In the popular book series, Rich Dad Poor Dad, author Robert T. Kiyosaki makes the distinction between assets and liabilities. Rich people invest in assets. Poor people spend their money on liabilities.
That came to mind as I was considering the wisdom of a chiropractor friend having a ball because he recognized the lifetime value of a patient. Turns out he “gets” the idea that his inactive patient files are assets. The names of people who know him, his personality, his results and his office location are a valuable asset. While other practices shuttle their inactive files first to the basement, then to the storage unit and then to the silver recycler, Steven understands that many of his inactives are merely waiting for an invitation to return!
Instead of seeing the brightly colored labels as a sign of rejection, he sees them as merely the artifacts of a relationship that has yet to be fully manifested. So he keeps in touch. He has a special knack for presenting a self-deprecating image of himself, obsessed with his boating prowess. Never mind it’s a 12 foot pontoon boat trapped on an obscure fresh water lake. His patients are amused by his vision of himself as a crusty sea captain. In fact, in a recent patient mailing the grand prize was an all expense-paid cruise.
Never mind the Boating Monthly magazine cover that he mocked up with the help of Photoshop. (It’s the only way he would get himself profiled at the helm of his 12” draw vessel.) Steve is having fun! Road construction in front of the clinic? No problem. Time for another postcard to his inactives that combines humor, irony and some playful fun.
This is because Steve understands the lifetime value of a patient (LVP).
More important than new patient or retention statistics, LVP is the dollar value of an average patient. That is, how much does an average patient spend with you during the course of their life?
Don’t be put off by the term “lifetime” when you’ve only been in practice for just a couple of years. All that means is, how much does a typical patient spend once they become a patient? Compute this figure for your practice by totaling up your total collections and dividing by the number of new patients you’ve seen. For example. If you’ve been in practice for five years and have seen 1000 patients, and your total collections have been $2,000,000, then the lifetime value of a patient in your office is $2,000.
Which begs the question: what would you invest (and for how long) to attract and cultivate a new patient relationship if the average relationship resulted in $2,000 of gross income?
But my friend Steve understands one other piece of information that seems lost of chiropractors fixated on getting new patients. And that is: The people most likely to show up in his office are people who have already been in his office. Most people would rather go to a place they’ve already been, then venture into unknown territory of an office they’ve never been to before.
That’s not a controversial idea. Except for one little detail. Many chiropractors do such a poor job of saying goodbye when a patient tries to disengage from the practice, that patients would rather venture into unknown territory than give you the pleasure of an “I-told-you-so” when they have the inevitable relapse. That’s winning the battle, but losing the war.