The document discusses a marketing model called the "4S model" that is designed to help entry-level marketing professionals in healthcare organizations better understand the market. The 4S stand for Size, Shape, Share, and Soar. Size refers to quantifying the market size for a medical service. Shape examines the service profile and customer profile. Share looks at the organization's current market share. Soar is about goals for growth. The model is intended to provide a template to facilitate understanding of the market and develop better marketing strategies.
Case 12.1 Home Value Stores (LO2)Home Value Stores operates 264 MaximaSheffield592
Case 12.1 Home Value Stores (LO2)
Home Value Stores operates 264 membership warehouse stores in the United States, Europe, and Asia. The company offers low prices on a limited selection of household and grocery products. In the past year, sales increased by approximately 10.8 percent and net earnings increased by 6.4 percent. The company opened only two stores in 2020 and 2021 and closed one of its stores due to poor performance. Jack Davidson and Michael Prine are on the board of directors of Home Value and serve on the company’s compensation committee. At a recent lunch meeting, they discussed the company’s performance. (See the table on the next page for a balance sheet and an income statement.) Both were pleased with the increase in profit and decided to recommend a contract extension and a substantial six-figure bonus for the company’s CEO. They anticipated, however, that the third member of the compensation committee, Tanya Barrett, would object to the bonus. Tanya believes that accounting profit is a poor measure of future firm performance. In her opinion, the company should be focused on what it is doing today to create future value for shareholders. She has also pointed out that, although the company showed quarterly profit increases, its stock price remained flat.
Required
1. To prepare for an upcoming board meeting, Tanya has asked you to evaluate financial performance for 2020 and 2021, taking into account both the level of investment and the cost of capital. Specifically, she would like you to calculate the level of profit (loss) that was earned in excess of the amount required given the investment in the company. Assume that the cost of capital is 15 percent. Is it clear that the company has had superior financial performance?
2. In fiscal 2022, the CEO of Home Value Stores retired. His successor is concerned that warehouse managers do not understand how their actions are linked to the company’s strategy and how they can affect future firm value. In his opinion, while monthly earnings are important, managers are focused almost exclusively on how their actions affect these numbers. Suggest a performance measurement technique that can be used to address the new CEO’s concerns.
Comparative Financial Statements: Home Value Stores (in thousands)
2021
2020
Sales
$26,360,000
$23,800,000
Merchandise costs
20,680,000
17,900,000
Operating, general and administrative
3,220,000
3,600,000
Rent
235,000
220,000
Depreciation and amortization
211,000
200,500
Interest expense
110,000
90,000
Total
24,456,000
22,010,500
Earnings before taxes
1,904,000
1,789,500
Taxes
380,800
357,900
Net earnings
$ 1,523,200
$ 1,431,600
Assets
Cash and temporary investments
$ 90,000
$ 60,000
Receivables
358,000
202,000
Inventories
1,944,000
1,405,000
Prepaid and other current assets
193,000
118,000
Total current assets
2,585,000
1,785,000
Land
260,000
140,000
Buildings and equipment (net)
640,000
450,000
900,000
590,000 ...
How can hospitals and healthcare systems increase awareness and build relationships with an audience that is becoming resistant to traditional methods of outreach and marketing? Gelb has worked with a number of top-rated academic medical centers and hospitals to assess the referring physician experience and develop strategies to grow this unique market.
Healthcare Online Marketing Benchmark for Healthcare ProvidersChris Bouwsema
We have surveyed clinics and hospitals around the world and summarized the results in a comprehensive 10 page report.
The report answers these questions:
- What percentage of healthcare providers are using online marketing?
- How much do they spend on online marketing?
- Which are the most popular channels for paid online advertising?
As a bonus we created a benchmark where you can evaluate your own online marketing efforts.
Case 12.1 Home Value Stores (LO2)Home Value Stores operates 264 MaximaSheffield592
Case 12.1 Home Value Stores (LO2)
Home Value Stores operates 264 membership warehouse stores in the United States, Europe, and Asia. The company offers low prices on a limited selection of household and grocery products. In the past year, sales increased by approximately 10.8 percent and net earnings increased by 6.4 percent. The company opened only two stores in 2020 and 2021 and closed one of its stores due to poor performance. Jack Davidson and Michael Prine are on the board of directors of Home Value and serve on the company’s compensation committee. At a recent lunch meeting, they discussed the company’s performance. (See the table on the next page for a balance sheet and an income statement.) Both were pleased with the increase in profit and decided to recommend a contract extension and a substantial six-figure bonus for the company’s CEO. They anticipated, however, that the third member of the compensation committee, Tanya Barrett, would object to the bonus. Tanya believes that accounting profit is a poor measure of future firm performance. In her opinion, the company should be focused on what it is doing today to create future value for shareholders. She has also pointed out that, although the company showed quarterly profit increases, its stock price remained flat.
