[00:00:00] If you are listening to this episode and you have no interest in growing your dental practice, which I can’t imagine why anybody would do that, please stop watching now. There’s happiness and misery, right? So don’t fall into that trap that you just don’t think any marketing works. There is technology today that we can, we’re able to put some code on your website, and we know when somebody comes to your website. About half the time, we know their name and their physical address without them even having to fill anything out.
[00:00:31] Welcome to the Dental Marketing Podcast, a podcast that helps dentists win in the online world of modern-day marketing. Each week, we cover the most cutting-edge marketing tactics and strategies that are working right now across our client base to drive leads, phone calls, and more new patients for dentists. Now here’s your host and founder of Kickstart Dental Marketing, Chris Pistorius.
[00:01:02] Hey, everyone. Welcome to the No BS Dental Marketing Podcast. I’m your host, Chris Pistorius. On this show, we talk about straight-to-the-point, no BS tactics, tricks, and strategies to help you grow your dental practice or orthodontic practice. Now, there’s no fluff here. It’s just great information that you can start implementing today to help increase your bottom line. So if you’re a dental practice owner, manager, or really whatever, be sure to click the Subscribe button on this page so that you are notified when we release a new episode.
[00:01:33] So today, we are going to talk about how much money you should really budget for your practice for marketing. Or should you really market any? But I’m going to warn you as of right now, if you are listening to this episode and you have no interest in growing your dental practice, which I can’t imagine why anybody would do that, please stop watching now because this episode is not going to be for you. This is going to be for people that are in growth mode, they are focused on growth, and they’re looking for ways to not break the bank and still be able to grow their practice responsibly with the right type of new patients. Okay, so just a warning there.
[00:02:03] All right, so first of all, why do you need a marketing budget at all? Well, you need a marketing budget just like you need a budget for everything else. And hopefully, you have budgets set up, like for your spending, for your overhead, you know, all of that stuff. And it goes back to one of my previous episodes of making sure you know your numbers, right? I mean, if you don’t have a budget and you don’t know what your profit margins are, you don’t know how much it costs to bring in a new patient, then you’re behind the curve and you really need to start there before you even get into marketing, okay? But you need a budget so that you can stay within a number that you’re going to be comfortable with.
[00:02:35] Now, in the beginning, marketing may be a number that you’re not comfortable with because it’s an uneasy feeling. You’ve probably heard stories and horror stories maybe of people spending money in marketing and nothing works, and it’s just all doom and gloom. Well, sometimes there’s happiness and misery, right? So don’t fall into that trap that you just don’t think any marketing works because it’s just not the case. The US Small Business Administration, let’s talk more about how much you should spend, what should your budget be, right?
[00:03:06] So for small businesses in general, right, the US Small Business Administration recommends allocating about 7 to 8% of gross revenue to marketing. And if you’re doing less than like 5 million a year as a practice, which 5 million a year is a good-sized practice, then your net profit, net profit margin after all expenses should be in the 10 to 12% range. Now, that’s for all small businesses. Most of our clients see overhead expenses and margin 20 to 30% typically.
[00:03:37] Now, starting out is a little bit of a different story. If you’re a brand new practice, you probably want to see a little bit more aggressive numbers there in the beginning. So you may be looking at maybe, you know, 12 to 20% is what the SBA recommends for a new business, right? The higher budget will help, you know, obviously establish you in your community, it’ll help with repeat business, and it will help with that all-valuable word-of-mouth marketing as well.
[00:04:03] So most of our clients here at Kickstart are between that 7 to 10% if they’re an established practice. Now, you know, those are just standardized numbers. Everything’s a little different based on how aggressive you want to be, it’s based on your market, it’s based on your goals, you know, how many more new patients do you want, what kind of patients do you want? You know, we have some, you know, dental implant people out there that they have to spend a little bit more because it is a little bit more to get an implant patient in than just a regular general patient in, and that’s because profit margins are better typically on dental implants. And so a lot more people want implants, okay?
[00:04:33] When you start thinking about a budget for marketing, you need to be prepared to be kind of that 7 to 10% of your gross revenue. That’s about where you want to be as a dental practice. Again, it could change on markets and what you want to do, but that’s about where you want to be.
[00:04:53] Now, some factors that really, you know, influence kind of how much a dentist or really any business should allocate to marketing, it is, you know, geographic, like we talked about, but it’s also the competitive landscape. You know, we’re seeing that more and more markets are so competitive. There’s dentists everywhere. It seems like there’s the pressure from corporate dentistry in a lot of markets as well. Sometimes your budget will change based on the competitive landscape as well.
