Making Data-Driven Marketing Decisions in your Clinic – Nick Schuster (Ultimate Physio)

Keeping the books full is more important than ever in this emerging post-COVID world of allied health clinic ownership. Profit margins are skinnier, canceled appointments are more plentiful and playing havoc with the diaries of our practitioners in 2022. It’s critical to keep our current and past clients engaged with their plans of treatment and get great results for great retention while also optimizing our sources of new clients for our business. When the books are full, the practitioners are happy and the clinic thrives. When the books look like Swiss cheese, everyone is stressed and the clinic suffers.


As a clinic owner you will commonly look at your practice management software and clinic diary, see these holes in the diary, and feel that you need to work harder or smarter to find new patients for your clinicians. Sometimes, especially during seasons like winter when sickness peaks and cancellations are higher, you can become acutely aware of the need to execute strategies to fill the books.


These strategies are essentially marketing. However, marketing for an allied health clinic can be tricky as you have so many options, and many of them have one challenge in common – you can’t really track how much you’re spending and therefore your Return On Investment (ROI).


There are 2 key metrics to understand in your clinic that assist your decision-making when putting your hard-earned time and money into strategies that will help you reverse engineer a great marketing decision.


They are – Return on Investment (ROI) and Lifetime Value of a client (LTV) – although this can be harder to calculate and sometimes I simplify it into another metric of Annual Value.


Here’s a practical example of each of the 2 key metrics above.

Calculating ROI

One of your first questions when a consultant, agency or advertiser asks you to spend money on potential (that is the key word) acquisition of new clients should be “What is my ROI”? And “Can you show me data to prove what you say”?

For instance, I was contacted by a lovely salesman from a local radio station asking me to spend money on radio advertising for my clinic. But when I asked the above questions, he couldn’t show me ROI so I declined to proceed with him. He showed me data about listeners, demographics, etc. but it really meant nothing to me as there was no certainty that I would achieve any results from working with his company and doing radio advertising.

The simplest example of ROI I can discuss with you is Google Ads. Say you work with a consultant who does your Google Ads. They cost you $500 per month. You spend another $500 a month on the ads. You acquire 20 new clients from the ads as shown by your Google reports and your internal tracking (the “how did you hear about us” question on your intake questionnaire).

For a $1000 spend you have 20 new clients. This equates to $50 per client. I personally consider a spend of anything less than $50 for a new Physiotherapy client worthwhile – but only if you track the next metric, and it’s all relative.

Lifetime Value, or more simply Annual Value (AV).

These example numbers are similar but not exact with regard to my clinic, Scarborough Physio and Health.

Last calendar year our clinic helped 1500 unique clients. In total the annual revenue from consultations was $1.5 million. Divide the annual revenue by the number of clients, and each of our $1500 clients spent an average last year of $1000 at our clinic.

If you measure lifetime value over a longer time period, say 5 years, you may find that your clinic helped 5000 unique clients over that 5-year period and made $7.5 million in revenue, and therefore the average client spent $1500 over the 5-year period. The lifetime value of a client really should increase annually in our industry as patients return for different episodes of care over time.

So the big question in regards to ROI is – ‘Is it worthwhile spending $50 to acquire a client who will spend $1000 with your business in a year?’

Technically you need to know your margins and profit as a percentage to answer this question most accurately, but if I knew I would spend $50 and an average client would spend $1000 with our clinic in a year, unless we were booked out week on week with no free spaces in the diary, I would be doing this spend every day of the week.

For the 2022 calendar year and for our physiotherapy service only, our AV of each client was $570. It is of, course, harder to calculate lifetime value. But based on this figure and our target profit margin of around 20%, my target acquisition cost per client needs to sit at $50 or below (including consultant costs associated with the service – ie to calculate a Google ads acquisition cost you must include the consultant’s monthly fee) to ensure I am getting value for my spend.

And every year the above $570 figure gets higher.

Where do you start? If you begin by simply calculating what you spend for each source of new clients and divide this amount by the number of clients that you are acquiring from each source, for which you will need your PMS and admin team working smoothly together (but that is for another article) I would suggest that is where you begin this process. You can input your values into the calculator below to help determine your AV and ROI.

My most impactful business coach once told me “What gets measured gets managed” and I want to leave you with this today.

In part 2 of the series, I will explore different marketing Channels and some Pros and Cons and helpful tips for each.

Nick Schuster

Ultimate Physio

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