Running head: MARKETING AND THE HEALTH CARE SYSTEM 1

MARKETING AND THE HEALTH CARE SYSTEM

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MARKETING AND THE HEALTH CARE SYSTEM 2

Health organizations implement various strategies in an attempt to shoe the buying

decisions of the market. Kiser Permanente is a non-profit integrated health care plan which

serves about 10 million members from employees, nurses, physicians and medical offices. Its

focus on quality, as well as preventive health care rather than curative healthcare, have seen the

organization rise in the market. It is important to analyze its marketing strategies and identify

future direction of the organization. This paper will discuss the effects of healthcare marketing at

Kaiser Permanente. It will identify the impact of direct marketing on the organization. It will also

identify the strategy it can implement to determine how services are being utilized and its

marketing strategy.

Direct impact of marketing for Kaiser Permanente

Marketing of Kaiser Permanente services has a great impact on the healthcare market.

The first impact of its direct marketing would result in increased brand awareness. Marketing as

identified by Berkowitz (2011) can add value to the health organization. Marketing enables the

public to understand the brand and what it stands for. Marketing, therefore, has the ability to

increase the number of people who know of the services offered by Kaiser Permanente and how

to access this services. Direct marketing can also lead to the increase in the number of

individuals joining Kaiser Permanente (Lofgren & Cantu, 2010). Marketing adds value to Kaiser

Permanente by addressing the needs of the healthcare consumers and building a reputation for

the company. Marketing can increase consumer awareness helping Kaiser Permanente to develop

services that meet the specific needs of the health consumers in the market.

Strategy to determine the utilization of its services.

When determining the extent of utilization of products or services, it is important to

analyze the external competitive market to identify how the organization is performing. Kaiser
MARKETING AND THE HEALTH CARE SYSTEM 3

Permanente, therefore, needs to conduct a market analysis specifically targeted at identifying the

consumers who purchase its service in relation to those who purchase the services provided by

competitors (Berkowitz, 2011). The market analysis, therefore, identifies that the main

competitors of Kaiser Permanente are United HealthCare, Humana Aetna, Cigna, Anthem, Blue-

Cross and Blue Shield (Ladika, 2015). Therefore the market analysis of the competitors can help

to determine the utilization of Kaiser Permanente services in relation to those offered by its

competitors. The market analysis would help the organization to determine its market share, and

this is, therefore, an indicator of the service utilization. The results of the market analysis,

therefore, identify the total percentage of the market share held by the organization. Current

market share identifies that Kaiser Permanente holds 8% of the consumer market, United

Healthcare holds the greatest share of the market at 20% while Humana accounts for 19%, Aetna

7%, Anthem and Cigna both hold 3% of the market while other small companies hold the other

26% (Ladika, 2015). Therefore the strategy to analyze the market share and the extent to which

the competitors have hold of the market identifies the current utilization of the Kaiser

Permanente services. Kaiser Permanente has over 10 million users and this account for 8% of the

market (Ladika, 2015).

MARKETING AND THE HEALTH CARE SYSTEM 4

Marketing strategy Kaiser Permanente

The most effective marketing strategy that would have the greatest impact on the market

for Kaiser Permanente is the implementation of relationship marketing which involves building a

relationship with the consumers. Kaiser Permanente is an organization dedicated to the provision

of quality care that seeks to provide preventive health care coverage as compared to other health

providers in the market (Kaiser Permanente Share, 2016). It earlier “Thrive” campaign was

successful in creating brand awareness by developing a relationship marketing approach

(Healthy.kaiserpermanente.org, 2016). Relationship marketing is more than just selling services

to the consumers by getting the consumers to trust in the brand and purchase its services (Smith,

2011). The relationship marketing could involve the development of advertisement campaigns

that are provided in different platforms from televisions, print media, radio or the internet to

reach various segmented marketed from the millennials to the baby boomers (Smith, 2011). An

advertisements campaign that shows how the organization helps to promote healthier healthcare
MARKETING AND THE HEALTH CARE SYSTEM 5

services by reducing diseases by focusing on the provision of preventative health care services

and early diagnosis through pap smears, mammograms, and other services. This services are

aimed at detecting early symptoms of diseases can effectively create brand awareness and create

a relationship between the organizations and its consumers.

An advertisement campaign that identifies the core beliefs and key values of prolonging a

long, healing and thriving life could be effective at marketing the organization. Kaiser

Permanente is unlike other healthcare plans due to its focus on quality, and the need to prevent

diseases by linking patients with a network of qualified health providers all within the same

building helps to reduce distance which is another supporting factor for the advertisements

(Hillestad & Berkowitz, 2013). Relationship marketing is about knowing the needs of the

consumers and being there for them, therefore, setting up 24-hour call centers to cater to the

health needs of its consumers can be an effective way of creating a relationship. Relationship

marketing can also be implemented in online platforms to attract the millennials, and this can

include an engaging platform where this target group can interact with the healthcare providers

and the organization to learn more about its services (Smith, 2011). The relationship marketing

strategy is more effective as it results in lifelong consumers who are loyal to the brand and its

services.

