How are hospitals using the Internet in marketing today? Where are health care marketers focusing their online efforts?What returns are marketers seeing from their Internet initiatives and investments? These are some of the questions we have been tracking since 1995 when we conducted the first-ever study to examine the ways that hospital marketers around the country were using the Internet and other emerging technology to promote their organizations. In the most recent survey, we look at what health care marketers are doing online and take the pulse of an industry grappling with rapid change and as yet unproven Internet strategies

Fell, Daniel

Shepherd, C. David

English

DigitalCommons@Kennesaw State University

Kennesaw State UniversityDigitalCommons@Kennesaw State UniversityFaculty PublicationsSummer 2001Hospitals and the Web: A Maturing RelationshipDaniel FellDaniel+Douglas+NorcrossC. David ShepherdKennesaw State UniversityFollow this and additional works at: http://digitalcommons.kennesaw.edu/facpubsPart of the Business and Corporate Communications Commons, E-Commerce Commons,Hospitality Administration and Management Commons, and the Marketing CommonsThis Article is brought to you for free and open access by DigitalCommons@Kennesaw State University. It has been accepted for inclusion in FacultyPublications by an authorized administrator of DigitalCommons@Kennesaw State University. For more information, please contactdigitalcommons@kennesaw.edu.Recommended CitationFell, D., and C. D. Shepherd. "Hospitals and the Web: A Maturing Relationship." Marketing Health Services 21.2 (2001): 36-8.I N T E R N E T R E S O U R C E SHospitals and the Web:A Maturing RelatioiishipBy Daniel Fell and C. David Shepherdow are hospitals using the Inter-net in marketing today? Whereare health care marketers focus-ing their online efforts? What returns aremarketers seeing from their Internet ini-tiatives and investments? These are someof the questions we have been trackingsince 1995 when we conducted the first-ever study to examine the ways that hos-pital marketers around the country wereusing the Internet and other emergingtechnology to promote their organiza-tions. In the most recent survey, we lookat what health care marketers arc doingonline and take the pulse of an industry'grappling with rapid change and as yetunproven Internet strategies.The Hospital Internet Marketing Reponis based on a telephone survey of 350 hos-pital and health system marketing profes-sionals conducted in the fall of 2000 byDaniel+Douglas-(-Norcross and C. DavidShepherd of the Michael J. Coles College ofBusiness at Kennesaw State University.Lists were compiled from several leadingindustry sources to provide as diverse aparticipant pool as possible. Senior market-ing officials (e.g., vice president or director)were interviewed at each hospitalThe survey was designed to reflect thediversity m the hospital industry, andhospitals were chosen from a representa-tive sampling of metropolitan and ruralmarkets to ensure that both large andsmall facihties would be included. Tbestatistics generated by the study have amargin of error of plus or minus 5%-Although the survey has evolved withthe changes in technology and onlinestrategies, the core objectives remainthe same:• Provide industry leaders with insightinto how hospitals and health systemsuse the Internet and emergingtechnology for marketing purposes.• Identify barriers and challenges tohealth care organizations using theInternet for marketing purposes.• Track trends related to how the Internetis used in health care marketing.• Encourage discussion of the issuesand opportunities that exist forleveraging the Internet and relatedcommunications technology tomeet marketing objectives inhospitals today.Web Marketing MaturesAlthough we have seen an astonish-ing 247% growth in the number ofhospitals using the Internet for mar-keting over the last five years (59%today vs. 17% in 1995), clearly therate of adoption is slowing somewbat-(Sce Exhibit 1.) The most recent fig-ures are up slightly over 1999, when57% reported using the Internet mmarketing. As might be expected,while larger health systems andmetropolitan hospitals have movedquickly to adopt tbe Internet into theirmarketing activities, many smallerhospitals and rural providers are laggingbehind. And it's probably safe to assumethat some ver)' small hospitals, withnonexistent marketing functions, maynever invest in online marketing efforts.While 11.1 % of marketers