By Terri Ross
Medical spas, or med spas, are the fastest-growing segment of the global cosmetic surgery market. According to the Global Medical Spa Market Report, the global market for med spas is projected to reach $25.9 billion by 2026. And according to AmSpa’s State of the Industry Report 2022, the average med spa revenue is $1,982,896 per year.
Many plastic surgery practices are deciding to either: 1) expand their offerings to include med spa services or 2) open a standalone med spa to help their patients obtain optimal results, increase the lifetime value of their patients, and boost their revenue. A standalone med spa can also funnel business to the plastic surgery practice as well.
It’s easy to get lured in and want to hop on the med spa bandwagon but launching without a strategic plan in place is like building a house without a strong, solid foundation.
Over the years, my team at APX Platform and I have helped launch hundreds of successful med spas and have helped numerous plastic surgery practices expand their offerings to include med spa services. That’s why I wanted to share some of the most important reasons why adding med spa services to your core practice can be beneficial.
But before you launch a med spa, here are the key factors to consider to build a strong foundation and set you up for success.
Med Spa Revenue Opportunities
According to a recent survey by the New York Post, the average female consumer spends $313 per month on products for her face and men spend $244. The survey states that 82% of men now are using skincare. If even 20 patients spent that on your products you recommend versus buying over-the-counter products, that would be an extra $6,260 per month of revenue generated by women and $4,880 for men.
Let’s take a little deeper dive into patient expectations versus reality.
- 86% of patients expect physicians to recommend a pre-treatment skincare regimen, yet only 14% of patients were recommended at-home care.
- 91% of patients expect physicians to recommend a post-care skincare regimen, yet only 30% of patients were prescribed post-care products.
So, you can see the clear gaps in the industry and how incorporating a comprehensive treatment plan to complement your surgical procedures can expand your revenue opportunities, increase long-term patient retention—and, more importantly—create better results for your patients.
The Value of Comprehensive Treatment Plans
I have taught my sales training course to thousands of plastic surgery and medical aesthetic practices across the country both onsite and virtually. Time and time again, one of the biggest areas of missed opportunity for revenue is failure to develop long-term treatment plans for patients.
Treatment plans help build long-term patient retention and increase the lifetime value of the patient. Lifetime value is the present value of all future profits generated by a patient. In other words, the average revenue that one patient brings to your practice for every visit spread out over several years. Bottom line, it’s a measure of what a patient is worth to your business.
With a comprehensive treatment plan that adds med spa services and retail products to surgical procedures, plastic surgery practices can provide clients with solutions, options, and possibilities to yield the best results—not to mention a “one-stop shop” for all their cosmetic needs.
If you were to add med spa services to your current practice, here is an example script of how you can incorporate them into your surgical procedure treatment plan:
Hi, Pam. My name is Dr. Smith. Thank you so much for coming in today. Our consultation will be around 30-45 minutes where my goal is to get to know you, focus on understanding your needs, and discuss all the viable surgical and non-surgical options, along with the best skin care regime that will help you achieve the best results.
Then, after you perform the assessment, you can say the following:
Based on my assessment to get you the outcome you are looking for, I am going to recommend the following: Pre-op hydrafacial to clean your skin and pores to prep for surgery; laser skin resurfacing to help with overall pigmentation and texture; faceliff; post-op recovery kit; Vbeam.
Key Med Spa Factors to Consider
Before you think about opening a separate med spa or adding these services to your practice, consider these key factors:
- Market characteristics
- Population statistics
- Potential resources
- Personal drive
Here’s a breakdown.
#1: Market Considerations: The status, pace, and growth of your niche market is the most critical factor that will directly impact the success and profitability of your med spa. Take a pulse of what’s happening in your target area:
- Is the market already saturated?
- How many offices are currently in operation?
- How many have opened in the last five years?
- Are they expanding?
- What treatments and services do they offer?
- How many other plastic surgery practices in your area have successfully incorporated med spas into their practice?
Research adding technologies and treatments that complement the current surgical procedures you offer or new treatments to expand your patient base. Identify surgical practices that have demonstrated considerable success and learn from them. Take note of their infrastructure, marketing style, target clientele, etc. Your goal is to create a med spa that excels above the competition.
