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Q: Hospital Return on Investment in Marketing ( Answered,   0 Comments )
Question  
Subject: Hospital Return on Investment in Marketing
Category: Business and Money > Advertising and Marketing
Asked by: rascaldog-ga
List Price: $200.00
Posted: 02 Feb 2006 13:13 PST
Expires: 04 Mar 2006 13:13 PST
Question ID: 440622
What ways are progressive hospitals using to track the ROI they
receive from expenditures in marketing and advertising? Some typical
ways would include hits on a website mentioned in ads or phone calls
to a referral line offered in advertising. Certainly tracking patient
volumes for the specific services being advertised is also
appropriate. I am looking for the trends in ROI tracking specifically
that hospitals would use to hold their ad agencies accountable.
Answer  
Subject: Re: Hospital Return on Investment in Marketing
Answered By: umiat-ga on 21 Feb 2006 16:09 PST
 
Hello, rascaldog-ga!

 My research turned up quite a bit of information on the topic of ROI
and hospital marketing but I believe the most useful case studies are
probably the subject of marketing conferences. It appears that
conference agendas often contains specific seminars on hospital
marketing strategies and ROI. Unfortunately, the conference
presentations do not appear to be published outside of the conference
arena!


FOR A GENERAL OVERVIEW OF SOME MARKETING AND ROI MEASUREMENT METHODS, SEE:

"A key strategy to revenue growth: the right marketing infrastructure:
not all successful revenue strategies are focused externally.
Sometimes the strongest strategies are built from within," by Arthur
C. Sturm, Jr. Healthcare Financial Management, May, 2005
http://findarticles.com/p/articles/mi_m3257/is_5_59/ai_n13760059

Excerpt:

"Rather than examining strategies and programs that build revenue,
this month's column looks at marketing organizational structure and
resources and how their unique deployment can achieve desired results.
As much as we like to scrutinize strategies, perhaps the
infrastructure should be put under the microscope as well."

"Our example is St. Louis-based BJC HealthCare, a $2.1 billion,
13-hospital system...

"BJC's central talent well appears to be achieving positive results at
the operating level. "Take our use of direct mail, for example," said
Nowak. "As recently as six or seven years ago, we would shotgun
thousands of pieces of direct mail. But now that we have a central
customer database and the talent to manage it, we are becoming
extremely efficient and effective in many of our direct mail programs.
Our response rates, which once averaged percent, are now 2.5 percent
to 3 percent, sometimes spiking to 5 percent."

Read further....


==

For some innovations in advertising (but no mention of ROI), see the
following article:

"Hospitals are expanding their markets by selling services directly to the public."
http://www.boston.com/yourlife/health/hospitalguide/HowToShopforYourHealthcare/



CALL CENTERS - ROI
====================

An excerpt from "The Beryl Companies Issues White Paper on Measuring
Accountability of Hospital Marketing, Highlights Importance of ROI."
http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/12-27-2004/0002715690&EDATE=

Excerpt:

"One of the greatest challenges that has historically confronted
hospitals of all sizes and sponsorships is how to measure the ROI of
their marketing efforts," Paul Spiegelman, CEO of Beryl, said.  "In
today's competitive environment, measuring ROI has become an essential
and expected part of the marketing discipline.  Over our 20-year
history of serving healthcare clients, we have discovered the drivers
for ROI measurement and the determinants of that measurement."

"Today's well-designed call centers have become the critical compass
towards revenue enhancement and market share potential as they provide
the starting line to quantifiably measure the ROI of dollars spent
marketing an institution's program and services.  In addition, best
practice call centers can measure income generated by targeted
marketing campaigns and can then provide the framework to overlay this
income on related expenses to accurately and fully measure ROI."

"The white paper outlines the simple step-by-step process
organizations can use to determine ROI."

(See rest of article....) 


** The complete paper may be found here:
 http://www.beryl.net/PDF/ROIWhitePaper.pdf


==


"Hospitals should look at call center returns," by Stephanie Patrick.
BizJournal. 2005
http://www.bizjournals.com/industries/health_care/hospitals/2005/01/24/dallas_newscolumn14.html


==

"Capturing your marketing ROI: hospitals can use their call centers to
determine the success of marketing projects aimed at attracting
patients to the organization,"  by Paul Spiegelman. Healthcare
Financial Management, August, 2003 
http://www.beryl.net/reprints/HFMMag0803s.pdf


==

"ROI Still a Key Driver in Gaining Call Center Credibility."
http://www.beryl.net/reprints/PR&TTT_1104.pdf



NEWSLETTERS - ROI
==================

"Marketers Find Mass Customized Communications Easy to Implement," by
Barbara Long, APR
http://www.strategichealthcare.com/pubs/shcm/f1_MassCustomization.php

"These marketers have found the Patient Education Newsletter System,
or PENS, an innovative, data-driven application for mass customization
of newsletters.

