Sample Analyses, Strategies, and Recommendations for Brand X Radiology

Foreword

I provide this analysis and set of recommendations to demonstrate some insight into my thought process. Please be mindful it was created in a short period of time and with access to limited resources. Please use discretion when disseminating this document.

Analysis of Radiology Industry

Radiology clinics must be very expensive. The start-up cost of the machinery surely is very high. Ongoing costs such as recalibrations, certifications, and consumed supplies are probably significant. Also, staff members must undergo continuous training for their own licensing. Combined with salaries, office space, and maintenance, a radiology clinic probably needs a steady stream of patients to continue operations.

It therefore makes sense for the radiology clinic to do what it can to increase the number of its patients. If everything else is held constant, increasing the number of patients seen each month means increasing profits. Once the breakeven point has been met for the month, revenues from every additional patient examined that month are almost all profit.

This is why it is important for a radiology clinic to grow. The main question then becomes: How can a radiology clinic like Brand X Radiology grow?

Analysis of Customer Segments

As I see it, there are three distinct customer segments. The first customer segment is the returning patients. These people were referred to Brand X Radiology some time ago and have been satisfied with its service. They use Brand X Radiology on an on-going basis for treatment or for regular monitoring.

The second customer segment is the doctors who currently refer patients to Brand X Radiology. They learned of Brand X Radiology's services some time ago and have been satisfied with they service they have received.

The third customer segment is the doctors who currently refer patients to other radiology clinics. The chief reason they use other radiology clinics is probably they are satisfied with the service they are currently receiving or they are unaware of Brand X Radiology's services.

Each customer segment must be approached uniquely.

Customer Segment #1: Current Patients

Current patients generally will continue to go to the same radiology clinic unless given a compelling reason to change. However, if they are unsatisfied with the service they receive, they will switch to another radiology clinic without hesitation. With some 140 radiology clinics in the Greater Washington D.C. Area, there is an abundance of other radiology clinics available.

Brand X Radiology must do everything within reason to have high patient retention rates and have high patient loyalty. One way is to satisfy them with the overall service they receive.

It is presumptuous for me to state what issues are important to Brand X Radiology's current patients. Therefore my strategy is to ask them what they want and try to make it happen. If done successfully, make sure the patients know about the improvement.

Another way is to ensure current patients appear for their next appointment. These patients may have forgotten to make another appointment or failed to appear for their scheduled appointment. Either way, it is a squandered opportunity for revenue.

Finally, there may be some differences in the clientele of some of the offices. The clienteles at the downtown and very suburban office are probably very different. The ways to satisfy each clientele may be accordingly different.

Using informal interviews, Brand X Radiology should find out how patients feel about the service they receive. Based on those results, it should then create a short questionnaire - one that can be completed in less than one minute. One question might be:

Once the areas in most need of improvement have been identified, Brand X Radiology should commit itself to rectifying the situation. Once completed, Brand X Radiology must then promote the improvements, such as by sending postcards to all patients affected by the change. (If the change is in one office, it is only necessary to inform patients of that office. If the change is company-wide, it is necessary to inform all the patients of every office.)

It will be necessary to repeat this change for each of Brand X Radiology's offices. This will account for preferences unique to each office.

The importance of the promotion, in this case the postcard, cannot be understated. It lets the patients know that Brand X Radiology listens to its clientele and responds proactively. The patients will feel their voices will be heard and loyalty will increase.

The informal interviews may very well lead to ways of improving Brand X Radiology that has not occurred to any of the staff. The possibility of discovering a competitive advantage exists, so Brand X Radiology must always look for it, and informal interviewing of patients is one of finding it.

Some patients may wish to learn more about the treatment they receive. For them, it might be beneficial for Brand X Radiology to have overviews of its major treatments on its web site. Each time a patient who learns about his / her treatment from the web site saves some work for Brand X Radiology doctor. Informed patients who are confident of their treatments tend to be more diligent in following their doctors' instructions. This usually translates to better experiences for both the patient and the doctor.

To address the problem with patients forgetting to make appointments, the staff may have to contact those patients to schedule their next appointment. This may require creating a system to identify which patients did not make another appointment. As for missed appointments, the staff must diligently remind each patient of the upcoming appointment.

Customer Segment #2: Doctors Currently Referring Patients to Brand X Radiology Clinics

I spoke with two doctors who refer patients to radiology clinics. They told me the most important issue to them was the work they received from radiology clinic. Specifically, they wanted:

• High quality work.
• Prompt delivery of the work.
• Clear and easy-to-understand reports.
• Consistent service of the above.

I got the distinct impression from these doctors that they have very little loyalty to their radiology clinics. Neither would tolerate even a short string of poorly done work; they would both switch immediately. Not only would they stop referring patients to that radiology clinic, but these doctors might also instruct current patients of that radiology clinic to visit another. The potential damage of poor service can be devastating.

In exchange for referring its patients, Brand X Radiology promised the doctors a certain level of service. It must deliver that service. It will be far more difficult to earn the trust of other doctors, especially with a tarnished professional reputation.

As medicine progresses, the doctors' expectations will change as well. It is important to frequently interview doctors to determine what they want. By offering the new services they want quickly, doctors currently referring patients to Brand X Radiology are unlikely to seek its competition.

If Brand X Radiology is offered something unique to the doctors currently referring patients, that could create switching costs for those doctors. Since doctors are very busy, providing them with conveniences only available from Brand X Radiology would serve as a disincentive to refer their patients to other radiology clinics.

My main recommendation for doctors currently referring patients to Brand X Radiology is to deliver high quality work promptly with good reports and to do so consistently. Admittedly, this is unglamorous and hard work, but it must be done.

In the recommendations for doctors currently referring patients to other radiology clinics, I advocate sending postcards to inform them of Brand X Radiology's new developments. The same postcards should also be sent to the doctors currently referring patients to Brand X Radiology. These doctors must know of Brand X Radiology's growing capabilities and never feel they are being left out.

I also recommend establishing a dialog with most of Brand X Radiology's referring doctors and a rapport with certain key doctors, ones in fields that make many radiology referrals. By finding out what they want and delivering it in a timely manner, Brand X Radiology can not only maintain its strong professional reputation, but it can also be regarded as a radiology clinic that is at the forefront of the industry.

It might be beneficial to making Brand X Radiology's web site into a useful resource for doctors currently referring patients. The doctors could visit it at any time and have their questions answered immediately. It could also create a switching cost for the doctors. If only doctors who have referred a patient recently are allowed access, it would dissuade them from referring their patients to other radiology clinics.

One final recommendation is to provide referring doctors with flyers with contact information about Brand X Radiology. The flyer would have addresses, phone numbers, maps, hours, directions, web site address, and a list of the doctors at each office. This will save time and aggravation for the doctor and the newly referred patient. If other radiology clinics do not provide these flyers, they may also act as a switching cost to the doctors currently referring patients to Brand X Radiology.

Customer Segment #3: Doctors Currently Referring Patients to Other Radiology Clinics

Getting a doctor to switch from one radiology clinic to Brand X Radiology is the biggest prize marketing can garner. Like the previous customer segment, these doctors are probably pleased with their current radiology clinic. However, some probably are not. If those could be identified, all marketing efforts would be directed toward them. Unfortunately, no one knows who those dissatisfied doctors are, so most of the promotional materials will be ignored and discarded. Nevertheless, Brand X Radiology must try because the reward is worth the investment.

As stated earlier, medical science is constantly evolving, and so too do the requests from doctors of their radiology clinics. Once Brand X Radiology has mastered a new procedure, it should attempt to create a niche for itself with that procedure. Brand X Radiology should promote its capabilities of that procedure to doctors referring its patients elsewhere.

This is not to imply that Brand X Radiology should focus on any single procedure. Rather, it should repeat this as many times as is feasible. Recognition as a provider of various specialized procedures will enhance its reputation to many doctors currently using other radiology clinics.

I hate mass mailings written blandly. Therefore, I do not believe form letters listing Brand X Radiology's services and capabilities is a worthwhile endeavor. We all receive many milquetoast advertisements and very few ever get read. Besides, doctors wanting to get a general overview of Brand X Radiology will visit the web site. Since the advent of advertising on the World Wide Web, many marketers emphasize "page views", "eyeballs", and "clicks." I believe these ideas are misguided. What is important is getting the attention of the target market.

What I like are targeted mass mailings with some punch. They are meaningful to the recipients, convey the message quickly, and let them know what to do if they are interested. I believe that, while reading the mailing, recipients ask themselves, "So what?" Any promotion that a good answer to the "So what?" question has a vastly bigger chance of succeeding.

The overall effect of this strategy is to have doctors learn of Brand X Radiology's vast array of services and high quality work in piecemeal. Over time, it will, hopefully, occur to the doctors that by cobbling together the bits and pieces that Brand X Radiology is a full-service radiology clinic at the leading edge of the industry. Brand X Radiology has the potential to be perceived as a clinic with great width - a wide variety of services - and great depth - able to perform complex and cutting edge procedures. The doctors should realize this themselves rather than being told it by advertisement because the doctors will be less likely to question their own conclusions.

Since each of Brand X Radiology's offices has several different machines, it is possible that some machines are underused. Effective marketing of procedures for that machine would be a source of greater revenues.

The easiest way to increase the number of doctors referring patients to Brand X Radiology would be to become affiliated with a popular hospital system. However, it is my guess that most of these alliances have already been made. It would probably be worthwhile to create relationships with doctors in these hospital systems. Though doubtful, these alliances may break and create an opportunity for Brand X Radiology.

As soon as Brand X Radiology becomes proficient with a new development such as a new procedure or optional accreditation, it should inform doctors by sending postcards.

The postcard should get their attention and be short — readable within 30 seconds — yet informative. The postcard is meant to whet the doctors' appetite. For doctors who want to learn more, the postcard also lists a web page address and a contact at Brand X Radiology. The web page will detail the new development and answer many of the doctors' questions. If a doctor acts because of the postcard, then the postcard has passed the "So what?" test.

There are two reasons why the postcard must be readable in a short period of time. One, if the recipient can read the postcard quickly — say 30 seconds — he/she probably will. Once the recipient commits to read the postcard, it has his/her full attention for 30 seconds. Two, by limiting the amount of time the postcard requires, Brand X Radiology has respected the doctor's time. This is especially important with repeated mailings, each touting a new development. Over time, this respect will hopefully foster goodwill.

These postcards should not be sent to all doctors; it should target only to those affected by the new development. Further, the message should be customized according to the doctor's specialty. The postcard should describe how this new development direct pertains to the recipient's practice. Thus the acquisition of a new machine will be described one way to an orthopedic surgeon and another way to an endocrinologist. Again, this custom messaging is meant to pass the "So what?" test.

By marketing itself as provider of a specific procedure, Brand X Radiology can be a leader of that niche market. So long as that procedure is not widely available - or perceived as widely available — the possibility exists for a greater-than-average profit margin. Dominating multiple niche markets can be very profitable.

By promoting Brand X Radiology's new capabilities, doctors using other radiology clinics may wonder if theirs can perform that new procedure. That one thought may be enough of an opportunity for that doctor to give Brand X Radiology a try.

Adding informative pages to the Brand X Radiology's web site may well make it into a useful resource for doctors. If doctors can find what they need to know quickly, they will have a favorable impression of Brand X Radiology. This too may become an opportunity for Brand X Radiology to earn the business of additional doctors.

As stated earlier, all these materials should also be provided to the doctors currently referring patients to Brand X Radiology. They must always be updated of Brand X Radiology's new developments. Also, not sending to the current referring doctors can easily be construed as a slight.

Each Brand X Radiology's office has several different machines, so it is reasonable to believe some of them are not being used to their capacity. To remedy this situation, Brand X Radiology should identify what procedures can be done on the underutilized machines, what medical specialties need those procedures, and target that procedure to nearby doctors of that specialty. The goal is to run every machine every minute possible. If the machine is running, it is generating revenue.

Conclusion

For current users of Brand X Radiology, be they patients or doctors, it is important to keep them satisfied. While customer loyalty is very important, it has a definite upper limit: If 100% of the current patients and doctors are satisfied, it would be prudent to focus on converting other doctors to Brand X Radiology.

Converting doctors to Brand X Radiology will take time, hard work, and a bit of luck. Not everyone will convert. The goal is to get as many to convert as possible.

Final Note

I compiled these analyses, strategies, and recommendation in four days. I used materials available on the World Wide Web, including Brand X Radiology's web site. I spoke with a few women who get annual mammograms, two doctors, my dentist, and a friend who works for the American College of Radiology.

To perform properly at this position, I must learn a great deal about radiology. Also, I still have much to learn about marketing and strategy. I am willing to do whatever is necessary to become more knowledgeable in these and related fields of study.

I have considered Brand X Radiology only as a well-known radiology clinic in the Greater Washington D.C. Area. I have not considered any competitive advantages or unique situations that may exist. I'm sure Brand X Radiology has its own way of doing things, and these recommendations must be tailored to accommodate those. Taking these factors into account will doubtlessly impact this paper. Also, I am sure there are many considerations I am oblivious of, and knowing them would also improve this paper substantively.

I can write that much improved paper. I also can see to it all the recommendations I have made in this paper, and most likely the ones in the improved paper, are carried out in a professional and complete manner.

But first, Brand X Radiology has to hire me.