17: Generating Patients for the Practice

Chapter 17

Generating Patients for the Practice

Part 1: Generating New Patients

So you think that advertising doesn’t pay? We understand there are 25 mountains in Colorado higher than Pike’s Peak. Can you name one of them?

The American Salesman


Objectives
At the completion of this part, the student will be able to:
1. Describe the evolution of marketing of professional services.
2. Discuss the relationship of professional ethics and marketing.
3. Define what marketing is and is not.
4. Compare the nature of services with products, and discuss how this affects their marketing.
5. Describe the stages of the growth of a dental practice and its relation to the marketing effort.
6. Define the “four P’s” of marketing and relate them to marketing dental services.
7. Describe why people purchase dental services.
8. Describe ways to segment the dental marketplace.
9. Describe how common internal marketing efforts generate patients for the practice.
10. Describe how common external marketing efforts generate patients for the practice.
11. Describe the market planning process.
12. Describe some common problems in marketing professional services.


Key Terms
0-2-10 rule
40-40 rule
advertising
benefits
bundle of services
consumerism
external marketing
    media use
    professional relations
    public relations
    signage
fees
“four P’s” of marketing dental services
inseparability
intangibility
internal marketing efforts
    branding
    performance
    facility
intestability
marketing
perishability
place
price
problem-solving purchases
product
promotion
routine purchase decisions
segmenting the market
    behavioristic
    demographic
    geographic
    psychographic
service vs product
target market
top-of-the-mind awareness
variability


Goal
This part presents the basis of marketing of professional services. The nature of dental services and the behavior of the buying public will be explored.

Dentists use many methods to help attract new patients to the practice, retain existing patients, and convince patients to purchase services. Actually, every management decision that dentists make in the practice has implications for patient generation. These efforts are called marketing. External marketing looks at generating new patients to the practice, whereas internal marketing aims to retain existing patients. Both are necessary for a successful practice. The hours that dentists keep, the fees dentists charge, insurance plan participation, and the types of services that dentist do all affect patient generation and retention. Together, these are marketing efforts.

Depending on the competitiveness of the practice area, dentists will need to put more effort into marketing. If the practice is as busy as it wants to be (or busier) with the right kind and mix of patients, there is less need for marketing expenditures. Even practices that have a full complement of patients and do not advertise continue to market the practice through their communications and management of the office.

What is Marketing?

Marketing is a managerial process that focuses a ­practice’s activities on the benefits sought by a target group of clients, thereby satisfying their needs and desires more effectively. Notice that marketing looks to satisfy the needs of a group of patients. The major task is to learn clients’ needs, wants, and preferences, and then to develop services and products that satisfy those needs. This affects how dentists deliver the ­service, and even how they organize the practice. It means listening to people and providing goods and services that they demand (or want). Marketing means that dentists view the practice through the patients’ eyes, thereby generating and retaining patients in the practice (at a profit).

It is almost as instructive to say what marketing is not, as to start by defining marketing. Marketing is not advertising, although advertising can be a part of marketing. Marketing is not the sales technique of a used car salesperson, although sales technique is a ­component of marketing. Marketing does not mean high-pressure techniques, convincing people to buy what they do not need, or slick four-color ads.

Marketing looks at dental consumers’ desires (not dentists’ professional assessment of their need). Those desires fall into three broad categories:

a. To avoid something, such as pain, disfigurement, noise, odors, X-rays or cost.
b. To gain something, such as health, a pretty smile, or relief from pain.
c. To prevent something, such as pain, disfigurement, or embarrassment.

Notice that consumers do not want amalgams, ­partials, or bridges. Instead, from their perspective, they are avoiding, gaining, or preventing something happening to them. Dentists can probably provide a service that helps the patient achieve their goal. That service may be a prophylaxis, tooth whitening, or orthodontics. If it solves the patient’s wants, then the dentist has acted with a marketing orientation. Part of the marketing ­orientation is to provide information to patients so that they know the procedures and techniques that are ­available. This education process makes consumers more aware of their needs, raising their level of wants, and, therefore, their desire for dental services.

Why do Dentists Market?

