Measuring Your Dental Marketing ROI

Is Your Strategy Working? Explore The Data

As a dental practice owner, you invest significant time, money, and effort into marketing your practice to attract new patients. But how do you know if your marketing initiatives are paying off? Tracking the return on investment (ROI) of your dental marketing efforts is crucial to determining what’s working and what’s not.

At Now Media Group, our full-service digital marketing agency based in San Diego, CA, our talented dental marketers can raise your ROI with data-backed dental advertising strategies. Call (858) 333-8950 to schedule a free consultation with our representatives and get started on improving your ROI today.

What Is ROI?

ROI stands for return on investment. It’s a metric used to evaluate the profitability of an investment. ROI is calculated by comparing the monetary gain from an investment to the cost of the investment. The higher the ROI, the better the return.

For dental marketing, ROI specifically measures how much profit your marketing generates compared to how much you spend. If your marketing efforts aren’t producing a positive ROI, then you’re losing money. However, if your ROI is high, that indicates your marketing investments are worthwhile.

Calculating Dental Marketing ROI

Figuring out your dental marketing ROI involves three main steps:

• Track marketing costs. This includes the expenses associated with all of your marketing initiatives, including:

• • Paid ads (Google, Facebook, etc.)
  • Website hosting fees
  • Print/TV/radio ads
  • Marketing services (SEO, PPC management, etc.)
  • Conference fees
  • Printed marketing materials
  • Staff time (for marketing administration)

• Add up the total money spent on marketing in a specific period (typically monthly or annually). This is the cost portion of your ROI equation.
• Calculate revenue generated. This is the income earned as a direct result of your marketing efforts. There are two main ways to calculate this:

• • Revenue from new patients that you acquired through marketing activities. Look at new patient numbers over your tracking period and calculate the revenue generated from these new patients based on your average per-patient value.
  • Your total practice revenue increased compared to a pre-marketing baseline. Compare total practice revenue before you began marketing efforts to total revenue after. The difference is your marketing-generated revenue (assuming other factors like staffing remained constant).

• Plug figures into the ROI formula.
  • The basic formula is:
    • ROI = (Gain from Investment – Cost of Investment) / Cost of Investment

For dental marketing ROI, this translates to ROI = (Revenue from Marketing – Marketing Costs) / Marketing Costs

Example ROI Calculation

Over the last year, Dr. Smith spent the following on marketing:

• $3,000 on Google/Facebook ads
• $1,500 on printed brochures
• $960 on radio ads ($80 per month for 12 months)
• $600 on SEO services

Her total marketing costs for the year were $6,060.

Dr. Smith tracked that she had 45 new patients from marketing who generated an average of $350 each in revenue.

• 45 new patients x $350 per patient = $15,750 revenue from new patients
  • Plug this into the ROI formula:
    • ROI = ($15,750 – $6,060) / $6,060
    • ROI = $9,690 / $6,060
    • ROI = 1.6

This means that for every $1 Dr. Smith spent on marketing, she generated $1.60 in return. Her annual dental marketing ROI is 1.6 or 160 percent.

Considerations for Measuring Dental Marketing ROI

Here are a few important things to note about calculating your dental marketing ROI accurately:

• Isolate Marketing: Make sure to account for every marketing expense, and don’t factor in other costs like payroll, equipment, etc., that aren’t directly related to marketing.
• Use Tracking Tools: Use Google Analytics, unique phone numbers, UTM campaign tracking, and other tools to accurately attribute patients/revenue to specific marketing initiatives. This allows you to see ROI by channel.
• Look At Long AND Short Term: Some channels, like SEO, take time to deliver results. Calculate ROI over the lifetime of a marketing campaign as well as in the short-term.
• Consider Indirect Revenue: Marketing can provide indirect benefits that are hard to quantify, like increased retention or word-of-mouth referrals. Factor this into your analysis where you can.

Optimizing Your Dental Marketing ROI

The goal is to achieve the highest ROI possible for your dental marketing programs. Here are some tips to optimize ROI:

• Test and compare different approaches, then double down on what delivers results.
• Experiment with budgets and pricing for paid ads — collect data to dial in optimal spending.
• Keep campaign messaging, offers, etc. relevant to campaigns with the highest ROI.
• Regularly clean your email and lead lists to message only highly engaged prospects.
• Follow up quickly on inbound leads and calls generated through marketing.
• Continually review results and tweak underperforming campaigns or eliminate those with consistently negative ROI.

Protect Your Practice With Data-Driven Marketing

Measuring and tracking ROI takes the guesswork out of dental marketing. You’ll gain insights into your best sources of new patients and revenue — and where you may be wasting money. While it takes some effort, understanding your dental marketing ROI is one of the most critical tasks for any practice looking to grow profitably.

Call (858) 333-8950 to schedule your consultation with a representative of Now Media Group. Learn how our full-service marketing team uses proven dental marketing strategies to attract new, loyal patients and increase your ROI.