Do You Know The Lifetime Value Of A New Patient To Your Practice?
The greatest benefit of monitoring your Lifetime New Patient Value is that it allows you to calculate your return on marketing spend. Additionally, it lets you know how valuable the new patients you’re receiving are and whether or not particular channels provide more value than others. If you’re not sure how to estimate or calculate LTV, you're sure to face the perils of blind marketing–never knowing what, when, where, why, or how to spend your marketing dollars. So the question remains, do you know the lifetime value of your new patients?!
What Does Patient Lifetime Mean?
Put simply, your current patients are on a journey to wellness, with your care being their vehicle. You're taking patients from 'here' to 'there' or 'ailing' to 'well'. Being the maximizing agent that you are, you intend to make the greatest impact on your patients' wellness while so-too maximizing the revenue associated with that care. Boiling this down to averages, you should begin to formulate an understanding of your typical contribution to your patient's wellness. The question remains though... what is the lifetime value of your new patients?
To Estimate or To Calculate... That Is The Question
Obviously, it’s difficult to accurately measure the lifetime value of a new patient, because they’re a new patient, they just barely came into your office. We aren't sure how far their gap between 'ailing' and 'well' is, nor how committed they are to your services as the vehicle to wellness. Nonetheless, it’s entirely possible to get an average that can significantly change your understanding of your return (ROI) on any marketing spend.
When it comes to marketing, there is little you can do to increase 12-month profit (and LTV) beyond targeting the highest-quality leads. Most drastic improvements on this side of the equation will be through operational adjustments such as the care plans you offer and your prolonged care protocols.
However, when it comes to new patients, we can leverage our understanding of LTV to model out expected ROI across any marketing efforts. When it comes to the costs to acquire new patients, you will likely experience significant variation in performance by channel, vendor, or even week-to-week with the same vendor. This is normal. Markets are dynamic. The goal shouldn't be consistency when it comes to performance; the real goal is optimization.
Cost-Consistency Is Sub-Optimal And Non-Compliant
Due to the variable nature of funnel marketing performance, vendors have begun to hedge their performance with non-compliant profit sharing. Not only are we wholly against this due to the preventative regulations, but we recognize the mechanics of ROI and how quickly this structure can eat away at your margins.
Sure, it's easy to run the calculator above with the understanding that every new converted patient will be acquired for a guaranteed consistent cost–say $100. However, you are thereby putting a strict ceiling on your potential ROI from that channel. If your NP (new patient) LTV is $1,000 your funnel will be hard capped at 10x ROI.
The reason our client's here at NHC regularly experience ROI in the double digits is because of our industry-standard-shattering economics. With us, you can run an anticipated ROI calculation given the return you'd like to see on the funnel:
With this newfound understanding of LTV and ROI, you can better channel your precious marketing dollars to the most-efficient funnel available to you. If you think it could be us, check out our demo video or schedule a call with our team today to hear more about how we're the best funnel marketing solution for new patients on the market.