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Strategic Marketing For Health Care Organizations: Building A Customer-Driven Health System



Strategic Marketing For Health Care Organizations: Building A Customer-Driven Health System

Philip Kotler, Joel I. Shalowitz, Robert J. Stevens

ISBN: 978-1-118-04717-0 January 2011 Jossey-Bass 576 Pages

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This much-needed text offers an authoritative introduction to strategic marketing in health care and presents a wealth of ideas for gaining the competitive edge in the health care arena. Step by step the authors show how real companies build and implement effective strategies. It includes marketing approaches through a wide range of perspectives: hospitals, physician practices, social marketing, international health, managed care, pharmaceuticals, and biotechnology. With Strategic Marketing for Health Care Organizations, students and future administrators will have a guide to the most successful strategies and techniques, presented ready to apply by the most knowledgeable authors.

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Tables, Figures, and Exhibits xi

Preface xv

Acknowledgments xvii

The Authors xix

Part One

One: The Role of Marketing in Health Care Organizations 3

Overview: Marketing is Pervasive in Health Care 4

The Elements of Marketing Thought 6

Two: Defining the Health Care System and Its Trade-Offs 13

Overview: Defining a Health Care System 15

A Framework for Understanding Health Care Systems 16

Strategic Choice Model for Organizations and Health Care Systems 25

Strategic Implications for Health Care 29

Three: The Health Care Industry and Marketing Environment 41

Overview: The U.S. Health Care System Needs Improvement 43

Defining a Well-Designed Health Care System 45

Major Participants in the Health Care System 48

Key Managed Care Trends 56

Dynamic Relations among Health Care Stakeholders 71

The Changing Health Care Environment 73

Four: Determinants of the Utilization of Health Care Services 85

Overview: Why People Seek Health Care 86

Multiple Factors Influence Health-Seeking Behavior 95

Local (Small Area) Variations 104

Part Two

Five: Strategy and Market Planning 109

Overview: Defining the Organization’s Purpose and Mission 111

Strategic Planning 111

Marketing Strategies 135

Reassessment of Mission Statement 139

Strategic Alliances 141

Marketing Planning 141

Six: How Health Care Buyers Make Choices 145

Overview: Key Psychological Processes 147

The Buying Decision Process: The Five-Stage Model 155

Organizational Buying and Decision Making 163

Seven: Using Market Information Systems and Marketing Research 177

Overview: The Need for Market Information 179

The Components of a Modern Marketing Information System 180

Internal Records System 181

Health Care Services: The Clinical and Financial Systems 182

Health Care Products: The Order-to-Payment Cycle 182

The Marketing Intelligence System (MIS) 182

Marketing Research System 188

The Path Model: Understanding the Health Care Consumer 197

Marketing Decision Support System 201

Developing a Marketing Research Plan: Application and Example 203

Forecasting and Demand Measurement 206

Appendix: Secondary-Data Sources 213

Eight: Market Segmentation, Targeting, Positioning, and Competition 217

Overview: Market Segmentation 219

Segmentation of Consumer Markets 222

Market Targeting 231

Market Positioning 235

Competitive Forces and Competitors 245

Part Three

Nine: Shaping and Managing Product and Service Offerings 261

Overview: Distinguishing Product Types and Levels 263

The Nature of Services 266

Viewing the Product Mix 271

Managing Product Lines 272

Ten: Developing and Branding New Offerings 281

Overview: The New Offering Development Process 283

Building the Brand 296

Managing the Stages of the Product Life Cycle 304

Building, Maintaining, and Terminating a Brand 313

Eleven: Pricing Strategies and Decisions in Health Care 317

Overview: Understanding Pricing 318

Consumer Payers 320

Government Payers 341

Private Payers 344

Twelve: Designing and Managing Health Care Marketing Channels 351

Overview: Marketing Channels and Value Networks 353

The Role of Marketing Channels 356

Channel Functions and Flows 358

Channel Levels 360

Service Sector Channels 360

Channel-Design Decisions 361

Identifying Major Channel Alternatives 362

Evaluating the Major Alternatives 364

Channel-Management Decisions 365

Modifying Channel Arrangements 368

Channel Dynamics 369

Legal and Ethical Issues in Channel Relations 373

Thirteen: Designing and Managing Integrated Marketing Communications 375

Overview: The Role of Marketing Communications 377

Marketing Communications and Brand Equity 378

Communications Process Models 380

Developing Effective Communications 382

Advertising 397

Sales Promotion 411

Public Relations and Publicity 414

Events and Experiences 418

Factors in Setting the Marketing Communications Mix 423

Measuring the Communications Results 424

Managing the Integrated Marketing Communications Process 424

Coordinating Media 425

Implementing Integrated Marketing Communications 425

Fourteen: Personal Marketing Communications: Word-of-Mouth, Sales, and Direct Marketing 429

Overview: Personal Communication Channels 431

Word-of-Mouth Marketing 433

Designing the Sales Force 441

Health Care Sales to Hospitals and Physicians 454

Direct Marketing 458

Part Four

Fifteen: Organizing, Implementing, and Controlling Marketing 471

Overview: Organizing for Marketing 474

Helping the Hospital Become Patient-Oriented 477

Marketing Implementation 478

Evaluation and Control 479

Glossary 491

Notes 511

Index 531

Praise for Strategic Marketing for Health Care Organizations

"This outstanding book not only delineates powerful conceptual frameworks and tools but is also studded with real-life, captivating examples in organizations that range from governments to biotech firms to Web portals, that illustrate how to make it happen. A tour de force."
—Regina E. Herzlinger, Nancy R. McPherson Professor of Business Administration, Harvard Business School

"This book is a first-rate introduction to the concepts and tools professional marketers use to develop cutting-edge value propositions for key target audiences in a range of health care arenas. It offers both frameworks for thinking about marketing strategy and insights into a range of tactical alternatives. It is a state-of-the-art volume for those in various health care fields who are eager to be better marketers, students who want to join their ranks, and those who simply are wondering what marketing is all about and how it might help their organizations."
—Alan R. Andreasen, professor of marketing, McDonough School of Business, Georgetown University

"Kotler, Shalowitz, and Stevens, in this important book, Strategic Marketing for Health Care Organizations, make many valuable contributions to our field, especially their discussion of tradeoffs among the three core aims of any health care system: cost, quality, and access. Students and professionals continually face this problem all the time."
—Lawton R. Burns, James Joo-Jin Kim Professor, professor of Health Care Systems and Management, the Wharton School of the University of Pennsylvania and director, Wharton Center for Health Management and Economics

"This work places marketing as a core activity impacting all of health care, from prevention to continuing care. It provides a comprehensive foundation for beginners and a valuable reference for experienced managers on a major and often overlooked aspect of management."
—John R. Griffith, Andrew Pattullo Collegiate Professor, Department of Health Management and Policy and director, Griffith Leadership Center, Department of Health Management and Policy, University of Michigan School of Public Health