15.4.08

Wrasslin' the Consumer Landscape: Mergers & Lessons for Managing Failure to Thrive

Organizations that embody Health 2.0 principles (content+community) adopt a consumer-centric view.

For a moment let's step back from the merry-go-round debate about why it behooves hospitals and other HC firms to do so.

Once you do decide to go consumer-centric, there's no going back.

So let's explore the new challenge hospitals will face when they finally realize the vital importance of marketing to selective buyers (meaning people - who happen to be patients - proactively engaged in becoming partners in care).

Consumers might think your company sucks.


If so, they take their wallets and walk (or crutch, or wheelchair, or cruise the web) to a company offering a better combination of products and people-to-people interaction, paying a premium for firms that succeed in offering 'hotealthcare' and embodying human-to-human marketing.

In addition, once you move from a commodity-business mindset to a consumer-based culture, you have to realize the competitive environment is completely fluid. Failure to thrive can hit at any time.

Just because you're the king of the hill one day doesn't mean your audience will love you tomorrow (thanks Amy for helping illustrate the concept).

Just because consumers think you don't suck one minute doesn't mean our loyalty is guaranteed. You can't assume we'll be happy to bring our business through your doors the next day based solely on your past performance.

You can't rest on a legacy. There's always another competitor waiting to take your place (quite cheekily in this case - click the "intervention" tab for a laugh).

Let's take another example from recent retail/consumer-goods news, which you know (unless you've been living under a rock) is where medicine 2.0, web 2.0, health 2.0, biz 2.0, etc. are driving the future of wellness management.

Brick-and-mortar movie rental chain Blockbuster is trying to sneak a hostile takeover offer for consumer electronics retail store Circuit City in under the radar while the US press is preoccupied with the MS-Yahoo menagerie, falling housing prices, airline industry snafus, uninspiring political choices, and other woes.

Luckily, The Washington Post caught on, and published this article, by Qlan Mui.

I sent the article to a tech/consumer electronics guru in my social network, with whom I've had many conversations about consumer-directed care (poor guy), and here's his reply (edited for some "choice" language):

"Well, after Best Buy came along, Circuit City has always been a sad excuse for an electronic store. Their layout sucks, stores are old, and stock poo poo. The only thing they used to have going for them was their educated staff/customer service. Best Buy comes along, improves upon those things but lacks customer service. Majority move to buying from Best Buy.

Blockbuster, once the king of movie rentals, has always had to adapt to other companies and their services/business practices. Hollywood Video comes out, lets you rent for longer periods of time, Blockbuster does the same. Then Blockbuster comes up with that "rent the movie, bring it back whenever, but please by such and such date." Netflix comes out, Blockbuster does the same thing but "oh, you can bring movies back to the store! Don't have to wait for them to flow through the mail system."

So, you've got two companies, once the king sh*& of the land and one wants to buy out the other? When is the last time either company did something that made some other company switch it up and do the same thing?"


Takeaway Points for Hospitals:

  • In the evolution of consumer-centric healthcare, consumers take content, create communities, and share feedback. Look before or you'll find yourself behind...what are consumers saying about your company?
  • Make sure your layout "doesn't suck" (how easy is it to navigate the halls? your payment and registration systems?) and your stock-in-trade (service line offerings, soft 'touches' at each point of the care spectrum) isn't "poo poo." I suggest using alternative wording to emphasize this point at your next Board meeting...
  • You can still win with good customer-service - customers trust companies who place us at the center. But you can't win with ONLY good customer service. New care delivery channels are emerging literally overnight. You have to know your consumer like never before, and provide access to care in ways we wouldn't have dreamed of 5 short years ago.
  • If no other hospital is imitating you, you're a dead in the water and a prime M&A candidate.
  • Proactively improve consumer offerings BEFORE you have no other choice but to buy or be bought out (or close the doors).
  • Consumers like my newbie-analyst above feel like we 'own' the products and, more importantly, the brands we buy. Each purchase goes into the pool of identity we create through selective purchasing. How does your healthcare channel help enhance my wellness and personal identity?
  • Speaking of stock in trade, it's still about clinical results first, and consumer relationships second. But with 'discretionary' care replacing primary and even emergency care in the US, the gap is closing quickly. Do you make more money from emergent or optional/elective care?
  • If you're not sparking change, you're eating some other competitors' smoke.
So is your hospital the type to fan the flames or eat the dust?

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