Why do patients prefer your hospital? In a healthcare landscape of inquisitive consumers and competition from all sides, every hospital's strategic plan comes around to that question sooner or later. The adage that all healthcare is local began to dissipate when a flood of new technology helped some community hospitals compete with large academic medical centers for profitable service lines. But just as many facilities began developing solid reputations based on quality data comparable to well-known institutions, the consumerism movement introduced a new facet to the marketing puzzle: the fickle nature of paying customers.
Today, hospitals on the forefront of direct-to-consumer marketing are pouring resources into customer research like never before to gain a competitive edge based on consumer preferences. Such research influences every aspect of the business. "Marketing not only helps attract patients, but more importantly it is becoming a key component in the process of listening to and learning from current patients," says Jeffrey Miller, chief executive officer of the 356-staffed-bed nonprofit High Point (N.C.) Regional Health System. "What our marketing team gathers from listening and learning activities is used to improve existing services and plan for future services."
Gone are the days when hospital marketers were simply creative wordsmiths whose primary function was to purchase ads in the local newspaper. Progressive healthcare organizations have embedded marketers in every aspect of the operation and charged them with reinforcing the hospital's image using sophisticated quantitative and qualitative techniques. In many cases, the chief medical officer is being asked to slide over to make room at the C-suite table for a new kind of CMO.
The emergence of chief marketing officers validates marketing's growing influence on healthcare. In fact, the average hospital's marketing/communications budget in 2004 was more than $1 million, according to the Society for Healthcare Strategy and Market Development. And large hospitals with at least 400 beds more than doubled that investment.
The vanguards of healthcare marketing are taking their cues not just from peer organizations, but from leaders in other industries. Lessons from companies like Coca-Cola, Toyota and Starbucks have helped some healthcare organizations develop new metrics, cultivate loyalists, create exceptional experiences and promote themselves with new technologies.
Schaumburg, Ill.-based Cancer Treatment Centers of America might be a specialty provider, but the four-hospital system has been direct marketing for nearly two decades. And when measured against revenue, CTCA's marketing investment far outpaces most healthcare organizations, with an annual advertising budget of about $17 million. "Only consumer-centric markets achieve the intimacy of care that produces highly efficient customer relationships," says Steve Bonner, CTCA's president and chief executive officer. "Our method of marketing demands that we know everything about who our patients are and what they value."
So why do patients prefer your hospital? The executives who think of services and experiences that are truly different from competitors are likely building a public image that will position their facilities for success in a constantly shifting industry. But those who respond with tired, generalized industry axioms could face an uncertain future.
The science of marketing
With an increased emphasis on marketing comes a heightened awareness that marketers must contribute to the organization's strategic direction. Health leaders once thought marketing was a soft discipline, but now it has become a haven for number crunchers. "We measure everything we do," says Jim Blazar, chief marketing officer for the Cleveland Clinic Foundation and the Cleveland Clinic Health System.
One of Cleveland Clinic's primary focuses has been on increasing the organization's national image awareness. Its goal is to create a national brand on par with Johns Hopkins and Mayo Clinic. Last year, Cleveland Clinic, which has 10 hospitals and 14 family health and ambulatory surgery centers, launched its first-ever national advertising campaign, with TV and radio spots and ad placements in magazines like U.S. News & World Report, Newsweek and Time. Blazar says that the efforts have begun to pay off; a quantitative survey he commissioned shows public awareness has grown recently. "From our measurement we are the only regional brand that's been moving up nationally in the last two years," he says.
But the day-to-day work of Cleveland Clinic's marketers is also closely monitored and critiqued. The clinic took years to develop a state-of-the-art database that ties every aspect of the business back to marketing campaigns. Each patient visit and every dollar the business spent to get it are linked directly to a marketing effort.
"I can tell you how many people called the Cleveland Clinic, how many people got information, how many people made appointments, how many people came in, and what the net revenue is for every single one of those things," says Blazar.
Blazar can analyze the database to make judgments about which media effort had the most success. He reports his findings quarterly to CEO Toby Cosgrove, M.D. While Cleveland Clinic's marketing metrics are clearly ahead of most in healthcare, Blazar doesn't think his organization has yet mastered the science. "We've been working at this a long time," he says. "Our emphasis is that you can't do a marketing project without at least a quantitative measure and usually an ROI."
If capturing better business metrics is one way of proving their worth, marketing pros need to be able to synthesize reams of data for busy CEOs. Reporting key findings, filtering out needless stats, and being ready to respond to tough questions are what it takes to maintain a chief marketer's standing.
When reporting to Mayo Clinic's physician leadership, John La Forgia, chair of Mayo Clinic's department of public affairs, merges all of his communication studies to present what he calls "the health of the brand."
"We provide an external perspective that is an important part of how our physician leadership strategizes about the Mayo Clinic of the 21st century," he says. "We're able to help our leadership evaluate which strategies and tactics are of value and which are not."
