Last week I promised to share how to apply the principles from the book “The Sticking Point Solution” to be more strategic, analytical, and systematic with your Medical Spa marketing.
Let’s jump right in…
Right now is a great time to be analytical, because analysis takes time, and time is something we currently have a lot of.
One of the best uses of your time is to identify the top 20% of your business inputs that are contributing the 80% of the outputs.
Let me explain:
In business (and life), we assume there’s a linear relationship between cause and effect, when in reality, it’s super lopsided.
This phenomenon is also called the “80/20 Principle”, the “Pareto Principle”, or the “Law of The Vital Few”.
It’s the same reason why roughly 80% of the world’s wealth is concentrated among 20% of the population, 20% of the roads receive 80% of the traffic, and even why 20% of your shoes get worn 80% of the time!
Why is this important in business?
Because it’s easy to fall into the trap of thinking all inputs (money, patients, staff, procedures, time) contribute equally to outputs (patient results, profit, freedom, and fulfilment).
The more likely case is that a small fraction of your money, patients, staff, procedures, and time “carrying the team”, driving your business forward while the rest contributes minimally.
This is why it’s crucial to regularly take stock of what you’re doing, so you can do MORE of what’s working and LESS of what’s not working.
Ok let’s get specifics… what should you be taking stock of?
There’s a lot you can analyse, but for now let’s focus on procedures and patients.
The 80/20 Principle is super relevant here, especially for established clinics.
The big aesthetic suppliers do a great job at making you think more procedures = more growth.
When in reality, more procedures = more overhead and headaches.
This is because no matter how many machines you have, they’ll always be those few “workhorses” that are super profitable, while the others just collect dust.
As an exercise, go through your books and figure out how much revenue each treatment contributes, as a percentage of total sales.
You may find that the numbers approach an 80/20 distribution.
For example, if you have 10 treatments, it’s likely that 2 of them are producing 80% of revenue.
If this is true, you might ask yourself: “Is it even worth keeping these other treatments”?
You may find it liberating to scrap some procedures entirely and focus on a few key treatments that get the best results.
In fact, this is what I did with my marketing agency.
We used to be “generalists”, offering websites, social media management, graphic design etc. etc...
Now we focus on ONE key service: Lead Generation & Appointment Booking for Medical Spas.
The result is the ability to get REALLY good at what we do, which ultimately leads to better results for our clients.
It definitely pays to keep things simple!
This brings us to the next subject of your 80/20 analysis:
You probably have a rough idea of who your “star” patients are, but it’s definitely worth going through your books and determining the exact distribution of patients to revenue.
As an experiment, add up your total revenue from 2019.
Then, if possible, organize your patient database in a spreadsheet in order of highest spending to lowest spending for 2019.
Sum the total spend of the top 20% of patients. For example, if you have 2130 patients, add up the revenue for the top 402.
Then, divide that number by your total revenue.
I bet you’ll find that number to be at least 50%, meaning 20% of patients contribute to more than 50% of revenue.
In fact, the distribution will probably look like the chart below.
If this is true, you should be diving deep into figuring out who these top 20% of people are and where they came from, so you can attract more of them.
Are all these patients over a certain age? It may be worth adjusting your messaging to speak just these people and no one else.
Do many of them come from a few “super-referrers” such as a local salon or yoga studio?
If so, you should approach these sources of referrals and negotiate a joint venture so they send you even more of these star patients.
The WORST thing you can do is focus on all patients and sources of patients equallydue to “fear of missing out”.
Weak marketing is unfocused marketing that tries to attract everyone.
If you try to be everything to everyone, you’ll end up attracting no-one because no-one will feel like you’re speaking just to them.
And if you never do this type of analysis, you’ll never have the confidence to narrow your focus this select group of people.
I hope it does because this idea alone can be the difference between a bloated, failing clinic with monster overhead and an efficient, hyper-profitable clinic that creates amazing results for customers and is FUN to work at.
So at the very very least, try these two exercises in the name of curiosity alone - you may be surprised by the results. 😉
1. Right now is the perfect time to be analytical, because analysis takes time, and right now we have a lot of it!
2. The most impactful analysis is to identify the 20% of your business inputs that are contributing the 80% of the outputs.
3. You should start by analysing your procedures and patients as inputs.
4. Once you’ve identified top 20% of inputs, look for ways to maximize them, while minimizing or even eliminating the bottom 80% of inputs.
Lastly, in a down economy, this analysis is more important than ever, because you simply can’t afford to waste resources on things that don’t work.