addition, all purchases were backed by bank guarantees.

As it often happens in a competitive environment, many of those vendor benefits have largely gone by the wayside and, today, virtually everyone gets a discount.

It also seems that the most important question to many eyecare professionals is, “What’s my price?” One result of all of this is discounting-based marketing messages dominated by BOGO and other egregious crimes of brand development.

Why is it that discounts prevail in an industry whose consumers fear the loss of vision more than anything other than cancer or heart attacks? Why don’t we have the confidence to communicate our products and services with pride and not just price?

This situation was driven home to me several years ago when a TV sitcom scene in an optometry office featured a big “50 percent off” sign as the dominant visual.

After so many years of these messages going out to consumers, my guess is that we’ve changed the consumer’s perception of “discount” from the standard definition—reduced price—to another of its definitions in Webster’s Dictionary: “discount…to disregard.”

I challenge our industry to look beyond discounting to find new ways of communicating and delivering value…at every level. We owe it to ourselves and to our universal “brand” to do that. The walk of 1,000 miles begins with a single step…. What will you do different tomorrow? EB

Alan Cleinman is founder and CEO of Cleinman Performance Partners (www.cleinman.com), a business consultancy specializing in the development of high-performance optometry practices. The opinions herein are those of the author and do not represent the opinion of Eyecare Business or its publisher. ©2013 Cleinman Performance Partners, Inc.