National Trends in Healthcare Consumerism: The Responsive Healthcare Consumer
Taking a Cue from Other Industries
Past annual reports from Solucient have explored a variety of unique segments of the population proactive healthcare consumers, influential healthcare consumers and quality-conscious consumers. This year's goal was to identify and examine one of the most important consumer segments studied to date: responsive healthcare consumers.
Marketers in industries such as retail, financial services and travel have recognized for decades the importance of creating and maintaining relationships with consumers. In fact, close examination reveals that many of the largest national and international companies have shifted their marketing mix over the last five to 10 years to include much more direct-to-consumer and interactive marketing. These companies recognize that their challenge is not just to identify people who may want or need their products or services, but also to get these consumers to take action. Targeted marketing techniques enable them to identify and communicate with consumer segments that are most likely to be receptive and responsive to their marketing efforts.
Hospital marketers can learn a lesson from their counterparts in other industries, especially as executives begin to question the value of traditional hospital branding and advertising expenditures. To successfully make the transition to a more targeted approach, hospital marketers must learn to develop and execute campaigns that will reach people who not only need a particular service but also are likely to take action in response to the marketing effort for that service.
Responsive consumers are precisely the segment that marketers want to reach to achieve this goal. These consumers are proactive in their decision making and willing to take an interactive step that may provide the foundation for a strong relationship with a particular hospital. To help marketers better understand the characteristics of this group, this year's report aims to answer questions about who these responsive consumers are, and perhaps more importantly, how to find and effectively communicate with them.
Key Findings
Analysis of Solucient's HealthView PlusTM research revealed the following about general healthcare consumer behavior as well as that of this newly identified and important group of responsive consumers:
- The percent of adult consumers who indicate a willingness to ask their physician to send them to their preferred hospital remains high at 63%, a figure that has not changed significantly over the last three years. The data suggest that consumers remain quite open to having a relationship with a particular hospital in their community.
- Identifying consumers who are willing to interact directly with hospitals remains the key challenge for marketers. New data show that in the last year 11.3% of 1 National Trends in Healthcare Consumerism: The Responsive Healthcare Consumer By Brian Frisch, Vice President, Planning & Marketing and Tara Gallagher, Technical Product Manager Fourth Annual Report from Solucient, LLC September 2005 2 adults responded to hospital marketing by attending an education class, participating in a health screening or making an appointment to see a provider. These are the responsive consumers marketers should seek to identify.
- Responsive consumers are much more proactive about their health and are willing to take on the responsibility for managing it. This makes them excellent targets for hospital marketing and communications efforts.
- Responsive consumers appear to be sicker than the average adult. Their slightly older age profile does not entirely account for a 20% to 80% higher prevalence rate for such major chronic conditions as high cholesterol, hypertension, obesity, diabetes and cancer. In fact, it may be their health status that is driving this increased level of responsiveness.
- Responsive consumers are about 90% more likely than the average adult to call a health information line and as much as two times more likely to utilize preventive medical services such as risk assessments and diagnostic tests. These trends could be driving high disease prevalence rates among responsive consumers because they are more likely to be diagnosed.
- Responsive consumers tend to be more independent in their decision making and are more likely than average to select a primary care physician based on either their own research or the physician's affiliation with a particular hospital. They have a below average propensity to rely on a friend's referral, which is the most popular decision making factor for the average adult.
- Similarly, responsive consumers show a significantly higher propensity to research and utilize hospital and physician ratings information, especially when faced with an impending need to consume healthcare services.
- Responsive consumers are up to three times as likely as the average adult to research healthcare topics such as medical conditions, hospitals, physicians and specific medical procedures.
- Responsive consumers are more willing than the average adult to pay extra to receive care from a higher rated provider. In certain cases, they are almost two times more likely than the average adult to spend their own money for "retail" healthcare services, such as heart scans, cosmetic procedures and Lasik corrective eye surgery.
- Traditional demographic targeting can be valuable in reaching this segment, but it has its limitations. For example, hospital marketers could expect a modest improvement in response rates by focusing on very narrow age groupings. However, this improvement pales in comparison to potential results from other, more sophisticated targeting methods.
- While they do have certain dominant characteristics, responsive consumers can be best identified using life-stage segmentation rather than traditional demographic variables. For example, by focusing on just the top 10 (out of 56) Solucient HouseholdView segments, hospital marketers could increase average campaign response by up to 75%.
Consumers Still Pushing Physicians on Hospital Choice
From 2000 to 2002, Solucient tracked a significant increase in consumers' willingness to push their physicians to send them to the hospital that they (consumers) most prefer. This shift seemed to be a clear indicator of the increasing power and importance of the individual consumer with respect to the healthcare decision making process.
