Health related
100honestywork
chapter_12.rtfChapter 12
After reading this chapter, you should be able to:
• Recognize the differences between the two basic forms of advertising: product and
institutional
• Describe the steps involved in developing an advertising campaign
• Know various ways to develop an advertising budget
• Understand the value of alternative media
No element of the marketing mix has been more visible in health care than advertising.
In recent years the growth of resources committed to this aspect of the marketing
mix has been substantial. In 2005, more than $25 billion was spent annually on
health care advertising. Three-quarters of this money was directed toward physicians.
However, the fastest-growing segment of health care advertising is direct-to-consumer
marketing. Direct-to-consumer advertising in health care was $4 billion in
2004, 15 times as much as the roughly $260 million spent a decade ago.1
“Advertising” may be defined as any directly paid form of nonpersonal presentation
of goods, services, or ideas by an identified sponsor. The key aspects of this definition
are: (1) that it is paid, which distinguishes advertising from publicity; and (2)
that it is nonpersonal, which separates advertising from personal selling.
Concerns have long been raised regarding health care advertising. As seen in
Table 12-1, consumers have mixed feelings toward this aspect of marketing. In two
separate studies, Andaleeb assessed consumers’ attitudes toward hospital advertising
on a range of issues. The higher the value, the stronger was customers’ agreement
with the statement in Table 12-1. Although consumers see advertising as increasing
health care costs, they consider it to be a somewhat useful tool in choosing a hospital.
Consumers also recognize that hospitals are really not different from other prod
Table 12-1 Attitude Toward Advertising
Statement Mean
Hospitals should not engage in advertising 3.09
Ads help win clients 2.92
Hospital ads increase costs 4.13
Hospitals with good reputations don’t need to advertise 4.02
I don’t trust hospitals that advertise 2.40
Hospital ads are no different than other products 3.52
To stay in business, hospitals need to advertise 2.27
Ads are useful in choosing hospitals 3.40
Hospital ads are often misleading 3.15
Hospital ads often exploit people’s anxieties 3.18
Hospital ads make people aware of health-related issues 2.41
Scale was “1” very strongly disagree to “5” very strongly agree
Source: Adapted from Syed Saad Andaleeb, How Consumers View Hospital Advertising, Journal of Hospital Marketing, Vol. 8,
No. 2, 1994, pp. 73–85. Reprinted by permission of the publisher, Taylor & Francis, www.informaworld.com.
ucts, which may suggest some receptivity toward health care advertising. However,
consumers are somewhat distrustful of hospitals that do advertise and question why
those with good reputations need to engage in this practice. This chapter will discuss
the value, the strategy, and tactics that make advertising a legitimate part of the marketing
mix.
n Common Classifications of Advertising
There are many forms of advertising; the two most common classifications are product
and institutional. Product advertisements focus on a particular product or service,
whereas institutional advertisements build up or enhance an organization’s image
rather than a particular product. There are several variations within each form of
advertising.
Product Advertising
Product advertising can assume one of several forms: informational, competitive, or
reminder. Informational advertisements are used in the early stage of a new product or service introduction. These advertisements help to explain the service, how it can
be accessed, or its objectives.
Competitive product advertisements are persuasive—they try to generate selective
demand for the organization’s service over that of competitors.2 In traditional industries,
this form of advertising compares competing products. Competitive
advertisements are not that common in the health care industry.
A final version of product advertising is purely reminder. For example, some hospitals
have implemented nurse information lines so consumers can talk to a nurse regarding
a medical question. When necessary, these nurses will provide callers with the
names of health care providers to call for further examination or consultation. The
University Health Care System of Augusta, Georgia, offers an “Ask-A-Nurse” health
service center, a 24-hour, 7-day-a-week help line staffed by registered nurses with at
least 5 years of experience. These nurses can assess symptoms and direct a caller to
emergency services or make a physician referral, as necessary ( www.universityhealth
.org).
Institutional Advertising
Institutional advertising is frequently used in health care. These advertisements are
used to build good will and to enhance the public’s image of a particular organization.
There are several variations of institutional advertising; some introduce or announce
the opening of a new company or facility, some compare programs, and some
advocate public policy positions.
One issue of concern among the public is that of having surgery done on the
wrong limb. From January 1995 through September 2003, 278 wrong-site surgery
cases were reported to the Joint Commission; 35% of these cases were orthopedic in
nature. To address this issue, the American Academy of Orthopedic Surgeons
(AAOS) formed the “Sign Your Site” task force in 1997 to address this issue and then
mounted a major national institutional advertising campaign, shown in EXHIBIT 12-1,
to heighten public awareness of the importance of participating in surgical site marking.