There are a few ways to approach this goal. First, you can strive to meet the needs of your target clientele better than existing practices. This can be achieved by providing a superior patient experience: an upscale office and treatment areas, the right treatments and services that have a high market demand, or something niched.
A must is having a highly trained team, both administratively and clinically, and making the consultation memorable by building trust and rapport, identifying the clients’ needs, listening, asking the right questions that uncover their emotions, and understanding their objections (if valid) and assuaging them. Then, ultimately developing a personalized treatment plan based on what you recommend they need to achieve the results they need, regardless of the cost.
Conversely, you can strive to meet a new need in your target population by specializing in a niche area or target demographic. The key is to identify an area of the aesthetics market that is underdeveloped in your local market—and capitalize on it.
This research may take some time and effort, but it will be worth it in the long run. You can also hire a consultant to help.
#2: Population Statistics/Ideal Client Avatar: Before launching a standalone med spa or expanding your services, you’ll want to carefully define your target patient population. Consider:
- Where do they live?
- Where do they shop?
- Which restaurants do they frequent?
Identify this population and research them extensively. Determine their average household income and their average monthly expenditures on aesthetic services, among their other discretionary expenditures. Consider what types of aesthetics services they are currently seeking and what types of services they may be interested in.
Identifying and characterizing your target population will further help you define your niche market. If you can identify a need in your target patient population that hasn’t been met by the current market, you’ve accomplished the most important (and perhaps the most difficult) part of launching your new med spa business or services.
#3: Competition: Identifying and understanding your competitors is a critical factor that will directly impact the success and profitability of your business. Consider:
- What types of services and treatments do they offer?
- Are there any practices already in the market that specifically focus on a niche service like hair restoration, female feminization, ethnic skin? We suggest you identify three to five of the most successful offices in your area, secret shop by calling the practice, view their website, look at their social presence, and even visit the competition.
- How long have they been open?
- How fast are they growing?
- How many providers do they have?
- How extensive is their support staff?
- What is their patient retention rate?
By mapping out these details for each of your top competitors, you will begin to understand key elements you want to implement or avoid when opening your med spa or expanding your services.
#4: Location/Potential Resources: Once you’ve identified your niche market and target patient population, you’ll want to make sure that the region you’re considering can support your vision. The area where you choose to launch is critical. It will affect your ability to staff, manage, and grow your business. What are the local demographics? Your staff’s ability to listen, engage, and communicate with your patients is among the most critical aspects that will shape the success of your office. This begins with hiring the right people and training them well.
APX Platform, for instance, features a comprehensive sales training course for every member of your practice based on best practices with proven success. We highly recommend training your team the right way from the beginning.
Another big decision involves using your existing facility if you have room or building or leasing a new one. Moving into an existing facility may be faster but may require some changes to your initial plans. Or, you may choose to build one out to meet your needs. Either way, you will need to complete a market feasibility study and competitive analysis.
The accessibility of technical support for your equipment you plan to or have purchased is another important resource you’ll want to consider. Your equipment and supplies will need regular and established maintenance and support to ensure optimal performance. Most laser companies offer a maintenance plan, but they can be very expensive. It is important to find out how quickly support personnel can arrive onsite to troubleshoot or maintain equipment. Do they offer a loaner if repairs are necessary?
#5: Personal Drive/Mindset: Your personal drive and mindset are key elements that will impact the launch/expansion and success of your med spa. To have a high-performance practice, you must put in the work and train like a high-performance athlete. You’ll need to dig deep, roll up your sleeves, and be relentless in putting in the time and work.
That means not only mastering the legal, compliance, and business fundamentals but hiring and training the right staff with the right mindset, to create a culture of accountability with intention around providing a high level of customer service.
As a business leader, you’ll be required to make informed, data-driven decisions to support the growth and success of your med spa. This includes training providers and administrative staff, implementing efficient processes and protocols, creating a successful marketing plan, consistently achieving new goals in patient retention and conversion, and understanding key performance indicators
To learn more about how APX Platform can help expand your surgical practice or launch a new med spa in the areas of sales, finance, and operations, visit APXPlatform.com.
Terri Ross is a world-renowned practice management expert, thought leader, and international speaker in the medical aesthetic industry. She is also the founder and co-CEO of APX Platform. Join APX Platform‘s Aesthetic Insights Facebook Group here for ongoing content and interaction with the team, or email them at [email protected].