Brand Aid: Hotels Bridging Health (H2H) – A Marketing Proposal for Health-Care Leaders (Part 1)
By Fred DeMicco, Executive Director and Professor in the School of Hotel and Restaurant Management at Northern Arizona University and John La Forgia, MBA, Consultant and Author
Marketing for health care is unlike marketing for any other product or service. Few, if any, aspects of a person's life are more highly valued than one's health or the health of a loved one. Few, if any, products or services one markets carry the consequences of dealing with a situation that is often a matter of life or death. To market effectively in the health care industry, organizations must develop a vigorous mission and vision statement, strategically market plans and tactics, think globally, understand power and priorities, and Implement the plan by empowering employees. While considering the basics marketing theory of the five P's.
Mission and Vision
At this stage in the process, you understand the institution's strategies and business objectives and you have an understanding of the institution's competitive market position. Now is the time to compare, contrast, and determine the most effective marketing strategies that will allow marketing to help advance the institution's mission and business objectives.
Health-care marketing departments usually express their mission as growing market share or increasing revenue. This makes perfect sense from a marketer's point of view. My concern with this approach is that it centers upon three problematic factors: overt competitiveness, focus on revenue, and measurability. Overt competitiveness carries the baggage previously described.
Most administrators will expect to see measurable growth in revenue attributable to the marketing program. Difficulties arise in capturing the necessary data. Few hospitals, even today, have the ability to smoothly track an individual's episode of care back to the patients or referring physician's initial decision to choose a particular hospital. True customer relationship management systems that would allow this kind of data gathering are rare in hospitals and often are focused more on revenue from the care episode than on marketing data. So, the marketer has two alternatives. One is to build a particular project in such a way that individual tracking is possible for a limited cohort. The other is to retrospectively collect referral or patient inquiry data that corresponds to the time ads ran or other marketing activities ran that can be isolated. Even then, executives are very likely to ask, or rather state, "You can't know which of those patients would have come, anyway, without marketing." That is true, of course; nor can the executive prove they would have chosen the hospital without the marketing, but in the end, this is a losing argument for the marketer, not the executive. Measurement will be covered in a subsequent chapter. For now, my advice is to limit promises of increased revenue to selective, measurable projects rather than the whole enterprise.
Hospitals have other reasons for existence besides making money. In evaluating the mission and purpose of a marketing department, my reference is to begin with the fundamental understanding that the job of the marketing department (or, really, any hospital department) is to support the mission and business objectives of the organization. As business guru Jim Collins states in his book, Good to Great and the Social Sector:
For a social sector organization, (e.g. a hospital) … performance must be assessed relative to mission, not financial returns. The critical question is not "How much money do we make per dollar of invested capital?" but "How effectively do we deliver our mission and make a distinctive impact, relative to our mission?"
Given this reasoning, I favor a simple statement of purpose for the marketing department, for example:
The mission of St. Regis Hospital's marketing department is to advance the mission and business objectives of St. Regis Hospital.
Once this type of statement is accepted by the leadership, it clarifies that marketing will contribute in ways that are intangible, as well as tangible, to the success of the organization.
Plans and Tactics
Formation of cogent marketing strategies and tactics is one of the most important antidotes to the short-order-cook type of activity that is the bane of so many marketing professionals. I cannot stress enough the importance and effectiveness of using strategic planning tools to forestall the strong tendencies in hospitals for staff to order up marketing materials the way they might order a STAT imaging procedure. Templates abound in textbooks and online describing how to construct these plans. The critical things to remember are that the strategy has to map to the overall organizational strategy and the consequent tactics have to be doable.
Often in the process of generating a strategic plan for a service line, the marketing staffers will have a myopic view of their task. A typical brainstorming session among marketing staff will result in long lists of possible tactics
Throughout this text, I have stressed the importance of research and data as underpinnings of strategic marketing. The dark side of depending upon research is the well-known corporate disease known as "analysis paralysis."
