Dr. Marketing is Jack Harms, President of The Marketing Department, where he specializes in helping companies improve their competitive advantage.
Q: What should we do to further differentiate our services from those of our competitors?
Dr. Marketing: Focus on your customers’ needs. In occupational health, I’ve found that if you think of the customer as “the person paying the bill,” your marketing efforts will be more effective.
Q: How should we go about determining what the customer needs?
Dr. Marketing: That’s the good news. There is only one need: To make more money. It may sound crass, but employers invest their company’s funds in the hope of getting back more than they spent. Your services need to provide your customers (employers) with a larger return on investment (ROI) than do those of your competitors. When they do, you’ve given the employer a concrete, dollars-and-cents reason for choosing your program.
Q: How can we make an employer more money?
Dr. Marketing: Think of your business in terms of what it provides to customers rather than what it does for patients. Doing so will change your perception of your business as an occupational health clinic to a “Productive Employee Restoration Company.” When you reposition your generic business in that manner, you create a point of reference for the development of new services. Because of the high level of professionalism within the industry, it’s very difficult to differentiate clinical services, per se. Differentiation will almost always come out of the business activities that surround the delivery of quality care.
Q: Once we have repositioned our business model, then what?
Dr. Marketing: Look for ways to reduce the employer’s overall costs and improve the productivity of employees. For example, processing payments, maintaining records and dealing with insurance companies can create hours of work for the employer’s staff. Develop ways to help reduce those costs, and give those methods specific, marketable names. Note that cost reduction does not mean price reduction. Marketing is responsible for raising prices, not lowering them.
Q: What is the best way to show the value of an investment in our services?
Dr. Marketing: It’s very important to quantify the economic gain produced by your differentiated services and establish the perception that employers are willing to pay more for your services because they see results. It’s the only true basis upon which the prospect can compare value. For example, a client company may reduce its clerical costs by an estimated $15,000 annually by working with your program but pay $5,000 more per year for your clinical services than it would pay a competitor. By paying more, the employer actually comes out $10,000 ahead (a 200% ROI) and benefits from your healthcare expertise.
Q: If doing more for the employer will cost us more, how do we determine if the investment is worth it?
Dr. Marketing: The same way. Compare how much margin (revenue less direct cost) you will gain from the customers you are likely to sign as a result of offering differentiated services. The size of that number is the measure of your reward for taking the economic risk and the basis for deciding if you should proceed.
