Are you keeping up with the Joneses? Or at least Dr. Jones down the street?
Maybe it’s just the Greener Grass Syndrome, but it sure seems like he gets more new dental patients, drives a nicer car, has better looking kids, and plays to a lower golf handicap. Does he spend more than you on his advertising budget? He must, right? Maybe you should start shelling out whatever amount he’s spending. Or more.
Or… maybe you should take a smarter approach to evaluating the amount you’re budgeting for your dental marketing.
If you compare your marketing budget to your competitors or what the average dentist spends, you won’t get an apples-to-apples comparison, which may lead you to either spend too much or too little. Even worse, you could end up throwing money into a marketing strategy that is already losing you more revenue than you are gaining.
There is a better way to evaluate your marketing budget, but first you’ll need to gather a few numbers. (Don’t be afraid to ask your Office Manager for help.)
The first part of the equation is calculating how much benefit you receive from your marketing. You should be able to pull the information from your patient records, assuming your team has recorded the reference source for every single new patient.
Next, you’ll need to know how much your marketing costs. You may need to dig through some invoices for this.
If you have those numbers collected, you can drop them into our handy Dental Marketing ROI Calculator. ROI is your return on investment, and for your marketing to be considered successful, you should have a calculated ROI of 300-500% or more.
Obviously, if your ROI comes back below 100%, stop your spending right away and find out what’s going wrong. Even if you’re in the 100-300% range, you may want to pump the brakes and reevaluate your marketing a bit before you pour more money into your marketing budget. It may be a matter of choosing different types of advertising, improving your conversion percentage, or just tracking your data more accurately. Also remember that ROI increases over time and you might not see immediate improvements, even if you are making the right changes.
If you’re at 300-500% or more, then congratulations! You can look at your marketing as an investment, not an expense. Your budget is really only limited by how much growth you want for your dental practice.
Think of it this way. If someone was selling ten dollar bills for two dollars each, would you be asking yourself how much you should spend? Or would you just buy as many as you possibly could?
I think you already know what Dr. Jones would do.