The Rise and Fall of the Narconon Internet Marketing Empire (Part 4)

If you missed the earlier segments of this series, see Part 1, Part 2, or Part 3.

Running a Sales Floor in the Treatment Industry
So far we’ve focused a bit on generating leads into a treatment center, especially Narconon.  But, before we continue into paid internet search advertising, it’s important to understand that simply getting phone calls isn’t enough.  What you do with those calls is equally, if not more, important than getting the calls. Getting people to call into your treatment center is critical to generating admissions. But closing them can be even more important. Ideally, calls should equal closes. Closes mean revenues. There are several factors involved in running a sales floor within a treatment center.

Closing Ratio:
A closing ratio is one of the most important factors in running a sales floor in the treatment industry today. This is a ratio of the calls that convert into an admission to number of people who call in. There are several factors that can influence the closing ratio of a treatment center:

Cost:
Is your price too high? A cheaper program results in a better closing ratio. Go too high and you lose clients who can’t afford to come.
Insurance:
Do you accept insurance? Most people would rather use insurance than pay out of pocket no matter what the type of program.
Distance:
Many people would rather go to treatment locally than go through the trouble of getting on a plane. However, if a client has a tendency to run away from treatment, distance can actually be a benefit.
Marketing:
How are you selling your program? Is it more of the same or does it offer something different?
Over-extended Marketing:
If you’ve promoted too heavily a local presence or non-specific keywords, you could be subject to calls from people who simply want advice, locations of AA meetings, or other information.
Length of Stay:
Families usually want their loved ones in a longer program. Addicts generally want a shorter one. Who you are talking to can influence the closing ratio.
Sales:
Do you have a trained sales staff who follows up and actually tries to bring clients in or do you have someone who just takes down information passively?  Is your sales staff honest?  Dishonesty can close, but ultimately the treatment center pays the price in complaints and reputation.
Referral Networks:
Generally clients that have been referred to treatment by professionals have already been screened and qualified financially. Referrals usually have a higher closing ratio than cold calls.
Reputation:
What is your reputation? If someone were to ask around about your program, what response would they get?
Detox and/or medical care:
This is important to many clients, especially those withdrawing from opiates.

Closing Ratios of Common Types of Drug Rehab Centers

Local Treatment Center:
In the past, local treatment centers generated many of their leads from insurance providers, local therapists, and word of mouth in the community. Generally speaking, the majority of these leads were already qualified financially and very little sales was necessary in order to fill a center. You could literally hire someone with little to no experience who would just take calls, ask for insurance information, and schedule a time for people to come in. There was little to no competition and sales in treatment was considered a bit shady. A standard closing ratio for a local treatment center was anywhere from 1:5 to 1:10. In other words, because the clients were already qualified and referred, 1 out of every 5-10 clients who was referred was an admit (admission).  Those clients who weren’t referred and just called in generally resulted in a poorer closing ratio.  Some of these clients had few or no financial resources, or were intoxicated at the moment but unwilling to show up the next day.  These types of calls had about a 1:20 closing ratio.
National Treatment Center:
A National Treatment Center is a treatment center that attempts to market nationally. There may only be one center or a myriad of centers, but the focus is national. These treatment centers that compete nationally generally have a worse closing ratio than a local facility. Distance, competition, and price, as well as other specifics, are all factors that affect the closing ratio of a National Treatment Center. The industry average for a national treatment center is somewhere between 1:50 and 1:100. Or, out of every 100 calls, 1-2 clients show up.
Narconon:
Although Narconon is considered a national treatment center in terms of marketing, up until 2008, they had a considerably higher closing ratio than standard facilities, in large part due to their promoted success rate. A good registrar (salesperson) could have a 1:40 closing ratio, which was quite a bit better than the industry standard. From solely a marketing perspective, Narconon promoted long-term treatment with the ability to get a job there, a high success rate, a “cure” for cravings through their sauna, and they were anti 12-step. No matter what someone wanted, Narconon seemed to have an answer for a family’s problems. So, Narconon dominated the web and their sales tactics were beating most other traditional rehabs in terms of closing ratios at a national level.

So what changed?

Read Part 5 of
The Rise and Fall of the Narconon Internet Marketing Empire.