DIY ROI: Revisiting the Tiered Categorization System for Benchmarking

By Peter Decoteau

When we explored measuring the return on investment (ROI) of traditional marketing activities in July, we began with the unavoidable truth that measuring ROI is both vital to marketing success and often incredibly challenging to execute correctly.

This is especially true for organizations running multiple marketing campaigns through various channels, as each platform requires a different technical or logistical set up to track metrics, along with different key performance indicators (KPIs) to measure performance.

Whereas in July’s article we dove into the specific approaches you can take to track ROI for traditional marketing activities, it’s important to keep in mind the broader view of what exactly this is all for and how it can be tied to your organizational benchmarks to drive your marketing efforts. For that “big picture” perspective, let’s revisit the “tiered categorization system,” first explained in the Impact article “Marketing Benchmarking: Using Data to Maximize Profits” written by Michelle Collie and published in October 2019.¹ Collie and another PPS Marketing Committee member, Scott Wick, explored the system in more depth at the 2019 PPS Conference and in subsequent PPS member webinars.

The system breaks down the primary influencing factors that resulted in scheduling a new patient into three tiers–primary, secondary, and tertiary–that get more granular the deeper you get. While this may sound complicated, it’s actually a fairly simple approach that codifies and prioritizes key influencing factors by both importance and ease of tracking. These three tiers are broken down below.

PRIMARY INFLUENCER (TIER 1): PHYSICIAN REFERRAL OR SELF-REFERRED (DIRECT ACCESS)

This top tier is simple, and that’s by design. It aims only to measure whether a patient was referred to physical therapy (not necessarily your clinic) by a physician, or whether the patient came to seek physical therapy without a referral (direct access). Basic information, yes, but a vital indicator of where your patients are coming from.

Examples:

• (Tier 1) John was referred to physical therapy by Doctor Matthews. Or…
• (Tier 1) John was not referred to physical therapy by a doctor but sought treatment on his own.

SECONDARY INFLUENCER (TIER 2): HOW DID THE PATIENT FIND YOUR CLINIC?

Tier 2 is where the setting up processes for tracking how a patient may have heard of you becomes vital. It’s also important to note that this level of tracking applies to both self-referred and physician-referred patients; while many groups may stop digging as soon as they see a physician referral, the truth is that most physicians are referring broadly to physical therapy and likely not directing patients specifically to your clinic. Therefore, finding out how a new, physician-referred patient ended up at your clinic is crucial to measuring the performance of your marketing activities.

Though still broad in definition, these influencing factors can tell a significant story about how people are finding you, what your target audiences see and respond to, and perhaps areas that deserve some more attention. Factors considered secondary influencer include word-of-mouth, being a previous patient, advertising (traditional and digital), insurance, or even something as basic as your clinic location.

Examples:

• (Tier 1) John was referred to physical therapy by Doctor Matthews and (Tier 2) he learned about your clinic in an advertisement.
• (Tier 1) John is a self-referred patient and (Tier 2) he already knew about your clinic because he received treatment at your clinic last year.

TERTIARY INFLUENCER (TIER 3): GOING DEEPER, GETTING GRANULAR

The third tier is the most difficult to track, but it can also be the most useful in identifying the exact influencing factor for a new patient. As you’ll notice in the two examples above, though, it may not always necessary to get this deep; in the example of a returning patient, there may be no other influencing factors to consider. On the other hand, if John was convinced to return to your clinic because he saw a reactivation email message or a compelling social media post, it would be useful to know which message facilitated his return. I told you it gets a bit complicated!

Tertiary influencers can include a specific advertisement (radio, print, digital, etc.), a specific community event, a friend or relative, a social media post, an email, your website, signage on your building, or a news story. As you can see, with as granular the third tier can get, the influencing factors can become numerous. This is why setting up processes and systems to capture this information is vitally important when attempting to prove the ROI on advertisements and other marketing efforts.

Examples:

• (Tier 1) John was referred to physical therapy by Doctor Matthews and (Tier 2) he learned about your clinic in an advertisement and (Tier 3) that advertisement was on the radio. Or…
• (Tier 1) John is a self-referred patient and (Tier 2) he already knew about your clinic because he received treatment at your clinic last year and (Tier 3) he was inspired to schedule a visit because of an eblast you sent to previous patients.

The tiered categorization system offers a high-level but structured approach to tracking the performance of various marketing efforts which, when tied to benchmarks, can provide a clear indication of the ROI for your marketing efforts. While broad numbers, such as new patients or self-referrals, can be useful in following trends and proving the value of platforms and activities generally, the more you set and track benchmarks for specific organizational metrics–say, doctor referrals from a particular region, or new self-referred patients scheduling appointments online–the more you can identify exact corollaries between action (influencer) and reaction (influence). Ultimately, the system helps you identify the marketing efforts that maximize your ROI, meaning better results, lower cost, and higher profits. 

References:

¹Collie M. Marketing Benchmarking. Impact. October 2019.

Peter Decoteau is the Director of Marketing at Physical Therapy & Sports Medicine Centers (PTSMC), Connecticut’s largest private practice physical therapy company. He can be reached at peter.decoteau@ptsmc.com.