Two (2) Critical numbers you need to know when Marketing for New Dental patients

February 26th, 2018

In Today’s Marketplace, when It comes to Dental Practices like yours, Competition is fierce. You need to have a team focused on not only achieving the highest goal of gaining New Patients, but also, they need to collect and analyze relevant data to make sure your marketing dollar is being spent intelligently.


 As business owners, we have a pretty good idea as to what we’re paying for business expenses like consumables, salaries, leases, rent, supplies etc. It is very important that we don’t stop there when it comes to Our industry. We must dial in even further to become a super successful practice. Though it may seem challenging, we must apply a similar metric to the cost of acquiring a new patient.


The first thing to remember is the business of dentistry is based on recurring revenue. If new patients are not returning for subsequent treatment, that’s a whole other issue we can discuss in a future blog. 


Let’s evaluate the two numbers you’ll want to understand before we go any further:

  • Cost to Acquire Customers (patients) – CAC
  • The ability to monetize those patients & Lifetime Value (LTV) of each patient

What is Your CAC?

The CAC is your entire cost of marketing (include salaries if you have a designated marketing person) divided by the number of new patients generated. For most offices this will range from $150 to $300 per patient, and as a rule of thumb, you’ll want to recover the CAC cost in year one.

For most dental offices, CAC recovery will naturally occur in year one as new patient spend averages $700-$1250 or more. Calculate your new patient average spend with your overhead percentage (industry average 60-75%) to determine your net per new patient. You’ll likely find that you’ve covered the CAC cost with a net per new patient at roughly $250-300.


So how do i Calculate LTV (lifetime value)? book your free 15 strategy session

Calculating LTV is a bit more complicated. If you ask 6 different consultants and 12 dentists, you’ll likely receive 6 different methods of calculation and 6 different answers. What is consistent is that the average dental patient stays with a practice for 7-10 years and spends an average of $653 per year (ADA average). This means that a new patient will generate at least $4500 in revenue (excluding referrals) in their lifetime with a practice. You can clearly see that after year 1, what the patient pays is profit back to the practice. Dentistry is all about recurring revenue and acquiring quality new patients is worth the initial investment.

When a practice’s business model fails, its CAC (cost to acquire customers) equals or exceeds its LTV (ability to monetize those patients). In other words, the new patient experience doesn’t result in return visits and low satisfaction/patient churn is way too high. Whether you have a marketing team internal or you are working this all out yourself, you’ll need to keep this in mind.

In successful practices the Lifetime Value is significantly higher than the Cost to Acquire, and that is the key metric to keep top of mind. If your LTV is high, through minimal attrition and high procedure acceptance and referral rates, a $300-500 cost of acquisition makes solid business sense. Remember there is no Magic Bullet (Though Facebook has added a Great Boost) that will replace This kind of market intelligence being acted upon. Your industry still benefits from both digital marketing and Old School Newsletter and direct mail campaigns to keep your practice front of mind. You will need a market medium mix.

 Marketing discipline and execution are critical to any practice’s current and future success and understanding the relationship between your specific CAC and LTV are critical components for an effective and successful long-term marketing planning process. That being said you still need to remind your community about your practice and the significant offering your practice provides. 

It’s also imperative to have the right internal marketing processes in place to effectively monetize patients’ LTV and to be constantly looking to improve. Then you’ll be in an advantageous position to determine what and how much you need to invest in terms of new patient acquisition. There is GOLD in properly coordinating with and training your Front Office Team and your hygienist (but that is a whole other conversation, right?). This will reduce attrition rates and increase the ability to achieve elevated levels of referrals.

With all the variables involved in taking care of the patient once they arrive, it just makes sense to bring in a team that speaks to your marketing needs and understands the numbers that matters. If any of this resonates with you, Let's Talk. Find out if we can add value,increase your Patient work flow,decrease your CAC and  if Action Direct Digital Media is a Fit for You. We have strategies that are currently working to help Dental Practices like yours around the country dominate in their local market. You are smart so Give us a call or email us today. 800-471-0495 or email us at and one of our dental marketing consultants will reach out.