Required
1. To prepare for an upcoming board meeting, Tanya has asked you to evaluate financial performance for 2020 and 2021, taking into account both the level of investment and the cost of capital. Specifically, she would like you to calculate the level of profit (loss) that was earned in excess of the amount required given the investment in the company. Assume that the cost of capital is 15 percent. Is it clear that the company has had superior financial performance?
2. In fiscal 2022, the CEO of Home Value Stores retired. His successor is concerned that warehouse managers do not understand how their actions are linked to the company’s strategy and how they can affect future firm value. In his opinion, while monthly earnings are important, managers are focused almost exclusively on how their actions affect these numbers. Suggest a performance measurement technique that can be used to address the new CEO’s concerns.
Comparative Financial Statements: Home Value Stores (in thousands)
2021
2020
Sales
$26,360,000
$23,800,000
Merchandise costs
20,680,000
17,900,000
Operating, general and administrative
3,220,000
3,600,000
Rent
235,000
220,000
Depreciation and amortization
211,000
200,500
Interest expense
110,000
90,000
Total
24,456,000
22,010,500
Earnings before taxes
1,904,000
1,789,500
Taxes
380,800
357,900
Net earnings
$ 1,523,200
$ 1,431,600
Assets
Cash and temporary investments
$ 90,000
$ 60,000
Receivables
358,000
202,000
Inventories
1,944,000
1,405,000
Prepaid and other current assets
193,000
118,000
Total current assets
2,585,000
1,785,000
Land
260,000
140,000
Buildings and equipment (net)
640,000
450,000
900,000
590,000 ...
How can hospitals and healthcare systems increase awareness and build relationships with an audience that is becoming resistant to traditional methods of outreach and marketing? Gelb has worked with a number of top-rated academic medical centers and hospitals to assess the referring physician experience and develop strategies to grow this unique market.
Healthcare Online Marketing Benchmark for Healthcare ProvidersChris Bouwsema
We have surveyed clinics and hospitals around the world and summarized the results in a comprehensive 10 page report.
The report answers these questions:
- What percentage of healthcare providers are using online marketing?
- How much do they spend on online marketing?
- Which are the most popular channels for paid online advertising?
As a bonus we created a benchmark where you can evaluate your own online marketing efforts.
Revolutionizing Healthcare Marketing Strategies for Success.pdfMillion Dental
In today's competitive healthcare industry, it is crucial for providers to have effective marketing strategies in place. With so many options available to patients, healthcare organizations must stand out from the crowd and effectively communicate their value proposition. This is where healthcare marketing services come into play.
Healthcare marketing services can help providers develop and implement targeted marketing campaigns that reach the right audience with the right message.
The healthcare industry is highly competitive, and hospitals need to find ways to stand out to attract and retain patients. One way to achieve this is through effective healthcare marketing.
2013 10 utilizing member engagement to improve cahps scoresimagine.GO
The Accountable Care Act means more access to healthcare for more people. But to pay for that access it also means margins for healthcare companies are going to be squeezed. But this does not necessarily imply doom for healthcare companies. The law actually encourages healthcare businesses to build better business models – and is willing to pay for it. By retooling your market approach, and the operations that run your business, you can actually improve your margins and your customer’s happiness at the same time you are helping to create a better and more efficient healthcare ecosystem.
Running head STRATEGIC CHOICE AND EVALUATION .docxagnesdcarey33086
Running head: STRATEGIC CHOICE AND EVALUATION 1
STRATEGIC CHOICE AND EVALUATION
13
Introduction
Organizations are forced to develop and implement various strategies to deal with emerging issues in the business environment. Trends in the external and internal environment of the organization demand development of new strategies for the organization in order to ensure that the business remains viable. The strategic choice of the organization is critical for the achievement of both short term and long term goals of the organization. Organizational leaders and analysts must therefore conduct a thorough evaluation of various strategic alternatives by analyzing the risks involved, organizational capabilities, external environment, and whether the strategies form a good fit with the objectives and values of the organization. (Peng and Dess, 2013) Comment by Jag Tiwari: Too strong words. They have a choice either do it or don’t.