“Sign Your Site” became a Joint Commission mandatory intervention for preoperative
procedures in 2004.3
Institutional advertisements can be competitive, such as when advertisements
compare two or more organizational forms, showing one to be more effective than
the other(s). In health care, this variation often appears with advertisements touting
prepaid health care plans versus more traditional indemnity insurance programs.
As in product advertising, institutional advertising occasionally serves as a reminder
to reinforce previous impressions in the target audience.
Another common form of institutional advertising is referred to as advocacy, in
which an organization publicizes its position regarding a particular issue. For example,
Developing the Advertising Campaign
The development of an advertising campaign begins with the preparation of a media
plan, which outlines the analysis and execution of the advertising campaign.
Define the Target Audience
Essential to a successful media plan is the first step—a definition of the target audience.
The target audience is the group or groups that the organization is trying to
reach. This step is an organizational decision, determined by earlier market research and based on prior market segmentation decisions. The more detailed this section of
the media plan, the easier subsequent decisions will be regarding placement of advertisements
and advertising copy design. As in the earlier discussion of market segmentation,
a target audience description will include demographics and, possibly,
attitudinal profiles and lifestyle descriptions. Upon defining the target audience, the
media plan must then specify the advertising campaign’s objectives, budget, message,
communication program, and manner for evaluation. These steps are shown in FIGURE
12-1 and are described in detail in the following pages.
Determine the Advertising Objectives
Advertising objectives are critical to any successful campaign. In setting objectives,
it is best to consider how advertising works. Consumers do not view an ad and then
buy a product or use a service. Rather, advertising facilitates moving consumers along
a sequence of steps that have been described as a hierarchy of effects—the stages a
buyer moves through from first seeing an advertisement ultimately to buying the
product or using the service.4 These stages include: awareness, interest, evaluation,
trial, and adoption.
Awareness
This level of the hierarchy is necessarily the first. The consumer must recognize the
advertisement or be cognizant of the fact that it exists. Canonsburg General Hospital
of Canonsburg, Pennsylvania, selected consumer awareness as the advertising objective
for its newly remodeled mammography center. The hospital conducted a
5-week advertising campaign in several newspapers. Advertisements were also
reprinted as flyers distributed to new residents.5
Awareness was also the advertising objective for the University Hospital in Los
Angeles, California. USC University Hospital and the USC Norris Cancer Center are
well known in medical and clinical arenas, but not among the general population.
The academic medical center built an awareness campaign around its athletic teams’
“Fight On” slogan and the key challenges facing many of its patients. The campaign
was tested in the Los Angeles metropolitan area prior to being launched, and the positive
response was overwhelming. The campaign included an integrative promotional
strategy that involved:
• A 6-month radio campaign on 14 radio stations throughout the Los Angeles listening
area
• Digital banner ads on the WebMD and Los Angeles Times Web sites
• Print ads in the Los Angeles Times and local newspapers throughout Los Angeles
and Orange counties
• Online paid and organic search promotion through Google AdWords and the Yahoo!
and Bing search engines6 Determine Target Audience
Specify Objects
Determine Budget
Specify Communication Program
Evaluate
FIGURE 12-1 Developing the Advertising Campaign
Interest
After developing initial awareness, a consumer must have some inclination to seek
additional information about the product. The organization’s goal at this level of the
hierarchy is to provide some information that will motivate further deliberation or
action.
Evaluation
Before consumers will buy a product or seek out a service from a particular provider,
they must compare that product or service with other available options. Organizational
advertising must include dimensions that are important to the target market.
Trial
The initial use of a service is called trial. Advertising can only move a person to this
level of the hierarchy. In order to have repeat purchases, a service must meet the customer’s
expectations. No amount of advertising can correct a bad experience with a
hospital or medical group.
Adoption
This is the highest level of the hierarchy and the ultimate goal of advertising—the
stage at which the customer becomes a regular user. If trial was satisfactory, reminder
advertising plays an important role in this level of the hierarchy of effects.
Determine the Budget
Several methods can be used to determine the appropriate amount to spend on advertising.
Because there is no absolute formula, these methods tend to include one of the four following categories: percentage of sales, competitive parity, “all you can
afford,” and objective and task.
Percentage of Sales
This method involves determining a fixed percentage of sales or revenue to use as
the basis for advertising allocations.7 For example, a hospital might decide that 1.5%
of last year’s net revenue will be allocated to the current year’s advertising. The advantage
of this method is its simplicity. It also provides some fiscal safeguards in tying
advertising expenditures to organizational resources. In spite of these advantages,
however, this method has an inherent flaw; it implies that sales or revenue causes advertising.
