Cognitive bias and securing treatment acceptance

Derek Uittenbroek considers some of the influences on patient choice and reveals how clinics can engage confident, committed clients

Technological advancements within the medical aesthetics sector are driving consumer interest and confidence. As a result, the market is expected to grow significantly, with an estimated increase of approx. £23.29 billion (USD 29.67 billion) at a compound annual growth rate (CAGR) of 8.6% between 2022 and 2027. However, although many more people opt for medical aesthetic procedures, the high cost of treatments hinders wider-scale adoption.1

Aesthetic clinics face a significant challenge: addressing patients’ financial requirements while maintaining the profitability of their operations. In an era of discerning consumers and economic uncertainty, the aesthetic industry needs access to accessible and affordable financing options that don’t impact their bottom line.

Consumers today are willing to spend on self-improvement and aesthetic procedures but are also cautious about how they allocate their hard-earned cash and to what. Behavioural economics combines elements of economics and psychology to explore the complexities of human behaviour in real-world contexts. Analysing the influences on people’s actions and decisions, it finds that individuals experience what is known as the ‘pain of paying’. This is a cognitive bias where parting with money is psychologically painful.

So, when individuals weigh the pros and cons of medical aesthetic procedures and perceived financial constraints, how likely are they to abandon their plans? What are the major influences? And what can clinics do to help them confidently make that jump from treatment-curious to invested and committed patients?

Importantly, we must be aware of the different forms cognitive bias takes. So, let’s consider how these apply in a clinical setting.

Anchoring bias is when people rely too much on the first piece of information they get when making decisions. So, if someone is initially given a high-cost estimate of their treatment, they might fixate on that figure and think the procedure is more expensive than it is. This could cause them to believe it is too costly and abandon their plan.

Confirmation bias is when someone searches for information that aligns with their beliefs while disregarding contradictory evidence. For instance, when people contemplate a high-end cosmetic procedure, they might actively search for evidence supporting their belief that it is too expensive. Or, they may emphasise stories of individuals who regretted their choices or faced financial hardships after the procedure, strengthening this uncertainty.

Status quo bias combines a preference for maintaining the current status quo with a profound fear of change. So, when faced with the prospect of a medical aesthetic procedure, people may naturally avoid change, especially if they perceive it as financially burdensome.

Loss aversion is the tendency to weigh potential losses more heavily than gains. For example, when considering the financial cost of a procedure, individuals may focus on the money they stand to lose should the procedure fail to meet their expectations or encounter unforeseen complications.

Hindsight bias is the tendency to view events as predictable after they happen. For instance, people might think: ‘I knew it would be too expensive’ after a medical aesthetic procedure, reinforcing their reservations about embarking on that treatment journey.

Availability heuristic is when people rely on readily available information to make judgements. Individuals may recall stories of friends or acquaintances who experienced financial problems after a medical aesthetics procedure.

Social proof is when people tend to look to others for guidance and validation. If someone perceives that people in their real-world or social media circles have stories of financial struggles or dissatisfaction with their procedures, it can create a perception that these issues are common.

However, in addition to non-tangible factors like personal preferences and hesitations, genuine financial obstacles can also play a significant role in patients’ decisions to undergo aesthetic treatments. The availability of funds holds a substantial sway in shaping patient conversions, and aesthetic clinics should consider implementing policies or strategies to provide support. This could involve offering financing options, creating packages or discounts or working with insurance providers to cover specific procedures.

SO, WHAT ARE THE OPTIONS?

Traditional financing solutions are often cumbersome or limited in their scope, leaving both patients and clinics unsatisfied. Clinics may look to offer a buy now, pay later (BNPL) model reminiscent of retail financing. However, such solutions often fail to cater adequately to the unique needs of the aesthetic industry. Also known as instalment or deferred payment plans, BNPLs make it easier for customers to make impulsive decisions on cosmetic treatments, which could lead to choices they later regret. From a business perspective, BNPL schemes in healthcare and aesthetics may raise ethical concerns. Aesthetic clinics that heavily promote BNPL options could risk damaging their reputation if patients have negative experiences or the public perceives them as prioritising profit over patient wellbeing.

Clinics may wish to consider offering their own finance scheme. However, without Financial Conduct Authority (FCA) registration, the maximum loan amount for in-house financing is restricted – and they cannot offer longer-term financing options beyond the 12-month threshold. This potentially limits patient access to the bigger-ticket treatment protocols the clinic might offer.

Partnering with third-party financing companies to provide financing payment plans offers another solution. However, while financing with 0% interest can make high-end medical aesthetic treatments more accessible, most lenders require clinics to pay an interest rate subsidy. This can be a substantial financial burden. For instance, a recent survey conducted within the dental industry found that interest rate subsidies can be as high as 8.7%, with many owners facing challenges in managing them. Hidden costs can considerably impact profits, challenging a robust bottom line.

Clinic owners should, therefore, understand the financial complexities of traditional financing solutions and single-lender finance companies. Taking the time to look at all options will reap benefits in the long term. With the right financing partner, such as one that offers a panel of lenders instead of just one, aesthetic clinics can provide patients with affordable and convenient payment plans that facilitate more extensive treatment plans. This helps them achieve their desired results without the business breaking the bank.

Partnering with an ethical financing platform can eliminate the need for practices to become FCA-authorised, empowering them to offer their patients longer-term financing options without the regulatory hassles. Look for companies that add value, too, such as marketing support through customisable materials, practicebranded web pages, website widgets for finance eligibility checks and signage for waiting rooms and reception areas.

CONCLUSION

Cognitive biases can significantly influence decision-making, leading individuals to overestimate the financial risks, focus on potential losses, and seek information confirming their hesitation. For clinic owners, this is not insurmountable.Education is vital in helping patients overcome any obstacles to treatment.

In the increasingly competitive world of medical aesthetics, clinics need to adapt to the changing landscape to meet the evolving needs of their patients. Offering easy financing solutions is a way to break down barriers to attract less wealthy clients while maintaining a steady and consistent cash flow. A combination of transparent pricing, flexible payment options, patient education and emotional support can help patients overcome obstacles to foster a more inclusive and accessible aesthetic care environment.

DEREK UITTENBROEK

Derek Uittenbroek is the founder of SmileSave.co.uk and chief executive of the healthcare marketing agency Ignite Growth. SmileSave.co.uk is a disruptive finance options platform designed to smooth the path of patient finance and address many of the pain points.