A good strategic choice will ensure that the organization operates to its maximum potential and achieves exemplary performance. The strategic approach that the organization adopts will depend on the organizational culture, organizational structure and leadership style. (Abu-Jarour, 2014) However, the bottom line is that organizations will design strategic plans that seek to improve customer satisfaction and service quality, gain competitive advantage, improve business processes, attract and retain employees and to manage costs. Comment by Jag Tiwari: Here you are giving a choice and not the above Comment by Jag Tiwari: I don’t think this word is needed here. It is use for transition
Strategic alternatives
In developing and adopting a strategic choice, an organization has to take into consideration various strategic alternatives that are crucial in making a decision. An important step in this process includes identification and evaluation of the best strategic alternatives for the organization. Evaluation is done on the basis of suitability, feasibility and sustainability of the strategy. (Jasper and Crossan, 2012) Common strategic alternatives to consider include value discipline, generic strategy and the grand strategy. This paper will analyze these alternatives in relation to Gentiva Health Care Inc. strategic plan. The strategy will be important for the company to deal with the rising competition in the health care services industry. In addition, the strategy will also enable the company to build capacity to handle the rising demand for personalized health care services in the country as well as building a strong customer base for its products and services. Comment by Jag Tiwari: I wasn’t clear on your alternatives. Are you say that these strategies are your alternatives.
Gentiva Strategic Goals
Gaining competitive advantage in the healthcare services industry is a major strategic goal for Gentiva. (MarketWatch, 2014) The company has to develop strategies to ensure that it remains the.
New Financial And Performance Metrics For Healthcare Industry From Brian WalkerBrian Walker
I examine what other industries are doing well from a marketing and financial perspective and how we can apply new thinking to the changing healthcare industry
This Presentation help organization in development of his sales teams. As the most important and expensive resource of any organization is his people. So to make his people productive, one should work on their development and make them " Efficiently Effective People". In this presentation , the of importance of " Sales Force Effectiveness Department" in an organization has been established. Every organization want that his sales team should fulfill quantitative objectives of organization. This presentation is specially for pharmaceuticals.
[ Smith & Jones Webinar ] 2023 Healthcare Marketing Trend: Leveraging Growth...Overit Media
As marketing budgets become tighter, it’s imperative that healthcare marketers are using all the data available to them to make informed, strategic decisions. But getting access to and interpreting all that data isn’t always easy. And even if you do have it, how do you make sense of it?
In this webinar, we’ll take a deep dive into our 2023 Healthcare Marketing Trend: Using Data to Fuel Growth. We’ll discuss growth marketing lessons learned from other industries and how to apply these tactics to our own. This webinar will give you a starting place to both launch new initiatives, and improve the campaigns you’re already running.
You work hard to design marketing and outreach strategies to attract referring physicians and grow referral volume. Learn how you can simplify the referral process to ensure you capture the volume you worked so hard to attain by downloading our white paper: Physician Marketing & Outreach, Omni-Channel Experience.
IN THIS SUMMARY
In Seven Strategies to Improve Your Bottom Line, E. Preston Gee outlines different tools and strategies that can help healthcare executives cut costs and improve their hospital’s efficiency and overall popularity. Some of these strategies include the incorporation of the Internet as a management tool, the incorporation of complementary and alternative medicine, and the addition of retail-like visual traffic. E. Preston Gee goes on to discuss the various ways hospitals can increase the number of insured individuals within their community, thus increasing the hospital’s revenue. He also explains the concept of “co-opetition,” and highlights the ways in which healthcare executives can use communication as an economic tool to improve overall hospital profitability.
SUBSCRIBE TODAY
http://www.bizsum.com/summaries/seven-strategies-improve-your-bottom-line
Revolutionizing Healthcare Marketing Strategies for Success.pdfMillion Dental
In today's competitive healthcare industry, it is crucial for providers to have effective marketing strategies in place. With so many options available to patients, healthcare organizations must stand out from the crowd and effectively communicate their value proposition. This is where healthcare marketing services come into play.
Healthcare marketing services can help providers develop and implement targeted marketing campaigns that reach the right audience with the right message.
The healthcare industry is highly competitive, and hospitals need to find ways to stand out to attract and retain patients. One way to achieve this is through effective healthcare marketing.
2013 10 utilizing member engagement to improve cahps scoresimagine.GO
The Accountable Care Act means more access to healthcare for more people. But to pay for that access it also means margins for healthcare companies are going to be squeezed. But this does not necessarily imply doom for healthcare companies. The law actually encourages healthcare businesses to build better business models – and is willing to pay for it. By retooling your market approach, and the operations that run your business, you can actually improve your margins and your customer’s happiness at the same time you are helping to create a better and more efficient healthcare ecosystem.
