Monthly Archives: July 2012

The fight for customer: regional vs destination hospital

Years ago, men and women from all over the country flocked to Cleveland, OH, Baltimore, MD, and Rochester, Minnesota for the answer. Local hospitals were not equipped with the right tools to diagnose and treat serious medical conditions. Consumers were not willing to receive that kind of care in their hometowns. In fact, when consumers were asked about why they would go to Mayo Clinic, Cleveland Clinic, or Johns Hopkins, the answer was usually the same.  Hopeful consumers were frustrated with their experiences at local providers, and articulated the same hope for a better experience with greater access to the latest medical knowledge – essentially a different prognosis and a better chance, from those more qualified. When local providers left them wondering, consumers sought out these destination hospitals for the answer, or their last chance for a different answer.

Today, community hospitals are competing with destination centers for patients on the same playing field of high-touch and high-technology.

To further enable the decentralization of competition, many of these world-class hospitals are providing access expertise through local providers. Does this eliminate a need for these healthcare meccas or introduce an integrated pipeline to ensure the next generation of patient flow?

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In Search of That ‘Moment of Truth’

Where does the road to experience begin? End? And why are we so obsessed with limiting ourselves?

When marketers map customer experience, they start by defining a beginning and an end. But consumers experience a brand in an integrated ecosystem, replete of definition. In fact, when we think of improving experience for a particular brand, we typically look at touch points that are knowingly controlled by that brand. Let’s say I’m in charge of Walmart’s experience– I’m probably looking at the parking lot, the entrance, the signage, the store layout and wayfinding, customer service, the checkout line, the bathrooms. The list goes on.  Every detail is considered, from the time you enter the parking lot until you drive off. But if there is construction outside, or no traffic light at the intersection of the parking lot, it’s not Walmart’s problem. Or is it?

While our customers might become frustrated with these obstacles, we don’t link the frustration with the brand as a singular experience – but what if we did? P&G sometimes refers to this as the first moment of truth. In P&G’s view of the world, the first moment of truth occurs at the shelf, before you buy and experience the product. It’s the experience before the experience. At this point, the brand can differentiate and articulate 3 of our 4 Ps: price, placement, and packaging. The goal is not only the sale, but also the experience of encountering the product. What is the first moment of truth for a brand that is an experience?

What is the first moment of truth for Walmart? Where does the experience start?  The front door to the mall in which your retail space resides? The highway ramp? The street outside the store, or the transportation that takes you there? What if the brand experience started the moment you walked out of your house, when you first acted to seek out the experience? If there’s construction on the sidewalk outside of Walmart, how can Walmart work with urban planners to better accommodate customers and enhance the experience offset by construction? What if Walmart could touch the entire journey, door-to-door?

Not too long ago I was flying with Delta Airlines, and as I went through security I caught sight of an expedited TSA lane. It was a lane with no line, no requirements to take off your shoes and belt or to take your laptop and liquids out of your bag. I wondered, how does the TSA pick the lucky few that get to use that lane? To my surprise, the TSA agent guided me in that direction. What had I done to earn such a privilege?

Apparently, my loyalty to Delta had enabled me to take advantage of this travel perk. When I think of my experience with airlines, I think of schedules, planes, seats, upgrade frequency, in-flight meal options, entertainment, or attendants… definitely not the dismal experience that security usually entails. I would have never extended my associations with Delta beyond the terminal, let alone into the airport. I never thought of my airline as having anything to do with my airport experience. In fact, I see LGA and JFK as different brands, have unique perceptions of them altogether and see Delta completely powerless and at the airports’ whim. But all of a sudden, the headache associated with the airport experience was alleviated due to Delta’s involvement. They simplified travel for me, and in doing so, earned a customer for life. I know this is not something they control, but they obviously influence it. This was their “first moment of truth” – my experience before I had a single interaction with the airline. They’ve managed to extend their experience beyond. What else could they do? Delta door-to-door?

We know that our customers are overlooking parts of their experience, not always connecting the dots. The fact is, brands are missing out on opportunities to interact with customers. By failing to address important parts of their experience, they are inadvertently letting them down. But why? The reason brands don’t actively pursue these things is because they are tough, expensive even, but it’s when brands tackle the big issues, they get the bigger payoff – the lifetime customer.

