You’ve probably heard of the 80/20 rule, but are you using it advantageously in your marketing efforts?
- Use the 80/20 Rule to Your Marketing Advantage
In the early 1900’s, an Italian economist named Vilfredo Pareto formulated this concept from his observation that 80% of the land in Italy was owned by the wealthiest 20% of the population. Later he found he could apply this rule to many other aspects of life, including his passion for gardening. Since then his theory has made its way into business management principles as the 80/20 rule, i.e., 80% of business revenue comes from 20% of customers or 20% of books published yearly (the best seller list) generate 80% of total book revenues.
In fact, once you start looking at life through the 80/20 prism, it’s uncanny at how relevant and omnipresent it is. You’ll be surprised at how many “best seller” lists you uncover!
Applying the 80/20 Rule to the Infertility Marketplace
Most fertility providers can apply the 80/20 rule to their best advantage, especially as it applies to marketing. In reality, the rule is nothing more than a means to clarify the most profitable or successful aspects of your organization and to help you focus on further maximizing the potential they offer. It also can be a wake-up call for not putting all your eggs in one basket and to start diversifying referral sources. But don’t obsess about mathematical accuracy. The 75/25 or the 60/40 rule can be as meaningful. Remember, it’s only a metaphor for streamlining your business and marketing operations. Let’s start with a few examples of how this plays out.
One of the most helpful applications of the 80/20 rule for your marketing efforts is in the evaluation of how patients learn about your services. If you consistently analyze these referral sources, you will probably discover that the majority of your patients come from a small percentage of categories, such as physician or patient referrals. Delving further, you also might determine that 20% of the physicians who refer account for 80% of the patients. Or if you conduct search engine marketing like Google pay-per-click, you might find that 20% of the keywords produce 80% of the clicks.
Making the 80/20 Rule Work for Your Marketing Plan
If your practice has a marketing plan, you are probably using a variety of strategies and tactics to attract and retain patients. So if only a few types of referral sources bring in the bulk of your patients, should you bother using the rest or should you further concentrate your limited resources on the top players?
The long and short answer is that you need to do both, but be realistic about the expectations and results. Here are a few points to consider:
1) Smother your best customers in goodwill: Are you showering your best customers with the appreciation they deserve? It is easy to take a referral source for granted if it seems like they have always referred to your practice. But remember, the competition is probably lurking in the shadows watching for an opportunity to serve it better.
2) Circumstances change: What if your best referral source could no longer refer to you because of a change in its parent hospital’s affiliation or due to insurance carrier restrictions (if insurance coverage is applicable)? Have you cultivated other referral sources to make up for the current and future decline in patients? Have you established your brand sufficiently so patients self-refer or suggest your practice to their physician?
3) Patients are an untapped resource: Most likely, current and former patients are referring patients without any prompting or request from you or your staff. They are happy that you have changed their lives, so they are spreading the word about their experience with your practice. But imagine if you consciously harnessed the power of the patient referral — what I call WOMB, word-of-mouth business? Then you have established a marketing team that can help grow your practice.
4) You still need to spend part of your budget on advertising and other tactics: Yes, I suggest that you employ the full arsenal of marketing tools as part of your plan. For most practices, physician and patient referrals are like the main courses of a meal. You still need and want dessert, however, so investing in your Web site, search engine marketing, patient seminars, social media and public relations are also necessary to establish brand awareness and bring in referrals.
5) Referring physicians and patients also respond to advertising and branding efforts: You understand how long it can take some patients to finally feel ready to start infertility treatment. This is why reinforcement from a variety of sources is crucial to a successful integrated marketing plan. It will help spur patients to take the action they need to resolve their infertility. So unless you ask patients in your surveys about the variety of ways they heard about you, you might not realize that it took many “references” before they made the first appointment. These references could have been their OB/GYN, their best friend’s neighbor, the post they read on a discussion board, and the radio ad they heard on the way home from work. A synergistic, integrated marketing plan is a beautiful thing — at least to marketing mavens.
Have Fun with the 80/20 Rule
So take some time to look at the world and your marketing practices with the 80/20 rule. It’s a fun exercise that will have beneficial and tangible results.