Running head STRATEGIC CHOICE AND EVALUATION .docxagnesdcarey33086
Running head: STRATEGIC CHOICE AND EVALUATION 1
STRATEGIC CHOICE AND EVALUATION
13
Introduction
Organizations are forced to develop and implement various strategies to deal with emerging issues in the business environment. Trends in the external and internal environment of the organization demand development of new strategies for the organization in order to ensure that the business remains viable. The strategic choice of the organization is critical for the achievement of both short term and long term goals of the organization. Organizational leaders and analysts must therefore conduct a thorough evaluation of various strategic alternatives by analyzing the risks involved, organizational capabilities, external environment, and whether the strategies form a good fit with the objectives and values of the organization. (Peng and Dess, 2013) Comment by Jag Tiwari: Too strong words. They have a choice either do it or don’t.
A good strategic choice will ensure that the organization operates to its maximum potential and achieves exemplary performance. The strategic approach that the organization adopts will depend on the organizational culture, organizational structure and leadership style. (Abu-Jarour, 2014) However, the bottom line is that organizations will design strategic plans that seek to improve customer satisfaction and service quality, gain competitive advantage, improve business processes, attract and retain employees and to manage costs. Comment by Jag Tiwari: Here you are giving a choice and not the above Comment by Jag Tiwari: I don’t think this word is needed here. It is use for transition
Strategic alternatives
In developing and adopting a strategic choice, an organization has to take into consideration various strategic alternatives that are crucial in making a decision. An important step in this process includes identification and evaluation of the best strategic alternatives for the organization. Evaluation is done on the basis of suitability, feasibility and sustainability of the strategy. (Jasper and Crossan, 2012) Common strategic alternatives to consider include value discipline, generic strategy and the grand strategy. This paper will analyze these alternatives in relation to Gentiva Health Care Inc. strategic plan. The strategy will be important for the company to deal with the rising competition in the health care services industry. In addition, the strategy will also enable the company to build capacity to handle the rising demand for personalized health care services in the country as well as building a strong customer base for its products and services. Comment by Jag Tiwari: I wasn’t clear on your alternatives. Are you say that these strategies are your alternatives.
Gentiva Strategic Goals
Gaining competitive advantage in the healthcare services industry is a major strategic goal for Gentiva. (MarketWatch, 2014) The company has to develop strategies to ensure that it remains the.
New Financial And Performance Metrics For Healthcare Industry From Brian WalkerBrian Walker
I examine what other industries are doing well from a marketing and financial perspective and how we can apply new thinking to the changing healthcare industry
This Presentation help organization in development of his sales teams. As the most important and expensive resource of any organization is his people. So to make his people productive, one should work on their development and make them " Efficiently Effective People". In this presentation , the of importance of " Sales Force Effectiveness Department" in an organization has been established. Every organization want that his sales team should fulfill quantitative objectives of organization. This presentation is specially for pharmaceuticals.
[ Smith & Jones Webinar ] 2023 Healthcare Marketing Trend: Leveraging Growth...Overit Media
As marketing budgets become tighter, it’s imperative that healthcare marketers are using all the data available to them to make informed, strategic decisions. But getting access to and interpreting all that data isn’t always easy. And even if you do have it, how do you make sense of it?
In this webinar, we’ll take a deep dive into our 2023 Healthcare Marketing Trend: Using Data to Fuel Growth. We’ll discuss growth marketing lessons learned from other industries and how to apply these tactics to our own. This webinar will give you a starting place to both launch new initiatives, and improve the campaigns you’re already running.
You work hard to design marketing and outreach strategies to attract referring physicians and grow referral volume. Learn how you can simplify the referral process to ensure you capture the volume you worked so hard to attain by downloading our white paper: Physician Marketing & Outreach, Omni-Channel Experience.
IN THIS SUMMARY
In Seven Strategies to Improve Your Bottom Line, E. Preston Gee outlines different tools and strategies that can help healthcare executives cut costs and improve their hospital’s efficiency and overall popularity. Some of these strategies include the incorporation of the Internet as a management tool, the incorporation of complementary and alternative medicine, and the addition of retail-like visual traffic. E. Preston Gee goes on to discuss the various ways hospitals can increase the number of insured individuals within their community, thus increasing the hospital’s revenue. He also explains the concept of “co-opetition,” and highlights the ways in which healthcare executives can use communication as an economic tool to improve overall hospital profitability.
