Strategic Planning & Marketing in Health Care

Executive Summary

The healthcare sector needs to be treated like other economic sectors. Therefore, healthcare planning should enhance the provision of quality services. Market planning forms part of the plans for improving performance. A number of planning steps have to be followed. The steps are setting goals and objectives, carrying out an analysis of the market using analytical tools like SWOT analysis.

The general environment in which the healthcare sector lies must also be analyzed. The environment is analyzed from two perspectives: the macro and the microenvironments. Finances to be used in implementing the plan have to be kept in mind. Also, structures that monitor the progress of the plan when implemented must be provided. Lastly, the mechanisms of adjustments, in case of leakages in the plan implementations, have to feature in the marketing plan.

Introduction

Healthcare is one of the most essential industries in any country and is categorized as a primary good. The demand for health services has been rising. This has put pressure on governments, necessitating the expansion and improvement of healthcare services (Hall, 2009). Privatization of healthcare services is a means of addressing the increasing demand (The Ritz-Carlton, 2012). There is a lot of competition in the healthcare industry due to the increasing demand for primary and secondary healthcare services. Resultantly, the changing conditions in the healthcare industry and the advanced delivery systems, marketing planning and strategies in healthcare have become crucial (Hillestad, Berkowitz & Hillestad, 2004). This paper presents an example of a marketing plan for a healthcare institution.

Marketing Analysis

The healthcare industry is one of the industries which have an unusually high demand. Within the industry, there are many participant institutions. The industry offers both primary and secondary healthcare services. A majority of the primary healthcare services are provided by government institutions. Secondary services are provided by private institutions; though, government institutions still remain a significant player (Clark & Fance, 2006).

As it is with healthcare, the capacity of hospitals does not meet the demand and the needs of the people who are seeking the services. Healthcare remains to be vital for many people in communities, yet many people seeking health services often complain of poor and unsatisfactory services from the healthcare institutions. We still have people who cannot afford to visit the healthcare services in certain communities due to a number of factors, among them poverty and access to healthcare. Therefore, the healthcare sector is still constrained (Stefan, 2004). Healthcare institutions, in most parts of the world, have a poor reputation. There is too little involvement of communities of people who form the clients or customers of the industry (Hillestad, Berkowitz & Hillestad, 2004).

According to Calhoun, Banaszak-Holl and Hearld (2006), marketing strategies in healthcare needs to be highly comprehensive so that they can capture the needs, as well as change the image that has been created by people about the sector. In marketing strategies, issues of service improvement have to be given priority. Many complaints have been raised by patients and other stakeholders in the industry.

Most complaints being raised concern poor quality services being offered by health workers. The search for alternative health services has become common because of these problems (Berkowitz, 2006). Hospitals are the main health institutions and can improve service delivery through applying marketing strategies in their operations.

Organization and Product Service Overview

Hospitals have diversified functions. The diversity begins with the different types of customers that they deal with, and also the types of services present in the institutions. There are patients of different kinds– the aged patients and infants and children. Also, there are patients suffering from different diseases coming to seek medical services in healthcare institutions. Services offered in the healthcare institutions include curative services that are offered by physicians or doctors, family planning services, consultation services on issues of nutrition, preventative services like vaccination and many other services depending on the capacity of the given hospital or healthcare institution in question (Berkowitz, 2006).

Healthcare institutions are classified into public and private institutions. There are other subgroupings of healthcare institutions. These groups depend on the level of specialty and the intensity of services available. There are hospitals, which are leading institutions in giving healthcare services; and they offer specialized healthcare services. Apart from dealing with the primary healthcare cases, they mostly attend to secondary cases of health, which need specialized services.

They have staffs that have specialized knowledge to offer specialized services like major surgeries. Apart from the hospitals, there are health centers and clinics that often give primary healthcare services. They can only attend to health cases, which are not complicated. All the healthcare institutions fall either in the private or public category. Most prefer private healthcare institutions as they are considered to have proper facilities and products; hence they provide better services (Edwards, Hugman, Tobin & Whalen, 2012).

The reason behind improved services in the private hospitals accrues to the attention that they give customers. These institutions employ a certain level of marketing in their activities, though the level of marketing is not as intense as has been proposed by healthcare marketers. Public hospitals do not emphasize profits. This is part of the reasons why they cannot perform as their counterparts in the private sector. However, private healthcare providers are quite expensive.

They avail services at a much higher cost as compared to the public hospitals. The relevance of the healthcare industry cannot be overemphasized. Without proper healthcare systems in place, the rate of development will be put in jeopardy, and development is likely to stagnate. Therefore, marketing of the healthcare industry has been outlined as one of the instruments that can be used for improving it (Edwards, Hugman, Tobin & Whalen, 2012).

SWOT Analysis

Strengths

The healthcare industry is one of the most funded industries in the world. Most governments are aware of the importance of healthcare. Though they do not provide adequate funding, they make efforts of ensuring that the health institutions are working. This is an advantage to hospitals and other healthcare institutions. It offers a foundation on which the marketing strategies and planning can be built to enhance healthcare service provision.

