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I was born and raised in the Bay Area of California and have been a co-owner and clinician of multiple local practices there. For the past 9 years, I’ve split my time between Los Altos Optometric Group and Pacific Eye Care Optometry in Mountain View (the latter is technically three practices merged into one location). We have five optometrists who rotate between the two locations, with various full-time and part-time schedules. All told, we see roughly 5,000 to 6,000 patients annually, of all ages, and we generate about $3 million in revenue.

The landscape of providing contact lenses has evolved over the years. The technology has advanced, making these lenses more comfortable and life-enhancing for a broader range of patients. But, their accessibility has also expanded through online retailers and low-cost providers, creating more competition for private optometric practices. Navigating the challenges of the contact lens marketplace while maintaining patient trust and profitability has been a key focus for our team in recent years.

KEY INSIGHTS IN THIS ARTICLE

  • Providing value: Focus on selling the service, not the commodity.
  • Removing price barriers: Price-match boxes of lenses to keep sales in-house and remove the reason for patients to look elsewhere (but only if they request it).
  • Lens pricing: A global fee for soft contacts; different pricing for specialty lenses.
  • Timing: Promoting annual lens supplies ensures yearly evaluations.

Approximately 20% to 30% of our total revenue comes from contact lens sales, 90% of which are daily disposable lenses. The reason for this high percentage of dailies is that they best fit the needs of our patient base. Due to our location, many of our patients work in technology or engineering careers and are on computers 10+ hours per day. The comfort, safety, and convenience of daily disposables makes these lenses the natural choice.

Building up a practice’s contact lens volume takes time, and it requires understanding and addressing patients’ needs. With thousands of lens products on the market, finding the right balance between performance and cost is crucial. In this article, I will discuss the challenges of pricing contact lenses and the pricing strategy my team and I have found to be effective for our practice.

PRICING CHALLENGES
I believe the biggest challenge for pricing contact lenses is competing with online retailers and communicating to patients that we can match or beat their prices. Soft contact lenses have become a commodity, and we no longer expect to make much profit on each box sold. Many patients believe the best pricing is found online, when in fact, we will match retail pricing if our patients inquire about it, thereby removing that barrier for them. We monitor the pricing at 1-800Contacts.com and Costco, as they tend to be our biggest competitors, and we use Otto (ottooptics.io) and EyeDock Pro software (by ODsonFinance), which shows lens pricing from all the major manufacturers.

Yet, perhaps because we work in an affluent area, we’ve found that only about 10% of our patients inquire about price matching or shop around for a cheaper price on their lenses. Rather than waste staff time on verifying prescriptions for outside vendors and answering after-hours emails— and still risk losing the sale—we’ve found that simply matching the price for those who ask makes it easier on everyone. “Frictionless” is one of my mantras for running our practice. Even if we make a little less margin on a box of contact lenses, keeping a happy, loyal patient who returns for annual visits makes up for it. Thus, we’ve shifted our strategy to emphasize services over product markup.

PRICING TO REFLECT THE VALUE OF SERVICES
Contact lenses are still an important part of our service offerings, so we’ve learned to structure our evaluation and fitting fees appropriately to make up that difference. My partner and I believe that, as professionals providing a skilled service, the evaluation fee should reflect our level of care. Each contact lens evaluation includes topographic imaging and evaluation of the tear film, and we use these data to both ensure our patients’ ocular health and explain why we’re recommending a particular lens to suit their visual needs.

We’ve set a global evaluation fee for any type of soft lenses, including spherical, toric, and multifocal contacts. We have a separate fee for specialty lenses like sclerals. We find this strategy not only simplifies the pricing process, but it also allows for more streamlined communication between our practitioners, staff, and patients. Tiered pricing proved ineffective for us, although it may work for practices of a different size and demographic.

To ensure patients return every year for their evaluation, we offer the best pricing on annual-supply boxes of contacts. We found that if we sell only a 3- or 6-month supply, then those patients’ follow-up visits aren’t timed correctly, and they tend to miss the annual evaluation. The yearly supply significantly reduces those gaps by giving the patient an incentive to schedule an appointment. Along with the discounts we offer with an annual box of lenses, we have at times run promotions such as a free pair of sunglasses or bottle of artificial tears, although we aren’t doing that currently. We do not stock boxes of lenses but instead use the direct-shipping options from the manufacturers (see the sidebar, To Stock or Not to Stock?).

TO STOCK OR TO NOT STOCK?
As part of my strategy of “lean” practice management, I do not believe in stocking boxes of contact lenses, even trial lenses. I know there are clinicians who have the opposite opinion, but to me, there is no need or benefit to doing so. In fact, I’ve lectured on this topic at Vision Expo. Contact lenses have a shelf life, and when you try to sell annual supply boxes, anything that’s expiring in less than a year must be thrown out. Now that most manufacturers offer 2-day direct-to-consumer shipping (many of them without a shipping fee), I see no reason to give up valuable office space to storing contact lenses.

KEEPING IT SIMPLE
My advice to fellow practitioners struggling to competitively price contact lenses is to keep it simple. At our practice, this means offering a global lens evaluation fee, price matching when requested, and incentivizing patients to purchase annual contact lens supplies. I’ve learned that ensuring that patients’ needs and wants are met while honoring patient loyalty will go a long way in the fight to remain competitive in the contact lens market.

Aaron Neufeld, OD
Optometrist and partner, Los Altos Optometric Group and Pacific Eye Care Optometry, California 
Founder, ODsonFinance.com 
aneufeldod@gmail.com 
Financial disclosure: Alcon, Aloha, CooperVision, Movu, Vyluma