SUBSCRIBE TODAY
http://www.bizsum.com/summaries/seven-strategies-improve-your-bottom-line
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Review the Effective Marketing Tool for the Marketing Professionals in.docx
1. Review the article, Effective Marketing Tool for the Marketing
Professionals in
Review the article, Effective Marketing Tool for the Marketing Professionals in Healthcare
Organization: The 4 ‘S’ Model. Are there any elements from this article you believe you will
implement in your own marketing plan in next week’s assignment? Why or why not? article
below: Patients are becoming more demanding for the medical service delivery as
organizations are continuously innovating new ways of service delivery. Irrespective of the
number of services being provided, the demand for marketing support in the healthcare
organization is growing. The number of hospitals with marketing department has increased
by 75% in 3 years’ time, which is partly due to increased competitive pressure. With more
investments in the healthcare, there is comparatively more expectation from the promoters
in terms of better returns of investment and that boils down to more pressure on marketing
activities of the organization. In such situation marketing associates including entry-level
professionals face a daunting task to justify the growth in market share and securing higher
budget for the marketing activities. To make their function more effective, a 4 ‘S’ model is
devised which captures the basic marketing information like Size, Shape, Share and Soar,
which every marketer need to have before any marketing planning. Since the information
needed for effective marketing plans for medical services is critical, the 4 ‘S’ model brings a
template-based tool to facilitate better understanding of the market and thus better
strategy for the organization. [ABSTRACT FROM AUTHOR] Copyright of International
Journal of Healthcare Management is the property of Taylor & Francis Ltd and its content
may not be copied or emailed to multiple sites or posted to a listserv without the copyright
holder’s express written permission. However, users may print, download, or email articles
for individual use. This abstract may be abridged. No warranty is given about the accuracy
of the copy. Users should refer to the original published version of the material for the full
abstract. (Copyright applies to all Abstracts.)Author Affiliations:1Department of Health &
Hospital Management, Symbiosis Institute of Health Sciences, Symbiosis International
University, Pune, IndiaFull Text Word Count:3682ISSN:2047-
9700DOI:10.1080/20479700.2017.1402423Accession
Number:144691545Database:Business Source CompleteTranslate Full Text: Choose
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(简体)繁體中文 (繁體)Isi-Zulu Effective marketing tool for the marketing professionals in
healthcare organization: The 4 ‘S’ model This content may contain URLs/links that would
redirect you to a non-EBSCO site. EBSCO does not endorse the accuracy or accessibility of
these sites, nor of the content therein.✖Contents Introduction Methodology The 4 ‘S’
model Size Shape Share Soar Conclusion Disclosure statement ReferencesFull
TextListenPatients are becoming more demanding for the medical service delivery as
organizations are continuously innovating new ways of service delivery. Irrespective of the
number of services being provided, the demand for marketing support in the healthcare
organization is growing. The number of hospitals with marketing department has increased
by 75% in 3 years’ time, which is partly due to increased competitive pressure. With more
investments in the healthcare, there is comparatively more expectation from the promoters
in terms of better returns of investment and that boils down to more pressure on marketing
activities of the organization. In such situation marketing associates including entry-level
professionals face a daunting task to justify the growth in market share and securing higher
budget for the marketing activities. To make their function more effective, a 4 ‘S’ model is
devised which captures the basic marketing information like Size, Shape, Share and Soar,
which every marketer need to have before any marketing planning. Since the information
needed for effective marketing plans for medical services is critical, the 4 ‘S’ model brings a
template-based tool to facilitate better understanding of the market and thus better
strategy for the organization.Keywords: Entry-level marketing professionals; hospital
marketing; 4 ‘S’ model; medical service marketing toolIntroductionMarketing mix in
hospitals and healthcare organizations predispose medical needs, gain market share and
increase the efficiency and effectiveness of the respective organization [[ 1]]. Adopting
marketing principles in hospitals and healthcare organizations is gaining importance. The
potential for developing new services and community program, the need for reevaluating
and redefining the target market of the organization’s service offering and the need for
more accurate and comprehensive strategic planning are major concerns and the driving
forces for the effective marketing program in the healthcare organizations [[ 2]].
