What metrics do you need to know to know how well your marketing is doing?

If you know what your metrics are and what it takes for you to get a new patient, then you can easily work backwards from your ideal practice size. You can figure out the inputs to get to your perfect practice.

You can also troubleshoot steps in the process to see what’s holding you back.

For example, if you know it takes you $30 in advertising to get a new patient and each new patient spends about $500 with you (on average), then you know you profit $470 per patient. If you wanted to make, say, $100,000 in a year (after advertising costs), then you need 213 patients (rounding up).

This means you have to spend $6,390 in ads. Over 12 months, that’s just $532.50/month. Put in terms like that, it becomes easy to see what it takes for you to grow your practice to your ideal size.

But how do you figure all that out in the first place?

A lot of chiropractors I’ve talked to don’t really know any of their numbers. This makes it almost impossible to know if anything you’re doing in your practice is making an impact.

This, by the way, is what we specialize in. If you want to know how your practice is doing and how to improve it—using numbers, not guesses—then book a free call here and let’s talk.

This article is part 1 of a multi-part series on how to figure out the business numbers in your practice. In this one, we’ll be looking at metrics you can track to figure out what it takes for you to get a new patient, how much money that patient will make you, and how good your marketing and advertising efforts are.

(If you don’t have some of the raw numbers we look at in this, don’t worry: The next article is about how you can get these raw numbers for your business.)

All right, let’s dive in.

Numbers you’ll want to get

The math we’ll be doing is basic, so don’t worry.

In order to do the math, we need some numbers. I’d recommend getting these on a monthly basis. Later, you can do this for multiple months and take the average. That way, you’ll be able to figure out your numbers without any worry of seasonality or fluctuations. However you want to do it, make sure all the numbers are over the same period of time.

Basic Numbers

Here are the numbers you’ll want to get. These can usually almost all be found in your EHR, which makes them really easy to find. That’s why these are considered the “basic” numbers.

• Total Sales and Marketing Expenses. We’ll want the total, and then we’ll want the amount you spent on each type of advertising. For example:
  • Any advertising costs (like Google Ads, Facebook Ads, etc.)
  • Any money spent on social media posts (if you have someone do that for you)
• Number of New Patients. Of this, ideally you can break them out into categories like the following (if you can’t right now, though, then don’t worry):
  • Number of referred patients
  • Number of patients from advertising (from each advertising source if you use multiple)
  • Number of patients from Google/search results (e.g. Google Business Profiles, Google Maps, your website, etc.)
  • Number of patients from other (e.g. social media posts, etc.)
• Total Number of Appointments
• Total Patients (over period)
• Total Revenue
• Total Number of Consultations (if you give away free consultations to prospective patients, then you’ll want this number)
• Number of Cancellations/No-Shows (ideally for both consultations—if you have those—and for regular appointments)

Advanced Numbers

These are numbers you may not know, but if you do, then we can get even more precise with our metrics. So, if you can get them, do it. If you can’t, don’t worry about it for now. The next article in this series will deal with how you can start tracking metrics like these.

• Number of Website Visitors
• Leads/Prospects (basically, people who expressed interest in becoming a patient at one point or another that you can contact. This could be people who used your contact form, called your business, or people who messaged you on social media). Of this, ideally we’ll want the following categories:
  • Referred leads
  • Leads from advertising (ideally we track this for each advertising source)
  • Leads from website (click-to-calls, click-to-emails, form submissions, etc.)
  • Leads from Google/search results
  • Leads from other
• Number of Scheduled Leads (these are leads that scheduled an appointment/consultation with you). Again, try to break them out into the following categories if you can:
  • Referred leads
  • Leads from advertising (ideally we track this for each advertising source)
  • Leads from website (click-to-calls, click-to-emails, form submissions, etc.)
  • Leads from Google/search results
  • Leads from other

Calculating the metrics

Now that we have all our raw numbers, it’s time to calculate the metrics to see how your practice is doing.

Basic Metrics

These are the easier-to-calculate metrics. You can usually get the numbers to calculate these from your EHR and financial statements/receipts (in the case of marketing costs). These will give you a pretty good idea of how your business is doing, what it takes for you to get a new patient, and how you can improve your practice.

• Customer Acquisition Cost (CAC)

Customer Acquisition Cost, also called Cost to Acquire a Customer (CAC), is the average amount you’re spending on marketing to get a new customer. For example, if you spend $1,000 on ads in a month and get 25 new patients in that same month, then your overall CAC is $40. This basically tells us how good your marketing is doing.

When we combine this with LTV, it tells us how profitable your marketing will be and how much you can expect to make per new patient in gross profit.

• Cancellation/No-Show Rate

The cancellation/no-show rate, aside from being a good number to have, tells us about how many appointments you can expect to have before getting a new patient. For example, let’s say you have a cancellation/no-show rate of 10%. This means that if you schedule 10 prospective patients, 9 of them should show up and turn into patients.

Again, this just gives us a more granular look into how you’re doing. We specifically use this with metrics like in the “Harder-to-get metrics” section, which you may not have the data to use just yet.

It’s important to note that we shouldn’t count reschedules here. We are only interested in cancellations or no-shows.

• Average Revenue per Visit

Average Revenue per Visit is self-explanatory. The reason we break out average revenue per visit rather than per patient is that it gives us a more granular view.