Advertising should be seen as contributing to sales, not the other way
around. Using this method, a company would reduce advertising expenditures when
sales drop. In fact, this may be the period when additional monies must be spent to
generate new sales. Hospitals that have large fixed-asset bases cannot afford to exist
with large, idle capacity.8
Competitive Parity
Competitive parity is common in industries where there is a significant amount of
trade data. The hospital sets the advertising budget based on industry norms or what
it perceives the competitor is spending. Logic demands that an organization consider
the competitor when determining any advertising budget.9 Table 12-2 shows an example
of such competitive comparison data collected in a recent study by Sutter
Health of Sacramento, California, a health system consisting of hospitals, physicians,
and a managed care plan. This study was conducted to determine norms regarding
system advertising spending. Except for consideration of the competitor, the logic of
this method is weak. It may well be that the competitor is trying to reach a different
target market or has different goals. Moreover, this method assumes that the competitor
knows what it is doing.
All You Can Afford
This approach is obvious by its name. Common to organizations that really don’t believe
in the value of advertising, it involves first allocating the budget to all important
operations within the organization. If any money is left over, it might then be
allocated to advertising.10 Although this method might address an organization’s fiscal
reality, it could lead to too much, as well as to too little, being spent on advertising.
No consideration is given to the objectives of these methods.
Objective and Task
This fourth method is the most appropriate way to determine the advertising budget.
The objective and task approach involves setting objectives along the hierarchy of
effects and determining the tasks necessary to accomplish these objectives. The costs of these tasks ultimately determine the final budget needed.11 EXHIBIT 12-3 offers examples
of advertising objectives for each level of the hierarchy.
In using this method, for example, a marketing director must decide how to accomplish
the first objective of getting referral physicians in Michigan’s Upper Peninsula
to be aware of the hospital’s helicopter service. In this instance, the director must
determine the following tasks and costs:
One physician referral brochure (6000 copies at $2 each) $12,000
One full-page advertisement in Michigan Medical Society
monthly magazine 1,500
One open house at medical center for area physicians 6,000
Total cost $19,500
The total cost is the proposed budget. At this point, however, the marketing director
determines how much the organization can actually afford and adjusts the
budget accordingly. Any further adjustment in the budget must be reflected in what can be accomplished regarding the objectives. The tasks will be redefined, and the
budget subsequently adjusted.
In examining the objectives listed in Exhibit 12-3, it is important to note the
ingredients for good, useful objectives. All of these objectives specify the target
market. Each objective is time-based, whether it is 30 days or 3 months. Finally, each
objective is measurable. This last component is essential in order to prove the value
of the campaign. In health care marketing, a common criticism of advertising relates
to whether it actually achieves its objective. This concern is a result of not beginning
with a measurable objective.
Develop the Message
The third step in designing the advertising program is the development of the message.
Marketing research is essential at this stage to determine the attributes that are
important to the consumer. In developing these messages, varying appeals are often
used, including rational, emotional, and moral/social appeals.
Rational
These messages are directed at distinct functional attributes of the product. The purpose
is to explain the value in using the particular service.
Emotional
An increasingly common advertising appeal is emotion, with fear and humor being
used most often.12 The use of fear in health care advertisements has some troubling
ethical dilemmas, as noted in an earlier chapter. In fact, the Alliance for Health Care Strategy and Marketing, which was the major professional association for health care
marketing professionals in the late 1980s and early 1990s, developed a set of ethical
guidelines for advertisers (reviewed later in this chapter). The group specifically noted
that advertising should not use emotional appeals to take advantage of individuals
who are vulnerable due to health care needs.13 Within limits, however, fear appeals
can be effective. One study used fear appeals in advertisements for AIDS prevention
for college-age students. Results of the study showed that an ad with a strong fear appeal
generated tension, energy, and a more positive cognitive response than the milder
version of the advertisement.14
Moral/Social Appeals
These messages focus on causes or issues. Hospitals mount advertising campaigns to
solicit funding for their medical foundation research. Likewise, the American Red
Cross appeals to the community for participation in blood donation.
Pretesting
Any good advertising message should first be pretested. Pretesting involves assessing
advertising copy options before their general use. Effective pretesting requires that it
be conducted with the intended target audience.
In Chapter 5 on marketing research, focus groups were discussed as one datagathering
methodology. Focus groups are used extensively in the early stages of advertising
development and pretesting. Initially, focus groups can be used to identify
the important dimension for the advertisements and alternative appeals that could be
utilized. Other pretesting methods can be implemented once a draft version of the advertisement
is created. Pretests can be conducted to ensure that the target audience
can interpret the advertisement, is interested in it, and prefers it over other versions.
