August 01, 2006
6 min read

Good relationship marketing creates value, produces steady referral stream

Research shows that up to 40% of new referrals come from previous patients, not other physicians.

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Marketing your Practice [logo]Relationship marketing is one of several approaches you can use to promote your brand and practice, but it is unquestionably the most valuable.

After years of conducting market research on behalf of orthopedic surgeons, I have found that relationship marketing, supported by the right integrated strategy, produces more new patients than any other method. Relationship marketing can also be one of the least expensive marketing approaches, but it is rare to find practices executing it effectively because it is hard to do well.

Physicians often find relationship marketing challenging because of the perception that it is “selling.” To get beyond that, bear in mind that the best marketing tool is what you do in clinic and surgery, and how well you do it, which are hardly “sales” activities.

Whether assessing a knee injury, giving clinical recommendations, or making it easier for primary care physicians (PCP) to refer to you, relationship marketing is fundamentally about delivering value. This is not “easy marketing,” like writing a check to run an ad.

It might also mean that your staff needs to spend a lot of time in relationship-building activities that don’t seem to at first produce revenue. But relationship marketing represents your best opportunity to develop and reinforce a preference for your services that can ultimately lead to an increased number of new referrals.

Good relationships may also help minimize effects on your business from the ups and downs in the health care field today.

No. 1 relationship

Bill Champion [photo]
Bill Champion

When most physicians think of relationship marketing, they think of establishing and entrenching their relationships with key referral sources, such as PCPs. That’s only partially right. While PCPs account for a lot of the referrals that orthopedic practices get each year, some practices rely or focus on them too much and miss out on establishing solid relationships with their largest referral source: current patients.

With the onslaught of consumer-driven health care and increased access to medical information on the Internet, practices must begin to consider current patients as their major referral source. Central to relationship marketing with patients is how a physician treats a patient in clinic and surgery.

That relationship and the one between the patient and the physician’s staff has become a fundamental marketing resource for medical practices. Our firm’s research has repeatedly shown that previous patients refer about 40% of all new patients.

Interestingly, from a clinical standpoint, former patients are the least qualified to make those referrals. Instead, they base their referrals on how they feel about you as well as their experiences with your practice.

Before you spend another dollar on external resources to market your orthopedic practice, devote time to ensuring that the service you deliver to patients doesn’t just produce satisfaction or loyalty, but also creates patient advocacy.

True advocates are your most valuable marketing assets. They not only return to you for their next orthopedic need, but rave about you to others.

To promote that, try to create an exceptional medical experience for each patient based on his or her needs. Our experience shows this could immediately impact your volume. Then take it one step further and leverage that personal experience with an appropriate marketing strategy, as some leading practices have done.

Relationship marketing 101

As you consider implementing relationship marketing techniques, remember that each referral source is looking for something completely different, but they all want their individual needs met.

Build relationships with potential referral sources by meeting their needs as they have defined them, which might take some research. Once you understand their needs, align your services to meet those needs. That demonstrates your practice’s value, how well you listen and how much you care in a powerful way.

Start by identifying what each of your customers needs, which will differ among patients, PCPs, workers’ compensation contacts, coachers and atheletic trainers as well as the local community. As you start to develop a relationship approach, consider each target segment’s needs independently.

PCPs, for example, may be looking for better patient access. Your ability to fill that need creates value and builds trust. Workers’ compensation representatives may want timelier turnaround for documentation.

Tailoring your operations to be more time-sensitive and reliable than your competitors’ entrenches the working relationship. Your goal should be to make it easy to do business with you by being more responsive than your competitor.

Next, be sensitive to patient needs. Most patients undergoing total joint surgery have Medicare coverage and are not as concerned about private insurance or referrals, since nearly every provider usually accepts their coverage. Sports medicine patients seek the “right physician” who has a good reputation for treating certain sports injuries.

Since each customer is different, the way you communicate with them should vary. Be sensitive to those differences. Some orthopedic practices promote their ancillaries across the board to every referral source. Although it’s an easy approach, it can be offensive to PCPs, for example. Don’t just learn a customer’s needs; account for his or her concerns, too.

Big payoffs down the road

The ability to intimately understand the needs and concerns of your referral sources gives you a competitive advantage, especially if you are willing and able to execute on them. Reaching out to identify the needs and concerns of your market is critical as you seek the right volume of patients. But it requires effort, as does any valuable relationship.

The market will continue to define where it sees value and will increasingly favor providers who deliver. One of the most compelling benefits of having invested in strong, strategic relationships is that they endure.

If you envision how you would like your practice to look like in 5 to 10 years, most likely it will be shaped by relationships.

Visit led to 30% more referrals over three months

by Bill Champion
SPECIAL TO Orthopedics Today

Several years ago, I was working on developing a strategic marketing plan for a five-physician orthopedic practice. I interviewed “Dr. Smith,” the senior physician, to get his input on the practice’s top referral sources. One of the top five referrers was “Dr. Harris,” an area internist.

“What can you tell me about Dr. Harris?” I asked Smith. Smith said, “Well, he arrived roughly around the time I started 20 years ago and has probably been sending 80 patients a year to me since.”

I asked what else he knew about him. After a little silence, he replied, “Honestly, I don’t know much. Actually, if I sat next to him in the movie theatre, I doubt the two of us would recognize each other.”

Surprised by Smith’s comments, I went and visited Dr. Harris. I found out that he was a golf fanatic and could not stop talking about Tiger Woods’ recent victory. After a few minutes of conversation, he indicated he was sending roughly half his patients to the group I was working with and was happy with their care.

As it turns out, all five physicians in the practice I was working with were avid golfers. So, a few months later, Smith invited Harris to a round of golf at his club. It went well. Both shared a mutual dislike of insurance companies, lawyers and select hospital personnel.

Three months later, referrals from Harris were up 30%.

In summary, the 30% increase in referrals didn’t come from mailing a marketing slick to Dr. Harris or from the orthopedic practice sending him a holiday gift, although they had done that for the last 20 years. The increase resulted from reaching out to Harris in a way that meant something to him. In this case it ended up being golf, the love of his life.

Do you know what is important to the Dr. Harrises in your market? Find out. Then build a relationship with would-be referrers like Dr. Harris based on those factors, back it up with good clinical expertise, and maintain those relationships. As a result, your orthopedic practice should expect to see a healthy inflow of new referrals.

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