Hone the plans and tactics, resist the urge to drop every possible tactic and medium into the implementation plan, and, as Tom Peters has said, have a bias for action. Despite all the research and academic marketing studies one can assimilate, marketing is part art, or, shall we say, educated judgment, as opposed to a mechanical, completely predictable science. An experienced marketer brings to the table not just knowledge of the facts and figures of marketing, but the accumulated knowledge learned from years of executing strategies and implementing tactical plans in the actual marketplace.
Developing strategies requires an ability to think strategically. I have found that not everyone possesses this ability. This notion of thinking strategically about marketing matters, not only in the development of solid and effective plans, but perhaps, most importantly, when a marketing staff person is meeting with a client—in the case of hospitals, an internal leader, department head, physician, or other requestor of marketing services. If marketing staff in hospitals are ever to transcend the order-taker role, they must be able to meet with the head of neurology, understand their situation, gather the necessary data, and then apply all of that strategically.
Some staff have shown an inherent ability to see the bigger picture and conceive effective strategies. Most often, staff seem to believe it is something you were either born with or were not, like having perfect pitch or being able to wiggle your ears. I believe strategic thinking is teachable.
I learned, as the years went by, that for every marketing department, awash in multiple projects, each requested by an equally powerful person with an equivalent sense of urgency, receiving from all quarters directives and objectives that pulled them in contradictory directions, the biggest problem was separating the wheat from the chaff or, more precisely, the worthwhile projects from the unnecessary.
Power and Priorities
Hospital marketing departments have very little power
No marketing group I have ever led had sufficient political power in an organization to set priorities. Even when I have been armed at the yearly budget wars with reams of data and reports that ring like bells with clarity and power about the worth of the program under discussion, medically minded operationally trained leaders ranked those items last on a long list of discretionary projects, few of which can be funded in a given fiscal year.
For a marketing department to have any hope of securing a modicum of necessary funding and developing a workable sense of priorities, it needs operational and medical allies. As we have seen, the marketing department, by now, has written a marketing plan for the hospital or hospitals based on research and honed by experience. Clearly, the plan must be approved at the highest levels.
A curious fact is that, after all that, the team may approve the marketing plan in concept and even applaud its good sense, yet at budget time, the team will be reluctant to fund it, even though much of the plan consists of their own requests. If the only advocate at the executive table is the marketing leader, the situation is precarious.
The critical factor is, of course, the CEO. Without support at that level, marketing has a tough row to hoe. Many marketing leaders I have spoken with acknowledge that the CEO can seem indifferent to the steady stream of requests and petty conflicts among the marketing staff and the rest of the organization. When a CEO is asked to mediate a difference of opinion between two physicians about a marketing strategy, that CEO has been put into a space that she does not want to occupy. No CEO wants to appear to play favorites, pitting one doctor against another. Sometimes the CEO may make a choice between the two alternatives. More than likely, the CEO will push the problem back to the marketing staff and, like King Solomon, ask the marketing group to cut the baby in half and somehow develop a solution that pleases both physicians. This mechanism gets the CEO off the hook but pleases no one, since such a solution is always substandard, and the outcomes will be substandard as well.
Nevertheless, the CEO is the titular holder of the organization's brand integrity and her support of the marketing plan is paramount. We found at Mayo Clinic that the best solution to the marketing problem described above was to depersonalize the situation. Like any organization, the first working principle is to keep the problem and the solution at the lowest practicable organizational level. These are the staff who know the problem best and who are best qualified to remedy the situation.
Most high-level executives would prefer to have most problems handled at the appropriate level and have only the truly serious issues escalated to higher authorities.
The operating principles that have worked the best in my career were:
- Empower the marketing staff
- Empower the marketing leader
- Establish a standing cross-functional operational team to oversee marketing
- Establish a small cross-functional leadership team to oversee marketing policy
- Use the executive team or governing board as a last resort
Empowering staff does not mean giving them permission to exercise independent authority and never mind the consequences. Mechanisms need to be in place, such as those listed above, to ensure that the empowered staff person has the backing of the people in the organization who hold the reins of power.
