SAP project

STRATEGIC
ASSESSMENT
PROJECT

Lifestyle
Lift
Holding,
Inc.

Melissa
Bissessar

Kevin
Falck

Patrick
Fereday

Kiara
Jones

Stephanny
Reyes

MGT
431

XIE

Section
F

Strategic Assessment Project – Bissessar, Falck, Fereday, Jones, Reyes 1
Table of Contents
Project Plan .................................................................................................................................... 3
Company Profile........................................................................................................................ 3
Key Issues.................................................................................................................................. 4
Client Goals ............................................................................................................................... 4
Scope of Project......................................................................................................................... 5
Client Deliverables..................................................................................................................... 6
Project Plan - Internal.................................................................................................................... 7
Group Member Contact List ...................................................................................................... 7
Group Member Assignments & Responsibilities ...................................................................... 8
Group Meetings ......................................................................................................................... 8
Weekly Group Meetings............................................................................................................ 9
Group Milestone Meetings ........................................................................................................ 9
Client Meetings.......................................................................................................................... 9
External Analysis .......................................................................................................................... 11
Industry Definition................................................................................................................... 11
Industry Players ....................................................................................................................... 11
Industry Life Cycle .................................................................................................................. 16
Michael Porter’s Five Forces Model........................................................................................ 18
Industry Value Chain ............................................................................................................... 23
PESTEL Analysis .................................................................................................................... 24
Opportunities and Threats........................................................................................................ 28
Internal Analysis ........................................................................................................................... 32
Introduction.............................................................................................................................. 32
Company Introduction ............................................................................................................. 32
Porter’s Firm Value Chain Analysis........................................................................................ 33
Important Resources and Capabilities ..................................................................................... 45
VRINE Analysis ...................................................................................................................... 46
Strengths & Weaknesses.......................................................................................................... 47
Strategy Recommendations........................................................................................................... 50
Introduction & SWOT Framework.......................................................................................... 50
Recommendation #1: Revamping Company Website to Attract Target Customers ............... 52
Recommendation #2: Reduce Outbound Calling .................................................................... 61

Recommendation #3: Improving Customer Loyalty ............................................................... 65
Recommendation #4: Targeting a More Diverse Demographic.............................................. 72
Recommendation #5: Use more specific advertising channels................................................ 76
Works Cited................................................................................................................................... 82

Project Plan
Strategic Business Analysis
Lifestyle Lift Holding, Inc.
100 Kirts Boulevard
Troy, MI 48084
Company Profile
Lifestyle Lift Holding, Inc. is a nationally branded cosmetic surgery company in the United
States. It was founded by Dr. David Kent, a surgeon who was determined to find a safe approach
to facial rejuvenation that was affordable to not just upper class customers but middle-class
customers as well.
The Plastic Surgeons Industry provides products and services in two broad segments which are
surgical and nonsurgical procedures. “Surgical Procedures” include breast augmentations and
reductions, liposuction and various procedures that shape parts of the face and body.
“Nonsurgical procedures” include the injection of certain chemicals, laser treatments and
chemical peels. Furthermore, surgical procedures can be categorized as either ‘elective’ or ‘non-
elective.’ Elective surgeries include facelifts and breast implants which are for cosmetic purposes
only. Non-elective surgeries are medically necessary and are typically covered by insurance
providers.
Lifestyle Lift Holding, Inc. utilizes a differentiation strategy by using local anesthesia during
face lift procedures which allows the patient to come and go easier. The company performs
25,000 surgeries per year on average, which breaks down to 350-400 per month.

Key Issues
Lifestyle Lift Holdings, Inc. currently spends approximately $50 million on marketing, however
it is not effective in achieving its goals. The company focuses on marketing on obscure
television channels and does not utilize the internet for marketing efficiently. Approximately
60% of patients cancel their operations due to the company driving them away calling 10 times
within 3-4 days.
Lifestyle Lift Holdings, Inc. is currently $5 million buried in debt. The company has recently
just signed a forbearance agreement with a banking institution to prolong foreclosure for the time
being. Many of the 750 employees were never made aware of the current financial situation due
to a lack of transparency existent in the company.
Lifestyle Lift Holdings, Inc. receives approximately 700,000 calls per year, however with their
current, outsourced call center, the company has a 35% abandoned call rate
The new CEO of Lifestyle Lift Holdings, Inc. feels as though the company is not living up to
their full potential as 82% of patients are having their procedures done more slowly, painfully
and more expensive than necessary. As a result of this, Lifestyle Lift Holdings, Inc. is missing
out on a large market share.
Client Goals
The client goals include:
· Educating customers in the target market about the superiority of their procedure
· Strengthening of pricing

· Higher patient confidence
· High financial and market success: $60-70 million EBITDA (Earnings before income tax,
depreciation and amortization) for next two years.
· Revamping the marketing strategy to include internet, social media, and referrals.
· Create transparency throughout the company to not only be a leader in facial rejuvenations,
but to be a social leader and build visibility.
Scope of Project
The scope of the project will include three comprehensive sections: External Analysis, Internal
Analysis, and Strategy Recommendations.
1. External Analysis
This section will address the client’s external issues related to the macro and industry
environments. In the macro environment analysis, we will examine the following five areas:
political/legal, economic, socio-cultural, technological, and environmental. The industry analysis
includes basic issues such as industry definition (boundary, SIC and NAIC codes, etc.), size,
products and services, trends, customers, competitors, suppliers, competitive forces, segments,
etc. The purpose of the external analysis is to identify important opportunities and threats the
client faces or will face.
2. Internal analysis
This section will address the client’s internal issues. More specifically, we will analyze the
client’s goals, strategies, performance, customers, products/services provided, resources,

capabilities, activities, organizational structure, etc. Based on the analysis of the client’s internal
environment, we will identify its key strengths and weaknesses.
3. Strategy Recommendations
In this section, we develop specific recommendations to address the client’s concerns and
accomplish the goal of the project. Our recommendations, along with the findings of the external
and internal analyses, will benefit the client and help the company’s strategic growth.
Client Deliverables
The client will receive out strategic analysis report through a formal presentation, given at The
University of Tampa. The following are tentative dates of when the components of the project
will be completed.
1. Project Plan - September 7, 2014
2. External Analysis - September 28, 2014
3. Internal Analysis – October 19, 2014.
4. Strategy Recommendations – November 14, 2014
5. Final Paper – December 5, 2014
6. Client Presentation – December 5, 2014

Project Plan - Internal
(Internal Use Only)
Lifestyle Lift Holding, Inc.
100 Kirts Boulevard
Troy, MI 48084
The completion of the strategic analysis project will require the equal cooperation and
persistence of each group member. The success of this project will be determined by each
members’ efforts to communicate effectively with each other, as well as the professor and the
client. Not only would success be based on communication, but by the combined efforts of each
member and dedication of time necessary to exceed the expectations of the professor and
essentially the client. This document will serve as the guide for our group and the key to the
success of the team. The contribution and efforts of each team member are expected to be equal
in both force and effectiveness.
Group Member Contact List
Melissa Bissessar - (813) 892-1920; melissa.bissessar@spartans.ut.edu
Kevin Falck - (402) 670-1175; kevin.falck@spartans.ut.edu
Patrick Fereday - (304) 516-3614; patrick.fereday@spartans.ut.edu
Kiara Jones - (813) 410-1616; kiara.jones@spartans.ut.edu
Stephanny Reyes - (813) 900-6183; s.reyesdominguez@spartans.ut.edu

Group Member Assignments & Responsibilities
Group members should check their email at least daily and should also be utilizing the Group
Discussion Board, as well as the Collaboration and File Exchange on Blackboard. Each member,
in the course of data gathering, investigation and analysis, will utilize all available resources.
Resources will include but are not limited to: the internet, library, the client, Dr. Xie (guidance),
other members, periodicals and other industry related publications. Group members should strive
to think outside the box, and be creative when addressing their assigned sections. Group
members are encouraged to share their information and talent with other members in order for
the group to fully utilize all resources available.
Melissa Bissessar has been elected the leader of our group. She will arrange all meetings,
including group meetings, client meetings, and meetings with Dr. Xie, assign tasks of editing and
submitting documents, coordinating activities, help address group conflicts, etc. However, each
group member will have a responsibility to contribute and collaborate, and to ensure that the
group functions well. All group members are expected to post their assigned tasks on Blackboard
file exchange in a timely manner.
Group Meetings
Weekly group meetings are mandatory, however, exceptions will be made for emergencies and
extraordinary cases. If for some reason a member is unable to attend the meeting, he/she should
notify the group at least 24 hours in advance. If there is an emergency however, a text should be
sent to notify the group. All group members are required to attend scheduled client and milestone
meetings.

