The Value of a Great Veterinary Brand
I was listening to the Bob Lefsetz podcast the other day. He is a long time thought leader in the music industry and has a podcast where he interviews some of the people that were behind the scenes of great artists or records. In this episode, he was speaking with Peter Rudge, ex-manager of the Who, The Rolling Stones, and Roger Waters amongst others. Roger Waters was a founding member of Pink Floyd until he left the band. He was the creator of some of their greatest songs and albums, most memorably The Wall, one of the all-time best-selling albums of all time. He shared a story of when Roger went on his first solo tour at the same time as Pink Floyd. Both started their tours in Toronto during the same week. Here he is the creator of their anthems, and responsible for their amazing stage shows competing against the band he created. Imagine how distraught he was when his ex-band, the one he made famous, the one he brought to unimagined heights outsold him 10x when they were both in Toronto. Roger couldn’t sell out a hockey arena, while Pink Floyd sold out a baseball stadium!
Right away I thought of the power of a brand. Roger Waters was the writer, singer and creative vision of much of Pink Floyd, but the crowds couldn’t care less. They wanted Pink Floyd. With Pink Floyd, they knew they would get a great visual show with amazing sound and would hear all of their favourite songs. Many of their fans would know Roger Waters, but likely thought “I prefer Pink Floyd”. Wow, that must have hurt.
The same power of a brand can apply to a veterinary practice too.
A brand represents the expectation or emotional response a person has to a company, person or event. When we think of Apple, we each have our own thoughts, but what other brand will have people stay in line for days so they can be first in line to get the latest iPhone?
The power of a brand can be huge. Tesla makes less profit than either GM, Ford and Chrysler yet has a market value bigger than the three combined because of the expectation the market has on its potential. It’s crazy stuff often not rooted in reality but has a powerful impact on people.
I bring up the concept of a veterinary practice brand when we think of a vet within a practice that is a star, a favourite of clients. I’ve seen many practices try to coddle these vets because of their fear that without them their practice would suffer. Some of these star vets come with considerable baggage that was disruptive and created a toxic work environment, yet the practice owners feared the difficult conversation needed to get these individuals to modify their behaviour. “What if they leave? We will lose so much business?”
There are two answers to this. The first is they are right if the business has been built up around the celebrity vet. Their brand is so much greater than the brand of the practice. The other answer is that if the reputation of the practice is healthy and known in the community the absence of the star vet may barely be felt.
Developing a strong brand should be a conscious decision that the business should try to develop over time to protect itself from the inevitability of veterinarians coming and going. In addition, a strong brand could increase the value of your business if you want to sell it. When a business is valued for sale a multiple of profit is often used to determine the sale price. A buyer is purchasing the expectation of future cash flows. The higher the risk the lower the multiple.
If the success of your practice is built upon one person it implies that revenue, or turnover, could be zero if the vet was out of commission for some reason. If the business has a great reputation than a buyer would recognize that the loss of one vet would not impact the attractiveness of the business to pet owners.
Let me share a story that happened to me in our veterinary practice called McKee-Pownall Equine Services (MPES). I am the Pownall and my wife is McKee. Several years ago, I went to a farm to do a pre-purchase examination on behalf of a trainer representing his client. This is where a vet assesses a horse to help a buyer understand if there are any obvious or underlying concerns that may impact the future use of the horse. When I got to the farm, I saw one of our other veterinarians there. I asked why she was there. She explained that the buyer wanted her vet with her to make sure the horse was all that it was supposed to be. I was very confused because she and I were there representing the same person. My colleague then shyly explained that her client didn’t know who this Mike Pownall was, so she wanted her own vet. What a compliment. The owner of the horse didn’t know me but knew that vets working under the banner of McKee-Pownall Equine Services did a great job. When this same vet went on her maternity leave for 6 months (Its usually a year in Canada) all of her clients went to other vets in the practice and when she returned, she developed a book of new clients. In other words, our clients wanted what the practice offered and was confident in any of our vets to take care of them and their horses.
Over the years we have been able to introduce many new vets to our practice. Clients routinely tell us that if they are a vet with MPES they must be good veterinarians. That is part of our brand. Our clients have the expectation that a vet from our practice is highly skilled and a great communicator and while they have their favourites, it is the rare one that won’t have another vet care for their animal.
We all value great vets with a following, but we should make sure that their personal brand doesn’t supersede the brand of the practice. We want to be recognized for being a great practice, not where Dr. so and so works. Building a great brand takes time and requires us to make decisions on what is good for the business and not necessarily on a person. We should work to elevate all vets to the same level and not make a star out of one of them over the others. When we build a team, clients recognize that value and know that whoever they get for a vet will take care of their pet as they have come to expect. What a comfort that is for clients, but also practice owners.