You’ve probably heard of the Pareto principle, right? It’s also known as the 80/20 rule.
It states that for many events, roughly 80% of the effects come from 20% of the causes.
A hundred years ago, Vilfredo Pareto, an Italian economist, observed that about 20% of Italians owned 80% of the land. He also realized that just 20% of the pea plants in his garden yielded 80% of the peas he harvested. And so on and so forth.
Once he noticed this ratio, he began to see it everywhere… and you can observe it, too.
80/20 at work in the world
Just as 20% of Italian landowners held 80% of the country’s land in 1906, today 80% of the world’s wealth is held by 20% of the population.
At Microsoft, 80% of software issues are caused by 20% of the bugs.
The most frequently used 20% of words in any language account for… you guessed it, 80% of word occurrences.
80% of employees at a company are usually responsible for 20% of the output. (Have you noticed that anywhere you’ve worked…?)
Similarly, in the US, 20% of patients use 80% of health care resources. For most businesses, 80% of income comes from 20% of the customers… and you can probably see where I’m going here.
Applying Pareto’s ideas to dentistry
I bet that if you do the math, you’ll find that about 80% of your patients just come in once or twice a year (or even less frequently, if they’re being really honest…). You do their standard cleaning, maybe some imaging or a filling every once in a while, and that’s it.
But the other 20% of your patients… well, that’s where the magic happens. One patient who needs a lot of work done can bring in as much revenue as 10 other patients combined. Sure, you do a bit more work for that one patient, but they are worth way more to you than one of those other, average, patients.
Same story with referrals. You probably put in the same amount of work to market to any potential patient. But think of a parent who brings along their spouse and all four of their children to see you… that patient is worth way more to you than a patient who will never refer a single other patient. This parent will bring you 5 new patients with no additional work at all!
Make 80/20 work for you
So who are your ideal patients? What common attributes to they share? How can you reach them?
Understanding exactly which patients make up that golden 20%, and more importantly, understanding their pain points and needs, will help you reach more of them. And if you make a concerted effort to reach out to them, you’ll move the needle and ensure the most profitable patients make up more than just 20% of your practice.
Stop wasting your time on marketing that reaches out to everyone. Start applying the 80/20 rule to your practice, and you’ll see the right clients flock to your practice.
If you’ve watched our webinar, you’ll know who the 20% are, where to find them, and how to attract more of them.
If you haven’t seen the webinar yet, it’s free, it’s an hour of exclusive content you won’t find anywhere else, and we’ll show you actionable tips to help you grow your practice right now. Click here to join an upcoming webinar.
What other ways do you notice the Pareto principle appearing in your practice? Let us know in the comments below!