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How to work out the lifetime value of your dental patients

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Lifetime Value for Dental Patients

Knowing the lifetime value (LTV) of your patients helps you make better, more informed decisions about your marketing. Find out how it works.


For those of you who’ve been meaning to do this for a while, there’s a handy spreadsheet for you to download to help you crunch the numbers.

The benefit of having this information cannot be overstated. With it you can shape your marketing strategy to bring down your Customer Acquisition Cost (CAC) and extract more value from the patients you’ve already got. Without it, your marketing approach no matter how sophisticated, is just guesswork.

If you want to skip the article and go straight to the free worksheet, click here.

So what is the lifetime value of a dental patient?  To put it simply, it is the average amount of money each patient in your practice is worth to you.

For relationship-driven businesses like dentistry, it pays to hang on to your customers. Transforming one-time buyers into repeat and loyal customers is crucial. They will be your greatest evangelists bringing with them friends and family and critically giving you that ‘oh so important’ social proof that businesses like yours rely on in the digital age.

What’s more with dentistry lifetime value can sometimes mean just that with patients returning throughout the many stages of their life to maintain a healthy smile. So how come too few of the dentists we speak to can quote this number when asked.

Well, part of the problem is it can be hard and knowing what formula to use – there are many out there to choose from can be overwhelming. The other issue is often being able to lay your hands easily on the data points you need to crunch the numbers. But if it feels hard, do it anyway, as I can guarantee it will be the best commercial decision you make this year.

Keep reading and we’ll tell you exactly what figures you need, how to calculate this yourself and of course, if you want to, download our worksheet to plug your own numbers in and get the insight you deserve into the health of your practice.

So, what goes into our calculation of the lifetime value of a dental patient?

The variables for the lifetime value of a patient are as follows:

  • Total revenue over period (TR)
  • Number of active patients over preceding period (PP)
  • Number of active patients over current period (AP)
  • Average revenue per new patient visit (ANR)
  • Number of new patients over period being measured (NNP)
  • Your direct costs over the period (DC)
  • Total number of patient referrals over the period (PR)

In the worksheet, we’ve provided some provisional numbers, however, please plug in your own figures to get your results. Below we’ve outlined an example to set you on your way. We’re basing our calculation on a 12 month period:

TR = £600,000
PP = 1,000
AP = 1,150
ANR = £150
NNP = 175
DC = £102,000
PR = 50

We then need to account for a number of different variables:

Churn rate: the percentage of patients that leave your practice)
Profit Margin: how much you keep)
Referral Rate: how often your patients refer new patients)
Average revenue by Active Patient: excluding new patient revenue)

In this scenario and jumping ahead a little (as all the formulas are available in the worksheet), the Customer Lifetime Value is £11,030.62

The final formula for how to calculate the lifetime patient value is:
((Live cycle * Average Collections by Active Patient) * profitability + ANR) + ((Live cycle * Average Collections by Active Patient) * profitability + ANR)*referral rate*life cycle

There you have it, it’s not so hard after all.

With this number at your disposal, you are now ready to make far better and more informed decisions about where to put your marketing spend, how much and what you need it to deliver in terms of return.

Any growth strategy will need you to spend money to make money. Digital advertising is no exception, however it is a channel where what you spend can be easily monitored, tracked and it’s return calculated.

Knowing how much your customers are worth to your business makes it far easier to work out an acceptable or profitable CPA or “Cost Per Acquisition” for each new lead and customer and if your dental digital marketing agency knows that, they should be far more able to calculate an optimum ad spend for your campaign.

Your agency should also be able to get new patient enquiries for your practice at a predictable cost for most treatments. They should help you bring new customers onboard, manage on-going communications to retain them and help attract and retain a loyal following to generate those all important referrals.

Over to you

To find out other ways to get better results from your digital marketing, click to read the free Ultimate Guide To Dental Marketing. It’s packed with information about to improve the financial performance of your practice.

Loran Simon

Loran Simon

Loran Simon is the Founder of Somnowell, one of the UK’s leading oral appliances to help to cure snoring and sleep apnea. Over the past 10 years, Somnowell’s growth has been mainly achieved using the digital marketing services of Somnowell Marketing, an agency that Loran Simon also founded and manages. The agency consistently generates thousands of new patient enquiries for Somnowell’s network of dentists.


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Book a quick exploratory
call with us.

We’ll take the time to understand your objectives and needs, and share our experience of working successfully with businesses like yours.