MKDG | BSMT II A | LAB MAN | MARKETING LABORATORY SERVICES

INTRODUCTION  The new market philosophy must be one of exploration,

openness, risk taking, and savy- of being able to identify and
 Terms used to describe users of laboratory services:
pursue market opportunities
 Customers
 Client MARKET ENVIRONMENT FOR MEDICAL LABORATORY SERVICES
 Market share
 Market Environment  includes macrofactors that determine
 This includes patients, physicians, nurses and third-party
the opportunities and limitations of a potential customer base;
payers (insurance companies and government agencies)
outside the control of the manager or organization
 Marketing plan  ensure economic survival of the laboratory
so that the patient can receive the highest quality care possible  Macrofactors (events outside the organization)
 Crucial skill of lab managers  Ability to respond to a rapidly  Patient population
changing market environment  Purchasing habits
 Competition
LABORATORY-CUSTOMER RELATONSHIP
Laboratory Marketing Environment
 Laboratory manages are concerned primarily with operations
today they need to generate business in addition to maintaining  Extraenvironmental forces
the current client. The laboratory msut defend itself from  Characteristics of population
assaults on its client base and increase its contributions to the  Climate
financial well being of the org  Geographical features
 Macroenvironment
THE MARKETING PHILOSHOPHY  Economy
 Technology
 Part of the marketing philosophy
 Public policy
 Reason for the existence of an organization
 Culture
 Plans for the future
 Market Environment
 Ways to attract and serve users
 Patient population
 Marketing and Public relations are complementary functions
 Buying habits
 Marketing  strategic process of attracting and maintaining a
 Competitors
customer base; a specific function of management
 Organizational Environment
 the marketing should be successful for the survival of an
 Hospital constraints
organization
 Laboratory objectives
 influence specific consumer behaviour in making
 Laboratory resources
purchasing decision
 Product
 Public Relations  communications tool designed to
 Laboratory tests
influence public attitude towards the organization.
 It has something to do with the organization’s public image
 Marketing philosophy and strategy have to do with how the
laboratory interfaces with the marketplace
MKDG | BSMT II A | LAB MAN | MARKETING LABORATORY SERVICES
THE LABORATORY CUSTOMER (1) Captive Market
 Having a captive patient population is a distinct advantage of
 Crucial to any market plan: determining who the customer is and
hospital-based laboratories in the past
what the customer wants
 This advantage is rapidly changing as patients receive care at:
Marketing target: the customer (1) outpatient surgery centers
(2) Walk in medical clinics
 Patient  the Person whom laboratory directs its professional  the hospital laboratory may find itself competing with referral
concerns lab
 Customers are also those entity that sends the patient to the  is also expanding to including contract commitments made with
laboratory. Such as: managed-care alliances and providers such as insurance and
 Patient themselves employer groups.
 Physician  Patient sources  important part of the laboratory’s marketing
 Parent plan
 Employer
 Insurance company (2) Discretionary buyer
 Government agency
 Entity that decides where a service is performed
 lab manager must understand why a patient goes to a particular
 May be a large managed-care alliance capable of delivering a
laboratory and factors that influenced the decision.
captive base of thousands of patient or an individual walk-in self
 Within the laboratory community, many places can perform a
pay patient
test each with own traditional patient base
 Laboratory services purchasing decision
 Hospital based patient:
 Institution’s assignment
 In-house testing
 Patient discretion assignment
 Referral testing laboratories
 Physician’s office assignment
 Non hospital based patients
 Third-party payer’s assignment
 Free standing clinics
 Mother  usually the one to decide where family receives
 Physicians’ offices
medical care thus much promotional focus is on the mother and
 Walk-in emergency centers
women in general and associated family issues
 Private walk-in laboratories
 Referral testing laboratories Customer Expectations
 Goal of marketing strategy: influencing and changing
 Which customer to target is determined by the lab’s ability to
purchasing decisions of the entity that selects where the test is
satisfy certain customer expectations
performed
 Characterization of the new world of competition:
 Purchasing decision makers are divide into:
1. Different customer buy different kinds of value  one can’t
(1) Captive Market  committed to a specific laboratory
hope to be the best in all, so choose your customers and
(2) Discretionary buyers  can choose among several
narrow value focus
laboratories
2. As value standards rise. So do customer expectations  stay
ahead by moving ahead
MKDG | BSMT II A | LAB MAN | MARKETING LABORATORY SERVICES
3. Producing an unmatched level of a particular value requires
a superior operating model  machine dedicated to that
value
 Treacy and Wiersma classified 3 market segments with specific
but different needs according to expectations or dimensions of
value
1. Best total product  offering most sophisticated and
specialized laboratory procedures or highly attentive
services (e.g elaborate personal attention and facilities)
2. Best total solution  providing complete package (e.g. test
THE FOUR P’S OF MARKETING
menu, phlebotomy, turnaround time) of services for a
specific type of customer (single or group practice)
