Last updated on July 23rd, 2021 at 10:33 am


MGE’s weekly webletter, Issue 49.


How Much Should I Spend on Marketing & Promotion?

By Sabri Blumberg, Deputy COO, MGE

A very good question, because when you ask around, you’ll normally find that when collections are down, marketing and promotional expenses are some of the first items that get dropped altogether. But is this really a wise decision? Let’s have a look.

First off promotion/marketing should fund itself and it normally will, if it’s based on proper market research, surveys, demographics, etc.

Losses in this area usually trace back to one or more violations of these points: no surveys (to find out what will motivate patients to come to your practice), or not using the survey results (believe me, it happens), using the wrong demographics for what you’re promoting (i.e. missing tooth replacement to college students), reaching your target public too irregularly, no “call-to-action” on your promotion or poor internet presence, to name just a few.

Done incorrectly, marketing can become a monetary hemorrhage. However, with proper homework it can be wildly profitable and worthwhile. Too many bad experiences along these lines could lead you to the conclusion that marketing or promotion as a subject just “doesn’t work,” when really it has everything to do with how you do it.

How would you know if it “worked?” Well, measure the Return-on-Investment (ROI) by how many new patients came into your practice and paid for treatment. Obviously if your target public for a particular campaign is your existing patient base, you would measure how many people came in off that particular campaign and how much income the practice made as a result.

Now, I want to qualify this statement with two small points:

  1. Even the best marketing can be killed by mishandling patients up front. Incorrectly handled new patient calls resulting in few appointments followed by little income can make it look like your marketing isn’t working. So, this tells us you should also track how many “reaches” (calls) came in off of a particular marketing effort. And
  2. Ineffective case presentations followed by little or no income can, again, make it look like your marketing didn’t work.  From this we can reason that your ability to “sell” will have a positive (or negative) impact on your marketing effort.

Generally, I would recommend establishing your marketing budget as a percentage. I’ve seen some doctors dedicate up to 10% of their collections or a certain percentage of profit to it. Again, good marketing should be profitable and when income goes up as a result, the amount that percentage represents will go up with it, allowing you to increase your marketing and promotion. What should this percentage be?  I probably wouldn’t do less than 3% of collections and you can go up to 10% (expenses allowing). A lot has to do with what you are trying to accomplish.  And again, remember that marketing isn’t just for new patients! Don’t ignore the thousands of patients (a number of which you may not have seen in a while) that comprise your existing patient base.

Now, when income is low, effective marketing becomes even more important.

When things are “rough” most business owners “buckle down” and stop promoting all together, which can turn out to be a very bad idea. With no promotion to feed expansion, you’ll normally come out of a crisis like this with a smaller business.

So, set aside a percentage of what you’re making to market your business. Promote consistently and most importantly, do your homework. After all, the marketing has to work.

At the MGE New Patient Workshop we’ll teach you basic, yet very effective principles that can be applied to most marketing and advertising (print, mail, internet, radio, etc.).

Give us a call today at (727) 530-4277 or toll free at (800) 640-1140 or visit our marketing blog at www.mgemarketing.com!

Sabri Blumberg provides this general dental practice management advice to furnish you with suggestions of actions that have been shown to have potential to help you improve your practice. Neither MGE nor Sabri Blumberg may be held liable for adverse actions resulting from your implementation of these suggestions, which are provided only as examples of topics covered by the MGE program.