Weekly Group Meetings
Every Friday at 3pm the group will meet for 1 hour in the Macdonald-‐Kelce Library. The length
of the meeting may vary depending on the group’s ability to use the time allotted effectively and
efficiently.
Group Milestone Meetings
Milestone meetings will serve as a time to distribute relevant data or findings of our individual
analysis, also providing an opportunity for discussion. Milestone meetings will be held
immediately after regularly scheduled meetings.
Milestone 1 (External Analysis) – Friday, September 26th, 6:00 pm
Milestone 2 (Internal Analysis) – Friday, October 17th, 6:00 pm
Milestone 3 (Recommendations) – Wednesday, November 12th, 8:00 pm
Milestone 4 (Final Paper) – Wednesday, December 3rd, 8:00 pm
Milestone 5 (Class Presentation) – Saturday, November 29th, 8:00 pm
Milestone 6 (Client Presentation, if selected as a finalist) – Wednesday, December 3rd 8:00 pm
Client Meetings
Client meetings will be held at the University of Tampa or the client’s location (business casual
dress required) or by telephone depending on what provides the better outcome. It is the
responsibility of each group member to submit an agenda to the group leader prior to the client

meeting. All members are expected to prepare for and attend the client meetings. This will
ensure productivity and efficiency during the meetings.
In conclusion, as stated above, a commitment must be made to both the client as well as the
group member. Each brings to the table different but complementary skills, knowledge and
abilities. This commitment should also include treating each group member with the utmost
respect and professional standards, as well as treating this assignment as a real world situation.

External Analysis
Industry Definition
Lifestyle Lift Holding, Inc. operates within the cosmetic and plastic surgery industry. This
industry provides surgical and non-surgical procedures to improve one’s appearance for cosmetic
or reconstructive purposes (Culbert, 2013: 2). The demand for the cosmetic and plastic surgery
industry has been on the increase in recent years due to a larger social acceptance of procedures.
Additionally with the increase of technology, procedures are becoming safer and more affordable
for customers (Culbert, 2013: 5). The cosmetic and plastic surgery industry provides an array of
services such as: injectables (Botox), laser hair removal, microdermabrasion, breast
augmentation, liposuction, and facelifts. Of those procedures, injectables make up 55% of the
industry followed by laser hair removal at 13.8%, and chemical peel at 7.3%. The industry
generates revenue of approximately $13.5 billion in 2013, with $1.9 billion in profits. Within the
past five years (2008-2013), the industry has grown at an average rate of approximately 2.3% per
year (Culbert, 2013: 4). Cosmetic and plastic surgery is becoming more available and accessible
to consumers outside the wealthy class. Surgical centers are becoming more popular across the
United States of America (Culbert, 2013: 7). With the economy on the rise, the industry is
expected to grow due to an aging population and an increase in disposable income at
approximately 5.5% per year to an estimated $17.6 billion in 2018 (Culbert, 2013: 5).

Industry Players
For the purpose of our external analysis, the focus will be on the specific segment of the industry
in which Lifestyle Lift Holding, Inc. operates in, which is non-surgical facial rejuvenation.

Competitors

Within the cosmetic and plastic surgery space, there are no major competitors. The industry is
instead filled with sole practitioners that operate locally or regionally, few nationally branded
companies, and smaller independent medical spas (Culbert, 2013: 20). All provide non-surgical
facial rejuvenation procedures that compete within the space.

Local/Regional Sole Practices

A key competitor to the non-surgical facial rejuvenation segments are the local/regional sole
practices. An example of such a company is The Bassin Center for Plastic Surgery with offices
in Melbourne, Orlando, and Tampa, Florida. The Bassin Center is able to operate in areas with
high demand for facial rejuvenation procedures. The Florida marketplace is ideal for regional
sole practices due to a greater number of aging patients. Dr. Roger Bassin is an eyelid and facial
plastic and reconstructive surgeon. The mission of his practice is, “To provide the most natural
looking result, so as to provide an “un-operated” appearance” (Florida Plastic Surgeon, 2014: 1).
The Bassin Center has a differentiation strategy of a non-surgical facial rejuvenation procedure
known as the ThermaCool TC Non-Surgical Facelift. What makes this technique unique is its
use of radio waves that are emitted from the Thermage ThermaCool TC device. The radio waves
target the collagen deep in the skin which results in the tightening of the facial tissue
(ThermaCool TC Non-Surgical Facelift, 2014: 1). An additional component to their strategy is
their customer group. The Bassin Center focuses on high end, aging customers who are willing
to pay top notch for the best quality procedure. Furthermore, The Bassin Center has other
resources and capabilities that make it successful. Due to their regional platform, they are able
invest their marketing into one geographic market. Since their offices are so closely knit, the
demographic of the market won’t vary substantially.

Independent Medical Spas

The final competitor in the non-surgical facial rejuvenation segment are the independent medical
spas. An example is The Skin Center Medical Spa. The Skin Center has offices in Columbus,
Ohio and throughout the state of Pennsylvania. The Skin Center is able to provide many similar
non-surgical procedures as sole practices and national companies at a lower cost and offer the
convenience of a “one stop shop” facility. The mission of The Skin Center, “Is to dedicate every
day to help improve our client’s enjoyment of life” (About the Skin Center, 2014: 1). The Skin
Center employs an integrated differentiation and cost strategy. They differentiate with their use
of certified surgeons of the QuickLift Face Lift procedure. The QuickLift procedure uses an
upward-directed lifting opposed to the pulling back of excess skin to create a more youthful look.
To achieve this, the process utilizes local anesthesia. The QuickLift Face Lift differentiates due
to its smaller incision and surgical time that results in less post-surgery effects and quicker
recovery timeframe (Common QuickLift Face Lift Questions, 2014: 1). The Skin Center,
similarly to Lifestyle Lift Holding, Inc., offers a low-cost strategy by using the QuickLift
procedure which features local anesthesia and shorter operating time, which reduces cost to the
company and customer. The Skin Center is capable of attracting customers due to its vast array
of services it offers. Other than non-surgical facial rejuvenation procedures, The Skin Center
provides services such as breast augmentation, liposuction, vein treatments, etc. all in one
facility. Similar to Lifestyle Lift Holding, Inc., The Skin Center focuses on the aging middle
class customers, however their customer group enjoys the convenience of having multiple
services offered in one location.

Suppliers

Within the non-surgical facial rejuvenation segment, there are a wide variety of suppliers.
Suppliers of the segment include medical equipment companies, brand name and generic name
pharmaceutical companies, medical personnel, and other support functions (such as a call center
for customer service). These suppliers of the non-surgical facial rejuvenation segment are not
concentrated and are widely available. For example, Medline Medical Supplies is a leading
supplier of medical supplies such as gloves, linens and cleaning supplies, etc. for many medical
markets such as hospitals, surgical centers, nursing homes, etc. (Medline, 2014: 1). However,
Medline is just one company that supplies those medical markets. The medical equipment
companies are not concentrated and their inputs are widely available. Similarly the brand name
and generic name pharmaceutical companies are not concentrated as well. There are many
wholesale pharmaceutical companies who supply drugs to the medical market. One example is
A. F. Hauser Inc. a pharmaceutical who supplies hospitals, dental offices, and medical practices
with pharmaceutical products including tablets, capsules, creams, ointments, liquids, vaccines,
and injectables (A.F. Hauser, 2014: 1). Another supplier of the industry is medical personnel.
They include plastic surgeons and nurses to staff the operating centers. The plastic surgeons are
heavily trained specialists and require extensive knowledge. According to the American Board
of Plastic Surgery, Inc., there are 6,300 board certified surgeons in practice today (2014: 1).
These medical personnel are somewhat concentrated due to their different level of experience.
Some surgeons are certified in certain facial rejuvenation procedures which gives a firm a
competitive advantage. However in general, there is not a short demand for medical personnel in
the industry. Finally, many firms in the non-surgical facial rejuvenation segment utilize third
party companies such as call centers for customer service support. An example is Quality

Consulting, which is a company that will take care of a firm’s tele services such as scheduling an
appointment, following up/appointment reminder, and customer service (“Call Center
Operations, 2014: 1). These third party call centers are also not concentrated and are widely
available to surgical firms. Overall, the number of suppliers of the non-surgical facial
rejuvenation segment are high which offer firms flexibility in terms of suppliers.

Customers

Customers of the non-surgical facial rejuvenation segment range from age 20 to 64, which
represent 91.4% of patients. The majority of customers are age 50-64 who are facing the effects
of visual aging. However, according to the American Academy of Facial Plastic and
Reconstructive Surgery, non-surgical facial rejuvenation is becoming more popular to younger
generations who are taking preventative measures to prevent the effects of aging in the future. In
58% of facial plastic surgeons saw an increase in the number of customers under the age of 30
(AAFPRS – Media Resources, 2014: 1). Most customers of the industry are women, they
account for 81% of all surgical and non-surgical procedures throughout 2013 (AAFPRS – Media
Resources, 2014: 2). Women are most common because they place more importance on their
physical appearance/beauty and preserving their youthful look. While men customers are more
concerned with wrinkle removal and preserving their full head of hair (AAFPRS – Media
Resources, 2014: 1). Non-surgical facial rejuvenation procedures are primarily dominated by
Caucasians. Caucasians in the United States culturally value their youthful appearance making
facial rejuvenation procedures more popular than with other ethnicities (Culbert, 2013: 15).
Customer demographics of the industry include annual income of $35,000-$99,000. The typical
cost of a facial rejuvenation procedure is $6,556, which is a hefty investment for customers with
such an annual income (“Facelift Cost,” 2014: 1). Customer demand for the segment can vary

depending on geographical region. For example, Eastern Texas, which includes Dallas and
Houston, have a high demand for non-surgical facial rejuvenation due to an increase in the
number of aging patients which higher income. Other regions that have high demand include
areas of warm temperature that attract aging customers such as Southern California and Florida.
The non-surgical facial rejuvenation segment is primarily a ‘want’ vs. a ‘need’ for customers.
While the procedure is a ‘want’, customers expect high quality and professionalism due to the
long-term effects of these procedures. In more detail, they expect high attention to their safety,
little to no complications following the procedure, and ultimately a preserved youthful look. The
segment provides procedures at a high price point which many customers consider to be an
investment in their future appearance. By doing so, the customer additionally expects attention
and knowledge in the form of a consultation pre-operation. Generally, customer needs are being
satisfied, especially by nationally branded companies and medical spas who are able to lower the
price of these procedures making them more available to customers. High quality needs of
customers are also being satisfied by independent/sole practices who have a higher price point
and a higher level of quality for long-term effects.

