AIM Dental Marketing

AIM Marketing

How to Choose a Dental Marketing Agency

How to Choose a Dental Marketing Agency

More dentists than ever are retaining the services of a dental marketing agency in support of their dental practice growth plans. The most often-cited reasons for doing so are a desire to manage their patient mix between third party reimbursed and fee for service, desire to add an associate, and as a response to inroads from competitors, most notably DSOs.

According to Mike Abernathy*, 50% of practice growth should come from new patient flow, which makes choosing to work with a reputable agency, having a  proven track record, and whose sole focus is dentistry, a logical decision.

*Summit Practice Solutions E-Letter (10-29-20).

If your experience with dental marketing has been less than stellar, the first question to be answered is “Where did I (or my marketing firm) go wrong?”

Dental marketing agencies unlock the power of the web for healthcare providers*

77% of patients used search prior to booking an appointment. With the growing percentage of the population consisting of Millennials, that number will only increase.

50% subsequently referred family, friends, and colleagues. Digitally secured patients are as likely to refer as are patients generated internally or via conventional external marketing methods such as public relations, cause marketing, and direct mail. 43% of new patients watched patient testimonials before scheduling an appointment, while 30% of patients who watched an online video booked an appointment.  Video is a critical component of an effective digital dental marketing campaign. Finally, 56% of new patients used the click-to-call feature on their cell phones to book an appointment.

Taken together this means that, to ensure rapid, cost-effective growth, the internet is the biggest, if not the only, game in town, at least in terms of external marketing.

*https://www.thinkwithgoogle.com/marketing-strategies/search/the-digital-journey-to-wellness-hospital-selection/

Law of Comparative Advantage

The decision to retain the services of a reputable dental marketing agency is further bolstered by what economists call the Law of Comparative Advantage, attributable to David Riccardo and James Mills, two nineteenth-century economists.  The theory holds that an entity, be it a country, company, or individual, should concentrate all its efforts on the task at which it is ‘most-best.’  It assumes the variable to be maximized is profit, that is, it does not take into consideration non-monetary benefits such as entertainment, mentoring, and other forms of fulfillment and gratification one might derive from such other pursuits.

*https://www.investopedia.com/terms/c/comparativeadvantage.asp

Once Bitten (by a Dental Marketing Agency), Twice Shy

Along with the increase in the utilization of dental marketing agency services by dental practice owners, a concomitant, and unfortunate, the consequence is that a greater number of dentists are being disappointed by the gap between promises and results delivered by their agency.

The main cause is an inability (and, in a sadly increasing number of instances, an unwillingness) on the part of the dental marketing agency to present clear, reasonable, and achievable expectations to their clients.  Largely responsible for this is the relatively recent arrival of what I term Big Box Internet Stores.

To a surprising degree, these entities are funded by private equity firms whose primary motivation is the maximization of the return for their investors within a given (usually 3-5 year) time horizon.  That leads the company to be more concerned with aggressive marketing tactics to build their book of business than it is achieving quality results for those who are paying the bills; their clients.

The perception of what constitutes a fair and reasonable investment in dental practice growth has become further obscured by such agencies.  In too many instances “over-promise, under-deliver” has become the prevailing theme.

The ‘going rate’ offered by these stores is around $300 to $600 per month.  When you consider that, in any reasonably competitive area, the investment required to generate a new patient average around $300, even a well-managed program will be unable to generate meaningful results at that level of investment.

What’s “Fair?”

What constitutes a reasonable investment for your dental practice growth plan rests upon a number of factors including the above-mentioned competitiveness of your service area, your timeframe, and your goals.

“Rule of Thumb” estimates pegged to monthly collections assert that, if you are solely interested in stemming attrition, that is, replacing people who leave your practice with just enough to maintain your current patient base, you should invest two to three percent of monthly collections on marketing. If you want to increase new patient volume at a moderate clip the investment should be five to seven percent of monthly collections.  If you plan to grow aggressively to, for example, add an associate, you will want to invest in the vicinity of ten percent of collections.

De novo practices are advised to invest upwards of 20% of projected production so earmarking a reasonable portion of startup funding towards a strategic marketing program is a necessary first step.

Return On Investment

Of course, it’s wholly reasonable to ask “What may I expect in return for my investment (and when)?” To calculate that let’s assume an average new patient acquisition cost of $300. The typical new patient spends an average of $700-$1250 in their first year, while the average patient will remain for 7 to 10 years.

Based on the foregoing, the average lifetime value of a patient, regardless of its source, is between $3,200 to $7,600. That means if one invests $2000 per month, a reasonable expectation is 7 new patients per month.  Return On Investment is simply calculated by subtracting investment from return and dividing by investment.

Return = Number of Patients (7) x Average Patient Lifetime Value (we will assume this to be $5000)

Investment = $2000

Therefore, ROI = $14,000-$2000/$2000

Or 600%.

Following is a table, which details the investment for a given task/tactic as well as the variables upon which that investment depends:

dental marketing agency pricing

 

Perform Your Due Diligence

When my brother and I started our dental marketing agency in 1989 we could count on one hand those companies offering a similar service for dentists.  Now that number is in the hundreds, with new entrants arriving seemingly daily.  As noted above, many of these new entrants are funded by private equity firms that have become aware of the potential to earn a handsome return by aggressively marketing to dentists, promising them spectacular results for next to no investment. It is this type of entity, which has resulted in so many dentists being disappointed with the results of their marketing investment.