An advertisement can be pretested in several ways, such as through portfolio tests,
jury tests, and theater tests.
Portfolio Tests
This form of pretesting involves testing alternative copy. The test advertisement is
placed in a grouping with other sample advertisements. Consumers are then asked
to review all the samples. Upon completing the review, consumers are then asked
to judge the advertisements on a series of dimensions such as interest, attention, likability,
and informative value. When Fallon Health Plan in Worcester, Massachusetts,
initially embarked on its first health maintenance organization (HMO)
advertising campaign, it pretested four different advertisements among consumers
who belonged to traditional indemnity plans. In conducting the portfolio test, the
Fallon HMO also showed variations of the advertisements to subscribers of a competing
HMO Jury Tests
In this version of a pretest, the advertisement or variations are shown to a panel of
consumers. Similar to a portfolio test, researchers solicit consumer reactions on several
dimensions in the advertisements.
Theater Tests
The most expensive and elaborate form of pretesting is the theater test. For example,
consumers are invited to a special viewing of a new television show or movie.
Sample advertisements are interspersed throughout the show. When the viewing is
over, consumers are asked to rate the show and provide reactions to the advertisements.
In the most sophisticated theater tests, consumers can react immediately to the
commercials and record their intensity of like or dislike by using a handheld device
while they view the advertisement.
Regardless of the degree of sophistication applied to the pretest, it is an essential
step in advertising. In health care, pretesting often involves showing the advertisements
to the physicians on staff or in the medical group to gain their approval. This
step is important to ensure that any advertisement intended for the consumer be factually
correct regarding any intervention or treatment discussed. Yet, unless the advertisement
is directed to other physicians outside the organization, this kind of
pretest would not be entirely valid. The advertisement also must be pretested with the
target audience of intended consumers.
Specify the Communication Program
Once an advertisement’s message is developed and pretested, the next step in the advertising
campaign is to select the appropriate medium and vehicle for delivering the
message to the target market. Related to this decision is determining the timing of the
messages to be communicated. Medium refers to the form of communication selected,
such as newspapers, radio, television, direct mail, or magazines. The vehicle
is the advertising alternative chosen within each medium. For example, an advertiser
might use magazines as the medium and Modern Healthcare magazine as the particular
vehicle within that medium.
In selecting the appropriate medium, two objectives often conflict within the constraints
of any advertising budget. These are the goals of reach and frequency. Reach
refers to the unduplicated audience that an advertising vehicle will deliver. The more
people exposed to the message, the broader the reach. Frequency refers to the number
of times the same person receives a message within a defined time period. The
value of frequency was best shown by the advice to prospective advertisers from the
1800s shown in Chapter 4. Ideally, a company tries to maximize the reach and frequency
of its advertising; however, based on definitions alone, it is easy to see that
this would incur significant cost.
In addition to reach and frequency, advertisers must also consider the amount of
waste, which refers to the people reached by a particular medium who do not belong
to the intended target market. A magazine, for example, that counts family practitioners
among its subscribers as well as pediatricians may have wasted coverage if
the target is only pediatricians.
The price of most media advertising space is based on the size and the purchasing
power of the audience. The larger the audience of a radio station, the greater the charge
to advertise on that particular station. Magazines such as Architectural Digest that target
an upscale audience might charge more money for advertising than Backpacker.
Scheduling
After the organization determines the balance between reach and frequency, it must decide
the timing for its messages. There are many variations by which an advertising campaign
can deliver messages; the three most common are seasonal, steady, or flighting.
Seasonal
Some products and services have a seasonal pattern to their demand. For example,
cold medicines have heavier demand in the winter months; a travel clinic might experience
greater demand in the summer months. Advertising, therefore, is scheduled
in heavier amounts at the onset of the peak demand period.
Steady
This schedule involves maintaining the same level of advertising exposure through the
selected time period. Physician referral lines sponsored by hospitals often follow this
scheduling pattern. On any given day, any number of people might need to avail themselves
of this service. Maintaining a constant level of product or service awareness is
necessary to reach each new consumer entering the adoption stage of the market.
Flighting
A common advertising schedule is called flighting, which involves a heavy amount
of advertising for short time periods. FIGURE 12-2 shows three diagrams to represent
flighting and two alternative scheduling patterns that are discussed below. The flighting
approach has distinct periods when there are a large number of exposures. The
logic of this approach is that advertising will have sufficient carryover effect to maintain
awareness when there is little or no advertising. The risk of losing product awareness
is represented by the gaps before the next burst in expenditures.