Communicating research accurately provides an advantage when inevitable conflicts about marketing promotions arise. When the director of orthopedics points out that his competitor is running an ad in the New York Times, for instance, quantifiable evidence can support whether the organization should follow suit or stick to its current strategy. As healthcare marketers become increasingly scientific, the days of knee-jerk reactions are vanishing.
As the discipline attracts hard-core business people, marketers are demanding more of a say in the creation of services. Healthcare marketers point to other industries that have found success by building market differentiators into the development of their products and services. Whether the example is Disney, Southwest Airlines or Google, many marketers are making a clear statement that they want involvement at the concept level. Marketers' common complaint is that healthcare organizations have a history of bringing together administrators, physicians, nurses and finance people to develop services that all too often look and feel just like the competition's offerings. Only then do they call the marketing team to communicate about what they've already built.
"The more sophisticated approach is to involve the patient and the family in the discussion about what the product and service ought to be," says La Forgia. "In medicine that is a fairly recent development."
For instance, High Point's chief marketing officer, Eric Fletcher, says that long before laying the first brick in constructing a fertility clinic, marketers should conduct research with women in the region. Their findings about the amenities that appeal to potential patients would help develop the design of the facility and the flow of care delivery. "That's the more mature marketing process," he says. "That's what Starbucks does."
The loyalist brigade
But Fletcher isn't trying to create market differentiators just to make his job of promoting services easier. Marketing chiefs in some of healthcare's top organizations are attempting to figure out how to get patients who are not only satisfied with care, but also loyal to their brands. They don't go so far as to suggest that standard patient satisfaction surveys have become passé, but these measurements are not precise enough for some of today's marketers.
Cultivating brand loyalty is something that Cleveland Clinic is just beginning by way of new patient-outreach efforts. When patients from outside the region receive care from Cleveland Clinic, they are added to a mailing list for print or electronic versions of the clinic's quarterly newsletter.
"We weren't doing a good job of following up with people who came here nationally," says Blazar. "It occurred to me that people come here, get great care, and then they go back home and there is no follow-up communication."
The idea sounds fairly simple. Keep former patients updated about the organization's new breakthroughs, surgeries, and services, and they might become advocates. It's a concept that other institutions are embracing, although methods vary.
Because of the nature of the services it provides, Cancer Treatment Centers of America typically interacts with patients over a long period of time. The system is keenly interested in gauging its loyalists, says Jack Moore, chief marketing officer. CTCA has developed a new proprietary patient satisfaction survey that in part aims to figure out how many loyalists his hospitals create, Moore says. In simple terms, CTCA tallies the number of patients who are completely satisfied minus those who indicate they are not. The result is what Moore calls the "net promoter score." He says it might be the most important measurement for CTCA.
CTCA then supports these loyalists through a kind of alumni society called the Cancer Fighter Program. CTCA keeps them connected to the organization through regional branches, events, publications, and online at www.cancerfighter.com. "This is a highly motivated, loyal and very active group for us," says Moore. "These are CTCA disciples in every state in the union. They give us constant feedback on everything from the technology we use to the TV ads we run, and they go around the country talking about their experiences at CTCA."
And perhaps this is the modern healthcare marketer's ultimate goal: services that spawn a legion of loyalists to market for them. Mayo Clinic, which has five hospitals located in Rochester, Minn., Jacksonville, Fla., and Phoenix, surveys more than 50,000 patients per year. Laurie Wilshusen, director of marketing for Mayo Clinic Arizona, composed of a 208-licensed-bed hospital in Phoenix and an outpatient facility in Scottsdale, is considered the organization's word-of-mouth expert. She says more than 90 percent of Mayo patients recommend the clinic, and each of these patients promotes Mayo to an average of 20 friends or family members. A typical patient satisfaction survey might ask how likely a patient would be willing to recommend the hospital's services. But Mayo makes a point of trying to find out the hard number of how many people have been referred through word-of-mouth. "One word-of-mouth recommendation is worth 600 media impressions," says Wilshusen.
Chief experience officer?
The real CEO might not buy into this suggested title, but head marketers are seeking involvement in everything that could potentially influence the patient experience. If patient loyalists are the desired outcome, then marketers want every interaction from the point-of-contact to post-discharge communication to be nothing short of perfect.
Moore sees many lessons for healthcare in the hospitality industry. Prior to joining CTCA, he worked in the marketing department for the Four Seasons Hotels and Resorts. "I learned some tremendous lessons at the Four Seasons about the importance of consistency, the uncompromising commitment to quality, and a belief that there is no margin for error," he says. "Every single touch point at every step along the way is a test for us. We can pass that test or we can fail."
The hospitals that used to differentiate themselves based on quality outcomes are now attempting to provide experiences comparable to five-star hotels. The Cleveland Clinic sends its greeters-they call them red coats-to the Ritz Carlton for training, and the clinic collaborated with the Cleveland Symphony Orchestra to find the most inspirational music for its lobby. A professional curator is in charge of the artwork and organizes it to help visitors find their destinations. So if a patient's daughter seems lost, a red coat might tell her to follow the Ansel Adams exhibits to get to the heart center.