Industry Life Cycle
Based on the characteristics of the different stages of the life cycle, the cosmetic and plastic
surgery industry is currently in the growth phase (IBIS World, 2014). The first characteristic of
the growth stage is customers becoming better informed. The general public has become more
aware and enlightened on the topic of plastic surgery due to the amount of public figures and
celebrities that have publicly acknowledged that they have undergone surgery.


The second characteristic, closely linked to informed customers, is the market expansion beyond
a niche status. During the past decade, the cosmetic and plastic surgery industry has enjoyed
rapid growth in consumer acceptance as these surgeries have become more mainstream.
According to a survey carried out by The American Society for Aesthetic Plastic Surgery
(ASAPS), 51% of Americans approve of cosmetic plastic surgery regardless of income (ASAPS,
2011).

The third characteristic of a growth industry is an increase in the number of competitors entering
the market, which is occurring in the cosmetic and plastic surgery industry. These competitors,
outlined in the Industry Players section, cover a wide variety of specialties and vary from the
high-end professional services to convenient “one-stop shops.”

Although the cosmetic and plastic surgery industry is in the growth stage, the industry
experienced its first decline in revenues during the recession. This decline is due to the fact that a
large segment of the industry surrounds elective surgeries that are greatly dependent on per
capita disposable income (Culbert, 2013: 9). Per capita disposable income, regularly monitored
as a key economic indicator to assess the state of the economy, experienced a strong decline
during the recession causing the weakening of the cosmetic and plastic surgery industry
(Investopedia). Naturally with a recovering economy, disposable incomes have grown and so has
the industry. ASAPS reported a 6.5% increase in total number of cosmetic surgical procedures
from 2012 to 2013 (ASAPS, 2014). Along with rising demand, technological innovations in this
sector are making procedures more affordable, more accessible, and safer, which will add to
industry growth.

This current growth stage of the industry has both opportunities and threats. The main
opportunities at this stage is for companies to adapt to customer’s needs and suggestions, and
research and development can still lead to more differentiation. Major threats include more
competitors entering the market and companies requiring significant amount of capital to
differentiate from competitors.

Michael Porter’s Five Forces Model
Rivalry

The cosmetic and plastic surgery industry comprises of many competing companies as well as
buyers and sellers. Competition takes the form of non-price competition. Rivalry in the cosmetic
and plastic surgery industry is influenced by numerous factors.

Numerous Competitors- There are numerous equally balanced competitors in the industry who
all offer local anesthesia. As previously discussed, competitors include local and regional sole
practitioners, nationally branded companies and independent medical spas.

High Fixed Costs- Rivalry is also increased due to high fixed costs of equipment, materials and
supplies. For example, at Lifestyle Holding, Inc., the cost of a patient is $2200 (Kickoff event).

Lack of Differentiation- In the cosmetic and plastic surgery industry there is lack of
differentiation opportunities as competitors each offer the same surgeries and procedures.
Surgeries and procedures that are done are of a similar nature which does not leave room for
companies to differentiate themselves.

Exit barriers are High- Exiting the cosmetic and plastic surgery industry is difficult to do as
there are many barriers. Such barriers include the costs of equipment and supplies. Medical
Equipment and supplies are expensive.

Rivalry in the industry is high as most of the factors make it difficult for new entrants to enter
the market and be successful in doing so.

Threat of New Entrants

The threat of new entrants in the cosmetic and plastic surgery industry is low and the barriers to
entry for a new entrant is high. This makes it difficult for an entrant to enter the industry and gain
visibility. The industry has a high average profitability of 1.9 billion as previously stated in the
industry definition (Culbert, 2013:4). While surgical centers throughout the United States are
becoming more popular and the demand for cosmetic surgery is increasing, many conditions
make it difficult to successfully enter the industry such as:

Capital Requirements- The price of obtaining capital to start up a center for cosmetic surgery or
facial rejuvenation is high. Companies would have to allocate a large sum of money to sourcing
doctors to perform procedures, medical equipment and supplies.

Access to Distribution Channels- As previously stated, the major activities in the industry
involve marketing and promotions. This barrier forces entrants to spend heavily in order to find
potential customers and obtain consumer loyalty. Cosmetic surgery providers have high fixed
costs and spend a lot of money on marketing. For example, Lifestyle Holding, Inc. spends $50
million a year in advertising (Personal Interview). It would be difficult for a new entrant to
compete and gain visibility.

Core Competencies- Surgeons must have their license to perform cosmetic surgery in the
medical community they choose and such accreditation can take years of school and training.
Establishing a reputation for a new coming surgeon may be difficult.

In conclusion the majority of influencing factors were positive with respect to the company’s
perspective as the barriers to entry were high. There are many barriers that prevent others from
entering the market. If one was to do so it would be very difficult.

Supplier Power

The supplier power in the cosmetic and plastic surgery industry is medium to low as they are not
concentrated and suppliers are widely available. The industry suppliers include Medline Medical
Supplies, A.F Hauser Inc. Pharmaceutical, McKesson Medical Supplies and Quality Consulting.

Many factors influence supplier power such as:

Switching Costs- Supplier products create a moderate switching cost. There are many
suppliers in the industry but companies may incur the cost of searching for the best supplier.
Additionally, there may also be installation and start-up costs of new equipment.

Products- Supplier products are critical to the company’s success, however, the suppliers
are large in number therefore new suppliers can be easily obtained. For example, Lifestyle
Holding, Inc., obtains their supplies from McKesson Medical Supplies and the CEO Dean Akers
choose to get them as partners so they can help his business (Personal Interview). Therefore
supplier power is moderate as Lifestyle Holding, Inc. has the upper hand.

The following are the supplies needed for the facial rejuvenation segment in the cosmetic and
plastic surgery industry.

Local anesthesia- The drugs needed to perform the procedure can come in the form of a
shot, spray or ointment. There are many suppliers that offer the same product.

Oral sedation- The producers of the drugs needed to perform surgeries are many in
number and have no power over pricing so therefore supplier power is weak. The Cosmetic
Surgery companies can easily replace them and find another supplier.

Call centers- The use of call centers are gradually decreasing as companies want to
eliminate that channel and be closer to their customers. For example, Lifestyle Inc. contracts
with a company to outsource all of its call center operations in order to save money but this may
have a negative impact on their profitability as customers want to feel involved (Personal
Interview).

In summary, the majority of influencing factors of supplier power were negative with respect to
the company’s perspective. This results in the supplier power in the cosmetic and plastic surgery
industry to be medium to low. Suppliers may be replaced easy by the company which has more
power over them.

Buyer Power

The buyer power in the cosmetic and plastic surgery industry is high as the buyers are large in
number. The major buyers in the cosmetic and plastic surgery industry are direct customers and
the amount of people that want cosmetic surgery is increasing rapidly. The main customers
include women from ages 20-64. According to data from the American Society for Aesthetic
Plastic Surgery (ASAPS), the number of procedures grew from 740, 751 in 1997 to more than

8.4 million in 2012 (Culbert 2013: 14). The number of direct customers are increasing as the
aging population is increasing and there is a growing demand for maintaining beauty and youth.
There are many influencing factors that affect the buyer power which include:

Total output- The buyers in the cosmetic and plastic surgery industry purchase a large
portion of an industry. The only buyers in the industry are the direct customers who are
interested in the procedures they offer. Without the direct customers, the companies would not
have a profits or a business.

Buyers Purchases- The buyer’s purchases are a significant amount of their suppliers
annual revenue as the money that comes in from customers go back towards suppliers in
purchasing of materials and drugs needed.

Switching Costs- The direct customer’s switching costs are low as they may simply
change the company they want to have their procedure done with if they are not satisfied. There
are many companies that a direct customer could choose from.

Buyer Power in the cosmetic and plastic surgery industry is high as most of the influencing
factors were negative in the company’s perspective. Each factor led to an increase in the power
of the buyers and the number of buyers that want to do cosmetic surgeries are increasing.
Without buyers there would be no business in the cosmetic and plastic surgery industry. This is
very important factor to the companies.

