Aventine Partners

Stronger Patient Relationships

This summer, as most of America became embroiled in the debate over health care reform, we had the privilege of working with a client looking to reform how health care is delivered at an innovative chain of dental clinic.

A health care outsider had been brought in to run and grow this business.  He began to ask questions about patient relationships, but couldn't easily find the answers.  Questions like:

• What is our patient retention rate?
• Which of our offices, dentists, or hygienists do the best job of generating loyal patients?
• What is the value of a patient? 
• Why do patients defect?    

We worked with his team to develop a set of metrics and analyses that began to shine a spotlight on some surprising patient retention statistics and the potential value to be created by managing both patient retention and acquisition differently.

Topgrading Marketing Spend

As I noted in my post To Cut or Not to Cut?, this is a smart time for most companies to reduce marketing spend, notwithstanding desperate pleas from marketing services providers that you double-down in the downturn.

Is there a smart, systematic way to do this?  Probably, but it's elusive, as confirmed by the many stories I hear of the across-the-board, arbitrary 10%, 15%, 25% cuts many marketers are trying to cope with.

A recent white paper from former colleagues at Deloitte Consulting prompted my writing this post, so let's look at their approach, which they call Structural Cost Cutting.  

The premise of the Deloitte's Structural Cost Cutting is that the big opportunities for big near-term reductions in spend come from challenging basic assumptions about the business and how marketing supports it.  The savings will emerge from multiple categories of marketing spend.  The Deloitte hit list of areas to examine are:

Asset Portfolio Risk vs. Customer Portfolio Risk

Nearly every financial institution is undertaking a comprehensive reevaluation of methods and processes for measuring and managing asset portfolio risk.

But what about customer risk?

This came to mind recently when reading an interview with Wells Fargo's CEO, John Stumpf, in Investors Business Daily.  IBD chose Stumpf as their CEO of the year because he had the foresight to keep WFC away from the most toxic forms of mortgage assets, sacrificing considerable profits in the short term but keeping the bank out of trouble in the long term.  WFC may be down 33% from Jan 1, 2008, but that's a far cry better than the 60%+ drop in value for the banking sector as a whole.

I noticed in the interview a story we've been hearing from Wells for years -- an emphasis on cross selling and signs of higher-than-average retention experience in their customer base.