Marketing Your Healthcare Services

SHARON H. FITZGERALD
Posted: Wednesday, February 25, 2009 4:33 pm

Marketing Your Healthcare Services | Richard K. Thomas, health services marketing, hospital branding, psychographic segmentation

"Consumer Engagement" is Today's Buzzword

Marketing healthcare isn't so much about catchy slogans on billboards anymore. Especially in today's tough economy, cyber communication even to individual consumers is the name of the game. That's according to Richard K. Thomas, vice president of Health and Performance Resources, a Memphis-based consulting firm.

A member of the preventive-medicine faculty at the University of Tennessee Health Science Center, Thomas has penned several books on the subject, including Marketing Health Services, a textbook that he's currently revising, and three trade books: Marketing Matters: A Guide for Healthcare Executives, Health Services Marketing: A Practitioner's Guide and Healthcare Communications. Thomas predominantly examines hospital marketing, but also studies practitioners, health plans and even pharmaceutical sales.

"Where it's going now, it looks like to me, is that the new buzzword is 'consumer engagement.' It's really an updated version of customer-relationship management," Thomas said.

First, a little history. Beginning about 30 years ago, "hospitals were trying to be all things to all people," according to Thomas, and sloganeering and image advertising were in their heyday. Yet he said he would be "hard-pressed" today to demonstrate that such mass marketing and branding actually funnel patients through the door. In fact, oftentimes it's physicians and health plans that determine which hospital a patient chooses.

"Now we should be marketing specific services to the populations that need those services," Thomas said. "That's been the evolution."

Furthermore, the idea is to "actively engage customers in a two-way conversation. Not only are they listening to you, the provider, but they're talking to you, providing feedback and taking a more active role in managing their health. They're becoming more compliant and being more proactive dealing with health issues, which should benefit them but also the provider," he said.

The key is database management and using software tools now available to segregate patients into what Thomas calls "clusters of consumers" – households with children of a certain age, for example. "We're seeing more and more segmentation of the healthcare-consumer population, not only by the types of services they need but also lifestyle categories," he said. Because of this psychographic segmentation, also referred to a behavioral segmentation, "we know their hot buttons and how they're likely to communicate," he said. Some consumers may prefer e-mail, while others may like texting, phone calls or even direct mail.

"Direct mail seems to have made something of a comeback in healthcare if you look at some of the figures," Thomas said. "Part of it, I think, goes back to that segmentation. Some clusters don't mind direct mail, and they even welcome it. If it's health-related, that gives it a little bit more cachet than selling consumer goods."

Database management is no easy chore, requiring discipline to ensure that it's properly updated and frequently used. Asked if he could cite hospitals or health systems that have really nailed the database concept to reach consumers, Thomas said, "I know it's being done. I don't know how effectively it's being done. My sense is, particularly in the Southeast, that it's probably somewhat piecemeal."

Just like most industries, hospitals have gone through several stages when it comes to electronically reaching an audience. First, there was the Web site that resembled an electronic brochure. Then, additional page links were added, inviting viewers deeper into the site. Next, consumers were taking a look at newborns and sending get-well wishes to friends and family in the hospital. Now, Web sites are moving "from interactions to transactions," Thomas said. "Customer-relationship management came to be a big deal when people in healthcare realized that it was a mistake to go after that one sale – get them in the door and get them out. You really want a lifetime customer who's going to spend a quarter of a million dollars over the course of their lifetime on healthcare."

Ensuring the success of such a strategy is market research. Certainly, patient-satisfaction surveys are a quick and relatively easy gauge, yet larger providers must conduct "environmental scans," Thomas said, to track community changes and interests. "With psychographic and even demographic segmentation, this has opened the doors for a whole other dimension of market research. Bottom line, we need to know a lot more about the consumer, whether it's an existing customer or a prospective customer, than we've ever had to know in the past," he said. "That's really given a boost to market research, but it's still probably not where it should be."

Finally, Thomas noted that the shift from inpatient to outpatient services has resulted in "a hospital without walls" and without the captive audience that hospitals once enjoyed. A well-executed Web site "becomes a window for consumers, not just into the hospital, but into all your services," he said. That's one of many reasons why stand-alone marketing functions are shrinking on hospital organizational charts. Within a large healthcare organization, marketing responsibilities might also be handled under the umbrella of strategic planning or business development. "There's a blurring of the lines in terms of where marketing takes place," he said.