reporthaving used the Internet for five years ormore, these professionals are clearly theearly adopters and not the norm. Themajority of hospital marketers (56.4%)have only been using the Internet formarketing for two years or less. Thissuggests that little exists in the way oftested strategies or benchmarks for otherhealth care marketers to follow. Eventoday, tbe Internet remains "expenmen-EXHIBIT 1Percentage of hospitals using theInternet for marketing80%70%60%50%40%30%20%10%0%--_ •1 11 1I 1 1• I I I1 1 1 1B • B B •1995 1997 1999 200036 SUMMER 2001tal" when it comes to the marketing ofhealth care.In terms of specific Internet marketingstrategies, the Web stte itself remains thecornerstone of Internet marketing. (SeeExhibit 2.) Fully 95.7% of marketers whoreported using the Internet for marketinghave a Web site. Other popular onlinemarketing activities include sending andreceiving e-mail (90.8 %); recruitingemployees (90.8%); providing onlinephysician directories (83.1%); providinghealth education (81.2%); and providmgdisease management online (60.4%).The focus on accountability is becom-ing more important for health care mar-keters, and online marketing is no excep-tion. In this study, we asked therespondents about their primary goals inusing the Internet for marketing. Theanswers, while varied, generally fit intoone of several broad categories.These categories include increasingthe information base (40.9%); improv-ing external communication (32.8%);providing better customer service(29.8%); increasing organizationalexposure or branding (30.8%); improv-ing internal communication (12.1%);mcreasing revenue (8.1%); and reduc-ing paperwork (0.5%).The respondents were later asked to ratethe returns they had seen from their Inter-net marketing efforts for each of these sameseven categories. The findings indicate thatfew hospitals are seeing any significantfinancial returns in terms of increased rev-enue, while many are seeing benefits fromincreased or better infonnation, increasedbranding, and improved communication(both extemally and intemally).Like many organizations, health careproviders are struggling with "closing theloop" ol Internet marketing from strategyto results. Part of the reason for the lackof hard accountability may be the lack offormal planning. Today, just 44% of mar-keters report having a written strategy forusing the Internet, and slightly more thanone-quarter (26.3%) report having a for-mal approach for measuring retum oninvestment in Internet marketing. If otherindustries are any indication of the trendsahead, health care marketers will continueto face challenges In demonstrating ROlfor their online investments and justifyingadditional spending on the Internet.Confidence and CautionDespite the questions surroundingbottom-line results for Internet market-EXHIBIT 2mg, marketers are generally pleased withtheir online marketing effons so far.Thirty-one percent ofthe sample reportbeing ver)' satisfied v̂ ath their efforts,while another 49% report they are some-what satisfied. Fewer than 20% weresomewhat or very dissatisfied.As with previous studies, hospitalmarketers continue to be very opti-mistic about the role of the Internet inhealth care marketing. Fully 68.6%believe the Internet will be very impor-tant in hospital marketing through thenext five years, and another 28.6%The online marketing acti\aties of hospitalsDiscussion groupResearcfiCommunication with physicianNewsletteiCommunication with patientPhysician referralIntranetDisease managementHealth educationPhysician directoryRecruit employeesE-mailWeb sitt:^ ^ ^ ^ ^1[L^̂• • • •r 1 10 20% 40% 60% 80% 100% 120%1999 2000MARKETING HEALTH SERVICES 37think it will be somewhat important.(See Exhibit 3.) This suggests that theInternet will continue to be emphasizedas a marketing tool and as a strategy forachieving bealth care marketing goals.Finally, 49% of the respondents expectto spend more on their Internet market-ing activities next year than they didthis year.However, hospital marketers stillface some formidable challenges as theyattempt to implement Internet strategiesand tactics within the health care set-ting. And because, as indicated in thestudy, most hospitals have only beenusing the medium for a year or two atmost, few benchmarks and industrycase studies exist. In many cases, hospi-tal marketing professionals are simplymodeling their efforts after Internetstrategies in other industries—many ofwhich have been only moderately suc-cessful to