As a healthcare marketer deeply engaged in daily activities, it’s common to become overwhelmed by the many metrics you analyse. Click-through rates, email open rates, impressions, shares – the list continues. Amidst these details, it can be challenging to pause and gain a broader perspective:
Evaluating the return on investment (ROI) for your marketing endeavours plays a crucial role in the triumph of your comprehensive marketing strategy. The objective is to amplify activities that yield revenue and ROI. This necessitates a strategic approach – channelling your focus onto distinct metrics that influence your business, facilitating a lucid assessment of accomplishments and setbacks. In the digital era, it is necessary to explore the benefits of digital marketing for medical practices.
Measuring Marketing ROI for Medical Practices
Enhance patient engagement through effective digital marketing for medical practices. Now, let’s delve into a discussion of seven crucial metrics:
1. Leads generated
Assessing the number of leads within your marketing pipeline assumes significance in ROI assessment. Display the lead count for each active campaign and indicate their progression within the funnel stages of acquisition, engagement, and conversion. This phase-based advancement is commonly called a lead’s “Funnel Stage.” Elevate your practice with strategic medical marketing for doctors.
Equally vital is comprehending lead generation in terms of channels. Pinpoint the initial and subsequent touchpoint channels that ultimately lead to conversion. By gaining a more profound insight into the interactions between leads and your organisation, you can fine-tune strategies for enhanced efficacy and expedite the transition of leads from the top of the funnel to the conversion stage.
2. Conversion rate
Within the marketing realm, the campaign conversion rate pertains to the proportion of patients who successfully fulfil a predefined top-of-funnel objective concerning the total count of targeted individuals within a campaign. The aspiration is to attain a substantial conversion rate indicative of a well-executed and precisely targeted campaign. To gauge the conversion rate for each campaign, begin by identifying the specific goal you wish to achieve.
This will guide your measurement of conversions—whether it involves webinar registrations, form submissions, or clinical appointment scheduling. Next, designate a monthly or quarterly time frame to compute the conversion rate. Drive patient growth through targeted medical marketing for doctors.
From a clinical perspective, striving for a clinical conversion rate or a lead-to-patient conversion benchmark is crucial. This denotes the percentage of top-of-funnel leads that transition into clinical patients. Notably, in the healthcare sector, this objective necessitates collaborative efforts between marketing and clinical operations rather than being solely managed by marketing.
As a point of reference, our clients typically observe a digital conversion rate averaging around 8 per cent. If your campaigns yield significantly lower conversion rates than this benchmark, reassess your tactics to enhance and elevate the conversion rates.
3. Acquisition costs
Securing fresh patients is a pivotal responsibility for healthcare marketers, thereby underscoring the significance of substantiating the efficiency of acquisition-oriented marketing endeavours. As new patients can be procured through diverse avenues—digital platforms, direct mail, paid advertisements, referrals, and call centres, among others—it becomes imperative to meticulously disaggregate the cost-per-acquisition (CPA) according to channels and specific campaigns.
This entails determining the expenditure your marketing department requires for a channel or campaign to attain a new patient successfully.
Segmenting CPA based on channels and campaigns offers a transparent view into the marketing initiatives that excel in drawing new patients into your healthcare system. Employing sophisticated attribution tools, such as a healthcare Customer Relationship Management (CRM) system, facilitates the collection, arrangement, and analysis of marketing data, thereby enabling the measurement of campaign efficacy and return on investment (ROI) per channel. This meticulous tracking aids in identifying the media and campaigns that effectively contribute to patient acquisition.
Given that numerous patient journeys encompass multiple communication channels—initiating from one channel, such as email, and extending to other avenues like the call centre—you must determine the approach for representing this complexity within your CPA data. Whichever method you opt for, it is imperative to maintain consistency in metrics across reports over time. This practice ensures accurate comparisons of analogous data and facilitates the identification of long-term trends in CPA.