An alternative scheduling strategy is concentration, whereby a company spends
its advertising dollars and achieves exposure within a defined, relatively short time
period. Or, an organization can follow a pulsing approach, in which advertising expenditures
occur at a constant level with occasional, short, heavy expenditures.16
Picking the Right Medium
Advertisers have a variety of media from which to choose to place their message.
Each of these media has distinct characteristics that must be assessed in the final advertising
plan.
Television
Of all media available, television has the advantage of communicating sight, sound,
and motion. These components afford the potential advertiser significant flexibility
in the creation of the advertising copy. Today, almost 98% of all homes in the United
States have television, providing the potential for enormous reach. Television’s major
disadvantage is its cost. Prime time spots can easily exceed $100,000. The production
costs of television commercials also add significantly to the budget expense. Except
for large national companies such as Cigna, Prucare, or Blue Cross Blue Shield,
national advertising costs are not part of the average budget for most health care organizations.
In recent years, however, the advancement of local cable channels has made television
advertising accessible and affordable for local advertisers such as hospitals
or medical groups. The challenge of local market television advertising is in identifying
the correct television station that will reach the desired target audience. As more
households are wired for cable television, the number of station alternatives expands
dramatically to 20, 40, or, in some markets, 80 channels, making vehicle selection
all the more difficult for the local advertiser. Local television advertising is generally
purchased by the time of the day rather than by a specific program. Because of this
difference with national network advertising, local advertisers must again know the
viewing habits of their target market at various times of day.
Another disadvantage of television advertising is the degree of clutter or competing
messages that exists. It is difficult for one advertisement to stand out when so
many commercials are packaged within a station break.
Radio
There are 10 times as many radio stations as there are television stations in the United
States. Since the mid-1970s, the radio’s major growth has been on the FM rather than
the AM band. A wide array of formats and programs make radio a highly segmented
medium for potential advertisers. Also, on a cost basis, radio compares very favorably
to television. The average circulation cost-per-thousand for radio is $4. The cost
of producing a radio commercial in local markets is often included in the rate charged
to the advertiser.
The production of radio ads can usually be completed in a short time period, and
St. Joseph’s Hospital in Milwaukee has capitalized on this advantage. The hospital
ran radio advertisements highlighting the birth of babies at its facility. The advertisements
began with an announcer reporting the news of the day, followed by announcements
of recent births at the hospital.17 A final major advantage of this medium is that it reaches consumers out of their home. Peak listening times for radio are the
morning and evening drive times.
Radio’s major limitation is its lack of a visual means of communication. Also,
because so many radio stations and varying formats are available, a potential advertiser
has almost too many options. The advertiser must also accurately identify the
radio station that attracts its particular target audience.
Newspaper
Of all media available, newspapers receive the most advertising dollars. In health
care, this medium has been the most popular because the strength of newspapers is
their coverage of local markets in which most health care organizations compete. Of
all media, newspaper advertising is typically the best for generating immediate response.
Coupons and special offers are common to newspapers. Newspapers are the
medium of choice for physician referral lines or nurse information lines. Another advantage
of newspapers is their cost. Newspaper rates are reasonable compared to
other mass media like television, making it the medium of choice for local advertisers.
Although in recent years, with the advent of cable television, the rate advantage
of newspapers has been somewhat negated.
The segmentation possibilities in local newspapers are relatively limited. In recent
years, however, most large metropolitan newspapers have developed zone editions
that target specific geographic areas within their circulation. The New York Times,
for example, has regional editions as well as a national edition sold in airport terminals
throughout the United States. An additional advantage of newspapers is the
short lead time required to place an advertisement. A hospital often will only need
to wait a day or two before its advertisement can be run in the local newspaper.
Newspapers do have some disadvantages. Newspaper readership tends increasingly
to be concentrated among older consumers. To overcome this problem, many local
newspapers have followed the pattern of USA TODAY, using a glossy four-color
approach and succinct writing to appeal to a younger, more visually oriented audience.
Magazines
Few media have grown as dramatically in recent years as magazines.18 A vast array
of specialized publications enable the organization to target a specific market segment.
Environmentally concerned consumers read Garbage, outdoor enthusiasts
might peruse Backpacker, and health-oriented consumers might subscribe to Men’s
Health, Organic Gardening, Women’s Health, or a host of others. Within the magazine
industry, competition for advertising dollars is fierce. Like newspapers, many national
publications have developed both zone and demographic editions targeted to
particular subsets of their readership. Thus, advertisers who know their target market
are able to spend their advertising dollars efficiently.
Magazines have other advantages beyond the selectivity that they can deliver.