Dentists market to gain patients for the practice. Dentists have marketed their services since the first dental practice was created. In recent years, dental marketing has become much more sophisticated as dentists have brought business techniques to bear on the world of professional practices. Several factors have brought this on.

The increased competition among dentists for the available patient pool has stimulated marketing. As described in the economics section, this is really a question of relative supply of practitioners and relative demand of patients. Factors such as the number and age of dentists, auxiliary use patterns, technology, and practice patterns influence the supply of practitioners. The number of patients, usage patterns, disease ­patterns, third-party reimbursement, and efficiency of preventive measures influence the demand for service. When dentists see holes in their appointment book, the first thing they try to do is encourage more patients to come to the office. In other words, they market their services.

Dentists have two kinds of competition. The first is to gain the attention of the potential patient and to have the patient patronize them, instead of another nearby dentist. In this sense, dentists compete against each other for their share of the available patient pool. A dentist’s internal operational policies (such as the hours that the office is open) and the external marketing strategies (such as advertising campaigns) help to attract new patients. Once the patient comes to the office, then the dentist faces a second, equally important marketing problem. That is to educate and convince the patient that their dental needs are important enough to spend (often large amounts of) money to repair. Because most dental procedures are considered discretionary services, then dentists compete against other forms of spending for the consumer’s dollar. In this sense, dentists do not compete against other dentists but compete against travel agents, home remodelers, big-screen television sales agents, and fine-dining restaurants. Convincing the patient to come to a dentist involves external marketing plans. Once the patient is in the chair, then the internal marketing and sales techniques become more important.

The changing nature of third-party contracts has encouraged many dentists to market their services. Various contract organizations (capitation plans and referral plans) may limit where patients can go for reimbursed dental care. The act of deciding whether to participate in one of these plans is a marketing decision because it addresses the patients’ desires for reimbursed dental care. Beyond that, a practitioner may see patients who sign up with a given plan leave the practice. The dentists then feels that they need to generate additional traditional fee-for-service patients to compensate for the managed care patients who have left. A dentist’s insurance plan participation becomes one of the most important marketing decisions that he or she makes.

The rise of consumerism and a revised legal and ethical climate in the profession have increased marketing in dentistry. In years past, the profession considered any advertising to be unethical. The American Dental Association (ADA) Code of Ethics and many state dental practice acts described advertising to be an illegal act. In 1977, a court decision (Bates and O’Steen v. Arizona) effectively ended professional prohibitions against advertising. This case stated that a professional must be allowed to advertise the services that he or she provides, if the advertisements were not false or misleading. Simultaneously, consumerism was beginning to be felt as an underlying trend in the United States. This trend advocates for more information for consumers to use while making informed decisions. According to this tenet, a consumer should differentiate among dentists. Dentists must tell the public how they are different from others. Some professionals have a problem with this notion. The public agrees with it.

Changing technologies have brought many new services to the arsenals of practicing dentists. These address consumer desires by fulfilling the benefits sought. Patients want to know about these services. Dentists who provide them want patients to know about them. Marketing answers both desires.

What do Dentists Market?

Before a dentist begins a marketing policy, he or she needs to understand the characteristics of dental ­services, so that appropriate marketing strategies can be used.

Dentists Market a Service, not a Product

A product is a tangible object. Services, on the other hand, are intangible. Consumers can see the results of the service, feel, or hear the service. However, they cannot pick it up and examine it. So services are, by nature, different from products. These differences lead to significant difference in the ways that dentists market products and services, as well.

Inseparable from the Provider of the Service

Retailers or other third-parties can buy, repackage and resell a product. They can put a different label on a product, move it across the country or the world, but the product remains unchanged. Services, on the other hand, cannot be separated from the provider of the service. The delivery of service is the service. If someone else delivers the service, it really becomes a new service.

Variability

Because services show low standardization, the ­providers of the service and the service itself are inseparable. Food preparation is a tremendously variable service. Virtually every restaurant prepares food differently. Fast-food franchises have decreased variability through strict ­standard operating procedures. A person knows that a “quarter-pound burger” from a favorite fast-food ­franchise will be the same whether it is bought in New York, Atlanta, or San Francisco. This standardization essentially turns a service into a product.

