How much should your practice be spending on marketing?
Marketing your dental practice is an ongoing process, even for the busiest of offices growth is the name of the game.
This post walks through the basics of determining your advertising spend.
What are your goals?
The age and growth cycle of your practice play a significant role in your need to invest in advertising. A new dental practice will spend a higher percentage of revenue than an established office.
Are you looking to significantly increase your patient base? Are you thinking about hiring an additional hygienist or dental assistant? Perhaps you’re even ready to bring another dentist on board?
Or are you simply hoping to maintain current levels of revenue? To attract just enough new business to replace patients who move out of the area or switch to a competitor?
The more aggressive your growth targets, the more you’ll need to invest.
A benchmark for comparison
The dental industry average for total marketing spend in the United States is 3-5% of revenue.
Use this figure for a typical, fully-established office looking to maintain current income and then adjust accordingly based on your goals.
- <3% – Well-established office with low patient turnover and high referral rates.
- 3-5% – Maintenance mode to very low growth. Attract the same number of patients as you lose.
- 5-10% – For practices in the growth stage. Newer practices or established practices seeking major expansion.
- >10% – Aggressive growth. Looking to get the most out of initial startup capital or moving into a new market.
These figures are only guidelines. Your unique market conditions will have a major impact on these benchmarks.
Test, test, test
More important than the amount you spend is the efficacy of your campaign. It’s vital to track where new patients are coming from. Once a campaign proves to work for your practice then it make sense to increase your investment. Sometimes you’ll invest in duds and other times you’ll knock it out of the park.
Implement a mix of external and internal advertising. Educating current patients on new procedures and services is as much a tool for revenue growth as attracting new patients.