Many publications have a long shelf life, meaning readers will keep them for weeks,months, or, in the case of National Geographic, years. An advertisement in these publications
may be read several times over the course of a publication’s shelf life. An additional
advantage of magazines is their excellent reproduction capabilities for
advertisements. The quality of the printing and color separation in magazines far surpasses
anything achieved to date by newspapers.
Like all other media, however, magazines have some disadvantages. The sheer
number of magazines makes it more difficult to select the specific publication in
which to advertise. Some publications also have a long lead time for the placement
of an advertisement, often requiring delivery of ad copy 4 to 6 weeks prior to publication.
Magazine advertisements thus must be used to support a longer running campaign
rather than to generate an immediate response.
Outdoor Advertising
Outdoor media consist of a couple of variations, namely billboards or transit advertisements.
Because of space and time exposure limitations for these media, outdoor
advertising is typically viewed as a supplemental medium to support exposures in
other media. Outdoor advertising is useful for its reminder appeal or in the introduction
stage of a service to generate brand name or service recognition. This medium
has also been useful in generating calls to referral lines or health information lines.19
According to the Outdoor Advertising Association of America, the health care industry
is the fastest-growing segment of its business.20
The major advantage of outdoor advertising is the repetition it can provide
through broad exposure of the message. Yet, its limitations are significant in terms of
the degree of selectivity and the message that can be communicated. As a medium, outdoor
advertising has an image problem. Some believe that billboards, in particular, are
a form of visual pollution. Some communities have placed constraints on the presence
and size of billboards. Four states (Alaska, Hawaii, Maine, and Vermont) have banned
all outdoor billboards. Fewer constraints have been placed on transit advertising.
These ads are common in larger communities that have public transportation.
Direct Marketing
One of the most targeted media choices available is direct mail. With increasing computer
sophistication, many direct advertising pieces can make a highly personalized
appeal to the recipient.
Critical to a successful direct mail approach is having a good list of prospects.
There are two approaches most companies can use. The first is to develop their own
refined lists of customers or prospects. Increasingly, companies are using database
marketing. With database marketing, companies develop detailed profiles of their
target market and then access names from their databases based on qualifying variables
such as income, age, or prior purchasing of particular products. A second approach
is to purchase a list of prospects from a commercial list broker who can
provide a customer database based on several classifications. In a recent hospital survey, the prevalence of direct marketing efforts was clear.
Almost 90% of hospitals surveyed indicated that their direct marketing budgets had
increased. In citing their reasons for using this medium, hospitals reported four common
objectives:
1. To increase hospital awareness
2. To generate leads for current programs
3. To promote special events
4. To enhance a facility’s image21
In 2007, the Cleveland Clinic conducted more than 710 individual direct mail campaigns,
most often targeted at people who had moved within 25 miles of its service
area. The Clinic measured call volumes and referral rates as well as transfers of medical
records. The Clinic found that the program paid off with a 5-to-1 return.22
Direct mail’s limitations are its image and cost. Many consumers regard direct
mail as junk mail. Consumers often get large amounts of direct mail material on a
daily basis, so it is difficult to get one piece to stand out from the competition. Direct
mail’s cost must also be considered as its level of sophistication increases. Historically,
the major cost of direct mail was postage. However, production costs must also
be factored into the cost equation. To attract attention, direct mail marketers have
significantly increased the use of color, higher-quality paper, and multiple mailings
to gain attention, all of which add greatly to total cost.
Internet Advertising
The Web is increasingly giving advertisers new and exciting ways to advertise. Online
advertising provides many advantages to potential advertisers. The organization
can track the number of users who visit a site, how many times a site has been viewed,
and how deeply a site was looked at by a visitor. Did the person look at the first page
of the medical group’s site? Or, did the visitor also look at the page of the orthopedic
department and the spine center services? A study released by Outsell found that
online advertising was projected to grow by 17.9% in 2007, compared to a 5.8%
growth rate in advertising overall.23
The following are the most common Internet advertising methods:
• Banner ads—rectangular graphics at the top or bottom of a Web page. Most receive
less than a 1% click-through rate.
• Button ads—small banner-type advertisements placed anywhere on a page.
• Pop-up ads—screens that appear while a Web page is loading or after the Web
page has appeared. Today, most Web browsers block many of these pop-ups,
which limit their effectiveness.
• E-mail—The sending of unsolicited e-mail is called spamming. Some states have
passed laws against spamming. Although e-mail is an easy and inexpensive way
to communicate with prospective customers, it is considered to be intrusive.
Evaluate the Response
Testing of advertising effectiveness occurs at two stages. As discussed earlier, the first
form of evaluation—pretesting—ensures that the target audience receives the message
in the way it is intended. Pretesting also determines preference and attention-getting
value.
