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Referral Programs that Get Results

Wendy S. Myers
Communication Solutions
1905 E. Mountain Sage Drive
Highlands Ranch, CO 80126
(720) 344-2347 office
(509) 277-4088 fax
wmyers@mycommunicationsolutions.com
www.mycommunicationsolutions.com

Seminar Overview

Where do you spend your marketing dollars? You may be surprised to learn that referrals are your No. 1 source of new clients. Learn why discounts, credits on accounts, and coupons don’t work. Instead, try these creative, affordable referral programs that get results.

What you’ll learn

•  How many referrals you need

•  Why you need to spend most of your marketing dollars on referral programs

•  Creative ways to thank referring clients

Why you need referrals

Average number of active clients per doctor

1,300

Percent of clients who move each year (20%)

  -260

Average number of new clients per year per doctor

  +308

TOTAL

1,348*

*Without effective marketing, you might gain only 48 new clients a year.

How many new clients do I need?

•  Average number of active clients per doctor

1,300

•  Average number of new clients per year per doctor

308

•  Average client retention

4.3 years

•  Average number of visits per client per year

3.9

•  Average charge per doctor transaction

$101

Source: 2000 Well-Managed Practice Study by Wutchiett & Associates and Veterinary Economics

Why you need referrals

To keep your practice healthy, you need at least 308 new clients per year—that’s 26 every month. If you want to GROW your practice, you need even more.

Where do you spend your marketing dollars today?

Yellow pages ads
Newspaper ads
Direct mail
Referral program
Sponsoring events
Other
TOTAL
$ ___________
$ ___________
$ ___________
$ ___________
$ ___________
$ ___________
$ ___________

How much do most doctors spend to attract new clients?

Most practice owners spend up to 1% of revenue on marketing programs.

Where should you spend your marketing dollars?

Referrals generate 53% of new clients!

Referral programs that DON’T work

1.  Coupons

"We sent $5 referral thank-you coupons to each client for each referral. Coupons could be applied to any product or service we offer. About 50% were redeemed. Due to staffing and time constraints, this program has been temporarily discontinued."

2.  Credits on accounts

"If an existing client refers a new client to us, he or she receives a $10 referral credit to use on any purchase. We’re currently exploring other ways to reward our referring clients."

3.  Discounts

"We’re experimenting with corporate discounts. Our program gives discounts to employees of America West Airlines, Intel, Dial Corporation, and Boeing. Human-resources managers give workers the form to complete and we create a personalized discount card. The client presents the card to the receptionist at the time of service. This seems to be an effective way to attract new clients, but our assessment of the program isn’t complete yet."

Why discounts, coupons, and credits on accounts fail

1.  Harms clients’ perception of value: "If you’re giving me $10 off now, are you overcharging me other times?"

2.  Less than 50% of clients redeem referral coupons or discounts

3.  Clients don’t get immediate gratification—they may wait months to redeem your "gift"

Referral programs that DO work

Too many veterinarians and practice managers roll the dice on yellow pages ads, coupons, free exams and other enticing offers that harm clients’ perception of value for your professional services. Rather than risk your reputation on marketing gimmicks, try these proven ideas that reward clients who refer others.

1.  Send a thank-you letter

As simple as it may sound, few veterinarians send thank-you notes to clients who refer new patients. You can spend as little as 34 cents in postage and get hundreds back in new business. Ask your receptionist or practice manager to send referral thank-you letters at the beginning of each month. Customize this sample thank-you letter to communicate your heartfelt appreciation:

"Thank you! We wish to express our sincere thanks for referring (name of new client) to our hospital. We appreciate the confidence you’ve shown in us by telling your friends about our clinic. We hope you and your friends will continue to be satisfied with the quality of care that our doctors and staff members strive to provide."

2.  Give every team member a business card

What happens when you give an 18-year-old kennel attendant her first business card? She gives it to everyone—classmates, friends and family members. Your kennel attendant will blow through 1,000 business cards faster than a tornado in Andover, KS. You can print 1,000 business cards for $50 or less and get plenty of marketing mileage. "Giving staff members business cards is a sales tool that personalizes almost every contact in our hospital. Most rank-and-file don’t have the opportunity to have their own business cards, so our staff members are very excited to find a reason to pass along one of their own cards with an ‘Ask for me’ comment," says Dr. Bruce Pedersen in Sandpoint, Idaho.

Also place business-card holders in every exam room and on your reception counter. Give clients a business card every time they visit, whether it’s for a medical appointment, food purchase or prescription refill. They may toss a card or two, but if one ends up in the hands of a potential client it could mean hundreds of dollars in new business.

3.  Put a sign on your reception counter, along with a business-card holder

At Cherokee Animal Clinic in Overland Park, KS, a sign on the reception counter reads, "The greatest compliment clients can give is the referral of their family and friends. Thank you for your trust!" Below the sign is a full business-card holder. Clients often take one or more cards to pass along.

4.  Host a client appreciation dinner

Invite your top 10 clients who refer the most new patients. This annual event will make them feel part of an elite club and lets you express your heartfelt appreciation. Choose a nice restaurant with a private dining room where you can have an intimate gathering.

Ask key staff members to attend so they can mingle with VIP guests. Use this social opportunity as a focus group to get feedback on why these clients consistently refer new patients to your practice. Remember, what gets rewarded gets repeated!

5.  Create a tiered rewards program

Thank clients based on their level of referrals. When clients refer more new patients, they earn greater recognition. For example, the first referral merits a warm thank-you note with a clinic brochure for the next client they refer. The second to fourth referral gets a pair of movie tickets. NEVER give a discount for professional services or products. Discounts are NEVER tax-deductible. The fifth referral qualifies clients for a dinner gift certificate or a beautiful bouquet of flowers. Imagine a female client who receives a bouquet of flowers at work from your hospital. She’ll feel like "Queen for a Day" and all her co-workers will hear about your caring hospital.

6.  Give clients a gift

Send something tangible and memorable. At Nassau Veterinary Clinic in Nassau, NY, clients receive a coffee mug with the practice logo that’s filled with spring flowers. The mug features the clinic logo, address and phone number. Because referring clients receive the gift at work, co-workers ask who sent the flowers. Many clients use the coffee mug daily at work. You also can send clients refrigerator magnets, pet photo frames, leashes and collars, movie passes and restaurant gift certificates.

Before starting any marketing program, understand where your new clients come from. Ask your receptionists to track how phone shoppers and new clients hear about your practice. Tally the results so you can decide how much to invest in referral programs, yellow pages ads, direct mail, event sponsorships and other advertising programs. With careful planning, you’ll spend your marketing dollars wisely and enjoy rewarding friendships with clients who refer new patients.

Wendy S. Myers is the former editor of Veterinary Economics. She owns Communication Solutions, a Denver-based consulting firm that helps practice owners and managers improve client service, marketing, newsletters, web sites and communication tools. She lectures at veterinary conferences nationwide on customer service, marketing and practice management. You can reach her at (720) 344-2347 or wmyers@mycommunicationsolutions.com.


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