Threat of Substitutes

The threat of substitutes to plastic cosmetic surgery is high due and is influenced by few
Switching Costs. Switching to a natural form of a better appearance is much cheaper for the

buyer than investing in a surgery which they may not be satisfied with. In the cosmetic and
plastic surgery industry the substitutes include:

Exercise- People may exercise in order for their appearance to look younger. It may take
longer than a surgery or procedure but it works just as well and it is healthier for the direct
customer’s body. Many people are now very health conscious of themselves.

Natural Remedies- Direct customers may also choose natural remedies in place of
cosmetic surgery such as oils, lotions, creams, facial masks, drinks and food choices.

Industry Value Chain
Materials & Components

Major materials and components utilized in the plastic surgery industry are medical equipment,
injectables, anesthesia, and other standard surgical equipment.

Services

In this industry, services provided fall into two broad segments: surgical and nonsurgical
(Culbert, 2013: 9). Surgical procedures usually involve the shaping of body parts and anesthesia,
for example Rhinoplasty. Non-surgical procedures are those that are non-invasive like laser
treatments, chemical peels, and injectables like Botox (IBIS World, 2014). While these
procedures are delivered as a service, they have similar characteristics to consumer durable
products (Hennink-Kaminski, Reid, & King, 2010). Similarities include long lasting results, they
are more tangible than others in the service sector, they are more expensive and have demand

curves that fluctuate with the economy and they also have a relatively permanent effect in the
consumer’s life.

Distribution

The main activities in distribution in the industry involve marketing and promotions. Due to the
competitive nature of the industry, companies and sole practitioners alike, substantially rely on
heavy marketing and promotions to find new potential customers. This marketing includes
television advertisements, magazines, and online advertising, which greatly increase operating
costs.

End User

Lastly, the end users in this industry are the patients that undergo the procedures, who are
described in the Industry Players section.

PESTEL Analysis
Political & Legal Factors

According to the client of Lifestyle Lift Holding, Inc. politics do not have much influence on the
surgical industry. However, government registration, such as the Affordable Care Act that is
currently being implemented affects the company. It affects how the company needs to view
their employees and customers.

Doctors are held to a high standard in being professionals. There are constantly medical
malpractice lawsuits that surgical practices’ have to deal with. From the client’s mindset, the
biggest issue with these lawsuits is that there is a lack of sympathy towards the patients. This

shows that there is an opportunity for more training to be offered to the employees with regard to
working with patients. The company has an obligation to show compassion and understanding
toward all patients on a regular basis.

Economic Factors

Many of the surgical and minimally invasive procedures being practiced are elective. This
means that because there is not an emergency, it is not the responsibility of the insurance
company to cover them. As a result of this, payment for the procedures has to come out of the
customer’s pocket. When the economy in bad shape, it is troublesome news for the surgical
industry since many consumers are only spending their money on things that are absolutely
necessary which is not inclusive of elective procedures.

It is interesting to learn that according to Time, over the last year cosmetic procedures has risen
5% and this may be interpreted as the recovery of the economy. This increase is mainly coming
from minimally invasive procedures (chemical peels, Botox, laser hair removal) instead of the
more risky, more costly surgeries (rhinoplasty). With more studies being done, it is being
discovered that none of the 5 most popular surgeries for 2011 (breast augmentation, eyelid
surgery, facelift, liposuction, nose reshaping) has increased significantly and there has been no
more than a 5% increase which isn’t much at all (Time). It can be said that since the recession,
the economy has recovered quite a bit since surgical procedures have increased. It is still
important to see that the numbers are still lower than they were before the recession occurred.
Though people are getting elective procedures done, they are opting out for the less expensive
minimally invasive procedures.

Sociocultural Factors

Currently the surgical industry is not a colorless industry. Many, if not all the advertisements
and billboards, feature blonde Caucasians. This particular area of the surgical industry needs to
be adjusted to match the society we live in today. The industry should want to reflect that they
are an industry that welcomes all diversities and ethnicities. Especially in California, Florida,
and Texas. Many of the clients in these states are Hispanic, but their advertisements are not
reflecting these clients. The surgical industry should implement these changes to truly show the
public who they are.

Another factor that the surgical enterprise uses for targeting is age. People ranging from 50-70
year olds are the target market for the company, but mainly age 60. With the baby boomer
generation needing increased medical care, they are an increasing target age. The surgical
Industry targets older clients that are either thinking of retiring or are already retired. They
market to those who are ready to start a new chapter of their lives; these people are financially
stable from working and saving, and now they have the opportunity to spend it on themselves.
Lifestyle Lift takes advantage of these new opportunities.

Social media has been booming with the current generation. Selfies have become extremely
popular and have increased the demand for facial reconstructive surgeries. According to the
American Academy of Facial Plastic and Reconstructive Surgery (AAFPRS) these include a
“10% increase in rhinoplasty in 2013 over 2012, a 7% increase in hair transplants and a 6%
increase in eyelid surgery. Photoshop is too much of a temporary fix for people now; they are
searching for a more permanent solution to their facial insecurities.

“Women continue to seek facial plastic surgery more often with an 81% of all surgical and non-
surgical procedures in 2013” (AAFPRS). Women seek to preserve their youth with an attractive
nose, face and eye lift, while the men’s’ concern are wrinkles and hair loss. Botox, hyaluronic
acid injections, hair transplants and rhinoplasty were the most common procedures among men
last year (AAFPRS).

Technological Factors

With technological advancements and information being so readily available, it is very simple to
find different ways to conduct nonsurgical procedures. It has helped in discovering more info
about non-surgical procedures. Chemical peels and other minimally invasive procedures were
discovered via access to the Internet and being able to research ways to help patients get a more
youthful appearance.

Computer-assisted surgeries have become increasingly popular since laparoscopic surgical
technology was introduced. An advantage of laparoscopic surgical technology is that it aids in
completing minimally invasive surgeries, which meets the demands of patients. Laparoscopic
surgical technology limits human error, and allows procedures to be cleaner and quicker. This is
very important since patients are interested in minimally invasive procedures that are quick,
limits scarring, pain, and healing time.

Environmental Factors

Every office as with every industry has an obligation to communities and societies to conduct
business with an environmental mindset. It is important for every company in this industry to do
as much as they can in disposing of their waste in the most effective and environmentally
friendly way as possible. Since the industry has to deal with very hazardous chemicals, a

specialized company picks up their medical waste to ensure it is disposed of properly.
Environmental consultants identify problems, measure to solve the problems as well as evaluate
risks and recommend solutions. The industry employs a multidiscipline staff of scientists,
engineers and other technicians.

Such efforts are a positive step forward in implementing
environmentally friendly procedures and going green.

Opportunities and Threats
There have been numerous topics discussed in our analysis so far. Some of which fall into the
categories of opportunities and threats.

Opportunities

A big issue is to do with the demographic being reached. 90% are female and 40% are range
from ages 45-65. Targeting a larger proportion of the male population, as well as the younger age
groups, would offer significant increases in revenue. Since this is the typical demographic trend
throughout the industry, increasing the popularity of facial rejuvenation among men and the
younger demographic would be a good opportunity, which as of yet is still very untouched.

The fact that the industry is growing each year is also very positive. Between 1997 and 2012 the
number of procedures performed annually has increased by just fewer than 8 million. The
industry is projected to continue growing at a rate of 5.5% each year; this is a direct correlation
with the economy slowly regaining strength. What this means is that people are seeing their
disposable income also increase. As a result this means that people should become more willing
to spend their money on higher end goods and services, such as those in the cosmetic and plastic

surgery industry. This is something that could be capitalized upon by almost every organization
operating within this industry

Geographic trends seem to be consistent within the cosmetic surgery sector. Eastern Texas (cities
such as Dallas and Houston) has a high demand for facial rejuvenation. Similarly Florida and
southern California also have high demands. These regions all tend to be associated with warm
climates, and they are also areas in which many people go to retire. So this suggests that these
regions would offer the greatest quantity of interested customers. This does not mean that that
other locations are of lesser importance, but based upon the quantity of potential procedures,
these locations seem to be very popular.

The costs associated with this industry are high. Particularly costs of materials, equipment and
supplies (Generally fixed costs). For example, Lifestyle Holding Inc. has a cost per patient of
$2200, which is a huge amount. The opportunity is that there for companies in the cosmetic and
plastic surgery industry to source their suppliers from other suppliers that are cheaper and offer
the same or similar product. We mentioned earlier the likes of Medline medical supplies, and
Hauser Inc. These are just two suppliers who can be utilized by the cosmetic surgery market.

Threats

The most significant aspect here is the buyer power. In this industry the buyer has virtually all
the power. This is very logical, as the procedures are very personal and very specific to each
individual patient. Since the cosmetic and plastic surgery industry operates directly to the
customer, it is crucial that this relationship remains healthy. The danger of a buyer having lots of
power is that they control the industry, without the buyer there is no revenue, and this would see
a big decline in the cosmetic and plastic surgery industry. The company therefore has an

obligation to satisfy the customer and if they fail to do so there can be repercussions to the
company.