After selecting the media and placing advertisements, most organizations conduct
tests to determine the effectiveness of the marketing campaign. Tests vary and are
based on the media used for advertising.
Companies often assess whether the advertising campaign has resulted in a
change in attitudes toward the product or service being promoted through the use
of surveys and posttest attitude tests.24
Broadcast
A common form of posttesting for television or radio is day-after recall. Typically, after
a commercial is aired on television or radio, the advertiser conducts telephone surveys
to determine whether people remember the advertisement. Recall can be either
aided or unaided. With unaided recall, the telephone interviewer might ask, “Have
you seen any advertisements on television for a women’s health program?” The recall
of the particular hospital’s program could then be assessed. With aided recall, the
interviewer would ask, “Have you seen any ads lately for St. Mary’s Women’s Health
Center?”
In the magazine industry, posttest scores are often collected through a syndicated data
service referred to as Starch. Roper Starch Worldwide conducts personal reader interviews
to determine the number of people who read a particular issue and whether
they saw the advertisement or the signature and whether they read the ad. Starch provides
companies with scores for the advertisements for the issues in which they were
placed.
Direct Marketing
The advantage of direct marketing advertising is that customer response can be directly
measured through follow-up inquiries or purchase orders. This direct form of
measurement has led to the medium’s growing appeal.
Internet
The advantage of the Internet is that it can be easily tracked with click-through to determine
how deeply someone is looking at the Web page or by counting how often
the page is viewed. However, it is difficult to measure the viewer’s retention of the
information presented.
The Web 2.0 and Social Media
As discussed in Chapter 11 on promotion, the line between advertising and communication
is blurring. Traditional media may be too narrow for the health care organization’s
promotional plan. Health care organizations should expand their reach by
adopting Web 2.0 strategies, including the use of social media. As shown in EXHIBIT
12-4, most hospitals have been slow to use social media as a marketing and communication
tool. However, as discussed below, a number of health care organizations are
embracing new media.
Blogging
In some ways, blogging is like keeping a personal diary online. The number of blogs
grew from 8 million in 2005 to 133 million in 2008.25 A survey by the Pew Internet
and American Life Project in June 2009 found that 43% of all Internet users (representing
32% of U.S. adults) reported reading someone else’s online blog, although few
are blogging about health care (5%).26 Two hospitals, High Point Regional and the
University of Pennsylvania Health Systems, entered the “blogosphere” fairly early.
High Point found that its blog was consistently one of its top viewed Web pages.27
Facebook ( www.facebook.com ) is a social networking Web site. All that is needed to join
is an email address. Launched in February 2004, Facebook has grown rapidly. Individuals
use the site to connect with friends and relatives, and companies use it for marketing
purposes. In 2008, Merck launched a Facebook page to promote Gardasil, a vaccine
that can protect against human papillomavirus (HPV). Bayer Aspirin launched a Facebook
page with a interactive quiz for women to gauge their risk of heart disease.
Podcasts
Podcasts are audio files that have been converted to an MP3 file or other audio file
format for playback on a digital music player. Podcasts have evolved to allow for
playback of videos as well.29
Akron Children’s Hospital in Akron, Ohio, was an early adopter of the podcast
format. Competing against major medical centers in Cleveland, Columbus, Cincinnati,
and Western Pennsylvania, Akron must compete in a congested media market
to get its message out to potential patients, parents, and referrers. Its first podcast was
of an adult patient who was treated at Akron Children’s for a congenital heart disease.
30 Since its initial venture into podcasting, Akron Children’s Hospital has developed
an extensive library of podcasts on a variety of topics, including parenting,
children’s health education, and health trends.31
Twitter ( www.twitter.com ) allows people to send messages fewer than 140 characters
in length. Messages can be accepted from a variety of different sources, including
computers, cell phones, and mobile devices. In a rather interesting online article, Phil
Baumann proposed 140 possible uses of Twitter in the health care arena, including
fund-raising, census management [market research], recruitment of health care staff,
publishing of health-related news, checking hospital rating with health care consumers,
real-time satisfaction surveys with consumers, arranging appointments with health care
providers, hospital reputation monitoring, developing stronger patient–provider relationships,
broadcasting infant care tips, and issuing dietary tips. 32 The University of
California at San Francisco uses Twitter to notify the public when new content is
available on its blog or on its Facebook page.33
Integrated Advertising Campaigns
The challenge for marketers in today’s Web 2.0 environment is to create and develop
an advertising and communication plan that integrates the organization’s online
strategy and the traditional media campaign. Whether the health care organization
is a solo practice, hospital, or major academic medical center, the goal is to determine
the best ways to reach patients, referral physicians, or other target markets and to create
an ongoing dialogue between them and the organization.
n Working with Advertising Agencies
Many hospitals and health care organizations do not have the in-house resources
needed to develop their own advertising materials. Those that do not can hire the services of an advertising agency. Advertising agencies vary in size and in the scope of
the functions that they perform. A health care organization must identify the types
of services needed to select the appropriate agency.
