Medical Marketing ROI (Return On Investment)
Medical marketing ROI is also known as healthcare marketing ROI. If you are a dentist, then it is also called dental marketing ROI. Results below are from dental and medical practices from US & Canada. Applies to dentists, surgeons & healthcare practices. In the world of digital marketing, marketers often focus on marketing results, however these may not result in profits and growth of the healthcare practice. It is important to distinguish between business results VS marketing results.
Healthcare Marketing Return On Investment (ROI) Formula
First, the formula for calculating ROI for your healthcare practice marketing efforts
(Total revenue generated Minus $ spend on campaign ) Divided by $ spent on a a campaign
Many times our prospect customers ask us, “if I use your service, how many patients should I expect? “
This is a very good question. However there is no simple answer. And anyone you tries to give you an answer like “20-30” new patients per day, or per week or per month, they are just guessing it. In the world of advertising and marketing there are no fixed techniques. Based on software used, best practices, domain knowledge of healthcare specialty, and results from similar customers you should be able to show ROI and hence forecast “similar results” but your mileage will vary. Every location has unique issues and opportunities. Every location has different competition. Below you will find some examples.
For example, if you are a pain practice, and you want to increase new patient acquisition, start with this page. In this use case, this health care practice has been in practice for 6 years. They have decent new patient flow, however the practice is not growing as fast as the owner would like. They are looking to spend approximately $3000 per month on advertising, and $1000 to $1500 per month for the marketing services (including improving SEO for specific keywords). They have high competition. In this example PatientGain recommended the following: Divide the goals into 2 parts. 1) Short term goals 2) Long term goals.
Short term plan: Focus on advertising to gain new clients and patients quickly. Recommended for those practices who want to see immediate results.
ROI Example 1 – Aesthetics , primary care and medical loss clinic
Advertising budget $3000 per month plan. $2500 on Google PPC Ads, and $500 on Social media ads. Each click on Google is $5.87 and Social ads each click is $4.12. However, social ads had a very low conversion rate. So they were soon paused. So for $2500 /month divided by $5.87 = 426 clicks. If the average conversion rate is 5% – PatientGain websites have typically 10% or higher conversion rate. From 426 potential patients, 5% converted. Which is 21 patients took conversion action. Conversion action is like contacting you, calling you, sending a text, requesting an appointment etc – This is called “conversion action”. This Google ads PPC campaign should be run constantly and optimized by an Adwords certified staff. The website landing page for ads plays a very important role in this conversion process. In addition, if this practice received 21 new patient inquiries(also called leads), and the new patient was not contacted courteously and quickly, actual conversion rate to paying patients will be less. If you convert 31% of the 21 new patient leads, your practice would gain 6.5 new patients. Each patient for a pain clinic has a value of $6700 as the life time value of each new pain patient. So by spending approximately $3000 per month, you would have gained 6.5 new patients. If the conversion rate is not 5% but 10%, the number of new patients would be 13 new patients. In these examples, it makes a business sense to spend $3000 per month on Google PPC ads.
Long term plan: Focus on your healthcare website SEO and online presence (Social media included) to gain new clients and patients quickly. Recommended for those practices who want to see gradual results, without spending money of advertising.
Focusing on building SEO for key services is a difficult task. And you will need a specialized company like PatientGain to help you. See SEO data from below from a pain practice below. Learn more about SEO for doctors and medical practices here.
The most common question: How do you calculate ROI (Return On Investment) of a medical marketing campaign?
Answer: The formula for Marketing Return On Investment (ROI) Formula is (Total revenue generated Minus dollars spent on campaign) Divided by dollars spent on the campaign. Lets review a customer example: A medical practice located on the east coast, wants to launch “medical weight loss” campaign. Using PatientGain’s PLATINUM service, monthly budget for the campaign was set to $3600 per month, it would run for initially for 6 months. Typically ROI is measured in “times”. See example below.
On average, over the next 6 months the campaign generated 489 inquiries from Google adwords (70% of the budget) and Facebook+Instagram (30%) of the budget, averaging 135 leads per month. With a close ratio of 30 percentage (meaning out of 100 leads, 30 of the leads converted to patients). At 30 percentage, 40 new patients converted from 135. Each patient spends certain amount on the medical weight loss service. Ranging from $600 basic to $3400 package. On average each patient spend is $1900 for the initial weight loss service. So on a monthly basis:
Revenue: 40 x $1900 = $76000 /mon
Campaign spend: $3600 / mon + PLATINUM service fee = $4600
$76000 – $4600 divided by $4600 = 15 Times
So the ROI is 15 times OR for each $1 spent, you are getting $15 back.
