Dental practices and DSOs gain competitive advantage by specializing in a specific niche rather than trying to be all things to all people, which means strategically saying no to unprofitable services, insurance plans, and difficult patients to differentiate from larger competitors.
- Differentiation is essential to avoid commoditization -- dental practices must compete on quality, convenience, or price in their chosen niche rather than trying to offer every service.
- Specialization with a lowercase "s" means consciously choosing a focused subsection of dentistry and saying no to insurance plans, procedures, and difficult patients outside that niche.
- The alternative to niche focus is burnout and direct competition with established DSO giants who have decades of experience doing everything, making it nearly impossible for smaller practices to win.
- Successful dental leaders play a different game than incumbents by carving out a sizable, specialized niche faster and more meaningfully than expected.
Modern-day thought leaders often describe the paradigm-shifting adoption of AI that we’re all experiencing as a “jagged frontier.” From a distance, the artificial intelligence frontier appears to be a smooth line that separates the AI adopters from the AI laggards.
But when you zoom in, you see that the frontier is quite uneven. Some have merely shifted from Googling to ChatGPTing as their new verb du jour. Others have automated their lives with AI and are vibe coding bespoke digital solutions to their everyday problems. In short, the closer you look at the topography of the frontier, the more it resembles a zigzag than a straight edge.
Dr. Alex Sharp.
In dentistry, the same phenomenon applies. Our jagged frontier for the past 20-plus years has been consolidation among dental service organizations (DSOs), with single-site solopreneurs on one side and rapidly growing DSOs on the other.
But not every dental practice fits the convenient yet reductive mold of being either wholly independent or swallowed up by one of the titans of industry.
In truth, as those of us in the industry know, many shades of gray exist between those two poles comprising:
- Small local general practitioner (GP) groups
- Small local specialty groups
- Local hub-and-spoke GP and specialty groups
- National midsize GP groups
- National midsize specialty groups
So what’s the multibillion-dollar question? It’s this: How do DSOs and dentists gain an advantage in the increasingly competitive dental landscape of the late 2020s?
To me, the answer is straightforward. File it under “simple but not easy.” To remain competitive, dentists and groups must prioritize differentiation above all else.
Put another way, industry leaders must fight commoditization. To be commoditized is to compete in a price-elastic market. Ask the erstwhile mom-and-pop store what it felt like to be run over by Walmart in the 1990s or early 2000s, or by Amazon in the 2010s.
If consumers view what you offer as an undifferentiated product they could get at the same quality, cheaper, or faster elsewhere, you’re in grave danger, unless you differentiate yourself from the also-rans and clarify your niche.
As I preach during our new doctor onboarding at SPG, we consciously choose to pursue mastery in a small subsection of dentistry rather than toil away trying to be jacks-of-all-trades. Most dentists still believe career success lies on the far side of decades of being all things to all people. Nothing could be further from the truth.
To dentists and companies: Start saying no. Drop insurance plans. Drop procedures. Drop PITA patients. Focus on services you can provide at higher quality, with greater convenience, or at a better price than others can match. I’d call that specialization with a lowercase “s,” which happens when you draw your own line in the sand about what you will and won’t do.
Whether you’re a dentist or a DSO leader, the alternative to differentiation is to accept every insurance plan, trip over yourself to provide every procedure under the sun, and burn yourself out while trying to keep the train on the tracks. By doing that, you’re competing with the mainstays of the GP DSO world, and they’ve been doing it for decades. They’re getting stronger every year.
So do what they can’t. Be the upstart who plays a different game from the incumbent and carves out a sizable niche -- more quickly and more meaningfully than anyone could have guessed.
Dr. Alex Sharp is the co-founder and CEO of SPG Dental Implant Centers, a dentist-founded, dentist-led DSO focused on full-arch dental implants. He is committed to making full-arch dental implants more accessible, helping patients regain their confidence, eat comfortably, and improve their quality of life.
The comments and observations expressed herein do not necessarily reflect the opinions of DrBicuspid.com, nor should they be construed as an endorsement or admonishment of any particular idea, vendor, or organization.
