How often do you think about marketing your practice? In other words, how often do you think about the amount of money you spend on marketing for new patients each week? Do you wonder if the amount of new patients you see now is a healthy number? Or that maybe you should be seeing more new patients? If so, then you’ve placed yourself in the same boat that over 70% of chiropractors I get the privilege of speaking to are in right now. Marketing is a big concern.
New patient acquisition is far and away the most common challenge related to me when I speak to doctors outside my companies. Let’s face it, if you don’t see enough new patients, your practice will never be as successful as your dreams, right? In this blog, we’ll discuss how much you should be spending on marketing each month to fill your practice with enough quality new patients so that you can build your dream practice and your ideal lifestyle.
Let’s start off with what happens when you log in to your email every morning. What do you see? Come on, you see the same thing I see, which is about anywhere from 5-10 emails from people trying to sell you their chiropractic new patient marketing program. Many of them come from DC’s.
I have to confess, I’ve become just a little jaded over the years because maybe like you, I’ve spent a great deal of cash buying all kinds of programs just to see what they were selling. You may know that I’m sort of a unicorn in chiropractic. I actually have a degree in business and have studied it at the undergrad and graduate level. This doesn’t make me any smarter than anybody else. It merely taught me how to think differently than most DC’s, which in my case was done by being immersed in what was called the Harvard Business School case study process. This process taught me how to pick away the B.S. and focus on the real data so that better decisions can be made. That’s how I built my first 4 clinics into the size they became. It’s also how I assembled the amazing team that helped build my current companies.
The first nugget today is to grasp that most of the marketing emails you get every day are worthless, often sold to DC’s that are desperate for more and better new patients. Hey, these people are just trying to build a business, but it shouldn’t be done at your expense. We’ve tested countless of them and not a one performed, other than stuffing an office with Groupon style people seeking something for nothing, ending up in the end sucking up your valuable time and dollars. And then in short order even the window shoppers no longer respond to the ads. There is a much better and more effective way to approach this issue. More on that in a number of future blogs.
Second nugget; How many new patients do you need each week? Do you know? If not, you simply MUST track this number every day and every week. Better yet, have your front desk specialist track it for you and print you a short report every day. You need to know your metrics.
If we ignore everything else going on in your clinic, which isn’t the right way to do this over the long term but is fine for the short term, if you’re practice is smaller than you want it to be, then you need more new patients. Yes, we have to look at a lot of other variables as well, like case average, treatment plans, wellness plans, appropriate supplements and products, state of the art rehab, the number of referrals you generate, retention…..the list goes on. But for now, let’s simplify it and only look at new patients.
If you want a bigger practice, chances are pretty great you need more new patients, but how many? How much more money spent on marketing will it take? How much do you spend on marketing and is it producing your desired result now?
Let’s get back to knowing how many new patients you need each week to build your dream practice. Probably the easiest way to think about this is to determine how big, at least right now, you want your practice to be. In other words, how much revenue do you want your practice to collect each year? Yes, we’re making the assumption that the people coming into your practice need great care and it’s exactly what you’re providing….no endless treatment programs, just great care delivering outstanding patient results.
Let’s do a hypothetical practice so this makes better sense. If you want a million-dollar practice and you right now average 20 converted new patients a month, how many more do you need to take your practice to the million-dollar mark. Well, we need more data. Specifically, you need to know your case average, which is the amount of revenue your typical patient brings into your practice before they transition to wellness care.
Let’s say your case average is $2,000 for this example. Fill in your correct data so this is extremely meaningful for you. If you have 20 converted new patients a month coming into your office at a $2,000 case average, this means you should be at or near $40,0000 a month in clinic revenue. Understand? Now do the same calculation with your numbers.
12 months at $40,000 per month in revenue means you have a $480,000 practice. This is a nice foundation from which to build your dream practice. It really is. So, if your dream is a million dollar practice, you’re about $520,000 short. Make sense? If everything else stays constant, you need more than double the amount of converted new patients you’re attracting now. That number is 21.67 more new patients each month in this example. What’s it going to take to now attract a total of 41.67 converted new patients?
First, a bump of 21 new patients is a challenging but doable hurdle. Write down how much you spend on marketing now each month. Then convert that number to a percentage of your monthly revenue. My guess is that you’re maybe at 2-3% of revenue invested into marketing, though that may be high for you. If 2% of your revenue is invested in marketing and you’re now getting 20 converted new patients, we have to more than double what we call the ad spend. In this example of wanting to grow to a million-dollar practice, investing at least 5% and most likely 7% of total revenue into marketing, given the size of this practice now, is a prudent place to be. 7% is great.
If the practice is now at $480,000, that means that at a 7% ad spend, you should be investing about $2,800 per month into marketing. Once you swallow a few times and digest that number, the next point you should understand is that as your practice grows, what you invest in marketing should grow at the same rate of growth. That assumes, of course, that you want an even larger practice and that you need more converted new patients to accomplish the growth.
Again, we had this example in a bubble, holding other variables constant. That’s really not the way it happens in the real world, but the example gives you a fantastic framework for your practice. As some of the variables raise or lower, you can adjust how you run your practice accordingly.
The holy grail is getting your practice to the size you want it. Once there, your marketing spend can become static, but other variables will ebb and flow. At that point, it’s more a management issue than a marketing issue.
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