Five Forces that will Change
Healthcare Marketing
Karen Corrigan
Corrigan Partners LLC
@karencorrigan
corriganpartners.com

The basis for competition in the health
industry is rapidly changing . . .
• Restructuring markets and intensifying
competitor activities in anticipation of reform
and other industry pressures
• New reimbursement methods and care
delivery models that require greater emphasis
on customer engagement to optimize
profitability
• Transformation of marketing practice through
web, social and mobile technologies
2

5 forces marketers must watch
1. The new economics of healthcare reform
2. Market restructuring and emerging delivery models
3. Evolution of brand in physical and virtual environments
4. Technologies that disrupt and transform
5. Growing, graying, connected consumers
3

Market force #1:
The new economics of healthcare reform
“The federal budget is on a dangerous, unsustainable
path. Federal debt will rise to unmanageable levels,
which will endanger our prosperity… we must take
immediate steps to reduce the unsustainable debt
that will be driven by the aging of the population and
the rapid growth of healthcare costs.”
The National Commission on Fiscal Responsibility and Reform, November 11, 2010
4

Volume vs. value economics
Today providers are rewarded for 23% of Medicare Patients
volume based transactions on
individual patients. Reform models
reward value based on episodes of 5 of more chronic conditions
care and outcomes:
 Bundled payments 12 different physicians
 Pay for performance
50 prescriptions per year
 Accountable care
 Medical homes 68% of Medicare costs
 Coordination of care
5

Regardless of reform mandates . . .
• National debt issues are not going away
• Health care expense growth rate is too high
• Labor shortages for physicians, nurses will happen
• State budget deficits will reduce Medicaid payments
• Downward pressure on Medicare rates will continue
• Payers will reimburse providers based on cost and quality
• CMS quality payment initiatives in place
6

Focus of the CMO
 Help your team understand changing
economics in the health industry and the
implications for marketing strategy.
 Understand not only the top line revenue
implications of customer acquisition, but also
the bottom line impact of key segments.
 Help hospitals and health systems better
understand, prepare for and relate to
consumers under new delivery structures.
 Build high-performing, future ready
marketing operations with more
sophisticated segmentation, targeting,
positioning, brand building, customer
acquisition and customer retention strategies.
7

Market force #2:
Market restructuring; new delivery models
 Accountable care models and organizations
 Hospital and health system mergers & acquisitions
 Physician integration, employed medical practices
 Ambulatory, post acute and retail diversification
 Academic, technology and business partnerships
 Multi-market, multi-state expansion initiatives
 Enterprise IT/EHR/website strategies
 Co-branding/co-marketing relationships
8

New players on the primary care front
Vision – “Well Experience”
 Become America’s first choice for health and daily
living
5 Key Strategies
 Transform stores to retail health and daily living
destinations
 Advance pharmacy to play a greater role in health
care through integration and expanded services.
 Deliver outstanding customer experience through
enhanced employee engagement.
 Expand across new channels and markets, Inside the Walgreens corporate-care
particularly through investments in e-commerce clinic at Disney World, employees
and mobile technology. enjoy a pharmacy, EKG and digital
 Reinvent the cost structure through continuous radiology machines.
improvement and innovation.
Source: Walgreens; Shareholders Hear Strategy for Growth and Value Creation
During Walgreens 2012 Annual Meeting; January 2012; Fast Company March 2012.
9

Walgreens “Well Experience” blueprint
 Enhanced, state-of-the-art pharmacy designed to encourage greater
interaction between pharmacists and patients – bring pharmacists out
from behind the counter
 Take Care Clinic offering a wide range of health care services including
vaccinations, health tests, physicals and treatments for common illnesses
and minor injuries – more tightly integrate retail clinics and pharmacies to
create health centers
 Upmarket Café featuring a juice bar and fresh hand-rolled sushi – provide
greater access to healthy foods
Source: Fast Company March 2012.
10

Strategic intent is clear . . .
“We have heard from key stakeholders across the health care landscape – including CEOs
of health plans and major employers – who have visited our ‘Well Experience’ stores. The
No. 1 comment I hear is, ‘This is exactly what we need. How fast can you do this?’”
Gregory D. Wasson, CEO, Walgreens
"It's acute episodic care now, but it's moving to full primary care. The dream is to expand
into chronic-disease management. That's a huge part of the cost of health care.
We haven't figured it out yet, but we will."
Hal Rosenbluth, president of Walgreens Health and Wellness
"Whatever does or doesn't happen is good for us. If reforms are adopted they're going
to need providers. We're a provider. And if a new health-care law doesn't pass, there
will be more people in need. And we're affordable, even when paying cash."
Hal Rosenbluth, president of Walgreens Health and Wellness
Source: Fast Company March 2012.
11

Focus of the CMO
 Use data and strategic insight to inform business
strategy, focus growth initiatives and build core
“system” competencies.
 Step up brand building to strengthen competitive
leverage for partnering, contracting, talent,
customer acquisition and retention.
 Be a catalyst for innovation; push for and
support care delivery and service innovations.
 Understand the marketing requirements of new
lines of business, and develop growth and
marketing management strategies, structures,
skills and systems to support multiple markets,
facilities, SBUs.
12

Market force #3:
Evolution of brands in physical and virtual worlds
The underlying basis of competition is changing –
taxing even well established healthcare brands.
Market consolidation and expansion, service
diversification and strategic partnering are on the
rise – fueled by reform and accountable care
clinical management structures.
Web, social and mobile technologies are changing
everything! How we learn, how we shop, how we
manage, how we engage, how we . . . . . . . .
13

