The following analysis is relevant, unless you think the Internet is a hoax.
This article is written for the dentist who either doesn't have a website, or, has a website that was built in the 1800's. It is a simple mathematical analysis to show you how to perceive the value of investing in the design and creation of a more modern, more refined, dental website.
This is the era of the internet. As such, it is also the era of people using the internet to shop for things they need. Dentistry is not excluded from this phenomenon.
Many of you have gotten buy over the years because your patient population is aging, and never needed the internet to find you. However, if you want to attract a younger crowd, or you are a younger dentist starting out, you cannot afford to ignore the notion that your business will not be as healthy if you don't have a decent website.
Before we proceed, let's agree on the following assumptions.
- People, including your prospective patients, will go to the Internet to discover dentists who can serve their needs.
- People referred to your practice will try to find your website to validate the endorsement they just received from their friend or family member.
- Each patient you acquire, if your internal operations is in order, will result in between 5 to 20 other patients over the life of the original patient.
- The lifetime value for services provided to the original patient is somewhere between $5 and $20 Thousand dollars, depending on the patient and the type of dentistry you provide.
- You can get a custom designed dental website for $6000.
- We are only talking about a website, full bells and whistles, but nothing else. No other monthly investments for things like SEO or Social Media Marketing. Just a website.
Now, I can provide links to research that validates these assumptions, but for the sake of this brief article, let's just agree that within a range of tolerable error, my assumptions are valid.
A quick note before we get started. All websites are not created equal. While you can certainly do OK with a cheap replica of 1000 other dental websites, in order to optimize results, you really should have a website that is uniquely designed to fit your brand and the needs of the people in your community.
Opportunity Gained by Adding 5 Patients per Month
I have seen in my travels working with my clients, two scenarios play out:
- A dentist who didn't have a website was able to add at least 5 patients a month by having a custom dental website designed for her.
- A dentist who had a really terrible website, was able to almost triple their patient acquisition rate per month, but with some additional services. So I will discount the volume to adding 5 patients a month.
In both cases, the investment for just the website amounted to $6000.
If we agree that every patient acquired would result in another 5 to 20 new patients, via the referral process, even if we take the low end of that spectrum, you would be adding 25 patients to your practice over the lifetime of the original patient acquired.
If we also assume, on the low end, that each patient is worth $5000 over the course of their time with you, then in the month you acquire 5 more patients, your opportunity gained is as follows:
5 new patients + ((1 new patient x 5 referred patients)x 5) = 30 new patients total.
30 new patients total x $5000 per patient = $150,000 over the life of the original patients acquired.
If your initial investment was $6000, and your total gain would be $150,000 assuming you internal operations makes you referable, your total return on the investment, at a bare minimum, is...
ROI = ($150,000 - $6000)/$6000 = 2400% or $144,000
Now, if you are paying attention, the 2400% return is on only one month, and 5 new patients acquired.
To drive it home even further. Let's assume that the new website only nets you 1 new patient per month. In year one, once your website goes live, you would net 12 new patients.
Let's assume that for every 1 new patient acquired, you get one referred patient over the course of the lifetime of the original patient.
12 new patients + ((1 new patient in year one x 1 new patient referred)x12)= 24 new patients total.
Let's now assume that each patient acquired is only worth $2000 over the course of their time with you.
24 new patients total x $2000 = $48,000
ROI = ($48,000 - $6000)/$6000 = 700% or $42000
Ok, just for argument sake, let's assume your patients don't refer you at all, and over the lifetime of them being your patient, they result in only $1000 of service revenue. Sticking with the notion that a new website will net you 1 new patient per month, in terms of the patients acquired in the first year, assuming those patients amount to $1000 worth of dental services, your ROI is...
12 new patients total x $1000 revenue per patient = $12,000
ROI = ($12000 - $6000)/$6000 = 100% or $6000
Quite frankly, if you rest on scenario three, you should close shop as your dental office is not being run very well. Yet, even with a poorly run dental practice, your website will still produce a positive return on your initial investment.
Yes, I am aware that there is more that goes into what your actual return would be, including but not limited to the actual margin on each an every patient served. However, if you believe in the notion that most of your costs are fixed, and only a small portion are variable, then you also have to agree that every dollar you earn brings you closer and closer to a profit margin that comes close to 80% or more.
How realistic is any of this?
Here is what I know to be true:
- The majority of your new patients will come from referrals if your internal marketing is in order
- The second largest pool of new patients will come from Insurance
- The third largest pool of new patients will come from pure internet search
Here is what else I know:
- When someone get's referred to your practice, in most cases, they will try to find you on the web, to check you out, as validation of the referral.
- When someone sees that you provide their insurance, they will find you on the web, to check you out, to validate that you are the right choice.
- When someone searches for dentists in your area, they will mostly compare the dentists on page 1, in the top half of the search results.
So, how realistic are my assumptions about your website making a difference in your ability to acquire new patients? I would say pretty realistic.
What about the notion that one patient should turn into many patients, or that one patient should result in a certain amount of service revenue?
Considering that the average hygiene appointment hovers between $250 and $350 per visit, and many of your patients will come to your office twice a year, one new patient, just in hygiene alone, will result in $1000 at $250 per visit, in only year two.
I would argue my numbers are extremely low estimates of what is possible.
Yes, I sell websites to dentists. Yes, I would love for you to buy a website from me, but that is not what this article is about.
My goal here is to get you to start seeing two things more clearly than before:
- People buy stuff they can check out and validate on the web
- Cost is not as good a decision making criteria as investment
I really want you to see that even making the bare minimum investment in marketing your practice revenue over the life of your practice will soar.