While it will require a bit of time and effort there simply is no substitute for deliberate research and comparison shopping.  Do not fall into the trap of assuming all dental marketing agencies are the same and therefore, the price needs to be the only decision criterion.  As with dentistry, price is but one consideration.  A true fit goes well beyond the investment.  As with most things, dentistry included, results are typically commensurate with investment, that is to say, “you get what you pay for.”

As part of your due diligence, the following questions should be asked and the information requested:

  • How long has the firm been in practice? Experience matters.
  • Does the firm specialize in the dental field? Profession-related experience matters.
  • Will the firm allow you to speak with current and former clients? Trust, but verify.
  • Does the firm require a large advance payment and a long-term contract? Reputable firms strive to keep your money in your pocket until they truly need it, and are sufficiently self-assured as to not require a long-term contract.  Clients should remain a client because they want to, not because they are contractually obligated to.
  • How does the firm demonstrate an understanding and sensitivity to your unique situation? Does it customize a plan to meet your needs, or do they employ a “one size fits all” approach?  Do they provide a fully transparent, regularly updated, and easily understood online interface, which presents their results?

Transparency and Accountability – Trust, But Verify!

There are certain key performance indicators (KPIs) about which your marketing agency should be reporting.  KPIs to watch include so-called “bottom of funnel” results: new patient volume (and how this compares to your agreed-upon goal), new patient acquisition cost, and your “team batting average,” that is, their success with converting calls from prospective patients into solid, and kept appointments. “Mid-funnel” KPIs include so-called conversions.  These are indications of some desired action being made by prospective patients including phone calls, form completions, chat-bot engagement, and reviews activity. “Top-of-funnel” KPIs to watch include: total website visits, percentage of new vs. repeat visitors, page load speed, bounce rate, time on site, paid search impressions and click-through rate, traffic lost to budget, and more.

New Possibilities

The properly conceived, implemented, and monitored dental marketing plan places the practice owner squarely in control of their practice growth plan, and can mean the difference between success and failure.  Conversely, a plan that is poorly conceived, executed and, therefore, rendered non-actionable can mean frustration, wasted opportunity, and costly.  That’s why it makes sense to become familiar with the means for vetting, selecting, and evaluating the dental marketing agency that will help you navigate dental marketing landscape and come out the other end a winner.

Here’s a free glimpse at AIM Dental Marketing’s Dental Marketing Dashboard 2.0

AIM MarketingHow to Choose a Dental Marketing Agency
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The Elite Practice Founder Interviews AIM Dental Marketing President

On June 8th, The Elitre Practice founder, Dr. Carlo Biasucci, sat down with AIM President Daniel A. ‘Danny’ Bobrow to hear an update on several digital marketing tactics dentists, both Canada and U.S.-based should know about it.

Updates included how to avoid paying GST/HST tax for Google Ads, enhance rankings by adding specific content to the dental practice’s Google My Business page, keeping your marketing honest and actionable, and eliminating the number one bottleneck between the dental marketing plan and practice growth.

The interview runs around 40 minutes.

Access The Interview Here

AIM MarketingThe Elite Practice Founder Interviews AIM Dental Marketing President
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Many Thanks To Six Step Screening Inventor Eva Grayzel

Many Thanks To Six Step Screening Inventor Eva Grayzel

On Thursday, June 17th, at 6 p.m. Central Eva Grayzel, Master Storyteller and Visionary Survivor, and author of: M.C. Plays Hide & Seek Mom’s Choice Gold Award Winner and Readers Favorite 5-Star Rating will deliver:

 

Protect Yourself From Liability, And Save A Life

A Free PACE-Approved CE Course For Dental Professionals

Access Eva’s Blog Here

AIM MarketingMany Thanks To Six Step Screening Inventor Eva Grayzel
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Earn Your Patients’ Trust OVERNIGHT!

Earn Your Patients’ Trust OVERNIGHT!

AIM’s President and CEO Daniel A. ‘Danny’ Bobrow sat down with The GEMS GUY Dr. Tom Orent to share his insights into establishing and maintaining trust with patients.

Access The Interview Here

Some of the topics shared by Bobrow included:

  • How to attract more more new patients, specifically, more new fee for service patients.
  • Key determinants of a dentist’s success with dental Marketing.
  • The importance of understanding Patient Acquisition Cost, Patient Lifetime Value, and Return on Investment and its role in achieving Actionable Intelligence Marketing.
  • The vital importance of proper handling of prospective patient calls, and his philosophy and approach to ensuring calls are converted into kept appointments.
  • How he demonstrates his firm’s commitment to Analysis, Implementation, and Monitoring to ensure dentists never fly blind with their marketing.
  • Human psychology and the role of the principles of persuasion in the context of creating new patient offers.
  • His pioneering work in the area of cause marketing in dentistry.
  • His advocacy of the importance of organizational skills development, and his coaching to “Master The 4 Ds Of Organization.

Access The Interview Here

AIM MarketingEarn Your Patients’ Trust OVERNIGHT!
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5 Ways Your Practice Is Bleeding Money, and how to stop it NOW!

5 Ways Your Practice Is Bleeding Money, and how to stop it NOW!

On March 18 AIM President Daniel A. (Danny) Bobrow, hosted Carlo Biasucci, DDS, who shared an actionable blueprint for success in the Covid economy

The “Covid Economy” caught everyone off guard. Yet, Dr. Biasucci maintains that the difference between success and failure continues to be more about methodical execution of proven systems than it is chasing “new” and “different.”