Ways Kaiser Permanente selected can shape the buying decisions of the customers

For Kaiser Permanente to be successful, it must address the needs of the consumers as

well as drive the buying decisions of the consumers. Kaiser Permanente can drive the purchasing

decisions of its customers through some strategies which are changing the social conversations,

appealing to the Millennials and public relations activities (Redsicker, 2014). Kaiser Permanente

should borrow a leaf from other health organizations such as the Mayo Clinic which has
MARKETING AND THE HEALTH CARE SYSTEM 6

conquered its marketing strategies by implementing an effective social, media presence.

According to Redsicker (2014) more than 35% of the consumers are influenced by social media

platform and therefore the most effective way to drive the buying decisions is by using the social

media platforms to engage in social conversations such a trending topics especially those on

healthcare. By being a trend setter in the healthcare environment, Kaiser Permanente can

effectively influence the decisions of its customers. The basis of healthcare plans is founded on

the healthy financing those who are sick, and this is the reason why influencing the decisions of

the Millennials is critical for the organization (McCarthy, Mueller & Wrenn, 2009). Developing

topics or promotions that directly appeal to the millennials such as the provision of services such

as internet connectivity or paying for the millennials who compete in a challenge created by the

organization can get the latest gadget such as the IPhone 7 can effectively appeal to the

millennials. The millennials are a crucial part of the Kaiser Permanente since they are healthier

and help to pay the high cost of financing older and less healthy groups (Lofgren & Cantu,

2010). Creatively engaging in public relations activities such as sponsoring sporting events or

marathons can also be useful in attracting the attention of the consumers where health

information is provided at such events helping to influence the decisions made by the consumers

Conclusion

Kaiser Permanente is an organization that has increased its brand awareness and the

number of customers due to its emphasis on quality and preventive care. Kaiser Permanente can

utilize a market analysis to determine the extent of its services utilization among the consumers.

The market analysis identified that the organization holds 8% of the consumer being among the

best health plan providers in the country. The direct impact of its marketing strategic would be

an increase in brand awareness and rise in a number of customers. The implementation of a

MARKETING AND THE HEALTH CARE SYSTEM 7

relationship marketing strategy which involves the use of advertisement campaigns in the

traditional platform such as television and radio as well as online platforms would be effective at

marketing Kaiser Permanente. Kaiser Permanente can drive the purchasing decisions of its

customers through controlling the social conversations, appealing to the Millennials and public

relations activities.
MARKETING AND THE HEALTH CARE SYSTEM 8

References

Berkowitz, E. (2011). Essentials of health care marketing. Sudbury, MA: Jones & Bartlett

Learning.

Healthy.kaiserpermanente.org. (2016). Custom care & coverage just for you - Kaiser

Permanente. Retrieved from https://healthy.kaiserpermanente.org

Hillestad, S. & Berkowitz, E. (2013). Health care market strategy. Burlington, Mass.: Jones &

Bartlett Learning.

Kaiser Permanente Share. (2016). Kaiser Permanente Launches Newest Advertisements in Thrive

Campaign - Kaiser Permanente Share. Retrieved from

https://share.kaiserpermanente.org/article/kaiser-permanente-launches-newest-

advertisements- in-thrive-campaign/

Ladika, S. (2015). The New Era of Mega-Plans. Managed Care Magazine Online. Retrieved 25

October 2016, from http://www.managedcaremag.com/archives/2015/9/new-era- mega-

plans

Lofgren, D.G & Cantu, D. (2010). Five lessons from Kaiser Permanente’s thrive campaign

Retrieved from

https://archive.ama.org/archive/ResourceLibrary/MarketingHealthServices/Documents/Fi

ve%20lessons.pdf

McCarthy, D., Mueller, K., & Wrenn, J. (2009). Kaiser Permanente: Bridging the quality divide

with integrated practice, group accountability, and health information technology. New

York: Commonwealth Fund.

Redsicker, P. (2014). 5 Ways You Can Influence Consumer Purchasing Decisions: New

Research : Social Media Examiner. Socialmediaexaminer.com. Retrieved 25 October

MARKETING AND THE HEALTH CARE SYSTEM 9

2016, from http://www.socialmediaexaminer.com/5-ways-brands-can- influence-

consumer-purchasing-decisions/

Smith, M. (2011). The new relationship marketing. Hoboken, N.J.: John Wiley & Sons.