Do you know what the REAL problem is in your business? Do you know what problems you actually have?
As you can imagine, we have many calls each week with therapy business owners looking for solutions to issues. The most common one seems to be, that they want more clients for their business. So, they often ask for advice on how to get more. Good question? BUT is it the right question to ask…mmmm!
Most are unaware of what the real problem is within their therapy business; so they guess it a marketing problem.
Marketing is an essential part of running any business. We need to attract new customers to our business. Marketing also comes with a cost, the cost of acquisition. This is the cost in time, money and energy for you to acquire a new customer (patient).
Most companies we speak to do not know their cost of acquisition. May I suggest if you are reading this and you are unsure, take some time out to work it out.
You take time to make social media posts; shoot some videos; write a blog, or perhaps have a meeting with a consultant. This time has a value. If you charge £50 an hour for services and a post takes an hour to make, then you need to account for that time in your overheads.
If it takes two posts to bring in a new customer, which accounts to 2 hours work then you cost of acquisition is £100. If this is the case then it is likely to be more cost effective to outsource your marketing. It will be cheaper, and give you more productive time.
What is the Real Problem?
Let’s imagine you now know the cost of acquisition. How do you know if this cost is a good investment? The only way is to understand what you return on investment (ROI) is in therapy business terms is to calculate the length or number of sessions a customer has in a treatment journey.
Have you spent time to consider this? Again, if not, please do this ASAP. Your financial bottom line will be impacted by your calculations.
When we ask any of our Elevate Group clients or those who attend our Masterclasses to work this out, many are shocked by how low the ROI is in their business. Especially, when you take into account the overheads needed to serve customers.
If John comes to you with knee pain. He has an Initial assessment (£50) and comes back for 2 follow ups (£100).
Journey length value = £150.
We then need to account of overheads and wages in working out the revenue made. In this example, let’s say we run at a 60% overhead to turnover ratio which means we have £60 left over after accounts for overhead costs. So we have taken an hours time to acquire this customer (£50). This means we have £10 left over or £3.33 per session. This is the net profit you are making on John.
I appreciate this is an example, but it is one that I have found to be a real issue in my conversations with other therapy business owners. For me the real problem is therapy businesses tend to under treat their customers during recovery. In many cases this is because colleagues in the business are poor at ” selling the client journey” which in practice means delivering only part of the treatment journey. This in my opinion is poor service. It leaves clients with the risk of reoccurrence. This could also be considered unethical treatment!!
On the Elevate Your Clinic coaching programme we make sure you consider the 10 step journey a client takes to become a RAVING FAN.
In this journey, we explore at first consultation the importance of working with the customer to set a desired outcome. From here we move on to look at how to educate customers on why they have their injury. We then highlight the journey or plan that you will implement with the customer to facilitate them to achieve their final outcome.
This maybe also be where you set the timescales of the journey. Use physiological timescales. If it’s a tendon issue, you would explain that it may take 12 weeks. Be honest. In my opinion just delivering two sessions and hoping that their body will adapt is not good clinical practice.
If you agree on a real desired outcome. Educate the customer on the findings from your assessment. Explain the journey from a physiological and anatomical bias. Be honest with real timescales. I guarantee that you will get better client outcomes. A longer client journey, which in turn leads to a better ROI.
Once we understand the length of the client journey we understand our average sales turnover per journey. From here we can calculate the profit from each client. We can then start to understand the cost of the acquisition and start to predict the profit per customer. As a result we now understand for each pound we spend on marketing what we will get in return.
We can then invest in marketing in the confidence that we are making money from the investment!