"Once the newsletter is sent, tracking occurs on multiple levels.
Customer Database Services measures "cause and effect" both by
individual articles and the entire newsletter and provides hard data
reports of household counts, ROI, payer mix, and so on. The company
also runs an analysis that compares hospital use by PENS-generated
newsletter recipients and control groups based on services used,
customer status, and financial class.

According to Padovani, the resulting information enables more precise
targeting with each successive campaign. "It is a deep, rich data
source. You can use it for market research and to conduct other
analyses for financial, operational, or clinical planning. The
database can become the hospital?s ROI source," he says.

At Washington University School of Medicine, Stack reconciles PENS
data with the billing department after every issue. Any prospective
patient that received a PENS-produced newsletter and enters the system
within six months is considered new income generated by the marketing
department. After the first year of PENS use, the faculty practice
tracked an ROI of $62 in income for every dollar spent. The second
year generated $88 for each $1. "It is obvious to faculty and
leadership that new or additional patient visits have been added and
that new practices are being developed," Stack says.
 
..

"But how does PENS stack up against other media? Evanston Northwestern
Healthcare in suburban Chicago used a LASIK campaign in 2002 to find
out. It determined that with PENS, a lead cost $55, and each procedure
performed cost $200. In contrast, the cost per lead from a newspaper
ad was $275, and the cost per procedure performed was $1,500. Direct
mail cost per lead was $180, and cost per procedure performed was
$600."

"Northwestern Medical Faculty Foundation also found PENS to be an
extremely effective tool for clinical trial recruitment. It used PENS
to fill a study with rheumatoid arthritis patients who did not have
cancer, hypertension, or diabetes. Only 33 patients were targeted to
receive the recruitment article, which generated 17 calls. All the
calls were from qualified candidates, and the study was filled at a
cost of $100. A traditional recruitment drive using classified
newspaper advertising would have cost $3,000 in addition to wasting
the nurse coordinator?s time fielding calls from ineligible
volunteers."



INTERNET LAUNCH BROADCASTS and ROI
===================================
 
Some short case studies highlighting ROI in conjunction with internet
launches can be found below:


Beth Israel Medical Center LaunchSite 
http://www.slp3d.com/studies/case.cfm?id=1 


Brigham and Women's Hospital LaunchSite 
http://www.slp3d.com/studies/case.cfm?id=2


Cleveland Clinic LaunchSite 
http://www.slp3d.com/studies/case.cfm?id=3


University of Maryland Medical Center LaunchSite 
http://www.slp3d.com/studies/case.cfm?id=13


Wake Forest University Baptist Medical Center LaunchSite 
http://www.slp3d.com/studies/case.cfm?id=12


Thomas Jefferson University Hospital LaunchSite 
http://www.slp3d.com/studies/case.cfm?id=11




WEBSITES AND ROI
=================

"Hospitals use Web sites to attract out-of-town patients."
http://www.woio.com/Global/story.asp?S=4115503&nav=menu68_2

"Hospitals looking for a financial edge say they are relying more on
Web sites to compete with other institutions and attract out-of-town
patients, particularly those who pay cash. Health care marketers say
they target "medical tourists," who use the Internet to find medical
information and are willing to travel to receive what they consider
the best care."

"To remain competitive, we know we have to do a better job of
utilizing the Web to get the word out about our centers of
excellence," said Andrea Reynolds, multimedia manager at Akron
Children's Hospital.

"Reynolds said a half dozen out-of-state patients who learned about
the hospital through the Internet brought in $250,000."
..

"Hospitals can boost revenues by convincing consumers that they excel
at treating certain conditions can boost revenues. The Web site of the
for-profit Cancer Treatment Centers of America promotes
around-the-clock sessions with cancer doctors who can offer treatment
advice over the phone or online."

"About 10 to 15 percent of the 3,000 monthly users become patients and
generate as much as a quarter of the centers' revenue growth each
year, said Jack Moore, chief marketing officer for the cancer
centers."