[00:05:20] Some examples of that, like right now, for whatever reason, Colorado Springs, Colorado, hugely saturated market with dental practices. It’s almost more expensive to market in Colorado Springs right now than it is in some tier-one major cities throughout the United States. Just the way it is. I don’t know why. I guess everybody wants to live in Colorado Springs and be a dentist for whatever reason, but that’s the way it is.
[00:05:44] So when we do budgeting and talking with our clients, we look at the competitive landscape as well. The other thing to kind of really think about here, I think, is, you know, a lot of dental practice owners that I speak with are looking at this in a spreadsheet, and they see marketing as an expense. They see it just like an electric bill or a loan payment or paying your hygienist, you know, it’s just a fixed expense every month, and that’s what we’ve got to deal with.
[00:06:09] But that’s really not the case because if you’re doing marketing correctly, you’re not spending money on marketing. You’re not taking up net profit for marketing. You are making money off of marketing, right? So if you put a dollar into marketing, you should be getting three to five dollars back every month. Now, there’s some ramp-up time, don’t get me wrong. If you’re doing a marketing campaign correctly, it’s going to take a few months to get off the ground to really feel the full breadth of it. That doesn’t mean you get zero results, you know, month one, two, three, or four, but you’ll see a slow increase if people are, if your company that you’re hiring or the person you’re hiring is doing their jobs correctly. You’ll see a steady incline in revenue until you get to kind of that top tier you want to be, okay?
[00:06:50] So this is not an expense like the light bill, okay? You should be profiting off this. This is truly an investment, right? So when you’re looking at your spreadsheet and your budgets, this is one that should definitely be increasing your bottom line and not taking away from it. I know that seems obvious when I say it out loud, but I would say probably three out of the 10, maybe even more, probably five out of 10 of new dental practice owners or any dental practice owner I speak with, it’s in their mindset that this is an expense, and it’s just a cost of doing business. It shouldn’t be, and it better not be, because if you’re not getting a return on investment in marketing, then really, what’s the point, right? So just think of it as a true investment.
[00:07:29] Okay, so let’s talk about different types of marketing expenses. Now, I’ve run Kickstart Dental Marketing for 15 years, going on 16 years, and I have seen the landscape change pretty dramatically. I mean, back in the day, it was, you know, you put it on in the Yellow Pages, you do maybe some direct mail, go to a few events, local events, and that’s kind of your marketing budget, right? I mean, it’s pretty straightforward. You know, Yellow Pages got pretty expensive there towards the end of their reign, but, you know, it was simple. You knew what to expect out of it. It was somewhat predictable, and better yet, it was tangible. You know, it was something that you could, you know, go to page 135, and you see your ad right there every time, right?
[00:08:03] More recently, the internet age has taken over, and there’s like 5,000 places you could go spend money on marketing, right? It’s a completely confusing landscape for dental practices in terms of where to market and where to spend your dollars. I always call it trying to untangle the web. And so 15 years ago, when I got into this, this is why I originally started Kickstart. I originally started wanting to be just a consultant of going in and saying, hey, you’re doing this, this, and this, but you need to be doing this, this, and that because I had that expertise of what works and what doesn’t. Okay, I have that even more now, by the way, because I’ve done for 15 years, and we’ve got a really good pulse on what works and what doesn’t here.
[00:08:38] But having said that, you need to work with somebody that knows what they’re doing. Otherwise, you could spend a ton of money and not get a single patient out of it. And maybe some of you right now are thinking that you’re like, man, you hit the nail on the head. I hired whatever company or whatever guy down the street, and I got nothing out of it, right? So you’ve got to make sure that that’s set.
[00:09:00] So when we talk about different kinds of marketing, you know, I want to talk to you about some of the most profitable ways to market that we use right now, okay? So it’s no more, no longer Yellow Pages, Direct Mail, yes, but you’ve got to do it correctly. So let’s talk about that a second. You know, the old traditional outbound marketing of direct mail, you get a list of a couple thousand people, maybe, you know, you design a postcard, and you send it out to the masses, and you hope that 1% of those people take action on it. That’s the true reality of direct mail, by the way. If you get more than 1% return, you’re doing really well. And that can work.
[00:09:30] I like doing that in smaller markets, more specific markets, and I really like targeting new movers, so people that have moved recently to the area. Do not send them to apartments. Make sure they are houses, homes. Now, how we refine that a little bit more is that I would suggest that you go with a direct mail marketing program that’s specific to people that already know about you. So you’re probably thinking, how the heck could that be? There is technology today that we can, we’re able to put some code on your website, and we know when somebody comes to your site, about half the time, we know their name and we know their physical address without them even having to fill anything out.