Understanding and applying the marketing way of thinking in order to raise the quality of
performance of healthcare organizations is becoming a necessity, which dictates behavior in
a competitive environment [[ 3]]. Application of standard marketing principles poses
3. different set of challenges for the healthcare organizations. Due to wide variations in the
request made by heterogeneous patients for a particular service becomes a serious
challenge to present the benefit of the concerned services and make them visible and
tangible in advance [[ 4]]. Public sector healthcare organizations, which mostly operate as
not-for-profit organizations believe more in quality and timely delivery of services. Thus,
marketing of these services were not felt important and urgent. Off late, Academic Health
Centers (AHCs) are aggressively marketing themselves by designing new services and
promoting these services more intensely [[ 5]]. Irrespective of the pre-requisite essentials
in the organizational level, the demand for marketing support in the healthcare
organization is growing. The number of hospitals with marketing department has increased
by 75% in 3 years’ time, which is partly due to increased competitive pressure [[ 2]].Target
markets in hospital marketing include patients and families, communities, doctors, medical
personnel, hospital staff and charitable donors [[ 6]]. While hospitals come out with a
number of services, it becomes difficult to position such services in the huge market place. If
marketing planning is not designed in a well-thought manner, it may affect the quality of
medical services and lead to unnecessary competition and may cause unnecessary
prescription of medical services [[ 7]]. While there are a number of functional activities in
the marketing of hospital services, from the organization’s perspective the analysis of target
market, future need assessment of consumers is quite important for a good management
strategy [[ 8]]. However, it has been a daunting task for the entry-level managers to cope of
the multiple demands from different departments to provide support to market the hospital
and healthcare organization services. Therefore, most of the activities in the healthcare
organizations are reactive in nature than proactive and well planned. Although it has been
proven that marketing can improve satisfaction of the target market [[ 7]], the current
practices in hospitals in India hardly analyses systematically the target markets.As per the
2016 State inbound report [[ 9]], 65% marketers reported that generating traffic and leads
is the top most challenge faced by the marketers followed by proving RoI of the marketing
activities (43%) and securing enough budget (28%). Other issues highlighted in the report
are managing website, identifying right technologies, targeting content for an international
audience, training the team and hiring the top talent. When the marketing plans are
executed without a base understanding about customers, their needs, place of service
availability etc., marketing activities would not be effective and gradually the organizations
have dilemma in increasing budget on marketing.A practicing entry-level managers said
that ‘Within a month, he had wedged himself into the fledgling marketing team’ [[10]] and
often witnessed many definitions of marketing starting from promotion of organization’s
product and services to process for creating, communicating and delivering the value to
customers. But most often entry-level marketers hardly have a tool to understand where to
promote, how much to promote, what to create to improve value.A number of deliberation
has been documented to improve the management of healthcare organizations including
hospitals in recent years [[11]]. Many innovative tools have been introduced in the
healthcare marketing to optimize the outcome of hospitals. The importance-performance
analysis (IPA) by using physicians perspectives regarding performance dimensions mostly
used to understand and interpret the perspectives of the users of services/products or
4. patients in healthcare [[12]]. However, such a tool would be further strengthened with an
objectivity-based hospital market information.The existence of dual professional expertise
namely medical and non-medical in the hospital sector makes it complex and its
management becomes more differentiated than other organizations. Such complexity in the
hospital sector has been described as double-headed monster by Drucker [[13]]. Thus, it is
becoming important to define an easy way to demonstrate the functionalities of marketing
professionals in the health and hospital sector.This current paper is addressing such need
for the entry-level managers and trying to bring a tool for them to make them more effective
in the organization while they create value for the organization and for the
customers.MethodologyThe current research paper is the outcome of the observations in
many hospitals in India and the class room deliberation of marketing management for
hospital services for the students of Masters of Business Administration (MBA) in Health
and Hospital management.In one of the researcher’s academic visit to one healthcare
organization, he had an opportunity to discuss with the Head of that organization about
marketing efforts being done. He mentioned various activities like the road show, direct
customer interaction, sponsoring few events on life style changes and so on. While the
researcher was trying to understand the reason behind such activities and how it is linked
to overall organization mission and vision, it was neither connecting to any of the core
values of the organization nor was linked to any measurable outcome. This in turn creates a
non-viable, non-evidence and non-conclusive marketing budget which is limited to few
activities which may or may not lead to the growth of the organization.This is the standard
practice in a sizable small- and mid-level organization. When young marketing
professionals enter such organizations, they become a task doer than a thought based
marketer. It has been observed that many of the young health and hospital management
professionals missed the appropriate way of looking to the market dynamics.In order to
make things a bit easier for the students who would start their career as entry-level
manager, the researcher developed a concept on ‘4S Model of Marketing’. This was
deliberated in the classroom of MBA students and evaluated through collection of