MARKETING AND ROI MEASUREMENT SCENARIOS
=========================================

From the Medical Marketing Association's "2005 Medical Marketers of
the Year." http://www.mmanet.org/news/news_details.cfm?key=11

"Ms. Eastman?s award-winning work on the QuickCare campaign for St
Mary?s Medical Center emergency department achieved approximately 300%
ROI. The campaign was originally designed to increase emergency
department volume by 10-15% within six months, but the actual volume
has far exceeded the team?s objectives. The campaign is characterized
by dramatic bold pieces that show accidents about to happen, with
light-hearted headlines, such as "Yikes," "Whoops," and "Whoa!?
followed by the emergency department?s promise "Emergency room care in
under 30 minutes. Only at St. Mary?s." The ads appeared on outdoor
boards, bus shelters, and buses in the surrounding community as well
as in movie theaters, and local papers. Area residents also received
direct mail pieces to reinforce awareness of QuickCare. The campaign
has been covered in local and trade publications and the QuickCare
program has been replicated in one of St. Mary?s sister hospitals. Ms.
Eastman said, "We had a very simple, straightforward message and
visual approach. I think the humor helped make it more interesting and
memorable so it wasn?t just part of the wall of advertising that
surrounds us."


* See an interview with Ms. Eastmen
http://www.mmanet.org/news/newsletter_Oct05.htm


==


The following excerpt is the Duke University newsletter
http://dukecreative.org/pdf/annualreport_2004.pdf

"Duke Advertising Effectiveness - Wake County Baseline Study,
completed January 2004 and to be repeated June 2004. The purpose was
to measure the effectiveness of the current branding campaign by
conducting a baseline market research study before the campaign began
and a second study to be completed after six months of airtime and
then again after one year of airtime. In the fall of 2004, we will
reconfigure the creative somewhat to
attempt to generate trials of Duke services in Raleigh."

"Executing a Fall 2003 Duke Sports Medicine Campaign with demonstrable
ROI: The purpose of this marketingvinitiative was to increase the
number of clinic visits andvsurgeries to take advantage of excess
capacity and to i n c rease program revenue. Specific goals were set,
including the following year-over-year increases:

+25% increase in the number of patients at the Saturday Injury Clinics
+11% increase in inpatient visits
+11% increase in total surgeries

"Through the use of radio and print ads; articles in the consumer
health newsletter Dukehealthline, the referring clinician publication
DukeMed Magazine, and the employee publication INSIDE; the Web; direct
mail; visits to referring physicians; and ponsorships, the following
results were achieved:

+45% increase in number of patients at the Saturday Injury Clinics
+15% increase in inpatient visits
+13% increase in total surgeries

"In addition, there was a 37% increase in traffic to
dukesportsmedicine.com. The campaign generated the desired level of
additional variable contribution margin for Duke Hospital and for the
past three months additional surgeries have been scheduled as a result
of this initial marketing effort. Based on these results, a smaller
spring campaign was initiated.


==


Some examples from the CPM Marketing Group website following
utilization of the company's tracking program to measure ROI:

"Hospital Educates Women on Cardiology Risks, Increases Utilization
with CPM Solution."
http://www.cpm.com/documents/PHY/releases/pr_Women_cardio_HRA_040605.pdf

"With more women having and dying of heart disease in its market area
than the statewide average, a Midwestern hospital used its database
marketing program to identify those with the greatest likelihood to
use or need cardiology services, coupling direct mail and an online
Health Risk Assessment (HRA) to produce a 5.5 percent response rate of
cardiology service utilization."

"The design of the campaign allowed for tracking at several different
entry points. The hospital measured the results of the campaign
against a control group, which had the same characteristics as the
target group but did not receive any mailings. In addition to tracking
the number of women who took the HRA, the hospital was able to track
the number of women who met with the cardiology nurse. It also used
its CRM database to track utilization of cardiology and overall
hospital services....After a year of tracking, the direct mail
campaign resulted in a higher utilization of cardiology and overall
hospital services from recipients in the target than the control
group. For cardiology services, a 5.5 percent response rate was found
to be solely attributed to the campaign. As is expected, the response
rate for overall services was higher with a 19.2 percent response rate
solely attributed to the campaign."

(Also read - "Inova Cardiology Program Achieves 10 Percent Response
Rate, $803,613 ROI with CPM Program.")
http://www.cpm.com/documents/PHY/releases/pr_InovaDontWait.pdf


==


From "Hospital Increases Orthopedic Services Utilization by 8 Percent
with CPM System."
http://www.cpm.com/documents/PHY/releases/pr_Orthopedic_Usage_060704.pdf

"A Midwestern hospital that applied targeted marketing to a health
seminar campaign has realized an 8 percent increase in orthopedic
services utilization as a result and a net post-marketing return on
investment of $152,407 with a program developed by Customer Potential
Management (CPM) Marketing Group. CPM is a leader in relationship
management solutions for health care."

