Marketing for the biggest payback
By Linda Segall

Medical doctors do it. Dentists do it. And chiropractors do it. "It" is marketing, and it is done in a myriad of creative ways.

Pick up any metropolitan or local newspaper and you will find healthcare offered to the public through small classified ads, half-page display ads, and full-page advertorials.

That same newspaper will also have articles that quote eminent healthcare experts on imminent health threats, press releases that announce the opening of a new office or the addition of new professional staff, and advice columns on how to deal with health problems.

Radio talk shows, cable TV, and community-access television all have their share of medical professionals giving advice to the listening and watching public.

Billboards invite consumers to become patients. Flyers encourage them to seminars on the latest techniques. Doctors network, give talks, run health screenings, and sponsor charitable events.

All of this is marketing, performed with the purpose of attracting patients to offices.

But which marketing methods work the best? And how do you know which ones work best?

Chiropractic Economics surveyed readers to find out how they market and which marketing methods work most effectively. Here are the results of our survey.

WHO MARKETS?

Our survey, sent out to Newsflash subscribers, attracted 262 respondents. Of those, 58.8 percent perform some type of marketing for their practices.

The average respondent who markets:

• Is male (80.3 percent);
• Has been in practice for 12.2 years;
• Graduated from chiropractic college in 1992;
• Is a solo practitioner (75.7 percent);
• Has median gross practice revenues of $240K-$249K;
• Works within the managed-care system (with only 7.9 percent having cash-only practices);
• Owns 1.1 clinics; and
• Attracts 10 new patients per week.
The same respondent:
• Spends 9.6 percent of his revenues on marketing;
• Tracks the source of new patients (93.5 percent); but
• Does not calculate return-on-investment (ROI) (51.3 percent).

MARKETING METHODS

With practitioners spending slightly less than 10 percent of practice revenues on marketing, where do they put their marketing dollars?

We asked respondents to indicate all of the different types of marketing they do:

• Yellow pages advertising, 45.4 percent;
• Networking, 34.7 percent;
• Newspaper ads, 30.9 percent;
• Health fairs, 30.2 percent;
• Community talks, 27.9 percent;
• Solo direct mail, 19.8 percent;
• Radio, 6.9 percent;
• Cable TV, 6.1 percent;
• Co-op direct mail, 5.7 percent;
• Television, 3.1 percent; and
• Infomercials, 1.1 percent.

Approximately 18 percent of respondents indicated they did "other" types of marketing. This category included such things as newsletters, sporting-event sponsorships, Internet marketing, and advertisements on grocery shopping cards and in health clubs.

ROI VS. NO ROI

Marketing experts always advise calculating the return-on-investment of marketing dollars. How else, they ask, can you know if you are spending your money on activities that get "the most for the buck"?

But are the marketing experts right?

Less than half (48.7 percent) of respondents calculate ROI on their marketing investment.

Interestingly, our survey showed that respondents who do not perform ROI calculations (51.3 percent) actually attract a larger number of new patients each week (11.0), compared to those who calculate ROI (8.9). Both of the groups claimed the same amount in median gross revenues ($240K-$249K). (See sidebar, "Does it make sense to measure marketing?" on page 26 to compare the gross revenues of those who track and do not track patients, as well as those who calculate and do not calculate ROI.)

However, don't be hasty to discount the value of ROI. The purpose of calculating ROI is to allow you to spend your marketing dollars on areas most likely to achieve the best results — in other words, to spend your marketing dollars more wisely.

DCs who calculate ROI rank the effectiveness of marketing methods differently from those who do not calculate ROI.

The rankings (by effectiveness) of ROI DCs were:

1. Yellow pages (17.8 percent),
2. Community talks (15.3 percent),
3. Health fairs (13.9 percent),
4. Newspaper advertising (13.8 percent),
5. Networking (12.1 percent),
6. Solo direct mail (8.5 percent),
7. Cable TV (3.1 percent),
8. Co-op direct mail (2.4 percent),
9. Television (2.2 percent),
10. Radio (1.7 percent), and
11. Infomercials (0.2 percent).

Practitioners who do not calculate ROI — and presumably put advertising dollars into methods they only perceive to be effective — ranked these areas:

1. Yellow pages (21.8 percent),
2. Networking (17.5 percent),
3. Community talks (12.8 percent),
4. Newspaper (12.2 percent),
5. Health fairs (10.8 percent),
6. Solo direct mail (6.8 percent),
7. Radio (2.6 percent),
8. Co-op direct mail (2.5 percent), and
9. Television (1.2 percent).

This group of practitioners did not include infomercials in its rankings. Both groups ranked "other" in the middle. "Other" included such items as newsletters, sporting sponsorships, Internet marketing, and advertisements on grocery shopping cards and in health clubs.

PATIENT TRACKING

ROI calculations take time. Perhaps that is why a smaller number of respondents do them. A much higher percentage (93.5) of respondents tracks the source of their new patients — and presumably dedicates marketing dollars to cultivating those sources that are most bountiful.

The results of tracking? DCs who track patient sources see an average of 10.2 new patients each week, compared to only 6.0 new patients for those who do not track sources.

DCs who track patients rank the effectiveness of marketing methods in the same order as DCs who calculate ROI.

"Tracking" DCs also enjoy median gross revenues of $200K-$249K annually, while those who do not track the sources of patients have median annual revenues of $140K-$199K.

WHAT CAN YOU CONCLUDE?

At least from this survey, you can conclude:

• Tracking and/or calculating ROI pay off. Those who track and/or calculate ROI enjoy significantly higher median gross revenues than those who do not track how they acquire patients.

• DCs who track or calculate ROI use marketing dollars better. They do not guess at methods that pay off. They put their money where the pay off is.

• You've got to spend money to make money. Respondents who do not track sources of patients spend less (5.2 percent of revenues) than the mean average on marketing (9.6 percent overall).

• Top five marketing methods are clear. They are (in order, as ranked by DCs who calculate ROI and/or track new patient sources): Yellow pages advertising, networking, community talks, newspaper display ads, and health fairs.

• Keeping statistics doesn't guarantee more new patients. Those who track the sources of new patients enjoy on average more new patients per week (10.2) than those who do not (6.0). But DCs who calculate ROI had fewer new patients per week (8.9) than those who did not calculate it (11.0).

SIDEBARS:
Characteristics of All Groups
Should you track, calculate ROI, or both?
Does it make sense to measure marketing? Judge for yourself

Linda Segall is editor-in-chief of Chiropractic Economics. She can be contacted at lsegall@chiroeco.com.