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First Principle of Enduring Success: Existing Patients First

By Stewart Gandolf, Chief Executive Officer

Lane 1 of a running trackSome fundamental business ideas deserve repeating:

Successful marketing—and practice growth—begins with taking care of existing customers/patients first.

Growth-minded healthcare organizations often assume that business development is exclusively a matter of bringing new people through the door. Previous or existing patients—customers who have already crossed your threshold—are taken for granted, mentally considered “a done deal,” or “checked off the list” as permanently "captured" and in your corner.

Healthcare reform’s patient-centered emphasis produces newly empowered patients who are far from “permanently bonded” to any provider, practice or hospital. And in healthcare (as well as in most product and service businesses), customer service, experience and satisfaction are core strategies for success.

The business value of the “existing customers first” principle has long been appreciated…but, unfortunately, it’s often overlooked or relegated to a lesser standing in favor or finding and attracting new patients. Some numbers from the business world:

  • Acquisition costs are six to seven times greater than retention (usually more).
  • The main reason for lost customers is the overall poor quality of customer service. [Accenture]
  • Increasing customer retention by as little as two percent has the same effect as decreasing costs by 10 percent. [Murphy & Murphy]
  • A five percent reduction in customer defection can increase profits by five to 95 percent. [Bain & Company]
  • Unhappy customers virtually never complain. In The Paradox of Disappearing Patients they simply leave and never return. [Healthcare Success]

At the risk of over-simplification, the needs and wants of most patients are to “feel good,” (that is, to medically address and resolve their health issue), and to have a “good feeling” about the provider, the practice and/or the process (i.e., patient experience). In the retail world, 70 percent of buying experiences are based on how the customer feels they are being treated. [McKinsey]

The business and financial consequences for healthcare are widely understood as similar. What’s more, doctor’s clinical skills and patient interaction are only part of the equation. The office or practice culture, and particularly the office staff, can make or break patient satisfaction. Consequently, a loss in patients and revenue is highly likely.

The bottom line is that, by any name—customer service, patient experience, satisfaction and retention—is not only a fundamental principle of good business, it is an essential strategy for growth and success. When we consult or teach, an overarching concept about healthcare marketing is to take care of existing customers first.

Satisfied customers are ten times more likely to do business with you again.

  • The probability of selling to an existing customer is over 60 percent (vs. 5-20 percent for a new prospect.) [Marketing Metrics]
  • The top influence factor in healthcare provider selection is family and friend recommendations.
  • Positive patient experience fosters referrals, word-of-mouth, and enhanced reputation.

Patient retention, and a first-customer-first mindset, is a fundamentally sound way to protect your existing revenue base, minimize the influence of competition, and grow the practice.

You’ll find related reading in these articles from our free marketing learning library:

Lonnie Hirsch

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