Dental Marketing Step 3 – Life Time Value

How much you can afford to spend?

Life time value is the average revenue a clinic stands to gain over the lifetime a patient will visit the clinic. Now much of a general dental clinics work will be a check up and clean and depending on the area, size, customer demographic etc of your clinic/s this figure will be anywhere from $160 – $240. Of course there will be clinics that charge higher and lower than this amount but it gives us some average value to work on.

Next we know that some patients may be worth several thousand dollars ie root canal and crown. So we need to find an average value per visit and considering that you will have more check ups and cleans than root canals lets be conservative and say the Average Patient Value (APV) is $400 to you per visit. This number may go up or down depending on your clinic so it is essential that you re-calculate what that number may be for you.

We know that the average patient will re-visit (with a good recall system in place) every 6 months or 2 Purchases Per Year (PPY), so that means you will make $800 per annum from an average patient. Some patients will leave the area after just one years whilst others will remain in the area coming to your clinic for many years to come, however for the sake of being conservative let us assume that an average patient will come back to your dental clinic for a period of 3 years, this is our Life Time (LT).

We can now calculate our LTV.


= 400 x 2 x 3

= $2,400

This is discounting the value of referrals, that means for a percentage of new bookings created by your marketing campaign, those patients will refer you to other friends and families so quite often this number is significantly higher, however we try to be as conservative as possible so we know that we are working with worst case scenario numbers.

If our marketing campaign can yield 40 new bookings per month we know that the value to the clinic in LTV;

= $2,400 x 40

= $96,000 per month of marketing activity

We can also look at this figure without considering LTV and only considering immediate value. In this case we take APV and multiply it by the number of bookings we are seeing coming in that we can attribute to our marketing channels. So if we are seeing 40 new bookings per month;

= $400 x 40

= $16,000

We now have a standard to measure the success of our campaigns against as well as giving us an idea on how much we can afford to spend. So how  much should you spend? That again depends on your own budget but to give you an idea from what we see, small clinics will spend $1000-$2000 per month with 1-2 chairs, clinics with 2+ chairs that are looking to grow will spend $2000+ per month with some larger clinics with 4+ chairs spending $5000+ per month across across their channels of online marketing.

Many established clinics use this LTV method to calculate what they can afford to spend on their marketing. 

Stay tuned for our next blog where we will talk about how to put together a Dental marketing strategy. You can subscribe to our newsletters by filling in the form on the right hand side of this page and if you have any questions or would like some help from the professionals at BizGrow with growing your clinic, you can contact us on 1300 669 618.



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