Why is data analytics important for my veterinary practice?
Through running reports, we can gather the answers we need to improve profit margins, measure KPIs and produce data-driven business insights and action points. From maximising marketing campaigns to expanding our services; data tells us who are customers are, our best sellers and loss leaders, where we might regain lost revenue and how we might tweak the rota to best support our team. Data analytics also supports best practice. We can ascertain which team members are excelling at specific procedures, and where this knowledge can be shared. We can also search for trends and patterns in our patients’ diagnoses, keeping on top of emerging threats to animal health and improving patient outcomes.
If the prospect of analysing data feels daunting, you aren’t alone. Perhaps you are new to it, or only run reports occasionally and for very specific reasons. You may also simply feel that you don’t have the time. After all, running a veterinary practice rarely leaves you twiddling your thumbs, and if the practice is doing ‘all right’, then data analytics could be seen as a chore that you could do without.
But the reality is that our entire lives are becoming more digital, and that includes the world of business. In fact, evidence suggests that businesses that use customer analytics – such as those acquired through PMS reports – are 19 times more likely to outperform competitors in profitability.
Data is the new business currency and our most valuable asset. It never becomes obsolete, is consistently changing, and there is always something that we can learn from it.
There is no need to ignore data, and, thankfully, data collection and analysis doesn’t need to be as intimidating as you may assume. You certainly don’t need to be a finance guru to understand your reports.
Let’s take a look at three case studies in how data analytics has helped veterinary practices:
A five-vet practice that has been operating for three years was keen to improve their marketing return on investment. The team had run a variety of different marketing campaigns through various media but weren’t sure which campaigns had been effective.
Data analytics through their PMS allowed the team to track how they had acquired new clients, improving their understanding of how to reach both new and existing clients most effectively. Marketing focus was then directed to the most successful streams, while additional consumer demographic reports revealed important differences between client age groups, leading to the development of more bespoke marketing strategies.
A three-vet practice, that is well established in their local community, felt either overwhelmingly busy or frustratingly quiet. These inconsistencies had left the team alternating between exhaustion or feeling overstaffed. Clients had also been left to wait for unsatisfactory amounts of time during the busier periods, leading to complaints.
Through analysing invoice numbers, peak activity and client waiting times, the management team identified the seasonal differences that influenced the practice. Appointment patterns and staffing numbers were therefore increased during peak time, reducing the risk of team fatigue, and increasing client satisfaction. Additional practice activities could also be scheduled for the quieter times, such as building improvements and community events.
A twelve-vet, multi-disciplinary veterinary hospital had been struggling with increasing aged debt, despite seeing a year-on-year increase in EBITDA. While there were processes in place to prevent unpaid accounts, the practice had multiple client categories, all with their own method of paying. This range included clients with insurance but who paid up-front to clients with pet healthcare plans, clients without insurance and charity accounts.
By running daily debt reports as part of the standard cash and sales process, the front-desk team could immediately identify clients who failed to pay that day without a legitimate reason, and these non-payments were followed up quickly. These friendly communications significantly reduced unpaid accounts, and 'bad' debtors were promptly identified, allowing management to start more rigorous debt-recovery processes alongside the weekly aged debt analysis.
We rely on evidence-based clinical treatment plans for our patients, so it makes sense to have the same approach to business, and data analytics does just that.
As you read through this book, we’ll discuss how analysing your practice data can help you to:
Recognise growth opportunities
Improve your return on investment with marketing campaigns
Identify quiet and busy periods (and the consumer behaviour behind it)
Get on top of aged debt and track financial performance
Understand where to share ‘best practice’
Get the whole team involved so that data analytics becomes a part of everyday practice life.
References:McKinsey and Company (2014). Five facts: How customer analytics boosts corporate performance.
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A powerful tool to maximise profitability and grow your practice
Integration with your chosen providers and services