If your goal is to increase your lifetime value (see below), then knowing your Average Revenue per Visit and your Patient Visit Average helps you to improve it. You get to see if either one is lower than you’d like it, which makes it easier to know what you should change to improve your LTV.

• Patient Visit Average (PVA)

PVA is the average number of visits a patient sees you for. Combining this with Average Revenue per Visit gives us LTV and allows us a more specific view of how your practice is improving.

• Lifetime Value (LTV)

The total revenue you can expect from a patient during their lifetime relationship with your practice. Using this, you can work backwards from your ideal practice size—like we talked about in the intro.

This is important for knowing if you can scale marketing and advertising efforts. If your LTV is extremely low and your CAC is extremely high, then you won’t have enough profit to scale your marketing efforts. You can read more on this in this article here.

• Referred Customer Ratio

This is the ratio of total patients to those who were referred by existing patients. This gives you an idea of how many existing patients it takes to get a new referral. This can almost be thought of as the equivalent of CAC but for referrals. Instead of spending a certain amount of money in order to get a new patient, you need a certain amount of existing patients to get a new patient. Put another way, instead of the input being money, the input is the number of existing patients you have.

You may not know your exact number of referrals just yet. The next article in this series should give you ideas on tracking all this.

Advanced Metrics

These metrics are harder to get because there are a lot of different sources you have to go to in order to get them all. The above metrics should almost entirely be findable in your EHR, plus the amount you spend on advertising.

The below metrics require you to know the numbers in your EHR, but also the numbers that tend to be rather deep in your ad platform. This can be tough to retrospectively figure out all these numbers, as it requires things like tracking each prospective patient, website visitors, click-to-calls and click-to-emails on your website, each prospective schedule, the number of people that showed up for each schedule, the number of people that turned into patients, and more.

It’s much easier to track all of these going forward, rather than trying to go backwards to figure them out. So, if you don’t have the numbers to calculate any of these just yet, then don’t worry about it. That’s what the next article in this series is for (which I will link to when finished). If you do have these numbers, then let’s get even more in-depth with your practice metrics.

• Traffic-to-Lead Conversion Rate

This measures the effectiveness of your website or online presence in converting traffic into leads. Specifically, the way you’ll want to track leads are things like click-to-calls, click-to-emails, and form submissions—these are all what we will consider leads (minus anything like spam, obviously). See the CPL metric for more info on what leads are.

• Cost per Lead (CPL)

A lead (or prospect—you may hear either term in the marketing world) is someone who you can contact that may be interested in your services. So, before anyone becomes a patient, they become a lead.

You may not always have this number, but if you know this number and a few others, you can figure out at a more specific level what your CAC is per marketing channel. For example, the basic pipeline from lead to patient looks something like this: Become a lead > Schedule consultation/appointment > Show for consultation/appointment > Become patient.

If we can track each of these steps, then you can see how efficient each step of the process is and figure out how you can improve the ones that are falling behind. We can also go more in-depth by doing this for each advertising/marketing channel. The first step starts with CPL.

Let’s go back to our earlier example where you spend $1,000 on a specific ad campaign in a month and get 25 new patients that same month. Let’s say you get 50 leads for a CPL of $20. Of these, let’s say 25 schedule a consultation. Of these, 12 show up and become patients.

This means that you got 12 new patients from that advertising campaign where you spent $1,000. So, your CAC for this particular campaign is $83.34, and you got an additional 13 patients from a different source. If you got those 13 patients from a different advertising campaign, then you can do this same math and see which one of them worked better.

But CPL is just the first part of the pipeline. To figure out the rest, we look at the next metrics:

• Lead to Consultation/Appointment Conversion Rate

In order to get someone to become a new patient, they have to show up first. And in order to show up, they have to schedule an appointment. This is one of the stages of the pipeline we mentioned earlier.

Next, we look at the show-rate.

• Show Rate

If you use free consultations, then you’ll use the Consultation to Patient Conversion Rate metric as well (see below). It’s worth noting that free consultations almost always see a lower show rate than regular appointments (depending on what kind of marketing/advertising you do). This is why ideally we break out the no-show/cancellation rate for both consultations and regular appointments.

If you use appointments and everyone that comes in must pay one way or another (in other words, they become a patient one way or another), then you’ll use this and skip the next step. If you use consultations, then we’ll have the next step in the pipeline as well.

• Consultation to Patient Conversion Rate

If you give free consultations to prospective patients, then it’s possible that not everyone becomes a patient. So, knowing how many consultations it takes to get a new patient on average will help you know your overall conversion rate, and will help you know if this step is underperforming.

• Lead Conversion Rate

This is the overall efficiency of your lead-to-patient pipeline. It’s the percentage of leads that eventually convert into paying patients. This can give you a quick overview of how your overall marketing efforts are going on each channel. Though, again, the above numbers give you a more in-depth view that allows you to figure out how to improve each step of the process.

We went through a lot of information in this one. If you’re unable to find every single number to make all the metrics in this, then don’t worry. The next article in this series will go over that. When it’s finished, I’ll link to it.

If you’d like some help with this kind of stuff, just go here and schedule a call to discuss it or send us a message and tell us you’re interested.