“New Financial and Performance Metrics”

SRK Educational Webcast

November 4, 2010

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Today’s Agenda: Learn from Others Success

1. Metrics and Strategies that other industries have maximized to acquire and retain customers, integrate products or services and build revenue

2. Questions and Answers – Post in GoToWebinar Dashboard to the right

3. An optional commercial message from SRK

We transition healthcare marketing and business development to the new requirements of reform and ACOs

Support academic medical centers, community hospitals and multi-hospital systems throughout the US

Collaborate with ACHE, SHSMD, HFMA & HealthLeaders to drive industry research and education

Meet SRK: Healthcare Industry Thought Leaders

Creates data driven strategies to help clients find and maximize revenue opportunities

Chief advisor on tactical integration, target segmentation and key messaging

Urbanathlete, political junkie and geek dad

Email: bwalker@srksolutions.com Twitter: @catalyst4growth

Meet Brian Walker: Senior Vice President

Real Time Industry Perspective

What do Other Industries and Companies do well that we can Adopt?

• “Strategic Halo”• Churn Rate • Upstream Feeder• Intelligent Profile• Conversion Rate• Control Group Lift• Cross-Sell Value

• Total Customer Value• Promotable Product• Downstream

Utilization• Acquisition Costs• Lag Time• True Physician

Impact

Evolving Healthcare Market Demands New Metrics

• Community benefit

• Marketing ROI

• Customer analysis

• Value

• Service line analysis

• Clinical opportunities

• Budget/ Revenue scenarios

• Geographic analysis

• Targeted physician referral strategies

• High-margin opportunities

• Payment segmentation

• Strategic tactics

• Campaign measurement

• Data-driven creative

• Growth opportunities

• Service line trending

How can we leverage these metrics to build enterprise consensus and strategy?

Although healthcare is a considered purchase…many agree it’s becoming more retail like – How can we be more competitive?

Identify Revenue Opportunities

Promotable Products: What is it, Why Does it Matter?

Promotable Products is based upon the concept of a “lost leader” used in retail to drive a transaction with the hope of incremental sales

Promotable Products: How can you leverage in healthcare?

Identify services within product lines that can be driven through consumer events such as screenings and educational programs

Strategic ConceptEvents should drive profitable services

Historical ConceptScreenings and seminars are a community benefit

Promotable Products: Make the business case first, understand demographics, then develop tactics(Example: PVD screenings)

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Execute and Maximize Tactics

Conversion Rate: What is It, Why Does It Matter?

Conversion Rate: Exactly what it means – How many prospects did we turn into patients? In other industries: “How many sales did we close?”

Commit To Convert: Hospitals do a great job helping identify symptoms, but do a poor job of helping them matriculate into their hospital or MD offices.

You need to understand all your touch points to maximize conversion

FY2010 AKMC PVD Screening Program

What you need to consider for conversion

• When creating a campaign your conversion strategy should consist of– Who should we target for conversion

• Example: Those at risk at a screening– What’s our time frame for conversion

• How soon after the event should people be contacted

– What’s the mechanism for reconnecting?– Who goes for the “close”?– When is a lead no longer viable?

Measure the Effectiveness

Lag Time: What is it, Why Does it Matter?

At last a metric that both marketing and the CFO can agree upon and benefit from!

Lag Time: Measures how long it takes a prospect to convert to a patient or how long it takes you to drive an existing customer back into your health system

Other industries use this metric to set expectations with management and integrate other strategies as well as future tactics CFOs can benefit from Lag Time to better predict financial impact and cash-flow from marketing and other tactics

Lag Time can vary greatly based upon target and tactic

Campaign Summary 5/09: Adults 35-64, HHI of $50K+ from high revenue CV zips, not seen at hospital in 2 years

Patient / Prospect Prospect MailingTotal Mailings 12,257Mailing List Chest Pain PromotionMailing Year 2008Mailing Month AugustMailing Date 13-Aug-08Response Month All