There is a remarkably high affinity for health services by communities. Healthcare services are always in high demand, and this means that the healthcare industry has a large clientele of customers (Rooney, 2009). There are many healthcare institutions present in the healthcare sector; including hospitals, health centers, clinics, and even individual service providers. The only problem hindering service delivery is the incapacitation of these institutions and the failure to use effective marketing strategies (Kotler, 2011). Hospitals often have a high number of service seekers because of the nature or expanse of their services.

Weakness

The healthcare industry is incapacitated, especially in the developing world. The majorly incapacitated institutions of healthcare are under the public domain. With these levels of incapacitation of services, a lot of resources are needed to improve the image of the institutions in service delivery. Hospitals have been reported to have a low number of staff and lack of efficient medical equipment. This will either hinder or add to the costs of marketing implementation. Marketing is something that has not been emphasized or used in healthcare. It is a concern that has come up in the recent times (Kennett, Henson, Crow & Hartman, 2005).

Opportunities

Many models of marketing have been developed and used in various sectors. The models can only be tailored to meet the marketing requirements in the hospital. The concern for healthcare marketing comes at a time when there are tremendous changes in technology. Marketing has been eased with the presence of information and communication technologies. Social network marketing and the use of the internet in marketing are enhancing marketing functions. Also, numerous demographic changes are taking place. The changing trends are resulting in changes in health needs among people. Therefore, more investments will be required by the investors in the sector. New market segments are emerging in the healthcare sector (Rooney, 2009).

Threat

The slowdown in the national economic system poses a significant risk to the healthcare service provision in hospitals. Cases of inflation and increasing standards of living have been on the rise. They hinder the consumption of healthcare services and products (Stefan, 2004).

Customers

The healthcare sector is a sector that has many customers. In every nation, primary healthcare is essential. More than 60% of population in many countries seeks for medical services every year. Majority of people who seek healthcare services lie in the age group of between 0-22 years – about 30%. This is followed by the adults who constitute about 20 percent and the old people (10%). Customers require better services at reduced costs. Customers also need to be sensitized on the variety of healthcare services that are available in the hospitals. The hospitals need to conduct thorough marketing surveys, and come up with marketing plans that are responsive to customer needs. Advanced communication tools available in the industry can be extremely helpful (Pitney Bowes, 2010).

Environmental Analysis

The environment usually has a significant influence on healthcare delivery. Healthcare is influenced by factors that are drawn from both the micro and macro environments.

Micro environmental factors

Customers

Hospitals receive a high number of clients who have varied needs, and deal with many people. The working and the nonworking populations are all customers. It is quite challenging for hospitals to narrow down to a given group of customers. The choice of a customer group can help in upgrading the healthcare services offered by a given hospital (Hillestad, Berkowitz & Hillestad, 2004).

Distribution channels

Intermediaries help hospitals with logistics; like timely delivery of health materials and services and storage of medical products and equipment. They help institutions to be more efficient and reliant to customers (Hillestad, Berkowitz & Hillestad, 2004).

Competitors

The competitive level hospitals in healthcare service delivery are directly impacted by customer satisfaction. Therefore, hospitals will work on differentiation strategies in positioning their products and services. This will help them to focus on certain services hence improving in service delivery (Hillestad, Berkowitz & Hillestad, 2004).

Suppliers

Medical needs are quite basic. The timely delivery of medical supplies ensures that customers get the services anytime they need them. As part of enhancing marking, hospitals will be required to initiate and manage healthy relationships with their suppliers for timely delivery of supplies (Hillestad, Berkowitz & Hillestad, 2004).

Macro environmental factors

Economic factors

Economic factors have a substantial effect in healthcare. The ability of the population to access hospitals is often reliant on the economic status and the prevailing economic conditions and structures. It is advisable for hospitals to be aware of their clients and the economic class in which they lie (Hillestad, Berkowitz & Hillestad, 2004).

Technological factors

The capacity of the hospitals to address the needs of the clients can be supported by technological systems. The social media is used for advertising and raising the awareness level of customers about the services. Hospitals are urged to take advantage of the technologies, like the internet and the social media. Social media are a successful tool when efficiently and maximally used in marketing. They must accept the cost of employing advanced communication technologies. Such costs are usually offset in the long-rum when marketing strategies are optimal (Pitney Bowes, 2010).

Sociological Factors

Demographic changes have an impact on healthcare sector. Such changes include changes in the values and norms of people, rise in academic levels and changes in the social responsibilities. The rise in academic levels impacts positively on healthcare marketing. High literacy implies that many people will be using the internet. Emigration and immigration will also force the hospitals to adjust to the changing number and nature of patients. Changing norms and values means that the strategies will be adjusted to capture the aspect of quality in products and services (Revere & Robinson, 2010).

Legal and political factors

Healthcare provision is highly sensitive to political changes. Stability in any country gives a favorable environment for healthcare institutions. Health institutions will flourish in countries with stable governments. The debate of policies leads to the choice of better policies that are supportive of healthcare development (Hillestad, Berkowitz & Hillestad, 2004).