Perishability

A service is perishable. It can not be put into a warehouse or put it into inventory as a product can. This means that timing is critical. Because there are only a given number of hours in a day, one person can only provide a given amount of service. Once time is lost (through a “no show” or cancellation) it is lost forever. Production can not be increased to make up for the lost time.

Intangibility

Services are intangible. A maxim of marketing is to ­“tangibilize the intangible, and intangibilize the ­tangible.” This means that dentists should try to provide an intangible service as a reminder of a tangible product and give a tangible reminder for an intangible service. Whether it is a little sign in a yard from the lawn service company, a mint on a motel bed pillow, or a toothbrush after a dental prophylaxis appointment, tangible gifts serve as reminders that someone provided an intangible service.

Intestability

Consumers are unable to test services before they purchase the service. They can not pick them up, examine them, take them for a test drive, or kick their tires to check for soundness. Instead, they use surrogates to test the service before they purchase it. Patients are similarly unable to test dental services before they purchase them. Instead they use surrogate measures for testing quality of health services. Those surrogates include reputation, recommendations from trusted others, cost (as a reverse measure), and familiarity. The inability to test the service beforehand leads to more postpurchase testing and dissonance.

Dentists Market Based on the “Four P’s” of Marketing

Marketers often speak of the four P’s of marketing. That is to say, nearly all marketing efforts involve four major concerns. Those concerns are:

1. Product is the good or service that is being provided. It involves both the core product and all extensions of the product itself in the bundled of services purchased.
2. Price is the money that the consumer pays for the good or service. It includes not only the price for the core product but also all extensions. For example, the total price of a veneer includes the fee charged, how much work time the patient missed, the payment plan offered, and how much the ­insurance pays.
3. Place is where the good or service is sold or delivered. Generally, for dentists, the core is the dental office. The extended place includes parking and public transportation availability, disabled accessibility, office decor, and cleanliness.
4. Promotion involves all the efforts that a person does to make people aware about his or her good or service. For the dentist, it includes the core advertising efforts and extended promotions such as signs, community service, and health promotion efforts by the dentist and members of the office staff.

Why Consumers Buy

The consumer wants to buy. That is a huge conceptual difference. People want their purchase to solve a problem for them. In that sense, they buy benefits, not features of the good or service. The expected outcome is generally not simply to own the good or service but instead to use it for some end. Consumers do not really purchase aspirin. They purchase relief from a headache. If another product (acetaminophen or ibuprofen) offers a better benefit at a reasonable cost, then they will purchase the other product. They do not really care about how they make the product or deliver the service.

Definition of Features

A feature is a characteristic of the good or service that is sold. Need to know the type of metal, the characteristics of the material, and the method of making the product. That is vitally important when fabricating a dental restoration or appliance. However, consumers do not care about the features of the product. An implant has the features that it is made of titanium and osseointegrates with the bone, and a porcelain crown is placed on top of the implant (Box 17.1).

Definition of Advantages

Advantages are the characteristics of one feature over another that makes a product or service different. They help the consumer to differentiate among choices, but advantages do not cause the consumer to buy. An implant has the advantages that there are no clasps or wires that look unnatural, and dentists do not have to cut on adjacent teeth to replace a missing tooth. This simply compares the features of one solution with the features of another.

Definition of Benefits

A benefit is the expected outcome of a purchase. Consumers do not purchase a filling, a partial, or cosmetic bleaching. They purchase the benefit of a more attractive, more youthful smile or the ability to chew food effectively. The more that consumers see the benefit as solving their problem, the more they are willing to pay for the solution (Box 17.2).


Box 17.1 Why a Consumer Would Buy Implant Service
Features
    Titanium
    Osseointegration
Advantages
    No clasps or wires
    Do not cut down adjacent teeth
Benefits
    Looks great
    Functions like natural teeth


Box 17.2 Benefits of Dental Services
Gain
    Health, sex appeal, relief of pain, function
Improve
    Function, speech, chewing, appearance
Avoid
    Pain, disfigurement, cost
Prevent
    Pain, embarrassment, disfigurement, cost, inconvenience, disease

Most dentists sell services based on their features, not the benefits that the consumer wants. When dentists talk “to” patients about their proposed treatment plan, they discuss the features of the bridge (what materials it ­contains, what steps the procedure requires) rather than the benefit that the patient can expect (a better smile, improved chewing). Any given patient will weigh the alternative solutions (partial versus bridge versus implant versus no treatment) and determine, in their mind and for their case, the best solution to their problem. Patient education plays an obviously vital role in helping people understand their problem and the benefits of the various treatment choices. In the end, it is the patient’s perception of a solution to their problem that is important.

