The 80/20 Rule: Are You Using it to Your Advantage?

You’ve prob­a­bly heard of the 80/20 rule, but are you using it advan­ta­geously in your mar­ket­ing efforts?

Use the 80/20 Rule to Your Mar­ket­ing Advantage
In the early 1900’s, an Ital­ian econ­o­mist named Vil­fredo Pareto for­mu­lated this con­cept from his obser­va­tion that 80% of the land in Italy was owned by the wealth­i­est 20% of the pop­u­la­tion. Later he found he could apply this rule to many other aspects of life, includ­ing his pas­sion for gar­den­ing. Since then his the­ory has made its way into busi­ness man­age­ment prin­ci­ples as the 80/20 rule, i.e., 80% of busi­ness rev­enue comes from 20% of cus­tomers or 20% of books pub­lished yearly (the best seller list) gen­er­ate 80% of total book revenues.

In fact, once you start look­ing at life through the 80/20 prism, it’s uncanny at how rel­e­vant and omnipresent it is. You’ll be sur­prised at how many “best seller” lists you uncover!

Apply­ing the 80/20 Rule to the Infer­til­ity Marketplace
Most fer­til­ity providers can apply the 80/20 rule to their best advan­tage, espe­cially as it applies to mar­ket­ing. In real­ity, the rule is noth­ing more than a means to clar­ify the most prof­itable or suc­cess­ful aspects of your orga­ni­za­tion and to help you focus on fur­ther max­i­miz­ing the poten­tial they offer. It also can be a wake-up call for not putting all your eggs in one bas­ket and to start diver­si­fy­ing refer­ral sources. But don’t obsess about math­e­mat­i­cal accu­racy. The 75/25 or the 60/40 rule can be as mean­ing­ful. Remem­ber, it’s only a metaphor for stream­lin­ing your busi­ness and mar­ket­ing oper­a­tions. Let’s start with a few exam­ples of how this plays out.

Refer­ral Sources
One of the most help­ful appli­ca­tions of the 80/20 rule for your mar­ket­ing efforts is in the eval­u­a­tion of how patients learn about your ser­vices. If you con­sis­tently ana­lyze these refer­ral sources, you will prob­a­bly dis­cover that the major­ity of your patients come from a small per­cent­age of cat­e­gories, such as physi­cian or patient refer­rals. Delv­ing fur­ther, you also might deter­mine that 20% of the physi­cians who refer account for 80% of the patients. Or if you con­duct search engine mar­ket­ing like Google pay-per-click, you might find that 20% of the key­words pro­duce 80% of the clicks.

Mak­ing the 80/20 Rule Work for Your Mar­ket­ing Plan
If your prac­tice has a mar­ket­ing plan, you are prob­a­bly using a vari­ety of strate­gies and tac­tics to attract and retain patients. So if only a few types of refer­ral sources bring in the bulk of your patients, should you bother using the rest or should you fur­ther con­cen­trate your lim­ited resources on the top players?

The long and short answer is that you need to do both, but be real­is­tic about the expec­ta­tions and results. Here are a few points to con­sider:
1) Smother your best cus­tomers in good­will: Are you show­er­ing your best cus­tomers with the appre­ci­a­tion they deserve? It is easy to take a refer­ral source for granted if it seems like they have always referred to your prac­tice. But remem­ber, the com­pe­ti­tion is prob­a­bly lurk­ing in the shad­ows watch­ing for an oppor­tu­nity to serve it bet­ter.
2) Cir­cum­stances change: What if your best refer­ral source could no longer refer to you because of a change in its par­ent hospital’s affil­i­a­tion or due to insur­ance car­rier restric­tions (if insur­ance cov­er­age is applic­a­ble)? Have you cul­ti­vated other refer­ral sources to make up for the cur­rent and future decline in patients? Have you estab­lished your brand suf­fi­ciently so patients self-refer or sug­gest your prac­tice to their physi­cian?
3) Patients are an untapped resource: Most likely, cur­rent and for­mer patients are refer­ring patients with­out any prompt­ing or request from you or your staff. They are happy that you have changed their lives, so they are spread­ing the word about their expe­ri­ence with your prac­tice. But imag­ine if you con­sciously har­nessed the power of the patient refer­ral — what I call WOMB, word-of-mouth busi­ness? Then you have estab­lished a mar­ket­ing team that can help grow your prac­tice.
4) You still need to spend part of your bud­get on adver­tis­ing and other tac­tics: Yes, I sug­gest that you employ the full arse­nal of mar­ket­ing tools as part of your plan. For most prac­tices, physi­cian and patient refer­rals are like the main courses of a meal. You still need and want dessert, how­ever, so invest­ing in your Web site, search engine mar­ket­ing, patient sem­i­nars, social media and pub­lic rela­tions are also nec­es­sary to estab­lish brand aware­ness and bring in refer­rals.
5) Refer­ring physi­cians and patients also respond to adver­tis­ing and brand­ing efforts: You under­stand how long it can take some patients to finally feel ready to start infer­til­ity treat­ment. This is why rein­force­ment from a vari­ety of sources is cru­cial to a suc­cess­ful inte­grated mar­ket­ing plan. It will help spur patients to take the action they need to resolve their infer­til­ity. So unless you ask patients in your sur­veys about the vari­ety of ways they heard about you, you might not real­ize that it took many “ref­er­ences” before they made the first appoint­ment. These ref­er­ences could have been their OB/GYN, their best friend’s neigh­bor, the post they read on a dis­cus­sion board, and the radio ad they heard on the way home from work. A syn­er­gis­tic, inte­grated mar­ket­ing plan is a beau­ti­ful thing — at least to mar­ket­ing mavens.

Have Fun with the 80/20 Rule
So take some time to look at the world and your mar­ket­ing prac­tices with the 80/20 rule. It’s a fun exer­cise that will have ben­e­fi­cial and tan­gi­ble results.

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