information on various aspects of the 4S model. The model was further refined by taking
informal feedback from the stakeholders of various healthcare organizations including
hospitals.The model also uses various epidemiological concepts like prevalence rate,
diagnosis rate and treatment rate and socio demographic variables like patients age,
income, place of residence and other factors considering the complexity in the demand of
various medical services.The 4 ‘S’ modelWhen a marketer starts planning of the marketing
activities, most of the fresh marketers are task based contributors rather than thought
based contributors. When the young and inexperienced professional go out of their
management school into a healthcare organization or a corporate hospital, mostly they are
into a state of confusion as their job is mostly ‘a reaction to a certain situation in the
organization’ or ‘task assigned by the senior professionals’. They are not able to create a
base on which they would prepare their marketing activities. Subsequently they develop a
perception that the marketing practice in the healthcare organizations are different than the
theories they have learned in their management education. This in turn creates hurdles for
the professionals to bring a competitive advantage to the organization they work for.The 4S
5. model is based on the premise of understanding the basic marketing principles. One of the
major challenges in the healthcare industry is the lack of proper definition of the services of
a particular organization. If it is not defined well and understood by its own employees, it
becomes a daunting task to create an innovative communication platform for the service
delivery. Again the service delivery model in healthcare organizations varies significantly
due to socio-economic, demographic and technological factors. The model tries to bring
systematic way of defining the service offerings and create a basic ground for the hospitals
to develop the service delivery and keep doing service development vertically and
horizontally.4S model carries different attributes to understand the base market and its
customers. The 4S in the model are; Size, Shape, Share and Soar.While for the entry-level
marketing professional it is important to convert the learning in the management school
into practice, it is also important to synchronize with the thought process of the senior
marketing associates of the organization. While the model was deliberated in few
organizations by the final year healthcare management students during their summer
training, it was highly appreciated and the synchronization was established without much
difficulty.The model is given in Figure 1.PHOTO (COLOR): Figure 1. The 4S model.SizeThe
first S of the 4 ‘S’ model is market size. It is utmost important to quantify the market size.
Most often the entry-level marketing professionals ignore such exercise for the medical or
clinical service they work for or to promote. The sizing of the market for medical or clinical
service is a bit complicated than the sizing for the other services. The patient pool sizing is
critical for marketing and positioning of medical or clinical services of both acute and
chronic disease. In spite of a prevalent number of 3.8 million patients for lung volume
reduction surgery (LVRS) in USA, only 119 procedures were performed in the year 2008
under Medicare [[14]]. This is due to the lack of effective diagnosis and other support
system including the communication and counseling to the patients. In case of chronic
disease, the rules of half indicates that of the total prevalent population, half of the people
get diagnosed and of the total diagnosed only half of them get treated [[15]]. This is clear
that the market size, say for a diabetes treatment is not the prevalent population, but only
the treated population which is a fraction of the prevalent population. However, knowing
the most accurate prevalent number, diagnosis population and treated population would
add a great knowledge to the marketing activity of the respective medical or clinical service
because the level of prevalence rate and diagnosis rate would impact the market size.The
template for market size is given in Figure 2.Graph: Figure 2. Template for market size.Such
template can be prepared for the territory that the organization has defined as its
operational market. The operational market can be a small administrative area or it can be a
state or even a country. If the organization has a multi-level presence in delivery of the
particular medical or clinical service, the market sizing can be done at each level of the
territory and then the same can be cumulated.Service pricing in healthcare organization is
widely fluctuated because of the monopolistic competitive nature of the market.
Understanding the average pricing of such services is also important from the marketing
strategy perspective. While prioritizing the effective marketing mix elements on patients’
tendency to hospitals, it was found that price, services and physical assets are the top
priority elements in public sector hospitals while services, physical assets and promotion
6. are the top ones in private hospitals. All these elements have an impact of more than 30% in
terms of patients’ tendency towards hospital marketing mix [[ 1]]. Therefore, the total value
of the service concerned must be worked out or estimated through a secondary data or
sample based market survey. Once this information is reflected in your market sizing
template, that would provide you a great insight of the service which you are dealing
with.ShapeThe shape is the second ‘S’ in the 4 ‘S’ model. Shape of the market indicates about
the consumer’s location and where the service is provided. This carries a lot of importance
for the marketing of healthcare services especially in developing countries. A study by IMS
institute for Healthcare Informatics on healthcare access in India shows that Physical
access, capability, quality of care and affordability are the four major issues in the
healthcare access in India [[16]]. This indicates that on an average the components of
medical services like hospital beds, doctors, nurses and pharmacists are available by more
than 70% in urban areas where as more than 70% customers are in rural areas. Again more
specialized and high-end medical services like bone marrow transplant is available in metro
cities where as customers are spread over metro cities, class I and II and other rural areas.
