To them, “marketing” often means PR and communications (this is due, in part, to the fact that the marketing manager often comes from a PR background).

“Business development” is often confused with solely physician engagement, and often that’s their primary focus – increasing physician referral patterns.

Incidentally, due to this confusion, most of the time, the “business development” teams tend to get more resources and attention from the hospital leadership (not only due to their physician-focus, but also because their activity is more measurable than “marketing”).

Of course, I believe marketing is inclusive of all of those elements – PR, communications, branding, physician liaison efforts, community relations, etc. Marketing (in my opinion) is about creating consistent dialogues with all stakeholders using a variety of tools, tactics and strategies.

And marketing is essential for any organization to succeed.

Thanks for providing such great feedback. I think we’re drawing a certain distinction between “business development” and “physician outreach,” which to your point, is often undervalued at hospitals. Here are some more thoughts to your thoughts on our thoughts…

“the surest way” – yes, exactly right. An acquisition is an intent to acquire/”buy” business (customers/patients), but it shouldn’t be taken for granted that customers/patients will stay without a smooth integration and smart communication.

“so much demand” – I don’t know what economics says about a “maximum” amount of demand. But an organization certainly won’t “maximize” demand without ongoing, sophisticated marketing.

“not true competition for consumers” – on this one we’ll have to disagree. In many cases this is true to an extent, but the majority of patients have choice in the majority of their healthcare encounters. They may be limited choices, but even within most managed care plans, there are a choice of a few hospitals. Maybe we can battle this one out over nachos sometime.

Thanks again for keeping the conversation flowing…

“The surest way to increase market share or dramatically increase volumes is to lock-in independent referral sources, or acquire competitive businesses. In essence, organizations are “buying” new patients…”

In the case of acquisitions, “buying” patients is almost a reasonable description but not exactly. Patients aren’t forced to remain with said acquired practice. And there’s no guarantee that a provider will stay for that matter; patients may follow a disbanded physician (or NP, PA) to a new practice if they’re able.

Building loyalty with an independent referral source must be done with utmost ethical and legal consideration. I believe that if a hospital can consistently provide great provider experiences and patient outcomes, clinicians will continue to refer. Any organization seeking independent referrals would be wise to familiarize itself with, and follow, Stark Law provisions.

“Second, consumer marketing should help create demand, regardless of what acquisitions are made.”

An organization can only create so much demand. (Didn’t you have a blog post about over-utilization?) Sure, you can draw consumers to an event, get them excited about your services and clinical prowess, but then what? Many can’t self refer for specialty care and there’s no guarantee their primary care doctor will refer to your organization. Probably better to hope your attendees are existing patients and appreciate it as a retention and health education effort.

“…there will always be competition for healthcare services.”

Yes, but it’s not true competition when it comes to consumers. Ultimately a patient can decide where she or he wants to go for care, but without a primary care referral and/or blessing from a health plan, the out-of-pocket cost will be out of reach for most. This is where consumer marketing falls short for hospitals. If there is no true choice, then the message of even an award-winning campaign is moot.

…business development and marketing shouldn’t be an either/or proposition.

Right. The two functions should be joined at the hip. Marketing Departments should lend their talents to business development efforts. This could entail strategic support like CRM management and customer/competitor research or more tactical details like well-designed outreach kits, presentations, clinical publications, conference displays and so forth.

Having left hospital marketing briefly, for a non-healthcare company that was very sales driven, I quickly respected the need to: identify decision makers who have the option to select our service;
reach out to them where they are with a strong value proposition;
provide everything our competitors do — and then some — once the customer engages;
measure satisfaction;
stay in touch.

I came home to healthcare marketing with a new enthusiasm to create a stronger link between the marketing department and medical outreach reps around our organization. It’s been fun and satisfying to support new business development by fostering that partnership.