It’s true! The average dentist actually loses money on 4 out of 5 marketing activities. Now, perhaps you’re doing better than that average. But, regardless, there’s most likely ample room for improvement here.
So, what’s driving this poor performance across the industry?
Well, one major cause is that in the continuous quest for new patients (which are certainly important), there becomes a lack of focus on what I call the ‘foundational’ elements of marketing. And, if you’re not paying attention, this can cost you dearly!
Foundational elements are the things you must be great at if you want to succeed in today’s increasingly competitive environment. And they are entirely focused on what’s happening inside your practice.
Think of your practice as a funnel. If the base of that funnel is too wide (meaning patients are leaving your practice or simply becoming inactive at too high of a rate), then it really doesn’t matter how much you pour into the top of that funnel (meaning how many new patients you bring into the practice), because you’ll never get your total patient level to rise. This is happening in far too many practices out there. But, unfortunately, the focus remains on the top of the funnel (acquiring patients), when dentists should in fact be paying much more attention to the bottom of their funnel (retaining patients).
You need to ensure your practice is running in an optimal manner internally before you start investing heavily to bring in more new patients. Otherwise, the majority of that external marketing investment is going to be wasted. And that’s a big part of what is driving that 80% number I mentioned up front.
Let’s walk through a simple example to illustrate this concept:
Let’s say it costs $250 in advertising on average in your market to acquire a new patient. That’s a pretty reasonable assumption. Now, let’s also say your call answering rate is 55% (industry range is generally 45% to 65%) and that your front desk converts 50% of those advertising-led calls into scheduled appointments (again, consistent with industry averages).
Now, if 100 people call your office upon seeing your advertising, then ONLY 28 of them will actually schedule an appointment (100 x 55% x 50%). That means you’re missing out on 72% of your paid opportunity! And that’s assuming the best case in that none of them cancel or fail to show up for that scheduled appointment. 28 out of 100 is simply abysmal! And that’s the industry average!
What’s also happened here is that your cost to a acquire a new patient has just skyrocketed from $250 to $900. In other words, you’re marketing budget needs to be 3.5 times greater to get the same new number of new patients!
No wonder you’re seeing a poor return on your marketing investment! And this in turn distorts your decision making. You start thinking that your marketing isn’t working, when in fact that isn’t the case at all. You’re getting the calls you’d hoped for. It’s just that your conversion rate into actual patients is the problem.
Okay, so here’s what I want you to do. Look at the five foundational marketing metrics below and see how you compare to industry best practices.
- Call answering rate of 95% or greater
- Call conversion rate of 80% or greater
- Case acceptance rate of 65% or greater
- Patient feedback rating of 4.8 stars or greater
- Annual patient retention and recall rate of 85% or greater
If you’re not operating at or near these levels, then the new patients that you’re spending good money to get a phone call from, are either not going to be converted into actual seated patients, they’re not going to be profitable enough when they do come in, or they’re going to have a sub-optimal experience and slip right out the back door of your practice.…never to be heard from again.
Next time, we’ll talk about new patient marketing and what you need to do to succeed in that space. But, for most practices out there (and just maybe yours too), there is actually far more immediate opportunity within these foundational elements.
Put some dedicated focus right now into reaching those five industry benchmarks outlined above. You’ll likely see that investment pay off quickly and generously. And, you’ll also find the results of your new patient marketing efforts increasing in multiples as well!
“It’s much easier to double your business by doubling your conversion rate than doubling your traffic.” – Bryan Eisenberg
About Kent Sears
Kent provides over 15 years experience in consulting and marketing strategy. His work has spanned the globe, in both public and private sector, with leading companies such as Microsoft and T-Mobile. He brings his corporate experience to help private practice dentists realize their full business potential through more effective marketing strategies to stay competitive in the rapidly changing world of marketing and healthcare.