Part VII:
Will the Internet change the way we purchase supplies?
Bill Kimball, DDS
The Dental Economics year-long series,"The Internet`s Impact on Dentistry," is proudly sponsored by smileworks.com.
My 11-year-old son recently asked me if, after reading all my articles in this Internet series, a dentist might be tempted to become a couch potato. I suppose that`s possible - at least when it comes to ordering supplies. The Internet B2B ("business to business") sites are becoming very popular. Online dental supply sites are also gaining in popularity. The dental product/supply business is a $3-$4 billion market. Companies are spending millions to persuade you to visit and buy from them. Are dentists ready to buy online? And what is the future of this industry in dentistry? Are supply reps heading down the same path as travel agents by losing huge amounts of business to the Web?
This month I`ll review three companies providing different types of online ordering options. One company is an online comparison shopping service designed as an online marketplace, featuring discussion groups and dental journals. Another company is creating an efficient ordering tool that can be used as a component of other dental portal sites. A third company, which has been a successful supply company for years, is now using the Internet to support its sales representatives. I interviewed these key players in the industry to find answers regarding online supply ordering in dentistry and to identify the potential pros and cons of this service.
According to Bill McClain, vice president of sales and marketing for net32.com, "We are unique in serving the dental community as an online marketplace for bringing buyers and sellers together on one site. Kind of like Expedia and Travelocity, which bring multiple buyers of travel services together with multiple suppliers of air travel, hotel rooms and rental cars - one site for easy comparison shopping."
McClain believes dentists recognize how efficient the Internet is for businesses of all types and that dentistry, too, can benefit. They can e-mail colleagues, research products and procedures, file claims electronically, and order supplies 24 hours a day, seven days a week. "We`re finding that many dentists are dipping their toes in the water and ordering some of their supplies via the Internet."
net32 believes existing channels of distribution will remain important to the dental community. This online company works with, rather than against, dental dealers. They also believe that the real power of the Internet is its ability to bring buyers and sellers together in an open, unbiased marketplace, while providing buyers with information that empowers them to make smarter buying decisions.
As an online marketplace (rather than an online dealer), net32 does not compete with existing channels of distribution. "We embrace both dealers and direct manufacturers," states McClain. "We bring multiple supply sources to the dental office. At net32, dental offices can comparison shop for over 60,000 product choices from over 50 different supply sources - including a full variety of dental dealers and direct manufacturers. net32 also offers dental professionals access to current and archived issues of RDH magazine, Dental Economics, Dental Equipment & Materials, and Dental Graduate."
According to McClain, a dentist could read about a new product in Dental Economics Online at net32.com, post a question and review replies from colleagues about that product on a net32 message board, then - still without leaving the site - order that product from his or her choice of suppliers.
Oralis
A site taking a different approach to servicing dentists is Oralis.com. Pierre Gallant is president and CEO of Oralis, an online supply company that`s about one year old (middle-aged for the Internet!). We recently spent an hour talking about this industry (both of us on our cell phones between meetings - isn`t technology grand?). His market research indicates that fewer than 30 percent of dentists (even less than indicated from other market studies) are using online services. Most of them are using it to trade stocks! Gallant feels this number will increase rapidly with the growth of what he calls more truly useful online services - dental supply ordering being one of them, of course.
Oralis is focusing on improving the problem of backordered supplies, which the company says accounts for about 20 percent of the average dentist`s order using traditional methods. This online company sees ease of use and speed as the key to introducing dental teams to their new services. In fact, Oralis has 15 people dedicated to making its site easy to use, according to Gallant, and "the system gets smarter every time you use it."
Gallant believes the big advantage to online ordering is in the time it can save the office, rather than as a price shopping service. Oralis sees itself enhancing all dental business-to-business sites and would like to handle the e-commerce for as many major sites as possible. Major components to increase usability are added every six weeks. On the Internet, everything is on a shorter timetable than the typical business model.
Gallant stresses that distributor reps will still be a necessary part of the supply industry, but thinks fewer will be needed. "The new style of service will include more than just taking orders," he says. Oralis.com is limited strictly to products. This type of site focuses on providing as much information as possible on the 45,000 products in stock. "The Internet could help dentists immediately by providing access to manufacturer information instantly, rather than waiting for a return call." This would prove handy if you just realized you needed more information on a product and your patient was already in the chair!
SmartPractice
SmartPractice, which has been in business for 30 years, is a leading family-owned supply house in Arizona. I spoke to David Spresser, senior vice president, to see how the Internet has affected company sales. Its first Web site for dental offices was launched over 31/2 years ago. A brand new site, smartpractice.com, serves about 5 percent of their 10,000 most active accounts. Spresser says, "The site is ... an extension of our sales reps."
SmartPractice plans to use the Web to enhance the relationship between the sales representative and client, not eliminate it. Sales representatives will have an additional role, assisting visitors on the Web site. The clients` virtual sales rep will greet them when they enter the site, remind them what they have ordered in the past, suggest what might be needed now, and tell visitors of any specials or new products that would fit their individual profile. These messages are from real people that can be called or e-mailed for questions or feedback. Each page on the site will be generated from the database. This means that dentists will see personalized prices guaranteed by their sales rep for each product orderd. "The vast majority of our supplies are purchased through SmartPractice assigned representatives." Basically, this gives visitors their own custom-ordering site. Some dental offices are already ordering exclusively online.
According to Spresser, "The supply industry is, and will remain, a relationship industry. Going online to save 1 to 2 percent is often not worth the effort. When people have a problem, they want to talk to their rep."
SmartPractice reps can now e-mail new product information to their client offices with links (words that "click" the reader to another Web page) to offer more detailed information to those that are interested.
24-hour access
Efficiency and control have been touted as the top Internet ordering advantages. With virtually 24-hour access, dentists and team members need not sacrifice chairside time to ordering supplies. Because so much product information is available online, the dentist can make faster and more informed purchasing decisions.
You`ll be seeing more and more about these sites as they jockey for position in this multi-billion dollar industry. Web sites such as the ones above, as well as ziladentalsupply.com, edentalstore.com, dexpo.com, and a bevy of others will be knocking - or should I say clicking - at your door (or mailbox or inbox) this year.
The Internet truly is changing the way we will purchase supplies. Some things, however, I believe will never change: the need for individualized customer service, reliable deliveries, honest product information, speed, and ease of use. These characteristics will be synonymous with the online dental supply site winners. And it definitely will not be a "winner take all" situation. Practices are unique, dentists and their teams are different, and no one site will be able to serve them all. Until next month ... viva la différence! May those who truly seek to serve the dental community be victorious.
