How to set a marketing budget for your medical practice
Sticking to a predetermined marketing budget and creating a thoughtful plan for implementation will ensure that you are spending your hard-earned money to maximise the reach and return on investment of your marketing efforts.
Setting and adhering to a marketing budget may seem like a daunting task for many medical practitioners, but this is a critical step in implementing a successful medical practice marketing strategy.
How much should I spend on my marketing?
Marketing is an investment. A medical practice should be spending somewhere between 2-10% of their annual gross income on marketing. This includes planning fees, personnel time, production costs, and implementation costs. Your marketing budget is very much dependant on your business goals and how quickly you want to grow your practice and attract new patients.
Putting aside your monthly budget
Once you have calculated your annual budget, I recommend dividing that number by twelve and putting aside a twelfth of the total each month. If you get in the habit of doing this, you will always have some marketing funds available to ensure a consistent marketing effort.
The most successful medical professionals are those who are consistent in their marketing efforts. Consistency requires funding, and funding should be carefully planned and budgeted.
Calculating your marketing return on investment
Return on investment (ROI) is a simple calculation you can use to evaluate the success of your marketing tactics. In order for you to calculate your marketing return, you need to have systems in place to track the patients and referrals that are generated.
To calculate the ROI for any marketing campaign, you simply divide the dollars you receive by the dollars you invested, using the lifetime value of a patient for a given period of time.
I recommended that you should be trying to get an ROI of 3:1 or above for all your marketing campaigns.
Return in Investment (ROI) example
Let’s say a given campaign brought in fifty new patients and cost you $10,000.
You may decide to track your marketing ROI against the two-year value of a patient (of $1,000)
50 new patients x $1,000 average value of a patient = $10,000 invested
$50,000 = 5:1 ROI
Any ROI over a 3:1 ratio is good.
Hence, you should keep doing or even do more of this type of marketing in this example.