Conversions to Hospital

Conversion Rate

Avg Visit Lag

(Mailing) Total VisitsVisits per

Conversion RevenueRevenue per Conversion

Revenue per Visit

481 3.9% 106 780 1.6 1,267,302$ 2,635 1,625

Source: SRK

Campaign Report 5/09 - Did Not Mail Adults 35-64, HHI of $50K+ from high revenue CV zips, not seen at hospital in 2 years

Patient / Prospect Control GroupTotal Mailings 490Mailing List Chest Pain PromotionMailing Year 2008Mailing Month AugustMailing Date 13-Aug-08Response Month All

Conversions to Hospital

Conversion Rate

Avg Visit Lag

(Mailing) Total VisitsVisits per

Conversion RevenueRevenue per Conversion Revenue per Visit

5 1.1% 158 9 1.8 10,345$ 2,069 1,149

Conclusions and Takeaways

Key Takeaways: Marketing in Transition:What SRK Thinks You Need to do Now…

• Build short term revenue and margin• Adopt new metrics• Sharpen data driven strategies and financial reporting• Understand product line interdependence

Key Takeaways: Marketing in Transition:What SRK Thinks You Need to Prepare For…

• CRM sustainability• Maximize opportunities for retention• Integrate new metrics and data driven strategies through the

enterprise• Become an experience brand

Interested in Learning More?

• See how “revenue ready” you are by taking our assessment at www.gatewaytorevenue.com

• Schedule a 1-1 hospital marketing assessment or executive workshop with SRK: bwalker@srksolutions.com

• Participate in upcoming free educational webinar programs: http://www.srksolutions.com/Webinars.cfm

• American College of Health Care Executives Cluster Program:– Vail, Colorado, January 24-27,2011– Kiawah Island, South Carolina, April 4-7, 2011

http://www.ache.org/seminars/seminar.cfm?PC=KEYMA

General Q & A Session

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How SRK is helping hospitals improve enterprise strategy to build revenue

• Balancing Acquisition and Retention Strategies

• Breaking Down Silos and Understanding the Interdependence of Product Lines and Services

• Better Insight on Customers and Physician Behaviors as well as their Total Financial Contributions

• Embracing the True Meaning of CRM Across the Organization

• Short-Term and Long Term Revenue Strategies

The Search for Revenue

Gateway provides enterprise-wide value

• Community benefit

• Marketing ROI

• Customer analysis

• Value

• Service line analysis

• Clinical opportunities

• Budget/ Revenue scenarios

• Geographic analysis

• Targeted physician referral strategies

• High-margin opportunities

• Payment segmentation

• Strategic tactics

• Campaign measurement

• Data-driven creative

• Growth opportunities

• Service line trending

Gateway’s core strength: Integration of physician and consumer data

From Exam Room… …To Hospital Discharge

Gateway’s core strength: Integration of physician and consumer data

Downstream

Downstream Feeders

Feeders

The SRK Strategic Halo: Product lines are interdependent

Product Line

DownstreamDownstream

Feeders

Feeders

The SRK Strategic Halo: Product lines are interdependent

Product Line

Gastroenterology

Pulmonary

Orthopedics

Endocrinology

Alle-Kiski Medical Center Four services “feed” 35% of CV visits from existing patients upstream

CV Patients

Total Visits

CV Patients

35% Total Visits

GastroenterologyPulmonaryOrthopedicsEndocrinology

Alle Kiski Medical Center CV entry patients provide 18% of the visitsto these four product lines downstream

CV Patients

18%Total Visits

Bill EnglertVice President of OperationsAnd Business DevelopmentAlle-Kiski Medical Center

“Its so simple and makesso much sense.”

Innovative metrics

A full suite of CRM tactical tools for a turnkey solution

Interested in Learning More?

• See how “revenue ready” you are by taking our assessment at www.gatewaytorevenue.com

• Schedule a 1-1 hospital marketing assessment or executive workshop with SRK: bwalker@srksolutions.com

• Participate in upcoming free educational webinar programs: http://www.srksolutions.com/Webinars.cfm

• American College of Health Care Executives Cluster Program:– Vail, Colorado, January 24-27,2011– Kiawah Island, South Carolina, April 4-7, 2011

http://www.ache.org/seminars/seminar.cfm?PC=KEYMA