After surviving an injury that almost ended his career, Dr. Biasucci was determined to change his practice from a beast of burden to a business that would allow him to live life on his terms. He took his already-successful $2.4 million dollar practice, tripled it in 3 years, and cut his work week in half.

He now spends 100% of his time sharing exactly how dentists across North America and overseas can get off the treadmill of trading hours for dollars.

Attendees learned why Elite Practice Members collectively outperform other consulting groups by a wide margin.

In his fast moving presentation, Dr. Biasucci stressed the areas where most dentists struggle are appointment conversion, case acceptance, and having and using accurate data.  He debunked some rather widely held views among dentists including that most dental marketing resources should focus  on direct mail, outspending ones competitor, Instagram, and other reactive strategies, in favor of an ongoing emphasis on internal dental marketing such as patient testimonial videos.

“Internal and external marketing are two wings of the same bird.” Says AIM Dental Marketing® President Daniel A. ‘Danny’ Bobrow. “When one is maximizing patient value, the return on investment from external marketing sees a commensurate bump.” Concludes Bobrow.

The Presentation’s Agenda included:

  1. Where to focus right now with your marketing budget
  2. Easiest “holes in the bucket” to fix
  3. Fastest ways to dramatically increase case acceptance
    and
  4. 14 statistics every dentist should closely monitor

Biasucci’s 4 pillars of practice success are Leadership, Systems, Training, and Marketing. He spoke about Team motivation and opined that, when the Team won’t do what the owner wants, he/she should not give up, fire them all, or hire new staff but, rather, engage them to ascertain the reason(s), then lead and train them, and incentivize the desired outcome.

Key statistics Biasucci urged dentists to track included:average yearly value of a new patient, collections (stated as a percent), and conversion percent, by Team Member, of phone calls into kept appointments.

The Presentation concluded with a Q&A session during which were addressed topics including:  details on cause marketing/community outreach; marketing metrics on which to focus; the importance of, and methodology behind, calculating Team Batting Average (appointment conversion rate); email cultivation (drip) marketing campaign set up and implementation; and telephone skills mastery.

The webcast ran around 90 minutes.

View The Webcast Here

AIM Marketing5 Ways Your Practice Is Bleeding Money, and how to stop it NOW!
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AIM’s President Interviewed By Dental Products Report on Dental Cause Marketing

AIM’s President Interviewed By Dental Products Report on Dental Cause Marketing

Dental Practices Should Engage in
Cause Marketing
A conversation with AIM Dental Marketing®
Founder Daniel A. “Danny” Bobrow

Dental practice management expert Bobrow joins Noah Levine to discuss why 2021 is a great time for dental practices to connect with their communities through cause marketing.

AIM President Danny Bobrow sat down with Dental Products Report’s Editorial Director Noah Levine to discuss what is likely the most underutilized dental practice building tactic.  Known various as cause-related event marketing, cross-sector partnerships, and simply cause marketing, its power and potential are limited only by the commitment, energy, and creativity of those who choose to embrace it.

The interview began with Noah asking Danny how and whether AIM’s Health Partners (clients) were advised to modify/prioritize their marketing and outreach efforts in response to the pandemic. Bobrow made the point that, aside from encouraging the use of tele-dentistry, including after the pandemic (owing to its ability to increase case acceptance), and clearly communicating the measures the practice is taking to ensure the safety of its patients, the real opportunity lay in ‘filling the vacuum’, that is, continuing, and even accelerating, ones marketing and outreach efforts to leapfrog those competitors who chose to curtail or eliminate their marketing efforts during the pandemic.

HIPAA compliant emails and online patient forms submissions have also seen an uptick in interest, owing to the convenient and support of social distancing each service offers.

The conversation eventually circled back to cause marketing, at which point Bobrow introduced the idea that “In contrast to Adam Smith’s Invisible Hand, which holds that society benefits when people pursue their own selfish interests, cause marketing states the opposite, that, by seeking to help others, one’s business unavoidably benefits.”

Watch The Interview Here

Dental Practices Should be Engaging in Cause Marketing: A conversation with AIM Dental Marketing® Founder Daniel "Danny" Bobrow

 

 

AIM MarketingAIM’s President Interviewed By Dental Products Report on Dental Cause Marketing
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CDS to Host Daniel Bobrow at 2021 Midwinter Meeting

CDS to Host Daniel Bobrow at 2021 Midwinter Meeting

We are happy to share that AIM President, Daniel Bobrow, will be speaking at the Chicago Dental Society’s 156th virtual Midwinter Meeting, the largest dental professional meeting in the United States.

This year’s Midwinter Meeting will be taking place February 25-27, 2021.

You can register for the Midwinter Meeting here: https://www.cds.org/meetings-events/midwinter-meeting/

This year’s Midwinter Meeting theme, ‘Heart of Dentistry,’ celebrates the passion for dentistry that we possess in our hearts and our commitment to the profession and those we care for. While our world is changing drastically, our profession now compels us to look even deeper into our hearts for the passion and commitment to move forward. We want all of our attendees to celebrate and share the importance of dentistry in our lives.