date-Hospital marketers face a few keyissues and challenges as they adopt theIntemet as a marketing tool. Those whocan overcome some of the obstacles listedhere stand a good chance of masteringthe challenges of Web marketing.Aligning Intemet activities withmarketing and organizational goals.Many hospitals are implementing Websites and other Intemet strategies as adefensive move to keep up with competi-tors or out of internal pressure to demon-EXHIBIT 3How important will the Web be tohospital marketers in five years?Nolsurei 1.4%NotimportantSomewhatunimportantSomewhatimportantVeryimportant20% 40% 60% 80%strate a Web presence for the organiza-tion. Often these strategies are not tightlylinked to overall marketing goals or cor-porate business objectives and may resultin programs that lack a clear direction.Committing resources to maintainand update Web content. Many hospi-tal marketers who have invested market-ing dollars to build a Web presence arefinding they do not have the rigbtresources in place to manage their newWeb site or have not developed goodsystems for tracking and mamtamingedits, updates, and new content. Manag-ing information flow between intemaldepartments is a challenge for manyhospitals as well.Measuring a return on investment.Health care marketers continue to strug-gle, as do many businesses, withaccountability for Internet initiatives.The "Ready. Fire. Aim." approach hashelped propel the industr)' online, buthas left many with a sense of defeatwhen it comes to demonstrating returnsto senior management. Tracking soft-ware and other technology give mar-keters an edge in quantifying their Inter-net activities, but the proverbial "wherethe rubber meets the road" question isstill unanswered for many seeking tomeasure success m terms of revenue,market share, or cost savings.Adapting new technologies to theuniqueness of the health care industry.For all the attempts to equate health carewith commercial industries, health care isstill a unique business that fluctuatessomewhere between competitive andcharitable. This d)Tiamic, coupled withtbe diverse avenues of bealth care deliveryand its fragmented nature, means it istougher to identify the best ways to usethe Internet and other emerging tecbnol-og>'. Many hospital marketers found thatsimply appl)'ing online marketing strate-gies from other service, retail, or manufac-turing industries doesn't necessarily work.Balancing marketing opportunitieswith branding issues. Hospitals areturning to outside companies to providetechnologies and content in an effort tobuild more robust Web portals. Whilehigh quality content and off-the-shelftechnology solutions are becoming moreavailable, many hospitals struggle witbco-branding issues and ethical issueswhen content and customer interactionsare being financially supported by out-side parties (e.g., advertising mediumsand pharmaceutical manufacturers).Hospital marketers will need to fullyevaluate what new partners bring to thetable and what the hospital or healthsystem may be giving up in return.Expanding marketing initiatives toinclude clinical and operational initia-tives online. In the past, hospital mar-keters have focused primarily on extemalissues of branding, public relations, andbusiness development. Increasingly, newtechnology requires marketers to con-sider the implications of using tbe Inter-net in areas of operational and clinicalcare. Marketers now must be familiarwith other IS/IT applications such asintranets, home-based computing, physi-cian-to-hospital electronic links, andelectronic patient records. Hospital mar-keters will need to take a more globalview of their efforts to be sure they areweaving other operational and clinicalgoals into tbeir Internet initiatives- It'salso crucial to help oversee and managemarketing issues that v̂ all arise as otherdepartments within the hospital use tech-nology to communicate with various hos-pital or health system audiences. •ABOUT THE AUTHORSDaniei Fell is a marketing consultantand principal with Daniel+Douglas+Norcross in Chattanooga, Tenn. He canbe reached at dfell@ddngroup-com-C. David Shepherd is an associateprofessor of marketing at the Michael J.Coles College of Business at KennesawState University. He can be reached atdavid_shepherd@coles2.kennesaw.edu.38 SUMMER 2001

Hospitals and the Web: A Maturing Relationship

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Hospitals and the Web: A Maturing Relationship

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