Tools to Make Reliable Marketing Decisions I

Part 1 of 3

By Daniel A. Bobrow, MBA (University of Chicago) & MBA (K.U.L. Belgium)

We have identified seven essential steps to successfully implement any dentistry marketing strategy. These are:

1. Identify Your Objectives
2. Determine Your Budget
3. Perform and Evaluate Your Benefit/Cost Calculations
4. Select Your Target & Frequency
5. Select Design and content
6. Schedule (depending on the strategy), Printing, Ad Placements or Media Buys
7. Implement Program Tracking Systems

In this Issue, we address Identifying Objectives and Determining Your Budget.

There are two general categories that best describe objectives for most dental practices. The first category is to increase the volume of new patients. For example, if your office is presently generating an average of 40 new patients per month and, based on your available capacity and other considerations, you could comfortably absorb an additional 50% per month, your objective might be stated as:

“Increase the number of new patients by an average of 20 per month.”

The word ‘average’ is italicized to emphasize that the actual increase will probably vary from month to month. Concentrating on the average increase over time keeps the dentist and staff from getting preoccupied with what is happening from month to month, and focus instead on the trend over time.

The second category of objectives is a change in the composition of your patient base. For instance, you may want to change the patient mix from 60% fee for service and 40% insurance-based to 30% and 70% respectively. Or, you may want to attract more patients desiring a specific procedure e.g. cosmetic, implant, etc. Whatever objective you choose, make it as specific as possible, and commit it to writing. Remember: when you do not know where you are going, any road will take you there.

Once you have agreed on your objective, you’ll next want to Determine Your Budget. This involves 1). calculating how many (depending on your selected strategy) mailers, impressions, or placements are necessary to achieve your objective, 2). determining your unit cost (cost per mailer, impression, or placement), 3). multiplying 1 and 2, and 4). adding any one-time (usually referred to as set up) costs.

Let’s say you want to add 10 new patients per month to your practice. A reasonable expected response rate to a mailing for new patients is about .25 to .3%. Therefore, (choosing the conservative response rate) the number of mailers per month you will need to send is 4,000 (10/.0025).

To calculate unit cost (using dental direct mail marketing as an example), you’ll need to factor the cost of your mailing list, design, printing, fulfillment (letter shop), and postage. Depending on what and how (type of postage) you mail, your unit cost can range anywhere from twenty five cents to over a dollar. Let’s assume it’s fifty cents. Your monthly budget, then, is $2,000 (4,000 mailers times $.50).

In the next Issue of STS, we’ll move to the next step in crafting a winning marketing strategy, namely, performing benefit/cost, patient acquisition cost, and other marketing feasibility calculations, as well as Selecting Target & Frequency, and Design & Content..


Daniel A. ‘Danny’ Bobrow,

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