AIM MarketingCDS to Host Daniel Bobrow at 2021 Midwinter Meeting
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When marketing fails to open doors

Four cases illustrate how to conduct marketing feasibility studies, regardless of whether you`re a rookie or a veteran, or whether you cater to country folks or city dwellers.

Four cases illustrate how to conduct marketing feasibility studies, regardless of whether you`re a rookie or a veteran, or whether you cater to country folks or city dwellers.

Daniel A. Bobrow, MBA

The need for reliable and predictable methods for attracting new patients is more acute than ever. Developing and implementing a well-thought out dentistry marketing plan offers the practice a way to assume greater control over its rate of growth and, in so doing, reduce stress in the office, all while adding a new and positive dimension to the career of both doctor and staff.

One of the best ways we know to move more rapidly along the marketing learning curve is by learning from other successes (and failures).

To that end, we present “real world” examples, taken from our client charts, of pitfalls, and how to avoid them. Only the names have been omitted to protect the innocent (and guilty).

Of course, it would be great to have a crystal ball to determine the optimum design of your marketing plan right from the start. The reality is that some mid-course correction is inevitable. By viewing the initial stages of your marketing program(s) as a kind of applied market research, you will make better, more informed marketing decisions, and gain a clearer picture of how and where to best allocate your scarce marketing resources.

Now let us elaborate on some specific cases so you can see just how various situations may be analyzed and evaluated. Even if you cannot directly identify with all of the cases presented, you should be able to apply the structure of the analysis to your specific practice situation.

Case I

New Practitioner

Background: A doctor who was one year out of dental school wanted to open a practice near Minneapolis. The doctor was primarily interested in attracting fee-for-service patients. As his was a new practice, his cash reserves and patient base were limited. Fortunately, he had grown up in the area, and so was able to draw upon personal connections (friends and family) to open with an existing patient base.

Analysis: A marketing feasibility study revealed that, among other things, there was a significant volume of resident turnover. A marketing feasibility study attempts to identify the strengths, weaknesses, opportunities and threats associated with operating a dental practice in a given area. Inputs to the analysis can range from the doctor and staff`s own experiences and observations to demographic data procured from external sources such as the U.S. Census Bureau. Using data collected from a similar practice near his service area, it was estimated that the average annual value per new patient in his area was $585 (see inset titled, Measures of Marketing Effectiveness). The reason data from another practice was used is that, being new, this practice had an insufficient patient base for this purpose.

Approximately 300 individuals and families were moving into the doctor`s Service Area each month.

A good rule of thumb for young practices is to allocate a minimum of 5 percent of estimated first year collections to marketing. This practice`s first year fees were estimated to be $150,000. This meant an annual marketing budget of $7,500 and a monthly budget of $625.

Implementation: Being a new practice, a majority of the marketing budget was devoted to external marketing. External marketing means communicating with people who are not yet your patients.Two thirds or roughly $400 per month would be devoted to targeting new residents. This meant that $1.33 (400 divided by 300) could be spent on communicating with each new resident. For that amount, each new resident could receive two mailings. These mailings would be sent two months apart.

A reasonable expected response rate to a mailing of this sort is one to two percent. Local demographic factors can affect the actual response rate. This would mean that, using the more conservative expectation of 1 percent, the practice could expect three new patients from each mailing.

Results: The average monthly rate of program response proved to be 1.25 percent. Return on investment (ROI), therefore, was 548 percent (an average of 3.75 new patients per month times an annual average patient value of $585, divided by the $400 cost to attract these patients).

Case II

Mature Practice

Background: A practice in Florida was experiencing deterioration in its patient base owing to increased prevalence of managed care and high mobility of the population.

Analysis: The marketing feasibility study determined that an increase in the percentage of the population participating in managed care and an increase in the proportion of dentists to population were responsible for the shrinkage in the patient base. The Study identified a downward trend in the median age of the population. It also identified an increase in the number and size of families with children.

Implementation: It was recommended that the doctor embark on an internal marketing campaign to “immunize” his practice against the loss of patients to managed care providers.

Because the doctor was an elderly gentleman who enjoyed treating patients closer to his own age, a marketing program directed at senior citizens was initiated. This entailed four quarterly mailings to high net worth individuals having a minimum age of 50 years.

A monthly New Resident marketing program was initiated that consisted of three mailings to each new resident over a three-month period. Because he had brought in a younger associate who was eager to treat younger patients, it was agreed that these mailers would be designed with an eye toward attracting the younger families moving into the area.

The doctor distributed literature on the benefits of fee for service dentistry to his patients, and sent letters to all patients leaving the practice for a managed care provider, explaining that, should their dental care needs not be met by their new provider, they were welcome to return. A number of patients who left the practice for a managed care provider did eventually return to the doctor`s practice.

Results: The above strategy combined with the new resident and seniors marketing programs resulted in a net increase in active patients after only nine months.

Case III

Competitive Urban Area

Background: The client had sent mailings to new residents each month for five years. While initially profitable, results were becoming lackluster (roughly 0.2 percent), and he wondered what could be done. The doctor did a reasonable job of tracking program response, and related that a number of practitioners had moved into the area and were performing similar programs.

Analysis: The mailing consisted of a two-page letter of introduction with no patient incentive mailed to new residents each month. He had been mailing using Standard Mail Postage (formerly known as Bulk Rate) for the past three years. Because inaccurately addressed mail is not returned to the sender when standard mail postage is used, he had no idea of the accuracy of the list he was using.

