Marketing
The amount of money spent on
marketing varies widely among different offices, and can range anywhere from almost
0% up to 20% of
income. In order to better evaluate where you can save on marketing, let's
first categorize where we spend our marketing dollars:
This can be a huge drain on your
resources. Again and again we have bought ads in the Yellow Pages without any
reasonable return. In the first year of my practice, I myself paid a high
price of $1000 a month for three ads in three Yellow Pages. After a year, I
followed up and found out that I had an amazing return on my investment! I had 3,
yes three patients who found my name and came to my office because of my
ads!! That is a price tag of $4,000 per patient!
Where the question of how to
spend on marketing
is concerned, the answer is simple; it has to make sense. If the return is anything less than
seven to nine times of the investment, that financial drain should be
stopped
immediately.
For
the most part, Yellow
Pages ads are a
thing of the past. This is not to say that they don't work at all, but when it
comes to choosing a dentist most people do not use the Yellow Pages unless they
are new in the neighborhood and they have a dental emergency.
Also, an ad in the Yellow Pages has
to be significant to work. I believe the worst kind is the one in the middle
price range; you either want to have a huge ad, or a very small one. Paying
a lot for medium sized ads probably has the lowest return ratio.
Another major issue to
consider is the structure of
your community. Is there more than one phone company and more than one Yellow
Pages directory? If this is the case, your investment value reduces even more. What about the number of
dentist ads in your area? Do you have to go through pages and pages of dental
office ads before you get to your own? If so, you are wasting your money and
should seek
more efficient ways to spend your marketing capital.
Another potential mistake is
to advertise in a Yellow Pages directory that is not the main one everyone uses. These
days every publishing company has a Yellow Pages, and advertising in these
(although they offer lower rates) is often only a benefit to the
publisher!
Yellow Pages ads sometimes work though;
this is when you can offer something unique to separate yourself from others.
Here is yet another tempting advertising method.
Almost every day we receive
solicitation letters about this kind of advertising.
I personally believe this kind of
marketing can be very expensive, especially if you choose the wrong company. What
you are doing is paying for some addresses,
as well as a package that
is made for you. I remember the first time I bought one of these;
it was called the "new home owner mailing list." To my surprise, I received a
marketing letter from myself a few weeks later at my home! At the time, I had lived in that
city for over four years!
It is important to make sure
that the list is
accurate and the return is reasonable. Never commit yourself to long-term
contracts, even if they are offering hard to resist deals. Try your mailing list
first. Pick 100 to 200 names, send letters, and then see what kind of results
you get.
If the response is lower than 4%, you
should not try this method again. Any result over 5% is
reasonable considering the packages and brochures you are sending do not cost
more than $1 each.
The rule of thumb is that you do not want
to spend more than $30 to $50 to attract each new patient.
Referral services are also rather expensive,
but there is one thing in particular that I like about them. Most of the time they offer some kind of
screening before sending a patient. You don't have this luxury with other
advertising methods, which is why you should not pay too much for each patient
that is coming through them. Another benefit of referral services is that
they give you the advantage of group marketing. For example, joining a service
like 1-800-Dentist® (registered trade mark of Futuredontics, Inc)
provides you
with exposure through professionally made TV ads, which would not be available to you
any other way.
If your referral service
efficiently markets your practice and really sends you high value patients, then I don't think
paying an average of up to $100 a patient is such a disaster. This method is probably a good
choice for the
few first years of a new practice when there are not many patients on file.
If you are a member of any referral
service and do not experience the return you are looking for,
you have two options; either end your relationship with the
referral service or, if the root of the problem is on your side of the deal,
evaluate and fix it. For instance, if it is your office that is unable to bring a
person referred by a service into the practice and convert him to a
patient of record, it may be your practice that needs to be looked at
before dropping the referral service.
I strongly believe that if
you have set up your practice right, after three to four years of
practicing, you should have be able to almost
completely stop all methods of marketing and rely on the inside marketing of
your practice. The best thing about this is that it's, FREE.
I have never had a good experience with this
kind of advertising. Unless you are running a huge multi-specialty office, or you
are offering something that is unique (advanced snore prevention treatment,
large dental implant groups, etc.) media ads can be very expensive.
You also need to keep in
mind that media
ads only work when they are repeated. Therefore, you cannot expect to see a significant
return simply by placing a single ad in a local newspaper or on the radio. So, if you are
not planning a serious and well-planned campaign, it may be better to keep your
precious marketing dollars away from media ads.
This is by far my favorite
marketing method. Although it costs almost nothing, it is extremely
effective. It is the best way to save on marketing costs. Some
offices spend up to 20% of their income on marketing. If you can operate
with only marketing inside your office, you can save a great deal of money each year.
If you can even transfer half of your marketing to inside marketing, you may be
able to save as much as $25,000 a year for a $500,000/year office!
Another advantage of inside marketing is
that patients who are referred by others are the best patients. They already
have a positive image of your practice and are more likely to stay with you in
the long
term.
When you have your office set up the way we
have shown you, your referrals will come to you automatically. Of course, you
can do a few things on your part to boost your referral rate.
- Print business cards for every
staff member in your office. (1000 cards can cost around $30. If they refer one
patient, it is paid for; besides, it makes them feel good.)
- Ask your patients for referrals.
I know it is difficult and it was the same for me, but even if you don't like
to do it directly let them know that you appreciate it when someone refers
patients to you.
- Have your staff ask for
referrals. After a pleasant experience, and when your treatment coordinator is done
with his/her presentation, he can hand the patient a few of his business cards
and say, "Give these
to your friends or family who may need a dentist and have them call me directly,
I will take good care of them."
- Remember that the key to getting
referrals from your patients is creating a great
Image.
Any one patient you get through inside
marketing is literally saving you money on other marketing methods.
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