3. Best total costs  concentrating on volume and price
 Total  key word in this model which may mean
1. Best product: individualized, highly customized
2. Best solution: relieving buyer of any paper work or lab
associated problems
3. Best costs: not only the price of individual test but all
associated expenses
 Four new rules that govern and describe market leaders’
actions and market strategies :
1. Provide the best offering in the marketplace by excelling in a
specific dimension of value
2. Maintain threshold standards on other dimensions of values
3. Dominate your market by improving value year after year
4. Build a well-tuned operating model dedicated to delivering
unmatched value
Examples :
Best total solution: link physician offices to computer system to
provide a common carrier for its patient
Best product: set up a lab or phlebotomy center in physician’s office
complex with hand delivery and charting of results
Best total cost: offer big discounts to managed care system
 Basic standards must be met in all three areas, but a laboratory
may only achieve success by excelling in one of the dimensions of
customer value
 Organizations must have operating models, or process to deliver
this customer value: “ business structure, management systems,
and culture which are synchronized to create a certain superior
value
 Customers like quality must be an integral part of each
management function
 Kotler and Clarke identified 4 major instruments that constitute
the org’s strategic and tactical means for attracting and retaining
customers
 4 marketing variables  provide the framework for
developing marketing strategy and identifying the way to
implement the plan
1. LABORATORY PRODUCT
 Performing tests and giving results – sophistication,
expertise and technological ability to perform large number
of tests or carry out complex procedures
 Focusing on doing only traditional testing ensures the
erosion of the patient base
 Ex of changes: Direct-access pathology  Patient come
directly to the lab and request test without referral from a
physician
 If the product is providing support and information to the
medical community the lab is able to research identify and
respond to a dimension of value demanded by the changing
market environment.
 Product differentiation  distinguishes one product from
another; factors that directly influence buying decisions by
making a product or service more attractive ; includes:
 Turnaround time
 Price
 Convenience
 Test mix
MKDG | BSMT II A | LAB MAN | MARKETING LABORATORY SERVICES
 Payment options
 Reputation for quality
2. PRICE
 Major competitive factor
THE MARKETING PLAN
 Labs that are able to control expenses and offer attractive
prices to discretionary buyers has a distinct advantage
 Ability to compete based on price is important in bidding for
laboratory portion of managed care and prepaid capitative
programs
 Inability to develop and administer a multitiered pricing
structure based on competitive and cost-revenue was a most
crippling liablility in marketing laboratory services
3. PLACE
 Location is a dominant factor that dictates what the rest of
the marketing mix looks like
 Factor designing how convenient the laboratory service is to
its client
 Practical variables include: remote drawing stations,
frequency of pickups and hours of operation
 Affects sever distribution and entails 3 decisions:
1. Physical access  covers channels of care (physician’s
office, emergency room, clinic), location and facilities
design
2. Time access  travel and waiting time
3. Information and promotional access  getting
referrals and getting the consumer to the provider
4. PROMOTION
 Products and services are constantly promoted through Market Research
commercials and advertisements
 Promotional tools
1. Advertising  type of nonpersonal presentation such
as ads, as well as brochures and flyers
2. Sales promotion  short-term discounts, product
incentives
3. Personal selling  selling through personal service
representative
4. Publicity  non-commercial informational
presentation issued through the news media and other
public forums such as social clubs and educational
institutions. (print, radio, TV news releases, public
information sessions)
 Marketing plan (proposal)  formal strategy for maintaining,
identifying and attracting customers
 It undergoes basic steps of
 Needs awareness
 Research analysis
 Alternative solutions identification
 Selection
 Action plan
 Implementation
 a laboratory marketing model includes
1. evaluation of the lab service area
2. determination of test demand
3. development of the appropriate test mix
4. development of the market through concerted efforts
5. systematic evaluation of all tests and services
 marketing proposal format:
1. purpose of proposal
2. market overview
3. SWOT analysis
4. Opportunities with recommendations and implementation
5. Approval request for implementation
 Provide info necessary to effectively market the services of a
health care organization
 Systems:
1. Internal record system  medical, financial and
operational parameters are monitored
2. Marketing intelligence system  obtain daily info about
developments in the market place
MKDG | BSMT II A | LAB MAN | MARKETING LABORATORY SERVICES
3. Marketing research system  organized to systematically
collect, study, and report findings about specific marketing
opportunities
4. Analytical marketing system  using statistical and
marketing model techniques to evaluate the data obtained
from the systems
Market Proposal
 Purpose: putting a specific plan to capture a targeted customer
into action
 Proposal outline divided into parts:
1. Market overview
2. SWOT analysis
3. Opportunities
4. Approval