By Brian D. Jaffe
“Half the money I spend on advertising is wasted: the trouble is I don’t know which half.” — John Wanamaker (1838-1922), founder of the first American department store
John Wanamaker’s quote is as true today as it was at the beginning of the 20th century. While most dental executives agree that spending money on advertising, direct mail, online marketing, and trade shows is required to generate leads and acquire new customers, many don’t understand how to optimize their marketing programs to yield the greatest return. This article provides an overview of some of the latest tools and technologies that can help maximize the return on investment of your marketing programs. It should be noted that many books have been written on these concepts. This article will provide you with an overview.
The first step in analyzing the costs and benefits of your marketing programs is to install a system that will enable you to track your leads through the sales pipeline. A customer relationship management (CRM) system will provide you with key performance indicators such as cost per lead, cost per appointment, and cost per sale across all of your marketing channels. In addition to lead quality, a CRM system will tell you how well your sales force or dealers are following up on your leads. Some dental companies, particularly large equipment manufacturers, spend as much as $100 to $300 for each qualified lead. This investment can be wasted if your sales reps are not aggressively pursuing these prospects. A number of relatively inexpensive CRM systems are on the market, including Salesforce.com and Sugar CRM.
The most cost effective approach to generating new leads is through search engines such as Google, Yahoo, and MSN. Internet search is comprised of two types — paid search and natural or organic search. When you enter a term into a search engine, such as “dental compressors,” the first few results at the top of the page plus the results on the right are referred to as paid search or pay per click (PPC.) When a user clicks on one of these results, the company that owns the listing is charged a fee. Companies bid on specific keywords as well as the position of their listings. For example, the ACME Compressor Company may bid $1 to be the top search result for “dental compressors.” While paid search seems relatively simple and straightforward, it is actually quite complex. Bid too high for a keyword and you’ll quickly burn through your marketing budget. Bid too low and no one will ever see your ad.
In contrast to paid search, natural or organic searches are the listings that appear just below the paid search ads, and they’re free. The major search engines rank Web sites based on their relevance to a particular search term. Today, an entire industry called search engine optimization (SEO) is focused on building and enhancing Web sites to reach the top of search engine results.
Given the complexity of both paid and natural search, I typically recommend that companies outsource these activities to specialists. Where I live in northern California, literally hundreds of consultants are focused solely on improving their clients’ search results. Regardless of whether you decide to outsource your search or retain it in-house, it’s important to closely monitor your results using one of many online analytics tools such as Google Analytics or Omniture. Not only will these powerful tools show you the return on investment of each of your paid search terms, but they will also tell you how users arrived at and navigated through your Web site.
E-mail campaigns, sometimes called “e-mail blasts,” are an extremely cost effective approach to targeting new customers. One of the most important factors in determining the success of an e-mail campaign is the quality of the e-mail list. First, you need to ensure that the list contains only those names that are the primary decision makers for your product or service. Many lists include e-mails for the entire staff of a dental practice. For example, it makes no sense to send a promotional e-mail for a digital X-ray system to a hygienist when the primary decision maker is the dentist. It is also critical that your e-mail list be fresh and contain valid names. You can evaluate the quality of an e-mail list by testing a small sample and determining how many names are rejected. A reject rate of less than 5% to 10% is acceptable.
Some quick tips on e-mail campaigns:
- Make sure your e-mail gives a reason for your recipient to open it. An e-mail offering a promotion or special is more likely to be opened than an e-mail announcing a new product launch. If you want to make sure your e-mail is clicked, put “Free” in the header.
- If your e-mail contains a product promotion, make sure the recipient is directed to the landing page that contains the promotion, not to your home page. Dentists don’t have the time to search through your site to find your promotion.
- Never send out an e-mail blast on Mondays or Fridays. Dentists receive a significant number of e-mails on Monday morning, which means they will spend less time reading yours. On Fridays, dentists start thinking about the weekend and are not in the mindset to think about your latest product launch.
Viral marketing — If you’ve ever received a video of a squirrel riding a unicycle or a baby doing the Macarena, you’ve experienced viral email. For years, marketers have tried to create funny or unusual videos that incorporate their product or service, hoping it will be sent to thousands of their closest friends. The challenge with viral marketing in our industry is that it’s extremely difficult to create a funny video about a dental product or service. Having said this, a colleague recently sent me a very amusing video of a signing dentist promoting PracticeWorks software.
Social networking — Marketers continue to search for ways to use Facebook, MySpace, Linked-In, and Twitter to target and acquire new customers. However, these social networking sites have yet to develop effective advertising models to market to dental professionals. While you are unlikely to attract new customers through these sites, I would encourage you to sign up for Linked-In and Facebook accounts. Linked-In is a terrific professional networking tool, and Facebook provides an easy way to stay connected to current and old friends.
Current customers — In an effort to find new customers, many companies neglect the value of their current customer base. Your existing customers are your best source of referrals. It is imperative that you stay in constant contact with your dealers and customers. As a first step, I would recommend conducting an outbound phone, e-mail, or direct mail campaign to obtain the most current contact information of your customers. You can offer them a small gift such as a $5 Starbucks card if they provide you with their latest information. You can even include a short customer satisfaction or product survey (less than 10 questions). Once you have entered their latest contact information in your CRM system, you should send them an e-mail or direct mail piece at least once a month to announce new products, product upgrades, and sales promotions.
Whether dental companies are focused on growing revenues from current customers or targeting new customers, new tools and technologies provide greater transparency to the effectiveness of their marketing budgets. As a result, dental marketers have begun to shift their marketing budgets from the more traditional programs such as print advertising, direct mail, and telesales to more cost-effective programs such as e-mail, paid search, and search engine optimization. Combined with the latest analytical tools and CRM systems, marketers can gain greater insight and more effectively deploy their valuable marketing resources.
Brian D. Jaffe is the vice president of sales and marketing for E-woo Technology USA Inc. Jaffe has over 15 years of senior level marketing experience and has held senior vice president of marketing roles at Suni Medical Imaging and Dent-X. He has a MBA from Harvard University and a master’s degree in engineering from UC Berkeley. He can be reached at [email protected].