"A Midwestern hospital that applied targeted marketing to a health
seminar campaign has realized an 8 percent increase in orthopedic
services utilization as a result and a net post-marketing return on
investment of $152,407 with a program developed by Customer Potential
Management (CPM) Marketing Group."



GENERAL ARTICLES
===================

The difficulty in measuring marketing ROI is discussed in the following:

Topic: Health Care Industry - Expert: Arthur Sturm - Date: 3/27/2003
Subject: Marketing ROI. 
http://experts.about.com/q/Health-Care-Industry-2410/Marketing-ROI.htm

Question: "From your experience, how many health care marketing
departments are successfully measuring ROI? I've worked for other
systems in which I've had a call center and sufficient support to do
data base marketing and could demonstrate return on the marketing
investment. However, in my present situation at an academic medical
center, with no call center and data base support, I've only been able
to use macro measures like market share and preference. The CEO, of
course, wants everything tied back to a very modest marketing budget.
The metric he is looking for includes not only marketing $s, but staff
salaries and construction/technology expense. Do you have a feel for
how other marketers are demonstrating ROI?"

Answer - "Frankly, I've never felt that ROI in its true sense is a
meaningful measure. A big part of the problem is what's thrown into
the to equation (captial expenses,etc). Still, we need to be
accountable......One metric that we have introduced with some success
is acquisition cost. We work w/CEOs, CFOs etc to talk about how much
they want to spend to get a certain type of patient or advise them on
what a certain type of patient is worth and then build a budget around
it. For example, a surgical heart patient is more attractive than a
maternity case in many instances. How much are they willing to get
that $25K heart patient? How many do they want? We use a metric of 10%
of revenue for a patient should be initially earmarked as an
acquisition cost. So, for a $25000 heart patient, an acquisition cost
should be $2500. If you want 50 new heart patients, your budget should
be 50x2500 or $125000. Conversely, if you run a cardiac patient
acquisition program that cost $200,000 and you get 100 new patients,
your cost to acquire that patient is $2,000. Is that acceptable? Every
institution needs to make it's own formala.


"Go Beyond the "Return on Experiment" to Track Website ROI," by John Eudes
http://www.greystone.net/news_websiteROI.html


"Marketing?s Ever-Growing Role at Hospitals - It?s Not Like It Used to
Be," By Mike Scott. http://www.radiologytoday.net/archive/rt_071904p18.shtml


"Can Hospital Advertising Dollars Be Better Spent?" By Anthony
Cirillo, for HealthLeaders News, June 2, 2004
http://www.healthleadersmedia.com/view_feature.cfm?content_id=55205 


"Increase Marketing ROI by Establishing Metrics and Testing Your
Tactics," By Anthony Cirillo, for HealthLeaders News, January 21, 2005
http://www.healthleadersmedia.com/view_feature.cfm?content_id=62716 


"How Not To Squander Precious Dollars," By Paul Barsch for
HealthLeaders News, April 2, 2004.
http://www.healthleadersmedia.com/view_feature.cfm?content_id=53717


"10 Ideas to Effectively Market and Brand Your Hospital," By Abe
Kasbo, for HealthLeaders News,Sep 09, 2005
http://www.healthleadersmedia.com/view_content.cfm?content_id=71654
 

"Six Strategies for Crafting 'Ethical' Hospital Advertising," By
Anthony Cirillo, for HealthLeaders News,May 04, 2005
http://www.healthleadersmedia.com/view_content.cfm?content_id=67071 


"Are You Taking Advantage of All Marketing Opportunities Online?
Second of Two Parts: Content, New Technologies, ROI," by Susan
Solomon. Strategic Health Care Marketing. April 2004
http://www.greystone.net/news_marketingOps.html

 
You will need to fill out a free registration to read the following
article in full:

"Employer-directed marketing: a boon for hospitals." From Healthcare
Financial Management: April, 2005. 
http://www.allbusiness.com/periodicals/article/393695-1.html


==


 I hope the information I have provided proves helpful! 

 If you have the opportunity, you might be interested in attending the
following conference:

"Maximizing Marketing ROI for Hospitals and Health Systems
conference." http://www.worldrg.com/showConference.cfm?confCode=HW613


Sincerely,

umiat


Search Strategy


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