How The Stereotypical Millennial Is Going To Impact The Growth Of Your Practice
The dental landscape is changing. Are you keeping up?
While eating a burrito yesterday at a hipster taco joint, I overheard a very interesting conversation. The lady beside me (let’s call her Samantha), who I’m guessing was in her late twenties, was complaining to a friend that she had to buy a single transit ticket for $2.75 instead of the month pass for $125 so she could save money to pay for rent. I understand life is expensive, but to me this was the epitome of irony and the embodiment of the stereotypical millennial. Here’s why… Samantha was eating a $12 burrito, $9 chips w/ guac, and drinking a $6 craft beer – she may have even had 2. Taxes and tip in, her meal was at least $30. Honestly, I was at a loss of words. I’ve joked around in the office about millennials and how they love their avocado toast and craft beer (true story, someone that applied for a sales job in March wrote that down as their hobby), but this scenario really got me thinking… How could someone who’s complaining about a $125 transit pass be ok spending $30 on a single meal, on a Wednesday.
For me, what’s both scary and exciting is that this generation is going to determine the success of your practice. Since I myself am a millennial, I thought I’d share a few stereotypes of our generation and how we will impact your practice.
Millennials want to enjoy life, not save money.
Our generation doesn’t value money the same way older generations do. We value experience, we want work-life balance. The cost of living has skyrocketed so saving money to buy a house doesn’t really make too much sense for us. Instead, we spend our money on things that make us happy like tacos, avocado toast and craft beer. Since we don’t save too much, we’re also pretty cautious about spending money on things that don’t make us happy – like getting our teeth cleaned.
Millennials have high expectations – especially at work.
Or maybe we’re needy and entitled. Either way, we expect more from our employers. We expect them to be more flexible and to make our lives less stressful. We want shorter work days, more vacation days, and more health benefits to name a few. Hell, forget Millennials, wouldn’t every generation want that if they could get it? So, if our employer is providing us with great health insurance, you better believe we are going to use it. And when we do, we’ll be expecting an appointment with a nearby dentist, right now.
Millennials are glued to their phones, tablets, and computers.
Remember when you used to look in the yellow pages to find a pizza delivery company? Yah, things have changed. Millennials do pretty much everything on their phones: order dinner, book hotels, buy clothes, and most important to you – find a dentist. They’ll be using Google or Maps on their Android or iPhone to find you, so you better be visible.
With this in mind, here are 6 statistics that will influence how you run your dental practice. They come from a variety of online sources including Forbes, Vendasta, Dental Economics, and our own market research.
1. Cost of marketing has increased 10X in the last 10 years
The reason why this is important is because of customer acquisition cost. 10-15 years ago when paid advertising was $1.00 / click, it made sense to dump money into Google AdWords. If you were an early adopter to PPC (Pay-Per-Click), you could get 20 clicks to your website for $20. For reference, it typically takes 20 clicks to get 1 dental patient. So in the early 2000’s you could acquire a patient for $20. Now the average cost of most high-traffic dental keywords is about $10. It still takes the average dentist about 20 clicks to get a patient, which means that the customer acquisition cost is closer to $200. What this means for you is that you need to a) focus on internal marketing and getting more referrals; and b) you need to make sure to focus on increasing conversions.
2. More than 60% of dentists said that referrals are still their #1 source of new business
Most dentists still track new patient sources on their new patient intake forms. If you don’t, you should. Anything you can do to improve new patient tracking will help you make better marketing decisions. The reason this is important is because you can then increase your investments on the types of marketing that are working the best. Here are a few questions to ask yourself: 1) What percentage of new patients come from word of mouth referrals; 2) What percentage of your budget is going towards getting more referrals?; 3) What can you and your staff do better to get more referrals? I’m not suggesting that you spend a proportionate amount on each marketing activity, however, I believe that referrals are best way to grow a practice without breaking your piggy bank.
3. 88% of people looking for a dentist read reviews online or are referred by a friend
This is crucial and cannot be ignored. I’ve got a client who attributes more than $600,000 in revenue last year to using our review and referral platform. With Google, Yelp, iPhones and Maps, it’s hard not to read reviews. Even when your existing patients are typing in your name or your practice’s name on Google, Yelp or Maps, they’ll see your reviews (or lack thereof). When someone types in “dentist in [city]” the first thing Google displays after the paid ads are the Google map listings. When your practice is literally being compared to every other nearby dental practice, you better believe that your reviews matter more than just about anything. Patients will look for star-rating and volume of reviews. Google will look for recency, frequency, volume, and star-rating when they are ranking you in the maps.
4. For each 1-star increase in rating, businesses see an 8% increase in revenue
This is an interesting stat that is commonly shared by most companies who sell reputation or review software. I can’t remember if I saw this on one of our competitor’s website or on Vendasta but it does make sense to me. It might be a bit skewed and play a bigger role in restaurants, hotels, or tourist activities, but I’m sure you get the point of the message. Basically if you go from being a 1-star practice to a 4-star practice and you have a lot of reviews, chances are you’ll increase your revenue quite a bit – in this example, it’d be by 24%.
5. More than 15,000 dental practices will have closed or been acquired by 2030
Private practice owners hate corporations – except when they need to sell their practice. Corporations spend WAY more money on marketing and have incredible new patient volume because of amazing offers that private practice owners can’t afford to give. And to make matters worse, they probably accept a wider variety of insurance providers than you do. The business model makes sense… Corporate dental practices can offer lower prices because they have lower costs. They spend less money on supplies (economies of scale), and less money on each dentist’s salary. Many dentists who work for corporate practices are recent graduates and are happy taking a salaried job to pay off their student loans. Keep in mind, these graduates are typically Millennials who want work life balance, less stress, more vacation days, time with their friends etc. etc. At the end of the day what matters is that corporate dentistry is real, it’s happening. It’s important that you keep an eye on what’s going on in your neighborhood. If / when it comes time to sell your practice, I’d bet that a dental corporation will try to wine, dine and pitch you on selling your practice to them.
6. Millennials are now the largest generation in the US
There is no getting away from this. Since Millennials are now the largest generation in the US, the success (and survival) of your practice will rely on your ability to cater to a very high-maintenance group of patients. In addition to providing an exceptional experience in the office, it’s crucial for you to have a strong online presence so that millennials looking for a new dentist to visit choose you, and not your competitors.
About Connect the Doc:
Connect the Doc is a technology company that provides a combination of software and services to help dentists to grow. Flagship software include the review platform and the referral platform. Together, you can expect to get 10-15 new Google reviews / month and 10-15 new patients / month (these numbers are based on seeing roughly 400 patients / month). Connect the Doc also provides its clients with a wide variety of digital marketing services including SEO, Paid Ads, Social Media Ads, and Email Newsletters. For more information, visit www.getconnectthedoc.com.