[00:10:00] I know, kind of scary, but it’s legal, HIPAA-approved, everything good. And what you can do is that that technology will trigger a postcard to automatically be sent out that same day or the next day to that person’s home. So they go to your website, they look around. Most people don’t take action the first time they go to your website, but in a couple of days, all of a sudden, they get a postcard in the mail talking about your implant special or, you know, whatever it may be. So we like direct mail, but we like it to do it the smart way so that we’re pretty targeted, and we know that it’s somebody that’s already been to our website and they’re looking to maybe take action versus just blasting out a bunch of them.
[00:10:33] There’s SEO, search engine optimization. That means getting your website to rank high organically, not the paid ads, organically on Google, Yahoo, Bing, some of the top search engines out there. It’s incredibly important. SEO’s been so overhyped, and, you know, everybody probably cringes, even I do a little bit when somebody talks about SEO anymore, but it is important, and it’s a basic part of the strategy now. It’s a longer-term strategy. It’ll take a little longer to get results there, and that’s why we like to use pay-per-click advertising in the beginning so that we can get that up and running quickly. Pay-per-click is just like what it says, pay-per-click, but on Google, Yahoo, maybe Bing, depending on your competitive landscape. But that’s something else that you need to budget for because you need that in the beginning while you’re waiting for SEO results to kick in.
[00:11:04] Now, how much do you spend on that? And that’s a tough one because it’s really tough to say one number because it depends on your market. You know, how competitive is it because it’s kind of like an auction, if you will. It’s more complicated than that, but it is like an auction. Whoever’s willing to spend the most money usually shows up higher. Minimum $1,000 a month on pay-per-click ads, pretty much no matter what market you’re in. You know, if you’re in a very small area, you could probably drop that down a little bit, but minimum $1,000. If you’re in a major market, you know, $2,000, maybe more. If you’re doing implant, you’re in that $2,000, maybe more range as well. So that’s something else you need to think about.
[00:11:34] Marketing, you need something to track, so you need some sort of tracking mechanism in place. You need to budget for that. You need to find software. You need to find a company that can do it, whatever it may be, but you need that in your budget because that’s really going to help you understand what’s working and what isn’t. So did that direct mail, how many phone calls did that get from us? How many phone calls did Google Ads get from us? And not just phone calls, how many of those calls were actual patient leads? It’s something you’ve got to be able to budget for. That’s another big one.
[00:12:03] Reputation marketing, if you’re having trouble getting reviews, there’s all kinds of technology out there that’ll connect to your practice management software. Some of it’s in-house, some of it’s not, and that’s, you know, anywhere from a couple hundred bucks a month up. Okay, there’s a lot of different places. Those are the places I would start.
[00:12:20] If you’re interested in video, we’re really all about video here. We do a lot of it. We’ll even send out a crew to do a video shoot so that we have plenty of content to work from, but do a video of your practice. Have a local videographer come out, have them edit it. Should be around a couple thousand dollars probably. It’s a one-time thing, and then you can have them cut it up into like 15-second clips here and there of interesting stuff, and then you can use those in ads like on Google or Facebook, somewhere like that. So that’s another thing you need to think about in terms of budget.
[00:12:51] There are some other things there. There are some more advanced strategies like YouTube ads, maybe video ads, TikTok ads. I’m just kind of really talking today about, you know, if I was at zero and I needed to market my practice, these are the basic things that I would do starting today to start bringing in more new patients. One other that I’ll add to that is what we call sponsorship marketing, and that’s where you sponsor like a little league team in town or an event or a charity, even a church, you know, a high school football team, for instance, is another one. Those are pretty much low-cost, under $1,000 bucks, even much less. We’ve booked them for our clients for like $250 bucks. You get a name on a t-shirt or you get a banner in the gym, something like that. So it’s great local brand exposure, but you also get links from their website to yours, and that will help with your SEO ranking organically on Google. Just a little tip there. So you would want to probably budget for that.
[00:13:40] Going to events, setting up booths, you know, local type sponsorship marketing, I think I would probably add to that mix if I was just starting marketing a practice.
[00:13:50] Now that we know kind of what the different expenses will look like and how much perhaps to spend on each, we need to talk about expectations. ROI expectations, return on investment, okay? So if you spend, say, $3,000 a month, right, how much are you going to get back from that? I get asked that all the time, and here’s the absolute truth of it. Month one, you’re probably not going to get much of anything back because any company out there that tells you different is probably lying, or if they’re not lying, then they don’t do much for you, and they’re just kind of taking your money.
