The Leaky Bucket Analogy
As you probably know, the profits (and profitability) of your practice depend heavily on your ability to attract – and keep – patients for life.
It costs time, money and effort to develop a name for your practice, generate leads and get patients to walk through your office doors.
So if patients leave after their first appointment(s), then all the time, money and effort it took to get them into your office will be wasted.
This is why many consider retention to be what puts your practice’s marketing investments to the best possible use.
In fact, studies show that if you increase patient retention rates by just 5%, you can increase your profits by anywhere from 25% to 85% (Reinhold and Sasser, Zero Defects: Quality Comes to Services, Harvard Business Review).
If these numbers aren’t piquing your interest in retention, let’s turn to The Leaky Bucket Analogy – because sometimes painting a picture can help when the stats don’t sink in!
Like a lot of business theories, this is pretty simple:
> The water in the bucket represents your current patient base
> The number of holes represents all the ways you’re losing patients
> The water leaking from the holes in the bucket represents the patients seeping out of your practice
> In order to keep your bucket full, you need a constant new flow of patients going into the bucket to replace the ones leaking out – but it’s even better if you can KEEP as much water in the bucket as possible. In other words: plug those holes to stop the leaking!
You need more patients going into your practice and staying in your practice than you have leaking out of it – because when patients leave, this marks the loss of the investment it took to attract them AS WELL AS the loss of production and referrals.
And this is what Patient Retention is all about: keeping your patient (or patient families) for life, so that your profitability can reach new heights.
So how do you plug the holes in your bucket?
Well, 85% of Americans say that they are willing to spend more when they are provided with excellent customer service.
This tells us that the focus is not on price, but on VALUE. This value includes the price of the treatment and the perceived worth of the entire patient experience. In fact, a patient is four times more likely to defect to your local competition if the problem is service-related (as opposed to price- or product-related).
Nowadays patients feel emotionally invested in the doctors they choose. This gives practices a valuable chance to foster deep connections, but it can be a double-edged sword; because if patients feel ignored, mistreated or dissatisfied, they are WAY more likely to take it personally and go somewhere else (regardless of how good a clinician you are).
Emotions are driving decisions, and these emotions are strongly affected by personal interactions with the practice on every level.
When it comes to choosing a practice and staying there, the patient relationship is the single most influential factor.
So if you want to plug the holes in your bucket – you need to channel a lot of your practice’s marketing into the growth, and strength, of those patient relationships.
For those of you who have grown accustomed to funneling all your marketing efforts into attracting new patients, this may require a bit of a change in your marketing philosophy. And when it comes to how far you can spread your marketing investment, the change is totally worth it – especially if it increases your profits by up to 85%.
We’ve found that our most successful Patient Relationship Marketing systems make patients feel important to. Something as simple as acknowledging birthdays, or sharing a braces-friendly recipe can make a HUGE impact on patient retention.
So next time you’re thinking about getting patients THROUGH your practice’s doors, save a little energy for thinking of ways to KEEP THEM loyal to your practice as well. In this case, a little bit of effort can go an astonishingly long way.