Implementation: A first class mailing was performed, yielding an inaccuracy or “nixie rate”of 25 percent. The decision was made to switch list providers. Using first class postage for the first month determined an accuracy rate of 93percent. This was well within acceptable limits so, to save on expense, future mailings were performed using Standard Rate Postage. For esthetic reasons, stamps were used instead of a Standard Mail indicia (imprint).

A follow-up mailing was added to his program, and an RSVP (postage-paid reply) card was inserted in both the first and second mailings. The doctor agreed to include an offer of a free InterPlak system for new patients. As a third contact, a telephone follow-up call was added.

The doctor also procured a practice management software package permitting him to track long-term patient value i.e. he was able to include recall and patient referral in his valuation. Also, printouts of all prospective patients contacted were retained to more reliably track program response.

Results: The Outbound Telemarketing Service yielded a handsome 18 percent response rate and an 80 percent “Quality Ratio”, that is, for every ten respondents, eight kept their first appointment. The response rate to the doctor`s new resident mailing program increased 350 percent.

Case IV

Blended Practice

Background: A multi-specialty practice in central Florida saw a number of major employers within the practice`s service area sign on with a capitation plan. With assistance from an outside consulting firm, it was decided that the practice should have 75 percent of its revenue derived from fee-for-service patients and 25 percent from managed care.

Revenues from fee for service treatment averaged $32,400 per month. The practice group signed up with a plan that paid five dollars for each enrolled patient. Two of the largest employer groups participating in the plan were a teacher`s union and municipal employees. Approximately 1,000 patients were immediately enrolled with the practice.

Analysis: Based on the above information, desired monthly revenue from the capitation program was $10,800 ($32,400 divided by 75 percent = $43,200 times 25 percent). Initial monthly collections from the Plan were $5,000 (1,000 times $5). Because the practice was committed to selling dentistry to both fee-for-service and capitation patients, it was expected that average monthly per patient revenues from patient co-payments would be equal to half the capitation fee earned per patient. So the average expected revenue per capitation patient is $7.50 ($5 plus $2). Therefore, the number of desired capitation patients is 1,440 ($10,800 divided by $7.50). Since 1,000 capitation patients were immediately enrolled with the practice, the desired quantity of new capitation patients is 440 (1,440 minues 1,000).

Implementation: The group historically spent 6 percent of its annual revenue on marketing. It was agreed to allocate 25 percent of this budgeted amount to enrolling participants in the capitation plan. The total annual marketing budget of $23,328 ($32,400 monthly revenue times 12 months times 6 percent) would be allocated proportionally between the fee-for-service and capitation groups. In other words $5,832 (25 percent of total) would be devoted to enrolling participants in the capitation plan.

Enrolling capitation patients would be accomplished by targeting known participants in the plan. Three consecutive monthly mailings were sent to each of approximately 1,500 teachers, 1,000 municipal employees and 2,500 employees of other firms known to be participating in the plan. Employee benefits administrators were also contacted via telephone to introduce the practice and request that literature be posted in common areas to introduce the practice group to the employees. An InterPlak System was offered as an inducement for visiting the practice. To stem fee-for-service attrition, the practice implemented a new resident marketing program consisting of four mailings to each new resident over a four month period.

Results: Within one year of initiating the above programs, the practice added nearly 350 capitation patients. Fee-for-service patients increased 10 percent. While the number of new enrollees was 90 patients short of goal, the practice understood that this level of growth after only one year had positioned them to meet or even exceed their goal over the next year.

We have presented the foregoing material with two purposes in mind. First, it is hoped that, by illustrating the challenges and impediments to success, the reader will be able to anticipate and avoid them, and thereby realize a positive dentistry marketing experience. Second, we encourage the reader to apply the various tools of analysis discussed above to make sound marketing decisions. The savings in time, money and frustration, and the rewards that follow, are well worth the effort.

Snapshots of marketing solutions

What`s a patient worth?

A solo practitioner located in a rural community had no idea what the long-term value of a patient was to her practice. Consequently, she was unable to evaluate the cost-effectiveness of any new-patient acquisition system she employed. In another practice, the receptionist of a New Jersey dentist was concerned because their outbound call-handling telemarketing service was “only” yielding three new patients per month on a monthly investment of $200.

Both practices failed to take the time to calculate the average annual value of a patient, as well as the average “lifetime” of a patient (see related article on next page). When they performed the valuations, it was determined that the “average long-time value of a patient” (average annual patient value multiplied by average lifetime of a patient) was $3,200 and $6,100, respectively, for the two practices.

Armed with this new information, both practices were able to confirm that the performance of their programs was, in fact, quite impressive. Of course, it is also essential to be aware of the cash flow consequences of all marketing decisions.

Lesson: You need to know both the cost and the benefit to perform a cost-benefit analysis .

“Sorry, wrong number.”

A practice employed a receptionist whose attitude, to put it diplomatically, was not conducive to encouraging potential patients to join the practice. A receptionist at another practice was completely oblivious to the existence of a marketing plan.

Both practices were encouraged to perform “test calls” prior to initiating any future external marketing programs. A test call simply consists of someone calling your office posing as a prospective patient who is responding to a mailing they recently received.

Results of the test calls make a practice aware of any impediments to success before real damage is done.

Lesson: Prepare and educate your staff.