Since 2002, however, the percent of consumers willing to ask for their preferred hospital or to seek out a new physician to be able to access their preferred hospital has remained relatively flat at just under two-thirds of all adults. (See Fig. 1.)
It remains to be seen whether the continuously changing economics of healthcare payment will drive the numbers up again in the near future. Nevertheless, it is still significant that two out of every three adult consumers have a preference and are willing to exercise their choice in hospitals. The question is which consumers should marketers interact with in the hope of building a relationship that is likely to influence their preferences and utilization decisions?
The Responsive Healthcare Consumer
While nearly one in five adults reported some response to hospital marketing efforts in the 12-month period prior to the survey, 43% of them were simply seeking or requesting additional information from the hospital. However, the other 57% (or 11.3% of all adults) responded to a particular hospital's marketing effort by attending an education class, participating in a health screening or making an appointment to see a provider. (See Fig. 2.) These are the responsive consumers that marketers must better understand to be able to efficiently identify and effectively interact with them.
Responsive consumers have a stronger than average sense of responsibility for their own health. Fifty-six percent of responsive consumers feel strongly that it is their job to manage their own health. This compares to 47% of all adults. Responsive consumers are also almost 50% more likely than the average adult (49% vs. 33%) to ask questions and seek out information during visits to their physicians.
In keeping with this greater sense of personal responsibility, responsive consumers are much more proactive about their health than the average adult is. For example, just 34% of adults say they follow recommended health screening guidelines. But 48% of responsive consumers indicate that they take steps to follow these same guidelines. In addition, the data show that responsive consumers are almost three times as likely as the average adult (16% vs. 6%) to attend a class or a lecture on healthcare. (See Fig. 3.)
They're Sicker and They Know It
The proactive nature and responsiveness of this unique group of consumers may be due to the fact that they have a significantly higher prevalence of a number of chronic conditions. They reported a statistically higher prevalence of nearly all of the 30+ conditions covered in this year's survey. For example, with respect to key risk factors for heart disease, they are 25% more likely to have hypertension (25% vs. 20%), 36% more likely to have high cholesterol (30% vs. 22%), 42% more likely to be obese (27% vs. 19%), and 56% more likely to have diabetes than the average adult (14% vs. 9%). (See Fig. 4.)
It is possible that these higher disease prevalence rates among responsive consumers are due to their greater propensity to utilize preventive screening and medical services. For example, they are 26% more likely to have had a cholesterol test (43% vs. 34%) and 50% more likely to have had a skin cancer test (6% vs. 4%) than the average adult. But perhaps even more significantly, responsive consumers are almost 90% more likely than average to call a health information or physician referral line (17% vs. 9%) and more than two times as likely to utilize risk assessment or screening services (13% vs. 6%). (See Fig. 5.)
On a related note, it is widely held that consumers in this country do not access preventive medical and screening services to the degree that most physicians and national medical organizations agree are appropriate.1 However, these responsive consumers may be a group that is properly utilizing preventive services. Because of this, it is possible that they are not really sicker than the rest of the population they just know it when others don't. After all, according to the latest statistics from the American Diabetes Association, 29% of all people with diabetes do not yet know it.
Researching and Making Independent Decisions
Responsive consumers demonstrate a greater than average propensity to research and make their own healthcare decisions. For instance, they are less likely than the average adult to rely on a friend's recommendation when selecting a primary care physician. On the other hand, responsive consumers are 20% more likely to choose a primary care physician based on their own research (18% vs. 15%) and 14% more likely to choose one based on the physician's affiliation with a particular hospital (16% vs. 14%). (See Fig. 6.)
This propensity to conduct research on providers and to search for other relevant healthcare information is worth additional exploration as it demonstrates the deliberate decision making process of this unique group of consumers. In fact, 50% of responsive consumers indicate that at some point they have researched hospital and/or physician ratings data. That is compared to just 33% among all adults. Moreover, 40% of responsive consumers say that they are very likely to research quality ratings if they or a family member needed hospital care or surgery. Comparatively, 29% of all adults said they would conduct research in such a situation. (See Fig. 7.)
Not only do responsive consumers care a great deal about quality ratings, they also show a much stronger than average propensity to research a variety of other general health topics. For example, they indicate that they are about twice as likely as the average adult to have researched specific medical procedures in the 12 months prior to the survey (27% vs. 14%) and are three times as likely to have conducted general research on hospitals in their area (18% vs. 6%). (See Fig. 8.) These data clearly show that responsive consumers are in tune with their health, and that they exhibit the type of proactive and interactive behavior which most marketers try to capitalize on through targeted communications.
