The financial fallout of the pandemic is coming more painfully into view at organizations budgeting for a new fiscal year to start in October or January.
Nearly half of chief marketing officers (44%) expect budget cuts of five to 15 percent or more, that’s according to a Gartner survey of 432 CMOs in North America, France, Germany, and the U.K. There is no denying many balance sheets are awash in red ink, particularly on the provider side of healthcare. Delivering the right metrics can help marketers protect their budgets.
During my career as a marketing executive in hospitals and healthcare organizations, I faced significant budget cuts more than once. Often, it’s easy to lament the fact that those outside of marketing—the same folks making the budget decisions—just don’t understand its value. Perhaps we need to look in the mirror and ask ourselves how well we’ve delineated that value. Now is the time to get serious about delivering the metrics that matter to the leaders who hold the purse strings.
Stop Serving Up Marketing Minutiae
No doubt you diligently track a long list of key performance indicators (KPIs), analyzing everything from new web visitors and time on site to cost per click, calls, and goal completions. Stop taking those granular statistics into the board room. Don’t get me wrong, these data are essential for marketers as they provide the insights needed to measure effectiveness and optimize your efforts. Just keep those KPIs in the marketing department. To prove performance to those in the C-suite, you must show results that align with the strategic priorities of the organization.
Get Comfortable Reporting Volume and Revenue
In healthcare, there’s a tendency for marketers to steer clear of any metrics they don’t fully control. I get it; for years I avoided including volume and revenue in my marketing reports. It feels risky being on the hook for something you can only influence. After all, performance is impacted by everything from physician alignment and patient satisfaction to price and access.
In the book, Health Care Marketing Plans that Work, David Marlowe writes, “The marketing plan is the organization’s plan, not just the marketing department work plan. So, while it can be daunting, a good marketing plan should include objectives where the responsibility for success goes beyond just the marketing function staff.”
The bottom line: if you don’t show the connection between your marketing efforts and the organization’s business goals, you, your team, and your budget are at risk of being deemed expendable.
What if I don’t have a CRM?
There are plenty of healthcare organizations that have not invested in customer relationship management (CRM) systems. Still, others may have a CRM but haven’t yet built an integration with the electronic health record. For these marketing departments, defining return on investment in dollars and cents remains elusive. That said, you can show and should speak to a directional correlation between your campaigns and the organization’s volume, market share, and revenue. Collaboration with finance or the business intelligence team is needed to get these performance metrics. Consider it an opportunity to build a bridge and potentially transform a somewhat adversarial relationship into an alliance.
It’s OK to Start Small
Marketing gets ever more complex and shifting how you report on all your marketing activities is a heavy lift. For that reason, it’s okay to start small by focusing on just a few (2 to 3) key service lines. It will be easier to track marketing spend, define the patient population to be counted, and capture the revenue. You’ll also be able to refine the process before you implement it on a wide scale.
A Need for Analytics
Some larger health systems are fortunate to have a dedicated marketing analyst to corral the information, crunch the numbers, and make sense of the data. That’s not the case in most organizations. Visual analytics has become imperative in marketing and healthcare, and fortunately, there are a host of dashboard solutions that capture real-time data and analyze trends effectively in place of manual, lengthy, and complicated reports. They require varying degrees of time, skill, and resources to set up and maintain. Another option is to outsource this function to a trusted partner. Primacy offers consolidation and visualization of disparate data sets into a single integrated view of a client’s key metrics. This includes volume, revenue, CRM, media, portal engagement, and other enterprise KPIs as long as there are APIs or automated exports available.
The Best Defense is a Good Offense
COVID-19 hit most healthcare providers so hard, few cost centers will be immune from funding cuts in fiscal year 2021. However, if you resolve now to establish a results-oriented culture in the marketing department and start reporting more meaningful metrics to those in the C-suite, you’ll be better positioned to protect your budget from hard times in the future. As the adage goes, the best defense is a good offense.
By focusing on big-picture KPIs that resonate more directly with C-suite stakeholders, honing in on business outcomes over marketing outcomes, and presenting this information in a way that is easily digestible and actionable, marketers can demonstrate the relationship between their marketing efforts and the bottom line, defending their budgets both for short-term planning in 2021 and longer-term.