The healthcare industry is struggling with revenue problems — here's why digital marketing could be the cure.
Since the 2008 recession, healthcare industry revenues have been down across the board. While nonprofit hospitals were posting annual revenue growth of 7% or more before the recession, growth has since shrunk to 3.9% in 2015 — the smallest increase in over 20 years, according to Adage. Meanwhile, massive players experienced significant losses in the past year: the Kaiser Foundation reported a $1.2 billion drop in profits, Community Health Systems’ stocks dropped 31%, and the share value of Tenet Healthcare fell by nearly 6%, as Health Leaders Media reports.
In addition, “[hospital] admissions are falling as higher insurance rates prompt patients to seek more affordable care outside of hospitals and crimp the demand for elective procedures.” As a result, medical practices and hospitals are searching for new ways to recover these losses and attract more revenue-generating patients. Could digital marketing provide the boost that the industry so desperately needs?
The Power of Search-Based Marketing
While T.V. and print advertising were once the go-to strategies for medical marketers, there has been a shift in the traditional patient path to treatment, which is quickly diminishing their efficacy and cost-efficiency.
Today, the vast majority of patients rely on the internet as their primary resource when seeking out health-related information — in fact, 80% of patients who are diagnosed with an illness take to the internet to research their condition. As John Weston, the CMO at Mayo Clinic, told AdAge, “If I were diagnosed with something tomorrow, one of the first things I would do is go online.”
This trend represents a huge opportunity for the medical industry — now, marketers can create search engine marketing (SEM) campaigns to reach patients the moment they begin actively searching for treatment options. By leveraging keywords that target “active” search queries, such as “sprained ankle black and blue” or “vein reduction treatment near me,” advertisements actually transform from an unwanted interruption into an actionable resource. As a result, marketers can reach a greater number of qualified patient leads at a much lower cost.
A Success Story: Boston Children’s Hospital
When revenues are down, a more cost-effective, multi-pronged strategy may indeed be the answer. Social media is a particularly effective promotional platform in the healthcare space — just look at Boston Children’s Hospital for proof. According to Margaret Coughlin, the hospital’s senior VP-chief marketing and communications officer, "Patients really want an outlet for telling their stories and social is such a beautiful way for people to do that." After implementing an “integrated marketing approach, which includes TV, print, digital, earned media, social and other types of direct marketing,” Boston Children’s Hospital saw a growth in revenue from $1 billion in 2011 to $1.4 billion in 2012.
While you may not need to throw away all of your traditional marketing tactics, coupling them with targeted SEM, mobile, and social media strategies may be just what your medical organization needs to boost its revenue in the years to come.
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