What’s the appropriate size of your medical marketing budget? If you spend too little…well, you won’t have any patients. If you spend too much, you might not be able to handle the influx of new patients. Getting to the right number involves some serious evaluation of company goals, your particular area of medicine and good math.
A lot of percentages can be tossed around regarding the portion of gross revenue that should go to advertising. For here, we’ll just say that a figure anywhere from 1 percent to 12 percent will put you in the generally accepted range.
However, that’s still a wide window and your specific niche will depend on your answers to the following questions.
What’s your goal?
Do you handle marketing for established doctors who want a reasonably steady office to take them to retirement in 10 years? Or are you doing advertising for young and hungry doctors, fresh out of medical school, anxious to show off their skills and pay back their student loans?
What’s the immediate value of any new patient?
This will be determined by also knowing what the average initial cost is of treating a new patient. Is the office in a practice area where the upfront treatments are intensive? Knowing this will at least help you manage expectations for how large the return on investment (ROI) will be in the early stages of a new campaign.
What’s the lifetime value of a new patient?
This would be an area where a primary care provider (PCP) would be in a position to recoup a substantial amount of revenue. People routinely visit their PCP for low-intensive treatments and checkups. A good PCP keeps people for years. Even if the upfront profitability isn’t high, ROI over time can be substantial.
What’s your practice area?
As alluded to in the questions about assessing value, the area of practice will have a wide-ranging impact on everything from cost of treatment to patient retention to the cost of advertising itself. PCPs might have great retention, but there’s also more competition for advertising space. A specialist will have a much more targeted niche to work and the marketing process may have to stretch out over a longer period before bearing fruit.
Whatever your ultimate decision is on spend and strategy, make sure the office is firmly behind the plan. Medical offices can fall into the same trap a lot of businesses with local clientele do—implement a few scattered ideas (sponsor a Little League team here, contribute to a local charity there) which are nice enough, but really don’t move the needle for a business unless they are part of a coordinated effort.
For the person running the marketing, that means getting good answers to the questions above. Then you need to lay out a budget that’s sustainable with clear metrics to rely on in the interim period between spending and success.