Much as economic climate can be viewed as an opportunity, it can also be seen as a threat too.
Take for example the crisis in 2008, every industry suffered and there is no doubt that the
cosmetic and plastic surgery industry had to deal with this as well. Arguably these higher priced
services would have faced more difficulties. Disposable income during this period would have
decreased significantly and people would not be as willing to invest thousands of dollars into a
cosmetic surgery. Although the economy in the process of recovery, history would suggest that
eventually it will decline again. While it is difficult to predict exactly when, it continues to pose
a huge threat to the cosmetic and plastic surgery industry.

There is a certain socio cultural group that tends to be associated with cosmetic procedures. We
mentioned that most advertisements and billboards feature a very stereotypical Caucasian group
of people. This gives the message that the procedures offered within this industry are only
suitable to that particular ethnicity. This becomes an issue because it helps reinforce a stereotype
that is already in place. It discourages people with an ethnic background to inquire about
cosmetic procedures. Whilst it could be seen as an opportunity if this demographic were targeted,
it is equally threatening because it could reach a point where ethnic groups continue to lose the
interest they may have right now in cosmetic procedures.

The cosmetic and plastic surgery industry is expected to maintain a high professional standard.
This means that any negative publicity such as lawsuits can have a detrimental effect on
companies. In wanting to have such an intimate and personal procedure done, the customer will
always do their personal research. The more negative media and reports that they see, the more
the chances of undergoing the procedure will decrease. This is a threat because you want

potential clients to see cosmetic surgery for all the benefits and positive reasons. This will allow
them to have confidence the company and their decision to have a surgery. Potential customers
may leave even though a handful of potential clients are deterred through bad publicity or
information. This would lead to the potential loss of thousands of dollar for that company. Every
company within the industry should be wary of this issue for their own benefit.

Opportunities
Threats

● The demographic that is not being
targeted is the male population, and
the younger age groups (under 45
years). This is still an untapped area
which could offer a large amount of
potential clients.
● The cosmetic and plastic surgery
industry is growing at a steady rate, as
is the economy. This results in people
being able to afford more expensive
services such as those in this industry.
● Geographically the areas with the most
demand seem to be those with warmer
climates. The likes of Florida, and
southern California where many
people retire to.
● The costs tend to be very high in the
cosmetic and plastic surgery industry
(materials/equipment primarily),
however there are a vast amount of
suppliers for the same or at least
similar products. Having lots of
options generally means you are able
to find lower prices as you are not
restricted to one sole supplier.
● The buyer has all of the power in this
industry. There is no middle man,
without the clients there is no
business. It is essential to maintain a
healthy relationship to keep the
industry positive.
● Economic climate can also be a threat.
In tougher times such as the 2008
crisis, people are unable to afford
higher end goods and services. This
affects the industry as demand is less
resulting in much lower revenue.
● The primary client seems to be
caucasians. This is a stereotype that is
harming the industry. If there is no
emphasis towards ethnic groups soon,
it may become difficult to pull in these
members as potential clients.
● Bad publicity is a major concern. In
such a personal and specialised
market, the client needs have complete
satisfaction they are making a good
investment. Bad publicity can
potentially deter numerous clients and
the end result is that thousands of
dollars are being missed out upon.

Internal Analysis
Introduction
The purpose of this paper is to perform an internal analysis of Lifestyle Lift Holding, Inc. This
analysis will include key components from Porter’s Firm Value Chain that are used to identify
resources and capabilities of the firm. Following the identification of resources and capabilities,
they will be analyzed through the VRINE model to test their level of importance to the firm.
Finally, from this analysis the firm’s strengths and weaknesses will be discovered.
Company Introduction
Lifestyle Lift Holding, Inc. is currently the United States’ largest cosmetic surgery practice and
the top provider of facial procedures in the country (“Confidential Information Memorandum,”
2014: 5). The firm operates in the cosmetic and plastic surgery industry and specifically in the
cosmetic surgical procedures market. Lifestyle Lift Holding, Inc. operates 45 surgery centers, 7
certified locations, and 12 consultation centers in 34 states (“Confidential Information
Memorandum,” 2014: 5). Of those locations, 16 are accredited with the Accreditation
Association for Ambulatory Health Care and the company is actively seeking accreditation for
all of its surgical centers (“Confidential Information Memorandum,” 2014: 34). Furthermore,
since its inception, Lifestyle Lift has performed procedures on over 175,000 patients
(“Confidential Information Memorandum,” 2014: 21).

Porter’s Firm Value Chain Analysis
Firm Infrastructure
History
Lifestyle Lift Holding, Inc. was founded in 2001 by Dr. David Kent in Troy, Michigan, where
the headquarters are now located. When the company was founded, the market was dominated
by sole practices who offered facial rejuvenation procedures. Lifestyle Lift was the first to
develop a large-scale cosmetic surgery practice with high quality surgeons, a focus on the patient
experience, and a high level of repetition. To differentiate themselves from the competition of
the sole practices, Lifestyle Lift Holding, Inc. developed “an innovative, less invasive, and safer
outpatient facelift procedure,” known as the Lifestyle Lift (“Confidential Information
Memorandum,” 2014: 5). The procedure differed from other facelift treatments in that it is
performed under local anesthesia and oral sedation opposed to intravenous sedation. The
difference reduces patient risk and allows for quicker recovery time. With a proprietary
procedure, Lifestyle Lift Holding, Inc. established Regional Medical Directors to train and
supervise the firm’s surgeons in 2011. The Regional Medical Directors ensured a level of
quality to each Lifestyle Lift clinic. In 2012, the firm expanded its operations introduced
consultation centers in addition to the pre-existing certified centers where procedures take place.
As a complement to the Lifestyle Lift procedure, in 2013, the firm introduced a custom facial
skincare product line available at their locations (“Confidential Information Memorandum,”
2014: 17).

Mission/Vision
According to Lifestyle Lift’s former website, the mission of Lifestyle Lift Holding, Inc. is,
“Being with you every step of the way on your journey toward a natural, younger-looking you”
(About Lifestyle Lift, 2014: 1). No information was found in regard to Lifestyle Lift’s vision
statement.
Value/Culture
Lifestyle Lift Holding, Inc. focuses on a patient-centered service model. Lifestyle Lift operates
elective facial rejuvenation procedures which place a higher importance on customer satisfaction
compared to non-elective procedures. The firm places a high importance on the emotional needs
of customers with a rigorous employee training program entitled, EPIC – Every Patient
Interaction Counts. The program instills the patient-centered values in employees that allow
them to base all interactions on their individual needs (“Confidential Information
Memorandum,” 2014: 21). The firm implements this through their Patient-centric Service
Delivery Model. The model revolves around high touch patient service with an emphasis on
“personal care throughout the facial surgery delivery process” (“Confidential Information
Memorandum,” 2014: 20). Lifestyle Lift achieves this through lead generation and call
handling, consultations (patient-designed procedure), meeting the physician, pre-operative
preparation, and treatment and aftercare (“Confidential Information Memorandum,” 2014: 20-
21). Due to confidential restrictions, testimonies from Lifestyle Lift employees regarding the
organization’s culture were not provided.

Strategy
Lifestyle Lift Holding, Inc. operates within the cosmetic and plastic surgery industry and
specifically in the cosmetic surgical procedures market. The firm is active in 34 different states
in the United States of America. The firm offers primarily facial rejuvenation procedures, such
as the Lifestyle Lift, however also offer Botox, neck rejuvenation treatments, and ancillary
procedures (such as blepharoplasties, laser skin resurfacing, and eye brow lifts). Lifestyle Lift
primarily focuses on internal development, specifically on their facial rejuvenation procedures
and their proprietary skincare treatment line. Lifestyle Lift Holding, Inc. primarily utilizes an
integrated differentiation and low-cost strategy. They differentiate from competitors by offering
the Lifestyle Lift procedure which uses local anesthesia and oral sedation to provide a lower-risk
patient experience. The firm also utilizes a low-cost strategy as well. According to Archie
Craige, Lead Surgical Tech at Lifestyle Lift – Tampa, a Lifestyle Lift procedure is approximately
$9,000 per patient compared to the cost of $14,000 per patient at a sole practice. Lifestyle Lift’s
physicians are able to focus all of their time on the patient, rather than performing administrative
services, which allows them to execute more facelifts than any other physician; approximately
25,000 surgeries per year according to CEO Dean Akres. By performing a high number of
procedures, Lifestyle Lift is able to spread their fixed costs across more patients, lowering the
cost of a procedure (“Confidential Information Memorandum,” 2014: 10). By integrating the
two strategies, Lifestyle Lift is able to offer a unique service at a lower cost than competitors.
Organizational Structure
Lifestyle Lift Holding, Inc. is fully owned by its founder and Chairman, Dr. David Kent. Under
him, is the firm’s executive management team. At the top of the executive management team is
the Chief Executive Officer, followed by the Chief Marketing Officer, Chief Financial Officer,

Chief Information Officer, and Chief Restructuring Officer (hired in December 2013 to
implement corporate improvements). Among the executive management team, are the Regional
Medical Directors. Three Regional Medical Directors are in charge of overseeing a high
standard of patient care and treatment in three different regions: Southeast and Northeast region,
Pacific and Mountain region, and Midwest and Northeast region. The Regional Medical
Directors oversee various surgical centers across the United States. These surgical centers are
composed of Surgeons, Lead Surgical Techs and a Center Manager. Under the Center Manager
is an Assistant Center Manager, and under them are the center Consultants. The diagram
provided, Figure 1, represents the organizational structure of Lifestyle Lift, based on available
information provided (“Confidential Information Memorandum,” 2014: 30-33).
Figure 1: Lifestyle Lift Holding, Inc. Organizational Structure Diagram

Performance – Financials
Through analysis of Lifestyle Lift’s financial statements, it is evident that the company’s
revenues have increased by approximately 10% since 2010, but the company has failed to
increase EBITDA margins. Due to the need to increase profit margins, the company has been
undergoing both organizational and financial restructuring initiatives and also hired a Chief
Restructuring Officer (CRO) in December 2013 (“Confidential Information Memorandum,”
2014: 8). Since the start of these initiatives the company has outsourced to call center, revamped
marketing operations, and reduced the cost of new customer acquisitions. Because these
initiatives are still relatively new, it is still unclear whether or not they will be effective in
increasing profit margins although they are expected to generate high cost savings.
At the moment, Lifestyle Lift is operating under a forbearance agreement with its senior lender,
to repay large sum of existing debt and to fund working capital, approximately $20.3 million
(“Confidential Information Memorandum,” 2014: 8). This large sum covered under the
forbearance is a substantial liability and threat to the company, and they should focus on
repayment if the aforementioned revenue-generating initiatives are successful.
Human Resource Management
Recruiting
As mentioned above, the management team is led by the founder and Chairman, Dr. Kent. In
addition to Kent, the company leadership includes highly experienced, motivated, and executive
management team comprised of business executives and medical experts. This leadership plays a
key role in the company’s human resources management. Lifestyle Lift’s CEO has over 20 years

of experience leading operations of national healthcare service providers, the CFO has 30 years
of experience finance industry, including large corporations, a banking institution, and an
accounting firm, and the CMO has over 20 years of direct response marketing experience
(“Confidential Information Memorandum,” 2014: 15). Given their track record, it is evident that
when the founder is recruiting for executive or senior level management, substantial experience
was a requirement for these positions.
Lifestyle Lift employs nearly 100 board certified or board eligible physicians including plastic,
facial plastic, and head and neck surgeons. These physicians are said perform approximately
15% of all facelifts in the U.S. Physicians are employed on both a full time and part time basis,
and perform an annual average of 415 and 210 facelifts, respectively; substantially higher than
the industry average of 30 (“Confidential Information Memorandum,” 2014: 15).
In regards to recruiting physicians, consultants, technicians and other personnel, there is a section
of the company’s previous website dedicated to career opportunities including positions
available (Lifestyle Lift, 2014). This is a very effective and widely used channel for attracting
employees, but only if persons and looking to work with this specific company. It would be
much more effective to post on career and employment engines.
Training & Development
Additionally, Lifestyle Lift employs three Regional Medical Directors who create and establish
the company’s clinical guidelines and protocols for both the surgery center front office
operations and the back office medical operations. The directors also serve as liaisons between
physicians and the management team, and provide expertise and support to the company’s

physicians. These Regional Medical Directors are responsible for guidance, leadership,
oversight, and quality assurance (“Confidential Information Memorandum,” 2014: 21).
For all employees of Lifestyle Lift there are programs available for continuous improvement and
training principles institutionalized by the leadership team. Although it not required of the
company, 16 of the company’s locations are accredited and the rest are pursuing accreditation.
One of the main training programs for employees is “Every Patient Interaction Counts” or
EPIC™, which is an extensive eight-week training program designed to educate and train every
employee, including physicians, on how to optimally address emotional needs of the patient,
which is essential in this service based industry (“Confidential Information Memorandum,”
2014: 21). EPIC™ training is continuous and maintained through a series of education and
coaching methods, which could provide Lifestyle Lift a competitive advantage over its
competitors whilst adding to the firm’s value chain.
Technology and Development
Process Innovation
The founder, Dr. Kent, invented a method for facelifts that was simpler, safer, and faster by
creating a less invasive outpatient facelift procedure. Procedures are performed under oral
sedation and local anesthesia instead of intravenous sedation or general anesthesia, significantly
reducing the risks to the patient and satisfying results. The traditional process involving general
anesthesia and higher levels of sedation require the use of accredited facilities and an
anesthesiologist to monitor the patient (“Confidential Information Memorandum,” 2014: 10).

These added requirements would have introduced more complexity to the procedure, which leads
to higher costs, more recovery time, and risks for the patient.
Using Lifestyle Lift’s innovative process patients are first given oral sedation medication to relax
them prior to beginning the procedure. Then injections are then administered using a local
numbing agent, thus patients typically experience no pain during the procedure other than minor
discomfort during the initial injections (“Confidential Information Memorandum,” 2014: 18).
Procurement
Given the company’s national branding and standing as one of the largest networks of facial
plastic surgeons in the industry, medical equipment and technology providers are eager to work
with Lifestyle Lift. This relationship with provides allows the company to use equipment on a
trial basis at little to no cost, enabling the company to test the latest technologies prior to making
a financial commitment (“Confidential Information Memorandum,” 2014: 10). This arrangement
with suppliers places Lifestyle Lift ahead of competitors by access to more advanced technology.
Inbound Logistics
The inbound logistics of Lifestyle Lift mainly comprises of supplier relationships. Lifestyle Lift
receives there medical supplies such as medical equipment and local and oral anesthesia from
McKesson Medical Supplies. Lifestyle Lift stores all their materials in house at their operating
centers.
Operations
Lifestyle Lift Procedure - The basic procedure at Lifestyle Lift is a derivation of a traditional two
layer SMAS, rhytidectomy, which tightens the face and removes sagging jowls as well as the

short flap facelift. Both procedures are done under local anesthesia and oral sedation. Both
procedures firm the face and neck as well as eliminate the sagging of skin and wrinkles in these
areas. Lifestyle life does this through neck tightening (platysmaplasty) and liposuction which is
excess fat removal.
The Lifestyle Lift Procedure utilizes local anesthesia and oral sedation. This method reduces the
risk of more aggressive sedation approaches and allows for little recovery time such as an hour.
Lifestyle Lift also offers various ancillary facial rejuvenation procedures such as:
• Blepharoplasties- Tightens eyes
• Naturalyn- Removes deep folds and adds volume to areas
• Laser skin resurfacing
• Brow lifts
• Chin and Lip fillers
• Fractional CO2 Laser- tightens and tones skin
• Artificial fillers and Botox (some centers)
Outbound Logistics
Lifestyle Lift mainly provides services to their patients, therefore the outbound logistics would
be the actual procedures they perform which are previously listed. A typical procedure at
Lifestyle Lift is 2 hours per surgery and there is a 30 second recovery time (Company Tour).
Patients sit in a recovery room till they are ready to leave.

In addition to the procedures performed, Lifestyle Lift offers extra skin treatment products at
their surgical centers. These skin treatments are distributed only to the surgical centers for
patients to purchase following their procedure to make recovery more at ease for the patients.
Marketing & Sales
We determined in the external analysis that typically customers in the cosmetic and plastic
surgery industry are women, and are aged between 55-65. These customers are primarily
Caucasian also. This is very much the primary market segment that Lifestyle Lift are targeting in
their marketing efforts. The company has a very good geographic reach and this is necessary due
to them having 68 surgery centers nationwide. They have commercials on the major TV
networks that provide exposure all over the nation. Demographically the customer groups they
target tend to have an average income over $35,000, which is logical considering the average
procedure cost is about $6,500. 12% of the US population falls into the primary segment of
females aged between 55-65, and this equates to just over 19 million people nationwide (US
census). Considering that only approximately 28% of the nation earn an income over $35,000
(US census), statistically you could argue that the population of Lifestyle Lifts primary target
segment drops down to around 5.3 million people. This is still a large amount of people but
getting their interest in procedures is still a big challenge. CEO Dean Akers recognizes this
challenge, in an interview he said that ‘we are getting 700,000 calls and only converting 25,000
to actual procedures.’ These numbers are astoundingly low when compared to the population
data. Firstly they are only getting a 3% success rate on the calls they receive, and this 3%
account for a mere 0.47% of the potential target market. Undoubtedly cosmetic procedures are
not for everybody, but regardless this is a very low number of customers within their prime
market segment. Effective marketing needs to be utilized in order to increase this figure.

