What does the lifetime value of a patient mean? Generally speaking, the lifetime value of a patient is the total amount of money that a patient spends with your podiatry business over the relationship life. It’s a future prediction and calculation.
In other words, instead of just looking at each consultation as an individual transaction, you look at all the future transactions that a patient will make with your business over their lifetime.
It’s Long-term Thinking
Often, podiatrists will only see the money they are about to receive for a pair of orthotics they’re about to fit. Once the fitting is complete, they're no longer interested in having further contact with the patient, unless of course, the patient wants another pair or orthotics.
If you continue on this path, you will lose patients to your competitors. You may get them back eventually, but in the meantime, they will spend their money elsewhere before they return.
Learning the Hard Way
It took me a long while to understand the importance of Lifetime Value of a Patient, but when you have patients return for treatment five years after their last visit, and they inform you they have seen another podiatrist and were fitted with another two pairs of orthotics, you start to get the message.
If this does happen to you, you will ask yourself, “Why did they betray me and see another Podiatrist”?
The answer is not complicated; they saw another podiatrist because you didn’t give them any reason to stay. You didn’t care enough about them to stay in touch.
Lack of Systems
You didn’t have a Patient Retention System in place, and you didn’t value them long-term. But why did they eventually come back and not go back to the other podiatrist they had been seeing?
Here's the answer: For the same reason they left you in the first place, the other podiatrist didn’t give them any reason to stay.
Financial Benefits of Lifetime Value
You may be unaware, but it's more cost-effective to retain and sell more products and services to your existing patients than it is to try and acquire or buy new patients.
Because when you do marketing, that is exactly what you’re doing; you’re buying patients.
Most businesses, unfortunately, tailor their marketing towards trying to attract new patients, and they forget the value of retaining their existing customers.
They will offer a ‘Special’ for a new customer to use their service, but nothing for their long-term customers.
Fortunately, our current registration rules restrict this type of advertising to some extent, but it still occurs. And if you do see a competitor do this, don’t waste your mental energy or complain to the Board; just let it be.
The Podiatrist that chooses to advertise this way, offering ‘Specials’, is not just annoying you; they are also annoying their existing patients, which is good for your business.
Profit from Return Visits
Long-term business profits come from patients that return on multiple occasions, not the patient that attends for a one-off visit because there was a ‘special’.
In reality, when you take in all the costs of running your podiatry business and what you spend on marketing, you make very little profit, if any, from the first visit.
Your team needs to understand this.
Refer Family & Friends
Existing patients that return regularly will refer their family and friends more often, so they can be worth far more than the money they initially spend themselves.
This is why you must nurture the relationship with the patient, and if you look after their family and friends the same way, they will also do the same and refer even more people.
Five Simple Actions
Here are five simple actions you can start doing immediately to improve your relationships with your patients and improve their lifetime value.
- Always be polite. Everyone appreciates courtesy.
- Use their name when you greet them.
- Do the little things. Walk your patients out to the door and thank them for visiting your business. Always invite them back again.
- Show an interest in them and their family (record personal information in their patient file about the holidays/children etc.) and bring it up in future conversations.
- Courtesy telephone calls to see how they are doing after particular types of treatment shows you actually care. (NWR, Orthotic Problems)
Patient Retention System
If you don’t have a patient retention system, start working on it now. You will not regret the time you invest in this activity. If you need help putting it together, consider one-on-one coaching with me to get it sorted faster, or join one of my 12-Week Podiatry Business Reboot groups.
If you're looking for a Competitive Advantage over other podiatrists in your area, please visit my EVENTS PAGE, and consider joining my next group coaching program, the 12-Week Podiatry Business Reboot or join the Podiatry Business Owners Club on Facebook.