Employ a Customer Mindset for Future Viability
Consumerism in health care must transform to meet changing consumer expectations. Consumers increasingly expect to be at the center of their health journey, yet the industry has lacked the ability to translate a retail-like experience—to the benefit of innovative disrupters. To compete and drive profitability, health systems must acknowledge the transformation in health care driven by competitive forces and see patients as customers rather than patients.
Post pandemic, changing consumer behaviors are emerging as a key area of focus. Customers expect brands to understand and respond to their unique needs with quick solutions, paired with meaningful interaction that will earn their loyalty—all crucial for future success. The industry is at a critical moment to secure relevance, add real value and maintain long-term viability. Absent a focus on customer-centricity in strategic planning and across leaders—which cements the customer as the core measure of growth—health systems risk losing profitable revenue to innovative market entrants who continue to offer greater value: convenient offerings with seamless access and digitally enabled services individualized for the customer.
Who Is the Health Care Customer?
Health care consumers have made their expectations of the health industry clear. They place high demand on not only being viewed as unique individuals, but also as purchasing customers poised to make an informed decision about goods, products or services—just as in other high-performing industries (eg, finance, hospitality, retail). The customer has a marked desire to feel important, understood and valued. They want their individual needs to be top priority, as well as purposeful human interaction for a streamlined experience. They are also time constrained. Thus, systems must deliver services and solutions quickly at the customer’s decision action moment and produce what they see as an optimal health experience.
► Nearly 50% of health care organizations are working to develop a customer-first mindset.
Well before the COVID-19 pandemic, other industries recognized that mass marketing strategies were a thing of the past. These businesses present attractive, customer-centric self-service offerings designed specifically for their audiences to help successfully power steady revenue streams—an evolution health care lacks.
With market pressures at an all-time high and financial pinches felt among households across the country, the ability to compete demands a strategic reorientation. Health systems must place the customer as the core focus of the design in products provided for consumption and move toward establishing lasting relationships with them (ie, become customer-centric) to cement higher value (ie, loyalty) toward driving significant short-, mid- and longer-term financial stability.
Future health system profitability and viability relies heavily on the adoption of a reinvigorated value proposition. An intentional shift is required toward embracing a customer-first mindset, with customer loyalty as the strategic transformational goal—and with the presumption of clinical quality and outcomes. Leading health systems will prioritize meeting the health care needs of the high-value customers they are best positioned to serve—those customers with the greatest likelihood to need the services from their brand—to earn greater share of loyalty and lifetime value. The goal should not be solely chasing high-revenue procedures, but also providing ultimate value for the customer through self-guided planning and relationship-building that will endure.
Why Should Health Systems Employ a Customer-Focused Strategy?
A shift in mindset is essential to adopt the customers’ priorities more fully as the focal point and ultimate source of revenue—and thus the driver for strategic investment toward future system profitability. A customer-focused business establishes partnership and trust as a motivation for users to enter through an organization’s doors—digital or physical—and continuously innovates for an improved experience. Health systems should embrace this strategy to increase total value for the customer and secure repeat utilization and loyalty for their brand long term. And with limited opportunity to capture and retain repeat customers, health systems who foster a more genuine bond with their customers will be better positioned to earn customers’ loyalty—which can translate into long-term revenue.
At the heart of a customer-focused strategy is a marked combination of authentic understanding of customer perspectives and the impact these unique behaviors have in driving purchasing selection. The goal of this strategic approach is to deliver a highly meaningful, unique solution for individuals and other like-minded customers (ie, customer segment), plus cultivate a personal relationship to carry customers through their health journey. Health systems that are more in tune with the unique lives and needs of the health purchasing customer—fostering a deeper relational tie to their behaviors through more purposeful interconnectedness—can more effectively position self-service strategies that appeal to their higher-value market customers.
Beyond individuals in a market, health systems must also consider the impact enterprise partners have in sealing relational value for customers and driving growth. These strategic partners—physicians and advanced practitioners (eg, physician assistants and nurse practitioners)—serve as integral influencers who advocate on behalf of customers and inform their next health action; they are a funneling power for growth—a significant revenue-generating force. Forward-thinking teams should view their physicians and advanced practitioners as core strategic partners with whom to foster a relationship to ultimately maximize downstream value potential.
Importantly, the critical strategic partner designation does not stop at physicians and advanced practitioners; it extends to support staff (eg, clinic nursing teams, scheduling staff, registration staff) who are also crucial to securing timely health transitions for customers. Lack of viewing these team members as integral partners who influence customer decision making can weaken midstream and downstream revenue.
Strategic Action: Pursue a Purposeful Plan
Organizations that employ a customer-focused strategy will enhance their strategic growth position in the short and long term. Attainment of customer loyalty is one of the most important competitive advantages for a health system to solidify future viability. When customers elect to return to a single system for their health needs over a measured period, it denotes high preference for a brand and, more importantly, solidifies brand credibility and enhanced customer value. Moving forward, these considerations are key for integrating a customer-focused strategy:
- Understand the unique health customer mindset and their distinct needs, and use them to develop strategic priorities
- Leverage key customer loyalty metrics, including share of wallet and customer lifetime value, to guide customer-focused investment strategies
- Prioritize customer segment needs when making investment decisions
- Position digital self-service options to enhance convenience and facilitate access
- Integrate effective communication channels to aid with customer navigation across your care continuum
Where Should My Organization Begin?
Sg2 members can start with our updated Engaging the New Health Care Customer Organizational Self-Assessment, found in our Consumerism Resource Kit, to gauge your organization’s readiness to attract and activate health care customers and consistently execute a customer-centric offering.
Not an Sg2 member yet? Contact us at learnmore@sg2.com or 847.779.5500 to speak with an expert on how your organization can employ a customer-focused strategy.
Source: Kaufman, Hall & Associates. State of Consumerism in Healthcare 2021: Regaining Momentum. Healthcare Consumerism Index. September 2021.
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