Marketing goals and strategies

Marketing goals are the key guide to marketing activities. The strategy helps in providing a framework on which the goals will be implemented so that a full marketing function can be reached. Hospitals will make use of marketing enhancement processes, and tools as part of marketing the sector. These include the use of the social media campaigns that target approximately 80 percent of the customers. Under this strategy, we have the formation of online dialogue sites or communities. All the comments of the customers will be reviewed as a way of encouraging many customers to link up to the sites (Trombetta & Woodard-Bourke, 1998).

Marketing goals

Since marketing has not been a substantial exercise in healthcare, the short term goal will be to change the image of hospitals in the eyes of the publics through restructuring. Confidence and trust in healthcare institutions and services will be restored by this. Restructuring will lead to quality services in hospitals. The long term strategies are aimed at reinforcing the image through marketing models; such as the marketing mix and social media marketing. Social media attract many users who are potential clients of the healthcare sector.

Financial goals

In the initial stages of marketing implementation, more finances will be used. Money will be invested in the acquisition of technological tools to be used in implementing the strategies of marketing. As the application and implementation continues, other corporate strategies will be adopted to supplement the technological tools. Once marketing has been initiated, it will be quite easy to sustain it (Trombetta & Woodard-Bourke, 1998). Hospitals will adopt services that will entice customers.

Marketing mix

All aspects of the marketing mix will be captured in the overall implementation. Promotion will be done using the social media. Hospitals will employ destination marketing campaigns according to the kinds of services offered by them and the nature of customers which they target (Kotler, 2011).

Monitor and Control Implementation

With the introduction of marketing strategies and market planning in healthcare, many changes are expected in hospitals. Therefore, monitoring and control is used in ensuring that the plans are executed according to the strategies laid down (Kotler, 2011). The marketing plans are usually designed on an annual basis. Performance reports are just but one of the useful tools used in monitoring progress. The reports are compiled on a monthly basis. The increase in the number of customers as well as sales and profits will be positive signs of the plan. Analyses of the volumes of sales will be used in measuring actual gain in sales (Wrenn, 2006).

Conclusion

For a long time, hospitals and other healthcare institutions have underperformed. The underperformance has often been linked to the poor services. The failure to apply marketing strategies and market planning has further complicated the situation. It has been found out that market planning can aid in improving the service capacity and delivery in the hospital. Hospitals need to take advantage of the social media and the internet as key enhancers of marketing the healthcare products and services. They also need to increase their service delivery capacity.

References

Berkowitz, E. N. (2006). Essentials of health care marketing. Sudbury, Mass: Jones and Bartlett Pub.

Calhoun, J. G., Banaszak-Holl, J., & Hearld, L. R. (2006). Current Marketing Practices in the Nursing Home Sector. Journal Of Healthcare Management, 51(3), 185-200.

Clark,A. P. & Fance, M. A (2006). Healthcare Marketing in the 21st Century: Beyond Promotion to Constructing Experiences to Achieve High Performance. Health Marketing Quarterly, 23(3), 1-7.

Edwards, B., Hugman, B., Tobin, M., & Whalen, M. (2012). Embedding ‘Speaking Up’ into Systems for Safe Healthcare Product Development and Marketing Surveillance. Drug Safety, 35(4), 265-271.

Hall, M. L. (2009). Nonprofit Health Care Services Marketing: Persuasive Messages Based on Multidimensional Concept Mapping and Direct Magnitude Estimation. Health Marketing Quarterly, 26(3), 165-182.

Hillestad, S. G., Berkowitz, E. N., & Hillestad, S. G. (2004). Health care market strategy: From planning to action. Sudbury, Mass: Jones and Bartlett Publishers.

Kennett, P. A., Henson, S. W., Crow, S. M., & Hartman, S. J. (2005). Key Tasks in Healthcare Marketing: Assessing Importance and Current Level of Knowledge. Journal Of Health & Human Services Administration, 27(4), 414-427.

Kotler, P., (2011). Marketing principles. Web.

Pitney Bowes (2010). Using targeted marketing strategies to optimize healthcare plans. White Paper. Web.

Revere, L., & Robinson Jr., L. (2010). How Healthcare Organizations Use the Internet to Market Quality Achievements. Journal Of Healthcare Management, 55(1), 39-49.

Rooney, K. (2009). Consumer-Driven Healthcare Marketing: Using the Web to Get Up Close and Personal. Journal Of Healthcare Management, 54(4), 241-251.

Stefan, P. M. (2004). Healthcare Marketing Liability: Avoiding Possible Pitfalls. Journal Of Nursing Administration, 34(11), 520-523.

The Ritz-Carlton (2012). Healthcare Marketing Strategies: Seventeenth National Summit. Web.

Trombetta, W., & Woodard-Bourke, N. (1998). The role of healthcare marketing: In the aftermath of the anti-referral movement. Health Marketing Quarterly, 15(3), 55.

Wrenn, B. (2006). Marketing Orientation in Hospitals: Findings from a Multi-Phased Research Study. Health Marketing Quarterly, 24(1/2), 15-22.

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