"We're changing the patient experience forever," says Blazar. "You can come to an academic medical center and get the very best, high-tech care, but in a way that you're treated like you would be at the Ritz Carlton."
New media's impact
On average, advertising still represents the bulk (36 percent) of the healthcare marketer's budget, according to SHSMD's 2004 survey report, so promotions continue to be marketing/communications' niche. Most of the advertising dollars are spent on traditional ads, including print, TV, radio and direct mail. But organizations like Mayo, Cleveland Clinic and CTCA are developing content-rich Web sites that experts say deliver greater value than traditional communication methods (see "Net Advantage," below).
CTCA's direct-to-consumer Web site, www.cancercenter.com, has become more of a gateway for its patients in recent years, Moore says. Seven years ago about 8 percent of CTCA's patients had visited the site; today, 55 percent of current patients have gone to the site prior to receiving care. "We are evolving CTCA from a television-based direct-marketing organization to a Web-based direct-marketing organization," he says.
The content on Cleveland Clinic's Web site rivals that of many news organizations. The clinic provides research and education for consumers and physicians with podcasts and vodcasts. With 113 million American adults searching online for health information, according to the Pew Internet & American Life Project's 2006 report Online Health Search 2006, healthcare organizations with the means are attempting to become trusted brands for online health information. To that end, Cleveland Clinic and CTCA have partnerships to supply healthcare-related content for WebMD's site.
"When people access Cleveland Clinic information, it's highly credible compared to other things that they might read," says Blazar. "It has been a strategy to help build our national recognition as a place you can trust."
Rick Johnson is senior managing editor of HealthLeaders Online News. He may be reached at firstname.lastname@example.org.
Web site users' expectations have evolved dramatically in the past decade of the Internet's existence. Once the Internet was the place to go for information, but now it's the place to go to get things done. The Cleveland Clinic's most recent survey of patients and caregivers who use www.clevelandclinic.org found that users have specific tasks they want to complete online.
"Many of them say they want to be able to learn about a current disease or condition and then have some information available about how to solve that problem," says Jon Catanese, director of interactive marketing.
Web site usability guru Jared Spool coined this the "seducible moment" for e-commerce developers-a fleeting instant when the Web site user wants to make a transaction. It's also the moment when the Web site should provide that capability to the customer.
In response to this user need, Cleveland Clinic has developed online applications to help users with a number of tasks, including getting second opinions, making appointments, finding physicians, registering for disease management courses, and taking risk assessments. "It's a combination of providing information and then tools to get things done," says Catanese. "The reason that Web sites like Orbitz and Travelocity are so popular is that they put information at your fingertips and then let you complete a transaction in a straightforward manner."
While some large institutions are creating Web sites that have rich content, dynamic media and transactional applications, many community hospitals remain far behind with static Web sites that look and feel much like print brochures.
Community hospitals should shift their marketing dollars from traditional advertising to online development, says Anthony Cirillo, president of Fast Forward Strategic Planning and Marketing Consulting, LLC in Huntersville, N.C. "People in healthcare don't realize the resources at their disposal," he says. "You need to divert some of your money to the Web and search engine optimization to affect the reach and awareness of your institution."
Is 'Quality' the New 'We Care'?
Hospitals used to position themselves as being first in patient care. That strategy worked fine-until practically every marketing campaign made the same claim and the words "we care" lost all meaning. Today's healthcare marketing initiatives increasingly stress quality. Driving the trend is an explosion of quality awards, rankings, lists and honors, from U.S. News & World Report's list of top hospitals to the Malcolm Baldrige National Quality Award. And there's no shortage of consultants, professional organizations and marketing agencies to help hospitals embark on-and publicize-the quality quest.
But many healthcare marketers are finding that positioning an organization as a quality leader is easier said than done. First, there's the difficult task of proving it. In a landscape of increasingly savvy healthcare consumers, hospitals will have to back up their quality claims with hard data. A data-driven approach has worked for Saint Luke's Hospital of Kansas City, Mo., which received the Baldrige award in 2003. Corrine D. Everson, vice president of marketing and communications for the St. Luke's Health System, says the key is the ability to produce measurable statistics that prove quality care.
"We do not use the word 'quality' unless it is directly linked to very clear and defendable data," she says. Another roadblock for marketers seeking to leverage quality is that although public awareness of the importance of quality in healthcare is growing, it's not yet a big part of patients' decision-making process.
"We have an extremely educated community here," says Diane Grillo, vice president for health promotion at Robert Wood Johnson University Hospital Hamilton in New Jersey, the 2004 Baldrige recipient. "But we found a lot of people didn't really know what Baldrige meant." The hospital launched a year-long education campaign to make sure consumers understood the significance of the achievement.
That's a sound strategy, says Kathleen Jennison Goonan, M.D., executive director of the Massachusetts General Hospital Center for Performance Excellence in Boston. "Because of the growing awareness that quality is not always perfect, it's very important to talk about quality in smart ways . that promote your credibility and your brand equity," she says. "Smart healthcare organizations are monitoring their community awareness around quality and then pitching their marketing to reassure [their audience and] to promote the brand strength of their organization."