New Patients, Value, Compliance, & Long Term Return
February 1, 2010
By: Mark Dilatush
The purpose of this article is to help you identify a portion of your marketing circle. A marketing circle is a new customer (patient) from initial interest & inquiry, all the way through until they leave your practice (for any reason). Every dental practice has a marketing circle. Many practices have breaks in their marketing circle. Breaks are costly. Most breaks are completely avoidable. It is my hope that this article helps you indentify and improve (close) some of those breaks.
What are the most common breaks in dental marketing circles?
- Not understanding the potential long term value of each new patient.
- Not understanding the hygiene department role in that value.
- Not doing the “little things”
- Improper promotion mix
Let’s take these one at a time.
Long term value of each new patient
The long term value of every new patient is measurable, although it is different from practice to practice and market to market. Would you be surprised to learn that a typical average revenue per active patient ranges from $800 to $1,200? Well, don’t be surprised. I’ve seen them as high as $2,600! Now consider that this is just a one year measurement. The value of each new patient over the life of the practice can be 10 times this! Do the math yourself. There are dental practices out there that produce an average of $2m/year for 20 years. That’s $40,000,000. If over the life of their practice, they saw 2,000 truly “active” patients – this equates to a lifetime revenue of $20,000 per active patient. I know what you are thinking, “how can a practice produce $2m on just 2,000 active patients?” Simple, it happens every day, all across the country. What is confusing you is the realistic definition of an “active patient”.
Short sighted dentists may not really worry too much about the patients that are leaving the practice. If those dentists understood the value of those patients leaving, it is very likely they would be motivated to look for breaks in their circle, and fix them! That’s why the long term value of each new patient is the first section of this article.
If you want to calculate and track these leading indicators for your practice, Mark has graciously offered to share the instructions and a spreadsheet that you can use to personally calculate the leading indicators for your dental practice. You can find the instructions here, and the spreadsheet is here.
Not understanding the hygiene department’s role in the overall value of each patient
What dentist’s need to realize is that the time spent in hygiene isn’t just about the revenue generated at that one visit. The big payback for the practice is when that patient continues to be compliant to re-care, requires additional restorative dentistry in the future, requires periodontal treatment in the future, has the time/confidence/trust necessary to refer their family & friends, and so on and so on. If you think the big deal about your hygiene department is the $85 you are collecting for the cleaning – you are making an enormous miscalculation and creating the subsequent break in your practice’s marketing circle.
In many cases, the primary relationship between patient and dental practice is not between the patient and the dentist. I know it probably pains you to hear that but if you are honest with yourself, you know it to be true. Good quality new patients value relationships. Many would never go to another dental practice just because they value their relationship with your hygienist with such high regard.
If your hygiene department is not running on all cylinders, it can/will definitely minimize the return on your marketing investment and increase your long term costs.
Not doing the little things
There are a million of these, so let’s just focus on the one’s that you can fix tomorrow at very little or not cost.
With the first little thing, let me ask you a few simple questions:
How many times last month did a new patient call during normal business hours and get your answering machine?
How many times last month did a new patient call, got connected, but ended up not making an appointment?
What reasons were most prominent when new patients called but did not schedule?
None of you (ok, maybe a handful) know the answers to these questions. Why? As a business owner, wouldn’t you want to know the answers to these questions? By not knowing the answers to these questions, could that create a break in your marketing circle? Of course it can! I would bet, in the majority of your dental practices, this is a significant break in your marketing circle.
The solution is simple really. On each of your external promotions, attach a unique telephone number and monitoring service. We use www.callsource.com for our clients. You can do the same.
At any time of the day during the month, you can log onto a secure website and listen to every new patient call, see calls that went to voice mail, and quantify the return you are getting from your marketing expenses. Pretty easy!
The second little thing is really easy to do and has a cost of zero. How many of you have no-show new patient appointments? If the answer is greater than one or two a year – I have the solution for you.
Call your new patients the day they call to make their first appointment! Why not? You have a call back list of patients you saw today anyway. Why not call the three or four new patients that made their first appointment today? The conversation is ridiculously simple. You just introduce yourself, check with them to make sure they are not experiencing any dental pain (they won’t be, otherwise they’ll be on the emergency schedule), and answer any remaining questions they might have. The whole call might take maybe – one minute. Bingo! You just minimized your new patient no-show rate down to zero (or as close to zero as humanly possible). You just closed a break in your marketing circle.
Improper promotion mix
This is a big one.
If you are currently promoting your dental practice, and, that promotion is primarily geared toward some kind of deal or incentive, I can confidently state that you are creating your own break within your marketing circle.
New patients that respond primarily to a deal or incentive are statistically notorious for being non-compliant to re-care. So, while the dentist appreciates having the schedule appear “full”, and perhaps for a short period of time the practice enjoys some boost in revenues because of the increase in new patient flow – I guarantee you the back end revenue build we discussed earlier in this article, will not be there. It will be partially there, but nowhere near where it could be had the practice promoted itself based on the benefits of today’s dentistry – rather than a financial incentive.
I am not saying that all financial incentives are wrong or should never be used. That’s not what I am saying. What I am saying is that there must be a balance. You must balance the benefits of today’s dentistry within your promotion. You must balance the need for new patient volume based on your capacity. If a solo practitioner really only needs another 10 to 15 new patients each month to get the practice going – why would they promote their practice based on price (incentives)? They should be able to get that volume promoting the benefits of dentistry.
By no means is the above list, a complete list of breaks in a dental practice’s marketing circle. But, the list is the most common list of breaks. I hope by sharing them along with the supporting downloads, that you will begin to close your breaks one at a time.
If you have any questions at all about the content of this article, feel free to reach Mark at: