Nasty or Nice: How Do You Grow Market Share?

HealthLeaders Media Staff, May 20, 2009

The first time I read an article in the mainstream press in which two hospital CEOs were waging a very public battle over market turf, I was surprised. I wondered, in fact, why the hospitals' communications team didn't march into these CEOs offices, unplug their phones, and duct tape them to their chairs to prevent them from airing their grievances in the press.

Then I started to see a lot more of these stories, and started hearing about hospitals that were getting downright aggressive in their marketing efforts—putting up billboards across the street from their competitors' hospitals and opening up clinics further and further away from their core markets—right in their competitors' back yards.

Then there are the bidding wars over the top physicians and rock star specialists. And lawsuits over who has the most top docs and more.

One reason for this new combative attitude is the economy, of course. But another is that patients are no longer just wandering like so many sheep into the closest hospital for tests and procedures—they're more willing to travel to get what they perceive as the best care.

Hospitals are moving beyond their primary—or even secondary market—into every geographic area that they can, says Robert Sutton, founding partner at IMA Consulting in Chadds Ford, PA. "People are much more well-informed because of the Internet that they're willing to travel further to get the best service."

No matter how unseemly, the big question, it seems to me, is whether or not these tactics work. They might turn friendly competitors into sworn enemies and public battles might be a big turnoff to the public in general. But if the end result is an increase in volume, does that really matter?

"Hospital competition is really driven off of the need to maintain a certain level of volume," Sutton says. "Hospitals don't make money when they're 50% occupied."

So what's more important, a hospital's reputation and image? Or grabbing as much market share by any means necessary?

You can read more about what healthcare leaders and others think in The Fight Over Market Share Gets Nasty, published in this month's HealthLeaders magazine.

Note: You can sign up to receive HealthLeaders Media Marketing, a free weekly e-newsletter that will guide you through the complex and constantly-changing field of healthcare marketing.
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