How Much Should Your Dental Practice Spend on Marketing?
We can all agree that marketing your dental practice is a must. However, the question we always get is how much should you spend on dental marketing?
The answer varies depending on your dental practice’s location and overall business goals. However, we have outlined some simple steps for you to calculate an appropriate dental marketing budget for your unique practice.
1) Define Your Dental Practice’s Goals
Do you have big gaps in your schedule, or have you noticed that you’ve been losing a large number of patients recently? Take a step back and define what growth and marketing look like for your local practice. Do you want to maintain a certain level of patients, or do you want to increase the number of patients coming through your door exponentially and grow your business accordingly?
2) Understand Your Dental Practice’s Patients
Look at past data from your business to understand what your patient turnover is and how many patients you lose each year. This will help give you an idea of how many new patients per month you need to either maintain or expand your dental practice’s growth. Most dental practices look to gain 20-50 new patients per month.
3) Take a Look Online at Your Reviews
Read what your patients are saying about your practice. Before spending excessive amounts of money on marketing, analyze your patient reviews and see if there are any service aspects that are affecting your churn rate, and see if you can make any improvements to these. Once you’re able to incorporate the feedback, then it’s important to start marketing your practice again so people are aware of improvements you’ve made to your practice — this will entice old patients to come back, and ensure potential new patients are not put off by outdated negative reviews.
4) Work Out the Lifetime Value of Your Patients
Figure out the average spend for new patients in the first year and existing patients and multiply that by the average amount of years your patients stay with you. So if your patients tend to stay at your practice for 10 years and their average spend is around $1000, their lifetime value will be $10,000 (10 x 1000). Once you take away your practice costs, you can understand what you are willing to spend on acquiring a new patient. Usually, a new patient costs between $150-300 to acquire.
Another way to decide how much to spend on your dental marketing is as a percentage of your gross revenue.
Established Dental Practices That Want Steady Growth
It’s advised to spend around 10-15% of your gross revenue on marketing. You should look at redesigning your website, concentrating on your SEO strategy and direct mail and email marketing campaigns a,nd some minimal digital advertising. You can expect results within 6-12 months.
Established Dental Practices That Want High Growth
You should be considering a marketing budget of around 15-20% of your gross revenue to give yourself a big boost in growth. Along with a brand refresh, a modern website, and a 6-12 month SEO strategy, you should think about investing in digital marketing advertising, focusing on your highest profit margin dental treatments.
New Dental Practice Budget
As a new practice, marketing is key to getting patients through the door. You should expect to invest 20% of your projected gross revenue on marketing. The more crowded the market is in your area, the higher you will need to budget to breakthrough into the market. The value of establishing yourself online cannot be overstated. Investment in a great functioning and good-looking website with strong SEO practices will set you up for long-term success. While you are building your online reputation, digital advertising is important to give your dental practice a boost in patients while your practice moves up on Google Search over time.
Denteo Marketing Group is highly experienced in helping clients develop a marketing strategy and budget they feel comfortable with that supports their business goals. If you’d like to learn more about dental marketing budgets and adding a dental marketing agency to your team to help manage all your marketing needs, look no further. Set up your free dental marketing consultation here today.