What have other brands done? Mayo Clinic has seen success by addressing unseen opportunities as well. When you’re visiting Mayo Clinic, it’s probable that either you or a loved one is ill, and there is undoubtedly stress involved. Once you’ve arrived, the Clinic is focused on alleviating that stress. But how could they alleviate it sooner? While not marketed, the hospital offers a concierge service to help patients coordinate travel. Someone helps arrange your flight, and upon arrival to the airport a Mayo Clinic representative is waiting to pick you up. If needed, they’ll even send a nurse to accompany the patient from their home.

The Clinic stages an experience before the patient expects to have one, but has it worked? I’ve spoken with patients who explain the anxiety and stress of coming to Mayo, and how much relief they experienced when someone came to pick them up, talked to them about the area, about the Clinic process – well before they even entered the hospital. Before they entered the defined, controlled experience.

How do you define the extended experience? What can a brand control or influence in order to encourage purchase and loyalty? We know what we can control, but there is so much more out there that we can influence. So I challenge the world of marketing to redefine endpoints, extend experience, and in Apple’s language: think different.

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Consumerism in healthcare

Healthcare has traditionally consisted of the patient-doctor relationship. A family member would provide a recommendation and hopefully the doctor was accepting new patients. The doctor was an authority figure, while the patient was indebted to his or her services. In most cases, one would maintain this relationship for decades, if not generations.  Today, a new healthcare system gives rise to a new type of relationship. In fact, the tables have turned: patients are no longer restricted accessing care, while physicians are looking for new ways to build their patient books.  Patients have greater expectations of physicians and are more discriminate in the selection of their care. They are no longer the subjects of medicine, but consumers of it.

Consumers are shopping for their healthcare more than ever before

The word “consumer” has not been historically accepted in the field of medicine, as it implies a sales process between the physician and his or her subject, and diminishes the relationship.  However, in today’s world of increasing options and educated consumerism, it is just that and ought to be embraced. This means, when we think about the experience, we need to stop thinking about it in terms of the patient experience and start talking about consumer loyalty. Treating patients as consumers acknowledges the scrupulous selection process and opens up an opportunity in the field of medicine.  From a clinical standpoint, care needs to meet a certain quality standard to be deemed acceptable; however, there are ways to create higher touch experiences for those that want it. In this choice model, a healthcare provider could create different levels of care for the open market – ranging from the Kia of healthcare, to the Mercedes. The opportunity is to capitalize on the choices consumers have in healthcare – to let them receive their care ‘a la carte’.

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Branded generics: more than just a number

more than just a number

Generic pharma company, Teva, prints their name alongside the pill number, which identifies the manufacturer, type of medication and dosage

I was recently prescribed Amoxicillin after going to the dentist.  As the drug has been in the market for ages, it was available in generic form.  When I opened the bottle, I noticed the capsules were printed with both an identifying number (that identifies the pill manufacturer, medication type, and dosage), and the manufacturer brand. Why put a brand on a generic? And which brand? Manufacturer or old pill name? Should Pfizer put “Pfizer” on the generic of Lipitor or should they put “Lipitor” and does it really matter? Is there a value to it?

As major blockbuster drugs come off patent and face their generic rivals, does that name still have value?  With parents that take an average of six pills every morning, I am intimately aware of the ritual that is involved in maintenance medication.  There is a routine established – from years of asking for the same script, and from constant regurgitation of current medications at every visit to a new doctor. It becomes a state of mind – “I’m on Lipitor” – whether it’s Lipitor or its pharmaceutical equivalent.  Having the Lipitor insignia on a pill might actually reinforce confidence among consumers, providing an added layer of stability midst a world of failing health. In fact, Pfizer may even be able to secure more scripts for their Lipitor, than competitively priced generics, for this convenience. The other side of the question is whether generic manufacturers build brands by creating trust and brand familiarity. Could they convince consumers, or physicians, to ask for their version? Could there be a household name in generics?

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Implications of the Supreme Court decision

Last week, the Supreme Court decided that it was constitutional for ObamaCare to require every American to have health insurance. Not in a while has a Supreme Court decision been able to impact every single American. While this ruling has a significant political impact, the impact on the healthcare system is more worrisome. Not only will this change healthcare consumption, but it will also create changes in the offer. Insurance companies will not be able to discriminate against high-risk consumers, and have to find ways to cover those that can not afford to pay. In order to meet market demands, payors will likely have to develop a set of products to meet emerging needs, undifferentiated from one another. As a result, it will be more important to optimize and differentiate on the customer experience to reach the expanding addressable market. What about the providers, that are already understaffed, and eating losses on charity care and declining reimbursement rates? Will universal coverage also change healthcare consumption, encouraging more people to seek care, and if so, can our system handle it?

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Filed under Payors, Providers