Missing the forest for the trees

A dentist in a rural part of a Midwestern state believed people would not be willing to travel more than 20 miles to see the dentist. This assumption was further bolstered by the fact that only a small percentage of his current patient base lived or worked beyond a 20-mile radius.

By marketing to new residents in a zip code nearly thirty miles away, this doctor discovered an under-served area. In so doing, he realized an impressive rate of return for himself. Also, because his office was on a road used by these residents to travel to work in the nearest main city, he made these people aware of a convenient location for their dental needs.

Lesson: Let your service area speak for itself.

Take the elevator up to the sixth floor…

A client located in a predominantly urban setting was having trouble attracting new patients. Her office was not visible from street level, and the residential population was insufficient to support marketing efforts directed to that group.

Employers and employees were targeted at their place of work, and a direct mail/telemarketing campaign was initiated. Within eight months, new patient flow increased markedly.

Lesson: Don`t be afraid to try different approaches.

Formula for determining “Active Patient Count”

– Count number of patient records in active files.

– Sample at least 150 to determine percentage who have been in during previous 18 months for any dental visit.

– Apply percentage of current patients from sample to total number of patient records. Add number of “Current Floating” records (records “in process” around the office).

– Total number is valid active patient count.

Example:

Active Charts = 1,445

Sample 134/155 = 86%

Current Floating = 41

Active Patient Count = 1,445 x .86 + 41 =1,283

Procedure for finding “Average Patient Lifetime”

– First, calculate “patient survivorship.” this requires that a measure of your active patient count be taken at two different points in time. Then, subtract new patients acquired since the preceding active patient count from your most recent active patient count.

– Subtract the patient survivorship from 1 and divide by the number of months between counts; multiply by 12 to determine the percentage lost per year.*

– Divide 100 by the percentage lost last year to arrive at the average lifetime of a patient in years*

* These are simplified formulas. Accuracy will decrease the greater the time between active patient counts using the above method. For most practical purposes, it will work with active patient counts taken within one to two years of each other.

Excerpted from The Life Time of a Patient. Reprinted with permission of Bill Rossi, Advanced Practice Management.

Measures of Marketing Effectiveness

The first question to ask when embarking on any patient acquisition or retention program is, “What do I stand to gain from my program?” To help you decide, first calculate the value to your practice of a typical patient. This is accomplished by calculating your Average Annual Patient Contribution to Overhead (AAPCO).

To calculate your AAPCO, randomly select 30 patients who have been with the practice for at least one year. Using a table, enter the Total Dental Production revenue generated by each patient in a column labeled Dental Production. Next, enter the Total Hygiene Production revenue in a column labeled Hygiene Production. Once you have 30 patients selected, add each production column and divide each by 30.

Next, multiply your total Dental Production times your Net Adjustment Factor. To calculate your Net Adjustment Factor, you subtract the following from 100 percent: 4% loss rate/bad debt expense + 7% universal variable expense + 10% lab fees = 21%. Therefore, your net Adjustment Factor is .79 (100% – 21%). Finally, to calculate your Average Net Dental Production, multiply your Total Dental Production times .79.

Also, you need to calculate your Average Net Hygiene Production. To determine it, you follow the same steps as above, but your Net Adjustment Factor is .89 (100 – (4% loss rate + 7% universal variable expense)). To calculate your Net Hygiene Production, multiply .89 times your Total Dental Production.

So, your AAPCO formula is (Total Hygiene Prod. / 30) x .89) + (Total Dental Prod. / 30) x .79). For a very enlightening article on Patient Lifetime Value, call The American Dental Company at (800) 723-6523 and request a reprint.

AIM MarketingWhen marketing fails to open doors
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Marketing Insider: Making a difference

If someone were to tell you they knew about a powerful practice building tool that involves no selling, costs little (or nothing) to implement, enhances patient loyalty, encourages referrals, attracts new patients, builds team morale, makes a positive difference for those in need, is repeatable, and lots of fun, would you want to learn more?

If someone were to tell you they knew about a powerful practice building tool that involves no selling, costs little (or nothing) to implement, enhances patient loyalty, encourages referrals, attracts new patients, builds team morale, makes a positive difference for those in need, is repeatable, and lots of fun, would you want to learn more?

There is hardly a dentist I know who has not already demonstrated a commitment to “giving back.” A free “Smile Makeover” for a deserving patient, volunteering at a dental clinic, participating in an overseas dental project, offering a scholarship to some deserving student, and sponsoring a Little League team, are but a few of the ways dentists and their staff have “put a human face” on their practice and the people who comprise the dental profession.

One of the most cost-effective and enjoyable ways I’ve found to grow your dental practice is to promote and stage an event, ideally in support of a non-profit, dental-related cause.

Cause-Related Event Marketing

Such events are called Cause-Related Event Marketing (C.R.E.M.) and, if your goal is to make an even bigger positive impact, C.R.E.M. could be the ticket.

I define Cause-Related Event Marketing as: The process by which an individual or organization seeks to achieve one or more business objectives as a consequence of its commitment to some form of philanthropy.

For some, the idea of doing anything of a philanthropic nature that results in some business or personal benefit evokes fear of being perceived as “feathering ones own nest.” That is why the above definition makes clear that any benefit to the practice follows from, and is a consequence of, the act of helping those in need. In other words, helping is paramount.

Some may wonder, “Why should I bother with all this? Why not just donate my own money and time and be done with it?” If doing what you do now satisfies you and you are not interested in growing your practice, the answer might well be that you should indeed keep on doing what you’re doing.