Example 1. Primary Care Physician with a Walk-In Clinic
Review of a real customer. Location is east coast – mid-level competition. Doctor Jones has been in practice for the last 13 years. Her focus has been Primary Care, Internal Medicine and general wellness with focus on Diabetic patients. However, since last 3 years, multiple clinics have opened within her 5 mile radius. In addition, two Urgent Care clinics have also impacted her business. In the past all she had to do was to advertise in local yellow pages, few referral practices and business had grown due to her excellent focus on patient care. Due to competition, her average patient count had steadily decreased from 30 patients a day to 22.
In this case, Doctor Jones had to focus on new patient acquisition. She searched online on Google for “online advertising for doctors” and found PatientGain.com as the first organic listing on Google. She signed up for PatientGain.com’s GOLD Service for $799/mon. The results have been as follows:
Nov – Go live with new website, along with 20 apps embedded in the new Medical Marketing website. New patient 135 phone calls received in the first month. 116 unique phone calls.
Dec – New patient 434 phone calls received in the 2nd month. 388 unique phone calls.
Jan – New patient 621 phone calls received in the 3rd month. 534 unique phone calls.
Feb – New patient 518 phone calls received in the 4th month. 419 unique phone calls.
Mar – New patient 599 phone calls received in the 5th month. 450 unique phone calls.
Apr – New patient 697 phone calls received in the 6th month. 541 unique phone calls.
May – New patient 801 phone calls received in the 7th month. 643 unique phone calls.
By the end of 7th month, Doctor Jones had achieved her target of 30 patients per day. Mission accomplished.
Example 2. Specialty Care Physician with a Specific Offering (Cash-Basis)
Medical Marketing ROI Calculator Example
For example in this case, this healthcare provider provides Ketamine Infusion based treatment focusing on Anxiety Treatment. most the treatments are on cash basis. Each treatment is approx. $300. With lifetime value of each patient approx. $3000.
Using PatientGain.com’s marketing techniques, HIPAA compliant software, Facebook apps, Google Advertising apps, Yahoo& Bing Advertising apps, Organic Content based SEO, Local SEO and unique Key-Word Tracking software, the following ROI was calculated in the 5th month of the launch.
Month 5 total spend $3200.
New patients 37 with avg initial spend $300 -total revenue generated $11,100
ROI Calculated : 2.46 Times
If calculated using LTV ( Life Time Value ) = $111,000 – with 70% patient retention = $77,700
ROI Calculated : 23.28 Times
Average ROI Calculated : 12.87 Times
Example 3. Pediatric Urgent Care – 10 Locations.
Medical Marketing ROI Calculator Example
For example in this case, this healthcare provider provides urgent care for children – They open mid day and stay open till mid-night. The clinics have been open for 10+ years and their focus has been referrals and using a local web development company. The owner is a physician and has successfully grown the business to many locations with over 100 healthcare employees. The practice owner was interested in latest changes in marketing for doctors. During practice owner’s research he found PatientGain.com’s GOLD package and was intrigued. Initially 5 locations were converted to the GOLD package. After few months, all 10 locations have been converted to GOLD package and experienced growth in business. The performance reports from the PatientGain.com’s dashboard revealed the following data.
Using PatientGain.com’s marketing techniques, HIPAA compliant software, Facebook apps, Google Advertising apps, Yahoo & Bing Advertising apps, Organic Content based SEO, Local SEO and unique Key-Word Tracking software, the following ROI was calculated in the 12th month of the launch.
Location 1 :
Jan year 1 – Total 621 patients – Jan year 2 – Total 852 patients – ROI Exceeded the planned return.
Location 2 :
Jan year 1 – Total 691 patients –Jan year 2 – Total 1092 patients – ROI Exceeded the planned return.
Location 3 :
Jan year 1 – Total 870 patients –Jan year 2 – Total 1105 patients – ROI Exceeded the planned return.
Location 4 :
Jan year 1 – Total 483 patients –Jan year 2 – Total 671 patients – ROI Exceeded the planned return.
Location 5 :
Jan year 1 – Total 1054 patients –Jan year 2 – Total 1353 patients – ROI Exceeded the planned return.