Thus it would be a huge impact on the marketing exercise when a marketing activity is done
without understanding the location of the customer and where the service is delivered. The
template on the shape of the market would help in understanding such vital
information.The template for gathering information on shape of the market is illustrated in
Figure 3.Graph: Figure 3. Template for ‘shape’ of the market.Various epidemiological studies
have demonstrated that there is a significant level of variation in the prevalence of a disease
(pre-requisite for demand of medical services) by different demographic parameters like
age, gender etc. Such information also influences the marketing activities of any kind of
medical or clinical services and thus needs to be part of the shape of the market
information.ShareThe third ‘S’ in the 4 ‘S’ model is the share. Harvard Business Review
(HBR) has reiterated that one of the main determinant of business profitability is market
share and the return on investment is directly related to the degree of market share [[17]].
The report has specified that higher level of market share is an indication for economies of
scale, bigger market power and superior quality of management. The marketing challenge
increases with higher market share as the organization demands to maintain the market
share at a higher level which may be a difficult task with the growing competition in the
healthcare industry. The entry-level manager must have an in-depth understanding on the
share of a particular medical service by all the competitors operating in the market
place.The template for data collection for the market share is given in Figure 4.Graph:
Figure 4. Template for ‘market share’.Healthcare industry including hospital services,
diagnostic services and allied service is emerging in most of the developing countries and
thus micro industry information by the service providers are limited although the macro
information is available. The pharmaceutical sector is an exception in terms of data
availability on market share and performance of the major market players. Therefore,
entry-level marketing professionals have to initiate an indirect estimation of market share
or rely on market survey pertaining to the service that they handle in the organization.
Having such information platform would provide a bigger advantage while planning for
competition strategies.SoarThe fourth and last ‘S’ in the 4 ‘S’ model is ‘Soar’. A good market
7. analysis will have an economy overview, which is very helpful in understanding where your
current market is and where it is going [[18]]. Healthcare industry is growing at a rapid
rate. The overall Indian healthcare market is worth around US$ 100 billion and is expected
to grow to US$ 280 billion by 2020, a Compound Annual Growth Rate (CAGR) of 22.9%
[[19]]. The industry includes sectors like hospitals, nursing homes, diagnostics,
pharmaceuticals, healthcare information technology, medical tourism and so on. The
growth would vary significantly within the sector. The key here is not only to capture the
growth rate of the sector but also the growth of the services in last few years. This would
help in setting up a forecasting platform for the marketing team and thus can influence the
investment decisions of the organization. The template for data collection for market
growth is given in Figure 5.Graph: Figure 5. Template for ‘soar’.For the marketing strategy
the forecasting is very crucial and critical because the strategies that a healthcare
organization would implement in times of rapid growth would be different during sluggish
market [[20]]. If the industry is expected to grow rapidly, the marketing plan would be
focused on acquiring as many new customers as possible. If growth is going to be limited,
the focus would have to be more on retaining customers the business already has – because
his competitors will be striving to lure his customers away.ConclusionIn the healthcare
industry, the market place is becoming too competitive as the growth is driven by high
incidence rate of non-communicable diseases, injury and other lifestyle-related
complications. Over the period there is a development of consumerism in the healthcare
industry which drives the demand for more marketing professionals to deliver value to the
ever demanding customers. The healthcare marketing is more complicated compared to
other services, as it brings the requirement of clinical information, epidemiological
expertise and of course marketing knowledge. While the healthcare industry is more a kind
of monopolistic competition, the principal- agent relationship between the patient and
doctor inhibits the disclose of major information flow, on the other hand the marketers in
the healthcare organization would try to bring as much as information to the patients to
make the decision making easy from the customer perspective. In such scenario, the entry-
level marketing professional manages multiple challenges during managing the marketing
planning activities. The 4 ‘S’ model discussed in this paper is going to add a significant value
for the entry-level marketing professionals in the healthcare industry.Disclosure
statementNo potential conflict of interest was reported by the author.Notes on
contributorDr Biranchi Jena is currently working as a professor in Health Economics and
Marketing at Symbiosis University, Pune. He also consultants on performance management
for healthcare projects of Tata Trust. Dr Jena is the former Director of IIHMR Bangalore and
worked in senior positions in corporations like Novartis and Novo Nordisk.References1
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