Use brand-name marketing to ensure PSO success

Stealing a trick from Nike

Prospective provider-sponsored organizations (PSOs) must include a marketing plan in their license application to HCFA. Like other vendors of consumer products, PSOs must make the leap from simple advertising and marketing approaches and embrace the overall concept of creating a "brand name" that generates a favorable reaction from consumers.

Health care "is fast becoming a battle of the brands," says Richard Klein, vice president for business development at Milwaukee's St. Luke Medical Center. Yet, despite the growing importance of brand-name recognition to consumers when deciding which provider to use, few health care organizations have truly distinguished themselves as a "brand name," Klein contends. More often than not, "attempts at health care brand management just degenerate into sporadic advertising campaigns that only add to marketplace clutter," says Klein.

Use this scorecard to get started

So where do you start? Klein developed a simple review process budding PSOs can use to help design and evaluate the effectiveness of their brand recognition and related marketing practices. Here's how to use the tool below: For each question, give yourself a score ranging from 1 (worst) to 10 (best). According to Klein's scale, a score of 0-30 points probably means your marketing plan is truly adrift and won't survive long in today's marketplace. Totals between 31-70 points indicate your marketing plan has potential, but still needs work. Scores of over 70 points put you in the top 10% of all health care organizations. Ask yourself the following questions:

1. Does the marketing/advertising plan clearly communicate the PSO's key attributes to the marketplace? For instance, rather than simply stressing "high quality" or "low cost," does your brand marketing also identify such things as "has highest-rated doctors on staff", "is accepted by most health plans," or "most preferred for . . ." ?

"Spotlighting specific competitive strengths likes these can be critical building blocks for creating brand recognition," says Klein. But heed this warning: No matter now good you think your marketing plan is, always pre-test and find out what actual consumers say before investing major money in your initial marketing campaign.

2. What is the impact of all your combined marketing and communications on different consumer groups and geographic markets? Part of creating a brand name is making sure all marketing, advertising, and internal and external communications complement each other and combine to create a unified overall message. "This is the kind of thing that differentiates brand management from advertising," stresses Klein.

3. How will you track PSO brand recognition in your marketplace? True brand name marketers regularly track and identify how consumers identify with and react to their product. A vital part of brand management, the results of this research should be shared throughout the entire organization and included in its overall decision-making process.

4. Have you defined and differentiated your various products? Is each brand clearly distinguished from the other? Does each have its own identity in the market? On the other hand, have you cluttered your prospective image by creating more confusion than clarity about what you are offering consumers?

5. What kind of internal coordination is there between pricing, managed care, cost management and marketing? In short, is there a match between what your marketing promises and how the PSO will be managed?

6. How will the bottom-line effectiveness of your various marketing, advertising, and sales functions be measured? Do you plan to use such tools as market benchmarks, consumer and follow-up surveys, and internal accounting data to determine the reaction to your various marketing programs (and the effect on profits)?

7. How well do you know your competition? Do you have an organized system to track and evaluate what the competition is doing and how you should respond?

8. How is your brand management process organized? Is there a clearly defined organizational structure for each brand? Who will be responsible for overall brand management? Does each brand have a specific person with designated responsibility for managing that brand?

9. Is brand management part of the organization's overall strategic planning process? If not, why?