[00:14:21] The first 30 days for us is a lot of building out. Maybe we’re building a website, maybe we’re doing an SEO campaign. We are building everything out very quickly, and it usually takes us about 30 days to do that. So that first month, I would not expect, you know, that 2:1 or 3:1 ratio that we talked about. If it were me, knowing what I know about marketing, I would make sure that you give your marketing company anywhere between 6 and 12 months to really feel the full breadth of it. Now, that 6 to 12 months is a pretty big range, and it all depends on your market, how competitive it is, what your goals are, what your profit margins are, you know, things like that. Don’t expect this to be a, you know, “I’m going to go out of business next month if I don’t hit my number” and you hire a marketing agency. Don’t expect them to be able to save you, okay? That’s just the truth. You need to give it some time. You need to have a budget to give it some time. And again, like I said before, it’s not that you won’t get anything until month 6 or 12. You’ll see a slow, gradual buildup to those points.
[00:15:21] Increase in new patients, it also depends on what kind of insurance you take. If you’re fee-for-service, there’s fewer candidates out there for you, right? So it could take a little bit longer. If you are in implants and you’re in New York City, it’s going to take a little longer. Very competitive, right? So, you know, 6 to 12 months is what I tell my clients typically that’s what you need to give us.
[00:15:43] Okay, so long-term planning. I think we just talked about that. That’s on my, sometimes I get ahead of myself, sorry, but long-term planning, you can’t think of this as a sprint. This is a marathon. Marketing is a marathon. It’s something you should really never stop. We have had practices with us for over 10 years, and they’re doing very well, but you don’t ever want to stop that momentum because the next Google algorithm change or the next COVID, you know, is right around the corner, and you always want to keep that brand name in mind, and you always want to be promoting your brand because there’s always people working, you know, moving in and out of your market, right? So you always want to keep that going. That doesn’t mean you have to spend as much money year over year over year, right? A lot of our clients go on what we call maintenance programs. We get them to their goals, and then we don’t stop marketing. We let our foot off the accelerator a little bit, right? And we maintain for them until they bring on an associate or another hygienist. Maybe then they can see more new patients. So you’ve got to really think of this as a long-term type expense.
[00:16:47] So those are my tips in terms of budget. You know, I can’t, I can’t look at every one of you and say, “All right, Tom, you need to spend $5,000 a year. Sally, you need to spend $100,000 a year.” I can just give you some general, you know, percentages. You’re looking at that 7 to 8% of gross revenue, right? And I’ll be really frank with you. If you’re not prepared to do that and you are in growth mode, it’s not going to go well. You’ve got to put it in gear, and you’ve got to have almost a no-fear attitude towards it.
[00:17:18] The important part of it is going to be making sure you hire someone or you hire an agency that really knows their stuff, okay? Now, obviously, I’m biased because I own Kickstart, but make sure that if you hire an agency, they are in dental specifically. I would not hire somebody that just, you know, does auto mechanics and lawyers and plumbers and everything else because there’s too many nuances in dental. If you hire somebody to be your marketing manager, for instance, try to make sure they have some healthcare background of some sort, okay? That’ll help with HIPAA stuff, and that’ll help with the nuances and the competitive landscape.
[00:17:50] Okay, so anyway, I really, really appreciate you taking the time to listen to this. I really hope that it’s helped a little bit. If you have any questions, as always, feel free. You can get some free advice from us at any time. Just go to our website, kickstartdental.com. I really appreciate everyone watching and listening today, wherever in the world you may be. And if you do like our podcast and you like what you hear, please hit that subscribe button because it will notify you of all of our new episodes as soon as they come out, and you can get the latest tips and tricks and strategies. So I look forward to seeing everyone on the next episode. Take care.
[00:18:22] Thanks for joining us this week on the Dental Marketing Podcast. Make sure to visit our website www.kickstartdental.com/podcast where you can subscribe to the show on iTunes, Spotify, or via RSS, so you’ll never miss a show. While you’re at it, if you found value in the show, we’d appreciate a rating on iTunes, or if you’d simply tell a friend about the show, that would help us out too. If you are ready to grow your practice, then you might want to schedule a free strategy session with us. Just go to kickstartdental.com and click the free strategy session button and give us 15 minutes of your time to change your practice forever. Be sure to tune in next week for our next episode, and thanks for listening to the Dental Marketing Podcast by Kickstart Dental Marketing, where dentists go to win online.