Just be aware that, by enlisting the support of others, you cannot help but leverage your “philanthropic portfolio,” that is, get more bang for your charity buck.  Put another way, which do you think your chosen charity would prefer to receive, $1,000 from your pocket, or, say, $10,000 because you chose not to keep your good works a secret?

Simple ways to have an impact

It is a curious irony that, by remaining “pure,” we actually deny an opportunity to do more good for our chosen cause.

If throwing a party places you and your practice in front of people through your local media and merchants, and your patients’ friends and families, it truly is a win-win proposition. You’ll receive newsworthy copy for the media; free advertising for merchants, good will and new patients for you and, most importantly, more benefit to the charity.

Also, the BBMG Conscious Consumer Report, reported that given a choice between similar offerings, a consumer will select the entity that demonstrates a commitment to social responsibility.1 Bear in mind too that, in challenging economic times, CREM is an even better bargain, because it can literally cost nothing to implement.

A night out on the town can, depending on where you live, quickly add up to $100, so why not invite people to have their night out with you and benefit a good cause, too? Having a party with your favorite people and their friends is fun, and people appreciate it, which makes it a repeatable event, which can then become part of your Annual Marketing Plan.

You and your team may feel ambivalent about asking your patients for money. The good news is that you don’t have to push your fundraiser on patients because you are offering them value in exchange for their support (i.e. a party) and, done correctly, it is your patients and the media who will be asking you the questions.

Getting started

If this is your first foray into C.R.E.M., it is probably a good idea to donate the funds you raise to an existing, reputable cause rather than attempting to set up your own non-profit foundation. You are then free to focus solely on promoting and staging a successful event, and leaving it to your chosen charity to put all that money and other resources to good use.

Before associating your name and reputation, and that of your practice, to any cause, a certain amount of due diligence is indicated.  For help with this send me an email. If you should wish to establish your own foundation, be sure to secure advice from legal professionals, both to get and keep your organization in regulatory compliance.

Assuming you have opted to raise funds for an established and reputable cause, your first step should be to hold a dental team meeting to gain ‘buy-in’ and valuable suggestions from your team. As this truly will be a team effort, it is important to request and receive consensus and commitment from them about why the practice is doing this, as well as when (give yourself and staff enough time to organize and promote your event to avoid unnecessary stress), where (your office, or possibly a local establishment whose owner is willing to donate the space), and how (what are the teams’ respective responsibilities) for your event to be a success.

Putting a plan in action

Explain to your team that you have a way to grow the practice requiring low or no cost and no selling, but simply a commitment to sharing with others what you are doing.  It is important to make this distinction at the outset, as many people are averse to being asked to sell even if it’s for a good cause.

Demonstrate your commitment to making your event a success by using in-office displays and other communications tools to generate interest among your patients.  Examples include: posters, brochures, patches or buttons on scrubs, promotional flyers for local area businesses to promote their involvement in your event, a link from your Web site home page to your fundraising page, direct mail, press releases, public service announcements, etc.

Armed with these tools, your team can easily incorporate information about the event into their regular communications with patients because your team will be responding to, instead of initiating, inquiries. Thanks to desktop publishing, much of the above mentioned communications material can be done in-house. Any additional expertise should be secured by networking with staff, patients, family, and friends. As most business people appreciate the value of free advertising as well as supporting a good cause, you’ll be surprised to find most, if not all, needed assistance will be provided gratis.

This first team meeting should facilitate an open exchange of ideas and feelings. Learn what your team’s interests and abilities are with respect to volunteering. All staff members’ views should be heard. Decisions made based on consensus of the group about the type of cause you wish to support will help ensure follow-through and a sense of ownership by every team member. Before the meeting adjourns, be sure you have established an action plan, complete with clear task assignments and timeframe for completion, and scheduled regular follow-up meetings.

Be sure to maintain the momentum you’ve established by adhering to your team meeting schedule, and by keeping positive and supportive, even when things do not occur according to schedule. For instance, instead of getting upset with a team member for not completing a task when or as promised, see what you and other members of the team can do to help them get it done, while gently reminding them of how important their task is to the success of the team’s agreed-upon objective.

Following the event, gather as much feedback as possible on its impact, as this is the best way to achieve the goal of making next year’s event better.

Annualizing your event

Remember, the goal of your event is to make it so much fun and rewarding for all who participate that, not only will people be glad they were invited to contribute or attend, they’ll want to know the date of your next event so they can add it to their calendar!

Indeed, an annual event may well become a regular part of your dental marketing plan. In so doing, you will have in place an ongoing strategy for keeping in front of, and showing your appreciation for, your patients, not to mention a great way to get to know their friends and family, and the public at large. After all, isn’t that what dentistry marketing is all about?

Daniel A. Bobrow, MBA, is president of American Dental Marketing, a Chicago-based Dentistry Marketing Consultancy. He is also Executive Director of Dentists’ Climb for a Causetm. He may be reached at 1-800-723-6523.

REFERENCES
1. Bemporad, Raphael and Mitch Baranowski. “Conscious Consumers Are Changing the Rules of Marketing. Are You Ready?” BBMG Conscious Consumer Report. Nov. 2007.

