Be the center of attraction

Why waste time looking for new clients if you don’t know why pet owners are leaving? Correct your hospital’s problems and start a marketing campaign.

Be the center of attraction
Growing practices also lure clients from other hospitals by offering something unique that pet owners really want.

In spite of a good economy and more owned U.S. pets, a couple of studies have shown concerning trends in veterinary medicine. The first piece of data comes from Insiders’ Insights, a Veterinary Hospital Managers Association monthly study of the same approximately 700 practices, which revealed that since 2014, new client numbers have declined every month except for one. Meanwhile, the American Veterinary Medical Association’s latest Pet Ownership and Demographics Sourcebook indicated a decline in veterinary visits from 2011 to 2016. Insiders’ Insights data showed an increase in veterinary visits in 2017 but declines in 2018 and the first half of 2019.

These trends aren’t affecting every hospital, but the data is concerning enough to suggest that all practices should take a closer look at attracting and keeping new clients. What I recommend, however, is that practices first review whether they are keeping clients before they focus on attracting new ones. There is no point in bringing in new clients if the pet owners are going to have a dreadful experience or if the practice isn’t providing what they want.

Do the Math

Tracking client-retention metrics is an important first step. New client, active client, practice transaction and doctor (medical) transaction figures are readily available from practice information management systems, and these figures should be compared from month to month and from this month in the current year to the same month last year. In addition to regularly reviewing those metrics, the management team should calculate the retention rate and the bonding rate.

Comparative benchmarks are available for some of these metrics from the most recent versions of the Well-Managed Practice Benchmarks Study and the American Animal Hospital Association’s Financial and Productivity Pulsepoints. These studies consider an active client to be one who had at least one transaction in the last 12 months.

Tracking internal trends is just as important as comparing your practice to others. The frequency of tracking also matters. If you look at metrics annually, a downward trend might have started long before you notice it. If you are starting to collect some of this data, pull historical numbers for the last few years, but track monthly going forward. When comparing to other practices, the figures must be calculated as a ratio; the number of full-time-equivalent doctors is the most commonly used basis.

The retention rate tells the management team, on average, how long clients stay with the practice. It is calculated by dividing the number of active clients for a 12-month period by the number of new clients over the same period. For example, 1,100 active clients divided by 240 new clients equals 4.6 years.

The bonding and lapsed client rates are calculated as the percentage of clients with an invoice at the practice during, for example, 2017 who also had a transaction in 2018. Another way of thinking of this is that the bonded client rate is the percentage of active clients in 2017 who were active in 2018. (Talk to your PIMS help desk about how to get this information.)

The lapsed client rate is the inverse of the bonding rate. For example, if 68% of the clients seen in 2017 were seen in 2018, that is the bonding rate. Subtract that number from 100% to get the lapsed client rate, or 32%. This calculation has some drawbacks. First of all, the information is somewhat dated by the time you get it; just because someone liked the practice enough in 2017 to come back in 2018 doesn’t mean they had a good experience in 2018 and will return again in 2019. And one purchase of pet food a year doesn’t necessarily make a pet owner a bonded client.

Because of these limitations, don’t rely solely on the bonding and lapsed client rates to understand what is going on in the practice. The management team also should regularly look at the other metrics discussed above and at the information in the next section.

Now What?

Knowing how effectively your practice is holding onto and attracting new clients isn’t enough. Here’s what I recommend:

  1. Determine why pet owners like or don’t like your practice. One way of doing this is to create a culture in which client complaints are welcomed and the practice works to make things right. Keep a list of complaints to identify patterns.
  2. Review records transfers and reach out to those clients. Acknowledge the transfer request and assure the client that it was done. Then say something like: “You’ve been with our practice so many years and we’ve loved taking care of Fluffy and Jasper. We were concerned that you may have asked to have your records transferred because of a problem or concern we hadn’t addressed. We’d like to make that right if we can.” This call needs to be made by someone who knows the client and can effectively deal with any complaints.
  3. Regularly look at online reviews of your practice. Some wacko pet owners with unreasonable expectations occasionally will post, but don’t be too quick to dismiss every negative review as coming from a wacko, particularly if you are getting similar complaints from multiple posters. Use the feedback to guide needed improvements.
  4. Create informal focus groups. Hiring a professional facilitator can get clients to open up about what they like about your practice and what they wish you did differently, make sure the questions are structured appropriately, and keep the conversation flowing.
  5. Regularly survey clients about their experience. A 2017 Insiders’ Insights survey found that about 50% of practices sent client surveys after every visit. Practices aren’t always sure what to ask, but identifying the percentages of truly bonded and not bonded clients and asking additional questions is most effective.