Alternative Advertising Agencies
The most comprehensive advertising agency, the full-service agency, provides all the
elements necessary to assume the total advertising function. These organizations typically
offer sales promotion, public relations, direct marketing, consulting on design
and identification, and even television programming.
The full-service agency typically has several departments organized around creative
services, account services, marketing, and administrative services. The creative
department is responsible for producing all the advertising design and copy. Account
services deals with the client—the health care organization. This professional has to
understand the health care business and know how to communicate the client’s goals
and objectives to the creative department. The purchasing of media space and time
is the responsibility of the marketing services department. Full-service agencies often
have marketing research functions residing within this area. The administrative
and financial department handles billing and agency management.
Opposite of the full-service agencies are the boutique agencies. A boutique agency
may offer a limited range of services, such as creative services or media buying services,
or will act as a contractor to put together the range of services needed by the
organization.
Agency Compensation
Advertising agencies are compensated by fee or by commission. Agencies paid by
commission are, in effect, being paid by the media. In commission compensation,
the agency places $200,000 of advertising in selected publications and in television.
The agency keeps 15% of this billed amount as standard compensation. The media
then provides $200,000 worth of advertising space. Although the client is paying
the agency, the media is, in effect, subsidizing the commission by providing the full
amount of media space or time.
A major buyers’ concern about the commission system is that it provides agencies
with an incentive to recommend more advertising than is necessary. Agencies
have also felt that the commission-based compensation system may not be providing
them with a fair return for the work they provide to a client. As a result, in recent
years commissions have declined and some agencies have moved to a fee-based
structure.34 The fee is agreed upon by the agency and the client and is based on the
amount, type, and scope of work being provided.
Ethics in Advertising
Few aspects of marketing were of greater concern to health care professionals than
the onset of advertising. Because of the sensitive nature of health care and the often
precarious position of the health care buyer, there is heightened sensitivity to the use
of this tool. The Alliance for Health Care Strategy and Marketing developed a set of
voluntary guidelines regarding the concerns and issues that should be considered in
health care advertising, shown in EXHIBIT 12-5. EXHIBIT 12-6 shows the ethical guidelines
issued by the American Society of Metabolic and Bariatric Surgery. Given the
large growth in bariatric surgery and the advertising associated with it, the organization
felt the need to issue such standards.35
Although advertising has become more common in health care, it still generates
concern and criticism. In the March 28, 2005, issue of the Annals of Internal Medicine,
a study was published that condemned the trend among respected academic
medical centers of using advertising strategies to promote services such as Botox and
Lasik and fertility treatments. The study analyzed newspaper ads for 17 of the country’s
best-known academic medical centers and concluded that the promotions placed
profits before patient interests. The study underscored to a large degree that the information
aspect of advertising is still not fully appreciated, but also highlighted that
in health care, sensitivity is required with regards to the promotional claims made in
any advertisement.36
The issue of ethics has extended to the Web. The Swiss-based Health on the Net
(HON) Foundation, which has been in existence for 12 years, has an eight-point code
of ethics. If a health information provider abides by HON’s code of ethics, it receives
approval from the nonprofit to display the HON logo. In 2003, more than 3000 Web sites received such approval (including the Mayo Clinic) and displayed their compliance
with HON’s ethical guidelines.37
Nonprofit Concerns
One final aspect of health care advertising that deserves attention is the matter of an
organization’s nonprofit designation. Federal, state, and local government agencies
have examined whether advertising by these organizations is excessive. Twenty of
Pennsylvania’s 224 nonprofit hospitals were required to provide services in place of
property taxes to various taxing agencies after being judged as acting more like forprofit
organizations in light of their advertising expenditures.38
n Conclusions
Advertising is an important ingredient of any health care organization’s promotional
strategy. Developing an effective media plan begins with a specification of its objectives.
From this foundation, a budget and appropriate tactics for media selection and
scheduling can be determined. Any effective advertising requires that there be a mechanism
both to pretest and posttest the campaign. Because of the serious nature of
health care and the vulnerabilities of consumers engaged in the selection of health
care services, significant attention is due to the ethical dimensions of the advertising
strategy ultimately implemented.