Lifestyle Lift spends approximately $50 million a year on advertising through their various
channels. Their strategy is direct response, this means that they want the potential customer to
respond to their media by either calling or visiting their website. This method does make it
difficult to see exactly what proportion of the population is responding to their advertising,
however they predict it to be 3.6%. The company estimates that the marketing cost per procedure
is $2,300, which certainly is higher than I think it should be. In fact this is something that they
have already stated would like to be reduced to nearer $2000. (“Confidential Information
Memorandum,” 2014).
Marketing Mix
Product
The product being offered although largely categorized as a facelift is ultimately unique to every
individual procedure. Quality is expected to be very high in every procedure, and the customer’s
needs are always at the forefront. Service is standardized throughout all of the branches as are
the methods of procedure, and this is again something unique to Lifestyle Lift.
Place
As we mentioned earlier there are 68 locations across the nation and Lifestyle Lift is the only
company in the industry setup like this. There is not really a distribution channel as such since
the customer has to go to a specific center to get the procedure. There is a call center which
provides information and refers interested customers to their nearest center. Place perhaps is an
issue since potential customers have to do a lot of their own research.

Promotion
Lifestyle Lift advertises in most household magazines, as well as having TV commercials and
radio advertisements on nationwide networks. A lot of their customers come through referrals
from previous patients. There are not sales promotions on the procedures themselves, however
they are run on the after service products which customers have the option to buy.
Price
A procedure is expensive, generally averaging out around $6000. This is not abnormal though.
For such a precise and life changing service the customer is expecting to pay a premium. If the
price were drastically lower than that of other competing surgeries, the customer would question
why this would be. There are payment plans available which help make the service more
affordable to a greater number of people.
Generally speaking, Lifestyle Lift seems to have a fairly positive relationship with its customers
and employees alike. Certainly from touring the Tampa facility to reading various reviews there
is no obvious negativity associated with the company. However marketing is an issue they have
and in fact it has been a big issue for a while. In June of last year there was a court case in New
York targeting the advertising of Lifestyle Lift. The issue was with the quote that a facelift was a
‘revolutionary procedure.’ This was accused of being a false statement as a facelift was not a
new thing. New York statesman Attorney general Andrew Cuomo said in 2009 that this same
marketing campaign was ‘cynical, manipulative and illegal.’ Although Lifestyle Lift did accept
the claim and changed their marketing approach, things like this can be damaging for a company
and no doubt some people were deterred. A similar case also happened four years previous when
it was discovered that employees were actually posing as satisfied customers. This was also

resolved but no doubt it damaged the reputation of Lifestyle Lift somewhat. Since these two
incidents the company has been much more cautious and with the different marketing campaigns
they have prevented any scenarios like that from happening again.
Important Resources and Capabilities
Tangible
1) Innovative process- In order to gain competitive advantage, Lifestyle Lift introduced an
innovative approach to facial rejuvenation. Lift Lifestyle Lift redefined the cosmetic surgery
industry by introducing an innovative, less aggressive and safer facelift procedure. They do this
by performing procedures under local anesthesia and oral sedation, rather than general anesthesia
which reduces the risks of the procedure significantly.
2) Favorable Locations- Lifestyle Lift operates in 45 surgery centers, 7 certified locations and
12 consultation centers in 34 states (CIM). Lifestyle Lift is widely dispersed throughout the
United States, therefore it easily accessible to potential customers.
Intangible
3) Brand Name- “Lifestyle Lift is the country’s largest cosmetic surgery practice and the
number one provider of face and neck cosmetic procedures in the US” (CIM). The unique
business model of Lifestyle Lift makes it a high choice among patients. The company’s founder,
Dr. David Kent who is an accomplished, widely recognized facial plastic surgeon. This also
contributes to the brand image that Lifestyle Lift has.

4) Trust- The surgeons at Lifestyle Lift are trusted as they are a highly experienced and
motivated professional team comprised of business executives and medical experts.
5) Firm Specific Practices and Procedures- Lifestyle Lift offers firm specific procedures such
as facial rejuvenation to middle income earners rather than high income earners. Using a
different business model and offering the same procedures as other companies in a less invasive
way has allowed Lifestyle Lift to offer a more affordable price to patients.
VRINE Analysis
Valuable Rare Imitable / Non-
Substitutable
Exploitable
1.) Innovation Yes Yes Yes Yes
2.) Favorable
Locations
Yes No Yes Yes
3.) Brand Name Yes Yes No Yes
4.) Trust Yes No Yes Yes
5.) Firm
Specific
Procedures
Yes Yes Yes Yes

Strengths & Weaknesses
Strengths
One of Lifestyle Lift Holding, Inc.’s biggest competitive advantage is their brand. They are the
country’s largest cosmetic surgery practice. The company’s founder, Dr. David Kent who is an
accomplished, is also a widely recognized facial plastic surgeon. This has created a strong
reputation where the customer comes first and where they are able to provide a service that is
financially more beneficial to their customers.
Lifestyle Lift Holding, Inc. has implemented a facelift procedure that gives them as a company
an advantage over their competitors. (“Confidential Information Memorandum,” 2014: 5). The
procedure differed from other facelift treatments in that it is performed under local anesthesia
and oral sedation opposed to intravenous sedation. The difference reduces patient risk and
allows for quicker recovery time. This enable the Lifestyle Lift to keep their prices lower than
their competitors and allows for the customers to receive a service that focuses on their
wellbeing, their personal experience.
Lifestyle Lift focuses a considerable amount of their resources on employee training. It is
important to them that their employees are trained to deliver remarkable customer service. They
want to ensure that their patients are always the number one focus, their needs and wants are
always taken into consideration. It is vital for the staff to have great bedside manners because
every patient interaction counts.
Lifestyle Lift employs nearly 100 board certified or board eligible physicians including plastic,
facial plastic, and head and neck surgeons. These physicians perform an annual average of 415
and 210 facelifts, respectively; substantially higher than the industry average of 30

(“Confidential Information Memorandum,” 2014: 15). This creates an incredible benefit by
providing more quality services for their customers.
Weaknesses
Though these issues were resolved and Lifestyle Lift Holding, Inc. took responsibility and
changed their advertising, it did make an impact on how their company was view. Damage was
done to their reputation and brand.
Lifestyle Lift spends approximately $50 million a year on advertising through their various
channels. Direct marketing is their purpose but they have a difficulties figuring out which
proportion of the population is responding.
Lifestyle Lift makes 700,000 calls to customers and only 25,000 are being converted into actual
procedures it is extremely vital that Lifestyle lift figures out what they need to do to get these
numbers to increase. A huge problem is that out of the 3% of successful calls they make only
0.47% is of their potential target market. It is imperative that they find a way to cater more
specifically to their demographic and find ways to grab their attention so to then in turn have
more patients coming through the door.
There is a section of the company’s previous website dedicated to career opportunities including
positions available. Though this is a very effective and widely used channel for attracting
employees, it would be much more effective to post on career and employment engines. This is
only one example of some of the issues with the website. A website can be the face of a
company and currently it is not as user friendly as it should be, and often it is hard to find
information on it. Receiving a surgical procedure is a risky, it is one that needs to be made with
a lot of thought and consideration. This is done through a significant amount of research.

Therefore, all this information needs to be put into the website in a welcoming, user-friendly,
easy to find way. Otherwise patients will not want to visit your website and this can ultimately
cost you a client from looking into your company more.
Strengths Weaknesses
• Country’s largest cosmetic surgery
practice. Widely recognized facial
plastic surgeon Dr. David Kent
• Legal Issues with advertising
• Innovative, less invasive, and safer
outpatient facelift procedure
• $50 million a year on direct marketing
but no idea of which proportion of the
population is responding
• Employee Training, Customer focused • There 700,000 calls are being made
and only 25,000 are being converted
into actual procedures
• Physicians perform a number of
facelifts higher than the industry
average of 30%
• Website needs restructuring

Strategy Recommendations
Introduction & SWOT Framework
In order to fully assist Lifestyle Lift, both internal and external analyses were carried out. Upon
execution of these analyses, various areas for improvement were found, as well as aspects that
could further affect the company’s future profitability. These topics are outlined below in the
SWOT Framework table. After further data collection and analysis, five recommendations were
made to address threats and weaknesses, as well as build on strengths and exploit opportunities.
These recommendations clearly provide formulations and data to justify, in addition to
implementable actions steps for the company to move forward.