It is worth noting that variations in CPA are customary across different service lines and markets. For instance, a cardiac valve campaign in a specific region might yield a CPA of Rs 240, while a bariatrics campaign in another region could result in a CPA of Rs 100. Acquiring an understanding of these discrepancies will empower you to make astute decisions concerning the allocation of marketing funds, aligning them with the objectives of various service lines and the broader health system goals.
4. Retention rate
In various sectors, the expense of acquiring a fresh customer is fivefold that of retaining an existing one. Therefore, directing efforts towards elevating retention rates is a potent avenue for enhancing ROI. Furthermore, the prospects of reselling to an established customer range between 60 to 70 per cent, a notable contrast to the 5 to 20 per cent likelihood observed for new customers.
Healthcare establishments boasting commendable retention rates channel their marketing strategies towards furnishing patients with gratifying encounters and exceptional customer service.
5. Patient engagement
Involved patients exhibit a raised focus on their well-being, yielding improved health outcomes, boosted retention rates, extended lifetime values, and diminished costs. Healthcare marketers possess the capability to elevate patient engagement through the cultivation of trust-based relationships with patients. This is accomplished through the personalised nature of interactions, alignment with the patient journey, and seamless coordination across various departments.
Patient engagement facilitates a more profound comprehension for marketers regarding how consumers and patients react to outreach initiatives and their likelihood of conversion. The assessment of patient engagement metrics also guides and refines healthcare marketing strategies. Quantifying patient engagement entails the evaluation of interactions—such as clicks, impressions, shares, comments, and calls to the hospital call centre—coupled with examining patient satisfaction rates.
6. Payer mix
The term “payer mix” relates to the proportion of patients attended to by your organisation who possess private insurance instead of those covered by Medicare and Health insurance. Grasping your payer mix holds paramount importance in ROI assessment, as reimbursement rates from commercial payers are markedly higher—often by 50 to 75 per cent—compared to rates from Medicare or Health insurance. The basic message is straightforward: treating patients with commercial insurance typically leads to a more substantial ROI, and maintaining a well-balanced mix is pivotal.
Given the substantial disparity between private and public payers, even a minor shift in the payer mix can significantly impact revenue. Consequently, furnishing reports on the payer mix enables you to project forthcoming income and gather insights into optimising your payer mix to enhance ROI.
7. Contribution margin
Your contribution margin reveals the amount of revenue remaining once variable costs have been subtracted. Variable costs encompass expenditures that vary about the revenue generated, such as expenses for purchasing advertisements related to healthcare keywords, costs associated with producing informational campaign materials, and outlays tied to hosting patient seminars.
Contribution Margin = Revenue – Variable Costs
The contribution margin analysis empowers you to ascertain the marketing endeavours—whether categorised by campaign or service line—that warrant continuation and those that may need reconsideration. If the contribution margin for a specific marketing endeavour, such as a conversion campaign for orthopaedics, manifests as unfavourable, it implies that the returns from this campaign are insufficient to justify the expenditures incurred.
Hence, it’s advisable to reassess this campaign by modifying the outreach approach to a more cost-effective one or by transitioning to a service line target with a reduced CPA. When the contribution margin registers as positive, you’re substantiating ROI and making a profit-oriented contribution. Recognising that your contribution margin can exhibit positivity even if your traditionally calculated profit appears negative is crucial.
Conclusion
The alignment of marketing endeavours with ROI hinges entirely upon data—its collection, analysis, and strategic application. Hence, it’s imperative to establish a well-defined plan within your health system for managing this data. Employing reporting dashboards that consolidate ROI metrics into a single location can also prove advantageous, streamlining presentations to the C-suite.
Demonstrating ROI in healthcare is paramount in securing buy-in from the C-suite, a factor that directly influences future budget allocations and resource provision. By accentuating the financial influence of marketing initiatives, you engage the interests of C-level executives and elucidate why your healthcare marketing department is yielding tangible outcomes, warranting their endorsement and support.
