Let’s talk about analyzing your practices marketing strategy and campaigns. I talk about this is greater detail in the marketing course, but it is very important that every single nurse practitioner entrepreneur has a basic understanding on how to evaluate their practices marketing campaign to ensure success. The last thing you want to be doing is wasting money on ads that aren’t providing you new patients!
First off, understand the difference between ad spend, patient acquisition cost, and management spend in THIS article. You need to understand where your dollars are going…
Now, the most BASIC way you can evaluate the effectiveness of your practices marketing strategy is simply by asking your patients the following questions:
“Where did you hear about us from?”
This single question will provide you so much valuable information. I include them in my intake forms so the patient must answer them. You should too. If you aren’t including that in your intake forms, do that today and keep track of the answers!
The answer to this question will reveal where patients are finding you. For my men’s health clinic, it is predominately word of mouth, Google search, or just driving by and seeing the sign. Guess what? All of that is practically FREE! So, I don’t need to spend much on marketing as I used to.
Now, depending on what digital marketing channels you are utilizing will determine which factors you should be monitoring, but overall, these are going to be similar, and I am going to briefly cover the main ones:
Customer Lifetime Value: How much revenue does each customer generate over their lifetime with your business? This is important as it will show your retention rate and what services your patients WANT.
Customer Acquisition Cost: How much does it cost to get a new patient? Word of mouth is free. A Google Ad is not… Therefore, you should divide the total amount you spend marketing by how many patients you have. That will give you a rough estimate. For my men’s health practice, we average about $50-80 per patient. Sometimes it is cheaper, and sometimes it is more expensive. It really varies month to month.
Conversion Rate: How many people visiting your website, Google Business Listing, and your social media pages are converting into patients? You should see this in the various advertising dashboards, but simply dividing the number of patients you have by how many visitors you are receiving will give you this rate.
Return on Investment: What is your ROI for your practices marketing campaign? How much money are you getting for how much money you spend? This is simple to calculate: ROI = Practice Revenue (or Customer Lifetime Value if you want to calculate ROI per patient) – marketing spend divided by marketing spend x 100
I spend approximately $3,000 a month at my men’s health clinic on marketing. We generated $72,000 in revenue last month.
72,000 – 3,000 = 69,000
69,000 / 3,000 = 23
23 x 100 = 2,300 % ROI
Pretty damn good… No way I could find that kind of return elsewhere. Obviously, there are expenses and what not to factor in, but those are just the raw numbers on marketing return. You could even break it down further and just determine how much money you generated off NEW patients that month (which is more accurate). In that case:
$16,000 – 3,000 = 13,000
13,000 / 3,000 = 4.3
4.3 x 100 = 433% ROI
Still pretty damn good.
It is important that you are analyzing your practices marketing strategy regularly. This is what we call “smart business.” So, instead of “playing business”, you as a nurse practitioner entrepreneur should be doing these sorts of tasks. This is how you become a successful nurse practitioner entrepreneur. Determining your marketing effectiveness is just one task you should be doing on a regular basis!
This is a great article about a variety of marketing key performance indicators. Read it if you really want to go in depth on this!