‘How much should we be spending on marketing?’ It’s one of the most common questions practice owners ask, and one of the most commonly answered badly. Some agencies quote whatever package they sell. Others point to a percentage of revenue that has nothing to do with your practice.
A better answer starts with your practice, not a rule of thumb. Here’s a grounded framework you can work through yourself.
Step 1: Start with what you need to achieve
Marketing should serve a goal, so begin there. How many new patients do you want each month? For which services? Is the goal growth, filling a new practitioner’s books, replacing patients who’ve moved on or building a more profitable mix of services?
Be specific. ‘More patients’ is hard to budget for. ‘Fifteen new physio patients a month for our new practitioner’ is not.
Step 2: Check your capacity
There’s no point paying for patients you can’t see. Look honestly at how many new patients your team can take on, and whether reception can handle more enquiries. Marketing that overwhelms your practice wastes money and frustrates patients.
Step 3: Work out what a new patient is worth
Estimate the value of a typical new patient over the time they stay with you, not just their first appointment. A patient who returns for ongoing care is worth far more than a single visit. This number tells you how much you can sensibly invest to win each new patient.
Step 4: Estimate what a new patient costs to win
Different channels have different costs. Paid ads have a fairly direct cost per new patient. SEO and content cost more upfront and less over time. Recall campaigns bring back existing patients at very low cost. If you have past data, use it. If not, start with estimates and refine them once tracking is in place.
Step 5: Put it together
Here’s how the maths works, with made-up numbers purely as an illustration:
- Goal: 15 new patients a month.
- Estimated value of a new patient over time: $900.
- You’re comfortable spending up to a fifth of that value to win a patient: $180.
- Budget: 15 × $180 = $2,700 a month across all channels.
Your numbers will be different, but the logic gives you a budget tied to outcomes rather than guesswork.
Split fixed and flexible spending
It helps to think of marketing in two parts:
- Foundations. Your website, hosting and care, Google Business Profile, SEO and content. These build value steadily and shouldn’t be switched on and off.
- Flexible spending. Paid ads and campaigns you can turn up when you have capacity and down when you’re full.
A practice with strong foundations usually needs less flexible spending to hit the same goals.
Fix leaks before spending more
Before increasing any budget, check where patients are being lost. Unanswered calls, a slow website or a confusing booking process can waste much of what you spend. Fixing them is often the cheapest marketing a practice can do.
Review every quarter
Track enquiries, bookings and cost per new patient by channel. Every three months, look at what’s working and move money towards it. Budgets should respond to results, not stay fixed because that’s what was agreed a year ago.
What about percentage of revenue?
Some businesses set marketing as a percentage of revenue, and it can be a useful sense check. But it doesn’t account for your goals, your capacity, your competition or how established your practice is. A new practice in a competitive suburb needs to invest more than an established practice with a full book. Use percentages as a cross-check, not the starting point.
The short version
- Set a specific goal.
- Check your capacity.
- Know what a new patient is worth.
- Estimate what each channel costs per patient.
- Build the budget from those numbers, then review it quarterly.
Want help working out the right number for your practice? Our free practice growth audit looks at your current channels and results, and gives you a grounded starting point.