Fundamental reason we exist.
Core
Purpose
Value Strategic
Innovation One of the Most Vision
How we sustain Powerful Forces in How we intend to compete.
competitive advantage.
Brand Building is
Focused Alignment – in
the ‘Bricks and Mortar’
Customer World as Well as the Brand Value
Experience Proposition
Digital One
How we satisfy customer The unique reason our brand
needs and wants. matters to customers.
© Corrigan Partners LLC
Brand
Alignment
How we link our business strategy to customer experience.
14

Brandscaping
15

Physical Virtual
16

The central challenge with brand
building is getting a complex
organization to execute a simple idea.
17

Focus of the CMO
 Build knowledge and understanding across the
health system about brand as a strategic asset to
drive growth and better business performance
 Develop a comprehensive, long-view brand
strategy to create a powerful, relevant and
defensible position and strengthen factors that
drive differentiation
 Build solid strategies for multi-facility, multi-
services and multi-market systems
 Orchestrate business, clinical and marketing
alignment to deliver consistent brand experiences
across all branded facilities, services and
environments
 Align brand identity and experience across web,
social & mobile environments, including health
IT/EMR/patient, physician and employee portals
18

Market force #4:
Technologies that disrupt and transform
19

A comprehensive web, social and mobile capability, integrated
with clinical IT systems such as EMR and patient portals, and
embedded in physical environments, is no longer optional for
organizations that want to remain relevant.
20

The newly integrated health & social ecosystem
Resources
Medical
Treatment
Record
Social
Support
Diagnosis Monitor
Health
Caregiver
Support Other
• 52 years old
• Breast cancer
“Fighting breast cancer is a
24/7 job. Treatment doesn’t
just happen in the clinic.”

Digital media fluency is essential
Web, social and mobile technologies require new skills.
• Integrated, multi-channel strategies
• Web development/management
• Content marketing
• Integrated CRM/contact center
• Mobile media development & marketing
• Content ecosystem management
• Digital brandscaping Adapted from http://costaricacloseup.com/designstudios/
• Social commerce
• Community management
22

Content is strategy; not just promotion
Decision Cycle Provider Goals Keywords Social Topics Content Channels
Awareness • Stimulate
demand
Interest • Drive
preference
Consideration • Differentiate
Patient Needs brand/offer
• Health Information and advice Trial • Customer
• Routine screenings acquisition
• Convenient care when ill • Customer
Retention
• Chronic care management satisfaction
• Self care support
Advocacy • Brand
• Caregiving support commitment
Content Strategy Map ©Corrigan Partners
Success requires a thorough understanding of
how consumers discover, consume and share CREATE
information on-line; and the role of search and CURATE
social interaction across the buying cycle. INFLUENCE
23

Focus of the CMO
 Help hospitals and health systems understand that
consumers today no longer have purely offline or
online experiences but weave technology through
nearly every point of contemplation, purchasing
and use of products and services.
 Understand the adoption patterns of technologies
that support care delivery and care management;
and explore opportunities for creating points of
differentiation in access, timeliness, convenience
and customer service.
 Master integrated search, social and content
marketing – strategy, planning, execution,
management.
 Build digital media capabilities and fluency – full
speed ahead!
24

Market force #5:
Growing, graying, connected consumers
• 2011 was significant in that it marked the first
year that baby-boomers began turning 65; and
for the next 15 to 20 years, about 10,000 people
will turn 65 years old every single day.
25

Boomers will be the driving force for healthcare
services in the coming decades . . .
. . . not just for “what” is delivered but “how” it will be delivered
 The first wave of the boomer generation is generally satisfied with their lives
and optimistic about the next third of life
 And they also have age-related health concerns similar to their parents
when they were 65
 However, in some very important ways boomers turning 65 are different
from their parents — particularly when it comes to ideas about retirement,
expectations about customer service, taking control of their own destiny,
and connectedness to information and resources.
26

Social networking isn’t new, just different
• The impact of web, social networking and mobile technologies cannot be
underestimated in its influence on how growing, changing, graying Americans
access information, communicate, and connect with brands and services.
• Aging Americans have unprecedented access to information about health care,
and growing expectations for the service conveniences of on-line appointment
setting, communications with physicians and personal medical records.
27

Not just a Florida and Arizona issue
People 65 and Older
• 39.6 million in 2009,
representing 12.9% of the
U.S. population – 1 in every
8 Americans
• Darker areas on the map
are regions where the
percentage of people over
65 exceed the average
• By 2030, there will be about
72.1 million older persons,
more than twice their
number in 2000 and will
count for nearly 20% of the
population.
28

Implications for the workforce
Dramatic Shift in Age of Workforce – 2000 to 2010
Younger Workers Older Workers
25 - 44 45 - 65
29

Focus of the CMO
 Move front and center in the realm of customer
intelligence, and dig deeper to gain meaningful
insights into aging consumer needs and behaviors.
 Assess aging trends and demand implications in
your marketplace and help leaders understand
both the opportunities and challenges of these
developments.
 Define aging segments and growth opportunities,
identify wants and needs, and drive niche
strategies, services, and program development.
 Help your organization understand that the new
“senior” will demand more choices, be less tolerant
of bad service and inconveniences, won’t
necessarily follow doctor’s orders, believe that 70 is
the new 50 . . . and expect to be treated
accordingly.
30

Embrace change, then drive transformation
31

Questions. Comments. Discussion.
Karen Corrigan
Founder/CEO
Corrigan Partners
karen@corriganpartners.com
P 757.288.2480
@karencorrigan
blog @ karencorrigan.com