Patients Buy a “Bundle of Services”

People do not buy a simple good or service. Instead, they buy a bundle of goods and services that all combine to make the purchase decision. When a person buys a car, he or she buys the core product, which is the automobile. However, he or she also buys the reputation and location of the service facility, the delivery date of the car, and financing options. These all make up the extended product that is purchased. Likewise, patients buy more than the core dental service. They purchase not only a veneer, but the time that the office is open, the date they can have the procedure completed, payment plans, and reputation of the dentist. So the simple price of the service often will not be the only determining ­purchase factor.

Marketing Plan Development

When dentists are ready to begin marketing their practice, they need to develop a marketing plan. Developing this plan makes the dentist look at the people he or she will be serving to meet their needs. It also makes the ­dentist look at what he or she is doing well and what he or she needs to improve, what competitors are doing, and how he or she will tell his or her story. It should fit with the dentist’s strategic plan and vision for the practice. The marketing outputs that are desired (e.g., additional new patients) are a function of these marketing inputs. The marketing plan consists of several discrete steps.

Defining the Market

The first step is to define who the patient base will be. This defines the market. The location of a practice is one of the most important marketing decisions a dentist makes because it is crucial in defining the market. Most patients live within 5 miles of the dental practice (in urban areas). If a dentist intends to develop an upper-class “white collar” practice, but his or her practice is in a “blue collar” side of town, the dentist needs to make an honest appraisal of goals and possibilities.

Segmenting and Targeting the Market

Segmentation of the market refers to dividing the population into smaller groups of similar individuals. Dentists may assign these groups on several bases. Geographic segmentation groups people by where they live or work. If a dentist uses any direct mail, he or she will probably look at zip codes to decide where to send mailings. Demographic segmentation groups people by some outward characteristic, such as age, sex, race, or income level. Many dentists aim marketing efforts at people who subscribe to a particular insurance plan. When a dentist advertises in a senior citizen’s newsletter, he or she is employing demographic segmentation in the marketing effort. Psychographic segmentation does not care about a person’s outward characteristics. Instead, this form of segmentation groups people by how they think or feel about a particular issue. If a dentist develops a fear reduction program with the hope of attracting fearful dental patients, he or she has used psychographic market segmentation. Behavioristic segmentation groups people by how they act. It is well known that people who display high general preventive health behaviors also have higher dental usage rates. When a dentist places flyers in the local fitness center or health foods store, he or she is employing behavioristic market segmentation.

Market segmentation is the true art in successful marketing. Segmentation tries to group people so that a particular group is more effectively appealed to, with less wasted advertising effort and money. This is called target marketing (as opposed to mass marketing). The target marketer is much more efficient because more of the marketing message reaches the person for whom it is intended. There are no fixed rules about market segmentation. A dentist can set and develop his or her own target groups (Box 17.3).


Box 17.3 Example Dental Market Segments
1. Fearful patients (dental phobics)
2. Smile seekers (esthetic conscious)
3. Status seekers (perfect smiles)
4. Utilitarians (basic care that works)

Developing the Marketing Mix

Dental office marketing consists of a mix of procedures and techniques for getting the word out about an office. The key is to decide who the target market is and then develop strategies that appeal to that target group. A dentist will probably find that he or she needs several strategies to deliver the message. Even a well-defined target group uses several channels to find information.

Tracking the Effectiveness of Marketing Efforts

Marketing efforts are expensive and time consuming for the practice. Therefore, it is important to track how many patients each marketing effort generates so that a dentist can decide if the marketing effort has been worth the cost and time spent. The best way to find out how a patient found out about the office is obvious, ask. When the patient first calls the office, the receptionist who takes the call should ask, “And how did you hea/>

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Jan 4, 2015 | Posted by in General Dentistry | Comments Off on 17: Generating Patients for the Practice
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