Many people have asked me over the years, "How do you say no to a top-level executive or physician?" The best answer is you do not, not directly.
Hospitals and health systems depend heavily on a strict hierarchy of command, based naturally on the need for rigorous controls to ensure the safety of patients and eliminate confusion or indecision at critical times. Ironically, this reliance on hierarchy can be used to marketing's advantage if the marketing leader can establish system-wide processes for review and approval of marketing activities.
The other side of this coin, though, is that marketing, being considered a "staff" function rather than a "line" function, puts the marketing group in a category of activity in which the medical staff and leaders from other provider departments don't always take the rules of the marketing groups seriously.
For this reason, the relationship between the CEO and the marketing leader is critical for the strategic implementation of marketing.
Management of the brand and reputation of the institution is another matter entirely. While CEOs may not feel their involvement in an ad campaign or a website is warranted, they understand deeply the need to manage the reputation of their hospitals. Interestingly, CEOs often do not see that the competent management of marketing and all its components is a vital aspect of managing the hospital's reputation and brand.
Given the multiple priorities facing the marketing department and the relative weakness of their individual authority, I have found that the simplest and best solution is the appointment of a small interdisciplinary team to handle issues of policy and mediate disputes on behalf of the executive team. After some orientation in the basics of marketing, members of the group, consisting primarily of physicians but including the marketing leader and some other key administrators, became, over time, quite conversant with the discipline and were equipped to make decisions in a manner that minimized the individual politics of a situation and spared the CEO from constant involvement in matters not usually worth their time.
My experience at Mayo Clinic showed me that having a committed group responsible and accountable for oversight of marketing policies, procedures, and major initiatives is the best method I know of for elevating the respect of the marketing department, ensuring that random ineffective promotions are curtailed, and having the institution buy in to the actions of the marketing team. In fact, what we observed, over time, was that many of the policies and procedures became institutionalized, that is, they formed as much of the fabric of the culture as the edict that all physicians wear suits and ties rather than lab coats. This, in turn, meant that much of the petty bickering that can occur over the color of a brochure or a video on a website fades away over time, and everyone can get on with more important work.
The Five Ps
In this chapter, we have examined the issues of marketing health care strategically—to a point. As any business student can recite, marketing comprises the four "Ps" (and sometimes five):
For the most part, we have discussed marketing in health care as being almost exclusively concerned with promotion, and some work in positioning that usually comes down to marketing communications activity. I have approached the subject in this manner because that is the prevailing situation in health-care systems today.
One might ask, "What's wrong with that? What else are they supposed to do?"
My response to these questions is manifold. Within the preceding pages, we examined the historical forces and current attitudes that continue to drive most health-care marketing groups into in-house promotional production teams. We have also reviewed the unique nature of health care as being simultaneously a service and a product, a concept that has as its consequence that mere selling will do little to achieve the goal of increased sales—that is, generating more patient referrals and increasing hospital revenue. We have also delineated the need for CEOs, physicians, and other health-care leaders to look beyond the traditional marketing department for the solutions to the problems that plague them regarding the purpose and intent of marketing health care. The fact that the unsatisfactory performance of many health-care marketing groups can be traced back to decisions made by the very leaders who complain about the underperforming departments remains lost on all but the most enlightened organizations. I said earlier that marketing could play a substantive role in helping health care achieve true transformation. Clearly, this is not possible with marketing in its current state.
My conviction is that marketing in health care needs to be completely redesigned, in essence, transformed into a role in the future of health care. Even the word "marketing" does not convey what I believe is necessary for this to be possible. The modest proposal of an active mission and vision statement, usefully marketing plans, global mindset, prioritization, and implementation will foster health-care leaders to embrace the concept of brand management in a manner that encompasses the totality of the patient experience, whether within the hospital walls or outside of them.