Strengths Weaknesses
Internal • Country’s largest cosmetic surgery
practice. Widely recognized facial
plastic surgeon Dr. David Kent
• Innovative, less invasive, and safer
outpatient facelift procedure
• Employee Training, Customer focused
• Physicians perform a number of
facelifts higher than the industry
average of 30%
• Legal issues regarding advertising
• Lifestyle Lift spends approximately $50
million a year on advertising through
various channels. Direct marketing is
their purpose but difficulties figuring
out which proportion of the population
is responding
• There 700,000 calls are being made and
only 25,000 are being converted into
actual procedures
• There is a section of the company’s
previous website dedicated to career
opportunities and positions available. It
would be much more effective to post
on career and employment engines
Opportunities Threats
External • The demographic that is not being
targeted is the male population, and the
younger age groups (under 45 years).
This is still an untapped area that could
offer a large amount of potential
clients.
• The cosmetic surgery industry is
growing at a steady rate, like the
economy. This results in people being
able to afford more expensive services
such as those in this industry.
• Geographically, the areas with the
most demand seem to be those with
warmer climates. The likes of Florida,
and southern California where many
people retire to.
• The costs tend to be very high in the
cosmetics industry
(materials/equipment primarily),
however there are a vast amount of
suppliers for the same or at least
similar products. Having lots of
options generally means you are able
to find lower prices as you are not
restricted to one sole supplier.
• The buyer has all of the power in this
industry. There is no middle man,
without the clients there is no business.
It is essential to maintain a healthy
relationship to keep the industry
positive.
• Economic climate can also be a threat.
In tougher times such as the 2008 crisis,
people are unable to afford higher end
goods and services. This affects the
industry, as demand is less resulting in
much lower revenue.
• The primary client seems to be
Caucasians. This is a stereotype that is
harming the industry. If there is no
emphasis towards ethnic groups soon, it
may become difficult to pull in these
members as potential clients.
• Bad publicity is a major concern. In
such a personal and specialized market,
the client needs have complete
satisfaction they are making a good
investment. Bad publicity can
potentially deter numerous clients and
the end result is that thousands of
dollars are being missed out upon.
SWOT Framework

Recommendation #1: Revamping Company Website to Attract Target Customers
Formulation
During the period of two months, the Lifestyle Lift Holding, Inc. website, www.lifestylelift.com,
has dramatically changed twice. Each time the website changes, information becomes more
difficult for consumers to find and the company less transparent. Our first recommendation is to
revamp the Lifestyle Lift website to attract target customers. This recommendation was derived
from the analysis of the firm’s weaknesses in the internal analysis. The recommendation was
also based on one of the goals of the firm: to solidify their corporate image to establish who they
are. To do so, the firms needs a consistent website that satisfies their customers’ needs.
As identified in the external analysis, the target demographic of Lifestyle Lift are women age 50-
65. These customers fall under the classification of Baby Boomers. With the emergence of
technology, more and more Baby Boomers are using technology and the internet to do research
on companies before investing into their products and services. According to Immersive Action,
one third of all internet users in the United States are age 50+ (“Resources: 50+ Facts,” 2014: 1).
Furthermore, 77% of citizens age 50-64 utilize the internet (“Social Usage Among the Baby
Boomers,” 2014: 1). Over time this number will only continue to grow which places a greater
importance on an effective website.
The website for Lifestyle Lift should offer a wealth of information for a perspective customer, as
well information for patients following their procedure. For those perspective customers, the
website needs to list the various locations and their classifications (surgical center or consultation
center). While the Baby Boomers are more active online, they still prefer face-to-face
communication. Offering information regarding consulting centers could increase interest. One

of the most important elements that needs to be included on the website is regarding the Lifestyle
Lift procedure and what sets it apart from its competitors (e.g. QuickLift and traditional face
lifts). Currently the website briefly describes the Lifestyle Lift, however it does not substantially
differentiate the procedure from its rivals. A Lifestyle Lift procedure is an expensive one and a
decision that will require a lot of time and research. Customers will want to know where the
procedure originated, and who will be performing the procedure. This leads into another
component that should be added to the website: information regarding the firm’s Medical
Directors and surgeons. With all of their qualifications, the company should be marketing their
highly qualified Medical Directors and surgeons through any medium. Furthermore, their
website should exemplify their high safety standards that are set in place to protect their patients.
All of these additions to the website would make a patient feel more assured with the firm.
Finally, the website should feature Lifestyle Lift’s patient-centered service model. As described
in the internal analysis, the company places a high importance on the emotional needs of each
patients and formulates a procedure customized to each patient. This practice should be
highlighted on the firm’s homepage. With a procedure with such high risk as a face lift, a patient
will feel much more confident with a company that is customer-centered and revolves around
their needs.
Implementation
The implementation of a new website should be very easy for the firm. Currently a website
already exists, which can easily be replaced by an updated site. Furthermore, the implementation
of a new website comes at little to no cost to Lifestyle Life Holding, Inc. The company already
owns the rights to the website domain eliminating a cost. The firm may continue to use Digital
Target Marketing for the design of the webpage. However a committee within the marketing

department should be composed to gather the necessary information to be added as mentioned
previously. This committee should review key components to include in a new webpage (but not
limited to): the firm’s values, mission, and vision statements, information regarding the Medical
Directors and team of surgeons, locations for surgical and consultation centers, the process of a
Lifestyle Lift, and their patient-centered model.
Action Plan for Implementation of Revamped Website
The implementation of an updated, user-friendly website is relatively easy for Lifestyle Lift. A
sample action plan for the implementation is provided below:
• Compose a committee within the marketing division within Lifestyle Lift.
• As a committee, identify key components to market online. Suggested website content
includes:
the firm’s values, mission, and vision statements, information regarding the
Medical Directors and team of surgeons, locations for surgical and consultation centers,
the process of a Lifestyle Lift, and their patient-centered model.
• Communicate key components to already established website design team, Digital Target
Marketing for the re-design of webpage with updated information, asking to design
toward targeted customer groups (baby boomers).
• Review website to ensure correct message conveyed and is attractive to the consumer
eye.
• Publish via Digital Target Marketing on www.lifestylelift.com.
Sample Website
Based on information gathered during the internal analysis, our group designed a sample website
that caters to the important information from consumer’s point of view. The site can be found at

www.mgt431f.weebly.com. The website was designed based on research data provided by the
National Institute on Aging regarding making your website senior friendly, which is Lifestyle
Lift’s target customer group. The research showed that senior-friendly websites focus on
simplicity rather than text-heavy (“Making Your Website Senior Friendly,” 2014: 2). This can
be seen in our homepage which simply illustrates the name, Lifestyle Lift, followed by the firm’s
mission statement in elegant font. A screenshot of our sample homepage can be found in Figure
1.
Our sample website includes components we found important from a customer’s point of view
that the current Lifestyle Lift website does not include. First off is the ‘History’ section. We
believe that the customer would be interested in how the Lifestyle Lift company and procedure
came to be. This page features the founder’s photo as well as a block of text about the history.
While the history is slightly more text-heavy, there are spaces between blocks of text that make
Figure 1: Sample Website: Homepage Screenshot

the writing easier to read for seniors. Similarly, we included a ‘Procedure’ page that explains
what exactly a “Lifestyle Lift” is, a fundamental part of the website. Customers want to know
what differentiates Lifestyle Lift from other facelift procedures, which is why an entire page is
devoted to information regarding the procedure. Screenshots of the History and Procedure pages
can be found in Figures 2 and 3 respectively.
Figure 2: Sample Website: History Screenshot

Another important page that we feel is crucial to Lifestyle Lift’s website is a page focuses on
their surgical and consultation locations. This is a major component of the website because it
provides customers with information on where they can take the next step towards a Lifestyle
Lift procedure. Rather than just providing customers with an address, our website provides
customers with information regarding the surgical team found at each procedure center across
the country. This allows the customer to do further research on their perspective surgeon and to
be more involved with such an extensive decision process. Figure 4 represents the Locations
page of our sample website.
Figure 3: Sample Website: Procedure Screenshot

The final components of our sample website include pages devoted to Lifestyle Lift’s “Patient-
Centered Service Model,” biographies of the executive management team and regional medical
directors, and patient success stories. We feel that highlighting the company’s “Patient Centered
Service Model” was an important addition because it gives the patient a piece of mind. Knowing
that their procedure is customized to them creates a level of assurance for the patient.
Furthermore we feel like the “Meet the Team” page featuring biographies of the executive
management team and regional medical directors provides further insight into the company that
Figure 4: Sample Website: Locations Screenshot

fulfills one of the firm’s goals: transparency. Finally our sample website retained “Success
Stories” from the current Lifestyle Lift website. These testimonies are another important layer to
the website which assures customers that the company provides quality service. Figures 5, 6,
and 7, highlight these final pages of our website.
Figure 5: Sample Website: Patient-First Approach Screenshot

Figure 6: Sample Website: Meet the Team Screenshot
Figure 7: Sample Website: Success Stories Screenshot

Overall the revamping of the corporate website with additional information as well as a design
that is attractive and user-friendly to Lifestyle Lift’s target customer group will increase interest
in the company and the procedure. More target users will be attracted to it and they will be able
to find information that is important to them regarding their procedure. This recommendation
provides a huge benefit to the firm at such a low cost.
Recommendation #2: Reduce Outbound Calling
Goal: Call Conversion Rate Increase
Formulation
Based on the internal analysis of the client and client data collected, it is highly evident that one
of the company’s major weaknesses is their call conversion rate. The client expressed that
currently their call center is receiving 700,000 inbound calls annually (“Confidential Information
Memorandum,” 2014). This high amount of inbound calls is from persons that have seen the
company’s various marketing strategies, i.e. television ads and online marketing on the firm’s
website. Of these 700,000 inbound calls, the company is converting only 25,000, a mere 3.6%, to
actual procedures (“Confidential Information Memorandum,” 2014). This caller traffic and lead
generation is one of the key differentiators between LifeStyle Lift and their competitors, namely,
independent practitioners. Given the amount of annual inbound calls, the company’s multi-media
approach to cost effectively drive inquirers to call in appears successful, and should be a
competitive advantage for the firm. Ideally the company should be much more profitable than it
currently is. It is hypothesized that the reason that only 3.6% of calls are transformed into actual

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