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You finally have a marketing budget you can do something with, but how much should you spend where? Should you spend it all on a Yellow Pages ad? Should you develop a new logo and letterhead? Maybe you need to send staff to training workshops so they can learn to be more patient-friendly.
Not knowing how to divide up marketing dollars can lead you to waste this precious resource. Follow these five steps and ensure you are spending your money wisely.
1. Know your practice.
Before you can set any goals for the practice, you have to know where you get your revenue from, says Alan Flippin, president of ADF Medical Practice Development in Germantown, TN. "All you need is a simple pie chart," he says. "If you know that 60% of your revenue comes from self-referral or other soft’ referral sources, you may decide that you want to change that percentage. But you can’t make that determination if you don’t know where your money comes from."
Most physicians think they have an idea about where their revenue is derived, says Flippin. "But they are often surprised when they make these simple calculations."
2. Know your practice’s goals.
Meryl Luallin, chief executive officer of Sullivan/ Luallin, a San Diego-based medical consulting firm, says a practice has to have concrete goals what kind of patients it wants to attract, how big to become, or whether to expand geographically. For example, if you are an obstetric practice, you may want to offer more primary care services to your patient base. "You have to have a strategic vision," Luallin says.
A simple form (see sample form, at left) can help you set those objectives, says Keith Borglum, vice president of Professional Marketing and Management of Santa Rosa, CA. It can help you target effectively, determine your competition, and write up some basic methods of competing effectively.
The goals you set must be more concrete than your practice mission or vision statement, Luallin warns. "Everyone feels good about a mission statement that says we want to provide the best care for our patients. But after you hang it on the wall, no one thinks about it," she says. She recalls one practice that set just such a lofty goal. But when patients started complaining that the entrance doors to the practice were heavy and cumbersome, the physicians refused to spend money to replace them. "How can you provide the best service if you refuse to spend money that makes it easy to get in and out of your door?" she asks.
3. Draw a map to the goal.
Luallin says once you have a concrete goal, then you have to determine strategies for reaching it. For example, if you are a urology practice in Peoria, IL, and you decide you want to expand to open satellite facilities to serve surrounding suburban areas and a greater number of patients, your strategy may include recruiting more urologists to handle the increased patient load.
4. Divide up the spoils.
Once you have a map to your goal, you can get a clearer idea of how to spend your marketing dollars, says Luallin. "If your goal is to take on as much risk as possible, then you go after sensible, profitable capitated contracts and a lot of them. You don’t spend your money on existing patients," she says.
Similarly, if you want to make physician referrals a bigger slice of your revenue pie, Flippin says you can allocate money for shoring up and improving that market.
5. Build in an evaluation procedure.
It’s not enough to have a marketing plan if you can’t tell if the plan works. There are simple ways to determine if your marketing split is effective.
Borglum says that every new patient questionnaire should have a space that asks, "Who can we thank for referring you?" Someone in the office must have the responsibility of making sure that space is filled out. When the patient paperwork is being completed and filed, the answer from that space can be transferred to a master checklist, which has options such as the telephone book, friend, or another physician.
"You just check the appropriate box for each patient," Borglum explains. "At the end of the week, you transfer that data to a master list, and you can keep a running tally." If you wanted to increase the number of patients referred by other physicians, you have an easy chart that lets you know if your plan is working.
Within about six months, you should be able to determine whether your road map is taking you to your goals, says Luallin. "If you aren’t seeing a change in that time, then you have to reevaluate your goals," she says. If your goal remains the same even after that reevaluation, you may have to change your tactics.
For example, if you are a cardiology practice in search of more referrals, you might find your initial plan is not working. If your goal remains the same, Luallin says, you should go to the primary care physicians to find out what is missing from your work. "It might be a call to the physician after you see one of their patients," Luallin says. "Or maybe you need to have lunch-and-learn sessions where you bring the doctors in and tell them about new procedures so they are more aware of your capabilities."
If you develop a new marketing program, track it again, says Luallin, and look at it six months later. "It’s all a matter of figuring out where you are and where you want to go. Once you do that, you develop a plan and deliver on it."