Healthcare Marketing – Are we really doing it the right way ?

Navigating the Complex Landscape of Healthcare Marketing in a Competitive Industry

Healthcare Marketing

A growing number of healthcare organizations now have Marketing Directors and Marketing Managers. However, many of these Marketing Directors and Managers are merely Public Relations Managers, Community Relation Directors, or Planning Directors who have been renamed. Their titles have changed, but the question arises, “How trained are they’?

Very few people have been trained as healthcare marketers, given the newness of the field. Therefore, to find individuals trained and experience in marketing, healthcare organizations have considered recruiting experienced marketing professionals from other industries. Now the problem with them is that, they may be experts at marketing but are novices in healthcare. As a result, marketing strategy development and implementation are put on hold for six months to a year until the marketer learns the idiosyncrasies of the healthcare field.

The lack of well-trained, experienced hospital marketers means that hospital marketing strategy and action are influenced strongly by the functional background of the individual filling the position. It also means that marketing managers and directors not knowledgeable about the breadth and depth of marketing may resort to marketing tactics without appreciating the need to first have a marketing strategy.

A further limitation to good marketing practice is low level of resources allocated to marketing departments. Most hospitals do not allocate even 1% of their total revenues to marketing. Though there has been a slight improvement in the percentage of revenues allocated to marketing, it is still well under the percentage allocated to marketing in other consumer oriented industries. This figure can be up to 20 percent for advertising and promotion alone in some industries. The best developed marketing strategy is worthless without sufficient funds to implement it.

There are a lot of flaws in the marketing strategies adopted by most of the healthcare organization (or hospitals to be more specific). The credo of good marketing is formulating strategies around the needs and wants of the marketplace. But the existing marketing strategies of most of the hospitals are usually sales strategies. They focus on stimulating demand through advertising and promotion. They concentrate on filling beds, attracting patients etc. They try to maximize demand for the services, equipment, skills and facilities they already have. They are product oriented and sales oriented rather than market oriented.

Healthcare organizations rarely review their services comprehensively and eliminate those for which there is inadequate demand. There may be a need to modify the existing services to meet the needs of the marketplace, and some services may need to be eliminated altogether. It is not prudent to continue to commit resources to a service for which there is insufficient demand. If the healthcare organization does not respond to the changing environment, then the organization is not practising good marketing and will eventually suffer in the long run.

Many healthcare organizations do not practice good marketing because they do not make choices about whom to serve and whom not to serve. They try to serve everyone. By doing so, they neither segment nor differentiate, and they leave themselves open to competitors who successfully target attractive segments with advantageously differentiated services.

Most healthcare organizations also do not package services properly. Successful packaging is a function of an internally coherent marketing mix through which the service, price, distribution, and promotional strategies complement one another. For example, a hospital in a wealthy metropolitan suburb had developed a Cardiac Program on World Heart Day, which was designed well, staffed by outstanding and well-known professionals, priced competitively, and promoted adequately to appropriate market segments. However, the program’s performance was disappointing. Because the program was housed in an old age home in a middle-class community a few miles from the hospital. The location did not match the rest of the marketing mix, which led to limited marketing appeal and hence to a disappointing response.

Given increasing competition, the healthcare organization that does not compete effectively probably will not survive. The development and implementation of appropriate marketing strategies can ensure organizational effectiveness and resulting survival. Because of competition and utilization declines, healthcare organizations must become activists and must aggressively position themselves to meet the needs and desires of their target markets if they want to persist. In addition, top managements, trustees and owners have a responsibility to educate themselves and the medical and non-medical staff about the necessity for and appropriateness of marketing. They must create a climate that is favorable to marketing activism. They must backup their words with actions, that is, support requests for resources for marketing programs, or act on the recommendations of the marketing department.

About the author :
Prabahan Sarma is a highly skilled management professional with diversified experience in healthcare marketing. He is specialized in developing plans and executing projects and initiatives that support the broader short and long-term marketing and financial strategy. He has a vast experience in brand marketing, advertising and promotion, market research etc. 

Previously Prabahan was associated with a reputed hospital in Northeast India, where his marketing, branding and new product development skills has been his driving force in successfully executing various tasks and assignments during his tenure in the hospital.

Prabahan Sarma - Manager Business Development at Integra Ventures
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