What’s Your NPS?

This is where your net promoter score (NPS) comes into play. It’s a highly thought of and widely used way of measuring client satisfaction in many industries. The key question to be included in your survey is: “How likely is it that you would recommend ABC Animal Hospital to a friend or colleague?”

A 10-point scale should be used to measure results. Promoters of the practice are those who give a 9 or 10; they are loyal and enthusiastic. Passive clients will rate the practice a 7 or 8; they are satisfied but unenthusiastic and could go elsewhere for veterinary care. Detractors, or those who rate the practice from 0 to 6, are unhappy clients who can do real damage to a practice’s reputation.

The net promoter score is calculated as the percentage of promoters minus the percentage of detractors. For example, 60% promoters minus 32% detractors equals an NPS of 28.

A score of greater than 50 is considered excellent for large national brands such as telephone and internet companies or for automobile dealerships. Small, service-oriented businesses such as veterinary hospitals generally average much higher ratings (75 to 80). If the practice rating is less than this, you have client service or pricing/value issues that need to be investigated and corrected.

Go After Them

Once you have corrected problems in the practice and offer a superior client service experience, it’s time to think about how to attract more new clients.

Rarely will you find a community that has an abundance of pet owners looking for a veterinary hospital and unable to find one. New clients might be literally new because they just moved into the area or acquired a pet and now need a veterinarian. However, growing practices also lure clients from other hospitals by offering something unique that pet owners really want.

The concept of competitiveness among hospitals is often uncomfortable for the management team; we see our profession as very collegial. It’s not a question, however, of actively trying to steal clients but instead of understanding what pet owners want and then providing it. All successful businesses focus on key client needs.

One of the most important things the management team must do is identify what makes the hospital unique and decide if those attributes are important to clients. Your practice might be unique because it offers rehabilitation services, but is that important to a large number of clients and will it result in significant growth?

Clients generally judge their veterinary hospital experience by non-medical standards. (They assume the medicine is good.)

Examples include:

  • Convenience: Hours the hospital is open and the ability to go online to make an appointment or refill medications.
  • Communication: Regular updates about a hospitalized or boarded pet’s condition; fast responses to questions; prompt communication of lab results; and the use of email or text messages.
  • Real relationships with the veterinary team: Think good bedside manner.
  • Value: The hospital’s services are worth the price, and payment options are available.

Have a Great Marketing Plan

Not every client wants the same thing, and not every practice has the same type of clients, so identifying what is important to your clients is critical. It’s critical to remember that what potential clients wanted five years ago is different from what they want now. Merck Animal Health’s 2018 Pet Owner Paths study — check it out at — offers interesting insights into the changing needs of pet owners.

Once you have a good idea of who your best clients are and what your core clients want and value, the management team needs to put together a marketing campaign that communicates these attributes to current and potential new clients.

Marketing used to be easier in veterinary medicine. Today, the practices typically growing the fastest are working with a marketing professional to make sure the right message is being delivered in the right way to the right audiences. A part of your marketing program includes tracking the success of each component of the plan. The management team needs to know where new clients are coming from, the cost of acquisition and which programs produce the “best” types of clients.

Ultimately, the goal is simple: Find out what your clients like and provide it. Implementation, however, is harder, but my recommendations above will move your practice in the right direction.

Dr. Karen E. Felsted founded PantheraT Veterinary Management Consulting. She spent three years as CEO of the National Commission on Veterinary Economic Issues. Protection Status