Average ROI Calculated : 15.17 Times – From 10 locations.
Read more at RWJF.ORG
Example 4. Urgent Care & Walk-In Clinic – Midwest USA
Healthcare Medical Marketing ROI Calculator Example
For example in this case, this healthcare provider has been in business for 4 years, in the Midwest. There are 6 Exam rooms, average patient count is 380 to 400 per month. Desired patient count 700 per month, approx 23 per day. There is a medical director associated with the clinic, but primarily the main providers are 2 Physician Assistants Certified (PA-C) . Owner is a Physician Assistants Certified (PA-C).
Average patient spends $142 per visit., with a LTV of $1800 per patient. There are digital x rays, exam rooms to provide main urgent care services like, minor injuries, sutures, broken bones, pediatric urgent care, physical exams, onsite lab testing, STD tests, travel medicine and DOT physical exams. The clinic is open 7 days a week, 8 am to 8 pm. The owner has been not been with growth. In early 2017, 2 new urgent care centers opened within 7 mile radius. One of the urgent care centers is a part of a large national chain. Due to this increased competition, the owner went on Google and searched for “medical marketing for urgent care”. The GOLD package ($799/mon) from PatientGain.com was implemented. Here are the results : ( your results will vary ).
End of Jun – launched. 401 patients
Jul – 453 patients
Aug – 625 patients
Sep – 536 patients
Oct – 709 patients
Nov – 805 patients
Dec – 838 patients
Jan – 1092 patients
Using PatientGain.com’s marketing techniques, HIPAA compliant software, Facebook apps, Google Advertising apps, Facebook ads, Yahoo & Bing Advertising apps, Organic Content based SEO, Local SEO and unique Keyword Tracking software, the following ROI was calculated in the 8th month of the launch.
Total spend $12,600.
Total 722 monthly patients – delta – 322 patients per months increased
Revenue increased over 7 months ($45,724 per month) = 320,068
ROI Calculated : 24.40 Times
If calculated using LTV ( Life Time Value ) = $4,057,200 – with 20% patient retention – Urgent Care metrics = $811,440
ROI Calculated : 63.40 Times
Average ROI Calculated : 43.90 Times
Example 5. Pain Clinic in Texas
Services offered by this practice include: 1) Back and spine pain 2) Herniated discs 3) Sciatica 4) Neck pain 5) Knee pain 6) Arthritis pain 7) Arm and shoulder pain 8) Abdominal pain 9) Headaches and migraines
Example 6. Vascular Surgeon and Vein Clinics
Healthcare Medical Marketing ROI Calculator Example
For example in this case, this healthcare provider has been in business for 19 years, on the East Coast. There are multiple locations. Each location has its own staff and each location is considered a separate profit & loss (P&L) center.
Average patient spends $452 per visit., with a LTV of $6400 per patient. Key patient services offered are Ambulatory Phlebectomy, Aortic Disorders, Aneurysm, Abdominal Aortic Aneurysms, Thoracic Aneurysms and Minimally Invasive Aneurysm Repair. The clinic is open 5 days a week, 8 am to 5 pm. There are 2 owners. Both are practicing surgeons. They have not seen any growth in the past 2 years. They have also seen 3 new practices open within the 15 mile radius. Due to this increased competition, the owner went on Google and searched for “medical marketing for doctors” and found PatientGain using Google Search. The corporate site was launched on the PLATINUM Package and each location is on the GOLD package ($799/mon) from PatientGain.com. Here are the results : ( your results will vary ).
End of Jun – launched. 114 new patients – without PateingGain ( From all locations )
Jul – 129 new patients First month launch
Aug – 145 new patients
Sep – 159 new patient
Using PatientGain.com’s marketing techniques, HIPAA compliant software, Facebook apps, Google Advertising apps, Facebook ads, Yahoo & Bing Advertising apps, Organic Content based SEO, Local SEO and unique Key-Word Tracking software, the following ROI was calculated in the 4th month of the launch.
Total spend $24,780.
Total 148 monthly patients – delta – 33 patients per months increased
Revenue increased over 3 months ($15,217 per month) =45,652
ROI Calculated : 4.40 Times
If calculated using LTV ( Life Time Value ) = $633,798 – with 30% patient retention – metrics = $443,6580
ROI Calculated : 26.0 Times
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