AIM MarketingMarketing Insider: Making a difference
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Marketing Insider: Increase your ROI

Dental professionals, out of necessity, must pay close attention to detail. It is surprising, then, to learn how little attention is paid to monitoring and evaluating the effectiveness of dentistry marketing tactics.

Dental professionals, out of necessity, must pay close attention to detail. It is surprising, then, to learn how little attention is paid to monitoring and evaluating the effectiveness of dentistry marketing tactics.

The good news is, with a little planning and preparation, the process is simple and the benefits are huge. When it comes to marketing your practice, the more complete, timely and accurate the tracking, the better equipped you are to capitalize on opportunity and minimize cost.

Why anecdotal doesn’t work

Asking your patients “Who may we thank for referring you?” is an unreliable, risky way to assess marketing tactic efficacy. Here’s why:

  • The lag between exposure and response to a message means the new patient may not know or remember what prompted him or her to contact you
  • Because people often need to be exposed to multiple instances of the same message before they respond, it is likely you will only hear about the last thing they saw or heard that caused them to respond
  • It takes up team member time
  • It risks alienating prospective patients by interrogating them instead of selling them on practice benefits. People are contacting you to make an appointment, not to tell you about your marketing.

Monitoring quality, not just quantity, of response 

Automating your response tracking allows you to identify opportunities to improve the quality of your communication with prospective patients, as well as eliminate obstacles to success.  Because telephone calls can be recorded, you actually hear what scenarios are playing out at the front desk. This allows you and your team to work together to find better ways to field inquiries.

Perfection remains elusive

It is important to recognize it may never be possible to completely track the benefits of a marketing program. Do not expect your tracking system to monetize the benefits from increased name recognition and contribution to brand awareness. But remember it is possible to establish, implement and maintain a reliable tracking methodology (see, “Have a plan”).

Tracking with TTNs

Tracking most strategies is greatly enhanced by using tracking telephone numbers (TTN). TTNs make it possible to monitor and evaluate response quantity and quality. In choosing a TTN provider:

  • Make sure the area code and three digit prefixes are as close to the practice’s as possible. This helps reduce any confusion in the minds of prospective patients who may wonder why they are being asked to call a number that appears to be outside of the area.
  • Avoid using toll-free numbers, as any benefit from offering the caller toll-free service is overshadowed by the perception that yours may be a large, impersonal entity. Do everything you can to convey a local flavor to prospective patients.

Be sure the tracking telephone numbers are new or, if recycled, have been inactive for at least 60 days. Otherwise, you run the risk of being interrupted and distracted by (and paying for) wrong numbers.

Your TTN provider should have the ability to notify you via e-mail whenever someone uses your TTN. The provider should also have an online portal that enables you to access the quantity and quality of response, for instance:

  • Quantity of calls generated by each campaign
  • Day and time of calls
  • Ability to listen to the calls
  • Disposition of calls (hang up, voice mail, disconnect)

On more than one occasion, this monitoring has identified disconnects as a malfunction with the practice’s voice mail, or voice mail not picking up until the eighth ring.  These problems, left undetected, can be costly.

The outgoing message

In one case, a client discovered through her monitoring system that an inordinate number of callers were hanging up without leaving a message. It was subsequently discovered that the outgoing message was more than two minutes long. The solution was to provide callers with the option of bypassing the remainder of the message by pressing 0 or #, as well as shortening the message by omitting office hours and other extraneous information. Because nearly anyone who wants to make an appointment with your office needs to speak with you first, having office hours on your outgoing message is unnecessary, and only serves to try the caller’s patience.

Remember the purpose of your outgoing message is to convey sincere enthusiasm and appreciation that the caller is contacting you, your regret for not being able to speak with the caller personally, and your assurance that you will return the call as soon as possible.

Make it work for you

Now that your data gathering system is in place, what do you do with it?
Schedule weekly sessions to evaluate and discern any patterns such as hang ups, extended rings, one staff member converting more patients than another, etc. The interval between sessions can be extended to monthly, or even quarterly, once the practice is well along its learning curve.  Regular monitoring helps ensure inquiries are handled promptly and appropriately.

You should also calculate your Return on Investment (ROI), and to do so, it is helpful to streamline the data evaluation process. Here’s one approach:

Each month, print out or display an alphabetized list of all new patients who have enrolled in the practice in the month just ended. Include name, first visit date, zip code and e-mail address. Most practice management programs can easily do this.
Print or display on screen your master leads list.  Be certain to include all lead sources and to look for matches. You will be amazed at how this number differs from your subjective tracking system.

Do this each month and continually add leads to your master lead list.  Again, the reason for this is the time interval between when someone responds to your marketing tactic(s) and when her or she becomes a patient. You will be surprised at not only the time lag, but also the number of touch points some people need before they bite.

The benefits

While it may never be possible to completely identify and attribute the return on investment from a particular marketing tactic, a reliable tracking methodology offers the twin benefits of confirming much of the return, and early identification of mid-course corrections necessary to increase ROI. It also arms the practice with a reliable tool to test variables, which can further improve your ROI.

Your tracking may never be 100 percent, but a little knowledge goes a long way.  So stop flying blind and starting tracking. Knowledge is power, and accuracy means more profit.

Daniel A. Bobrow, MBA, is president of American Dental Marketing, a Chicago-based Dentistry Marketing Consultancy. He is also Executive Director of Dentists’ Climb for a Cause™. He may be reached at 1-800-723-6523.

AIM MarketingMarketing Insider: Increase your ROI
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