Cost not Typically an Obstacle
Hospital marketers often search for consumers who are willing to pay for classes, screenings and retail medical services. Solucient's research indicates that responsive consumers are not the typical free health fair or screening event attendees that some might think. They are quite willing to spend more to receive high quality services and are much more willing than the average adult to pay out of pocket for retail health services.
For example, a full 34% of responsive consumers indicate that they would be willing to pay a premium of 10% or greater to receive medical services from a provider with higher ratings. This is compared to just 26% of all adults. (See Fig. 9.) Responsive consumers also indicate they are much more willing than the average adult to pay for retail services such as ultrafast heart scans (45% vs. 33%); alternative medical therapies (13% vs. 8%); and gastric bypass (11% vs. 5%). (See Fig. 10.)
How Do You Find Them?
While direct marketing can be an extremely effective means of communicating with this unique group of consumers, the key challenge is to correctly identify them. Although it may not be possible to identify responsive consumers as individuals until they show up at an event or make an appointment, healthcare marketers can identify specific segments of the population that are most likely to exhibit this desired behavioral profile.
Traditional approaches would suggest segmenting by age, or perhaps even gender or income, to hone in on particular groups that are more likely than others to respond. But, as demonstrated by the research, these approaches are not likely to deliver the kind of response rates that will drive strong return on investment. For example, the data show that targeting very narrow age groups could improve cumulative annual response by up to 35% vs. randomly targeting adults of any age. (See Fig. 11.) This level of performance improvement is not bad, but it is nowhere near as strong as it could be.
Instead, through application and use of an appropriate healthcare behavioral segmentation system such as Solucient's HealthView Plus life-stage segmentation marketers can drive truly significant increases in response. For example, targeting the top 10 most responsive HouseholdView segments (out of 56) would drive a cumulative annual response rate of up to 20% a 75% increase in response over simple random targeting. This also represents an incremental 30% improvement over the best possible age-based segmentation (20% vs. 15%). It is also clear by looking at the performance of the 10 least responsive segments why marketers would want to avoid communicating with them. (See Fig. 12.)
Consequently, by using this type of targeted approach, hospital marketers can be much more focused in their communications and can expect a much higher response and return on investment if, for example, they use a mail list containing only the most responsive consumer segments.
Marketing to Responsive Consumers
Hospital marketers across the nation are being challenged to justify their annual marketing budgets by demonstrating not just return on investment but also the ability to show improvement in marketing performance over time.
With many still struggling to make the leap from branding to truly targeted, measurable marketing, the experience of marketing peers in other industries is worth considering. While they have not abandoned their traditional approaches, marketers in other fields have slowly shifted their resources to support the development and execution of more quantitative, measurable tactics. At the core of these efforts is a process that enables them to target their campaigns based on the expected response patterns of various consumer targets. They have truly embraced and perfected the process of behavioral segmentation and targeting.
The good news is that responsive healthcare consumers appear to be out there waiting for marketers to find them. In fact, they are quite eager to interact with healthcare providers and are likely to place significant value on their relationship with a hospital. Even better, the techniques used for identifying these responsive healthcare consumers have already been developed and proven over the last decade.
The real question is whether or not healthcare marketers are ready to make the leap. The art of marketing will never disappear, but now is the opportunity to take control and add a measure of science to the equation. By doing so, healthcare marketers will enjoy improved results while elevating the entire marketing process.
About Solucient HealthView Plus
Data for this analysis were gathered from Solucient's HealthView Plus national healthcare consumer research tool and represent the collective responses of nearly 20,000 households annually. This research tool helps hospitals understand the attitudes, behaviors and decision making patterns of healthcare consumers in their local market. Covering such topics as health status, chronic conditions, utilization, hospital and physician selection, use of information resources, media and lifestyle behavior, etc., HealthView Plus provides the information hospitals need to support development of highly targeted consumer marketing strategies and tactics.
About Solucient and Thomson Healthcare
Solucient is a part of Thomson Healthcare, the leading provider of decision support solutions that help organizations across the healthcare industry improve clinical and business performance. Thomson Healthcare products and services help clinicians, hospitals, employers, health plans, government agencies, and pharmaceutical companies manage the cost and improve the quality of healthcare.
Thomson Healthcare is a part of The Thomson Corporation, a provider of value-added information, software tools and applications to professionals in the fields of healthcare, law, tax, accounting, scientific research, and financial services. The Corporation's common shares are listed on the New York and Toronto stock exchanges (NYSE: TOC; TSX: TOC). For more information, visit ( www.thomsonhealthcare.com ).
End Notes
1McGlynn EA, Asch SM, Adams J, et al, "The Quality of Healthcare Delivered to Adults in the United States," New England Journal of Medicine 2003; 348 (26): 2635-45.
