Podcast #44

How to Navigate Budget Cuts and Economic Uncertainty

No matter the economic climate, there is value in understanding potential economic pressures and market challenges, as well as having a plan in place to overcome them. How can healthcare marketers create a business strategy that will maximize their budget and keep them aligned with leadership?

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Episode Highlights:

Lauren Leone

Lauren Leone: “Don’t throw money at the wall on assets and channels that are super high-cost. If you have not done those things or you’re creating a new MSO or you’re a newer group, there is still an opportunity to build your foundation and that should be where the budget goes initially.”

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Announcer: Welcome to the Ignite podcast. The only healthcare marketing podcast that digs into the digital strategies and tactics that help you accelerate growth. Each week, Cardinal’s experts explore innovative ways to build your digital presence and attract more patients. Buckle up for another episode of Ignite.

Alex Membrillo: Thank you for tuning in, and we’re going to have a fun one today. Actually, it’s kind of gloomy. Two years ago, a little over two years ago, we had a huge economic hit. It’s okay because we were accelerating way too quickly. You have inflation that came along with it. It’s okay to have a reset. It’s okay to have reset. I started Cardinal in ’08, ’09. There was no jobs. 25% unemployment for 25 and under. It was really bad. I had to go take an interview with Enterprise Medical and they told me I’ll be washing carts in a tux in an Atlanta or somewhere else, so that’s a no-go. I don’t think we’re going to get back to that, but let’s talk about what our healthcare, what our provider groups, need to do to adjust to this new reality.

You all are so tough. You just went through two years of COVID. We can definitely make it through an economic reset. This is good. It will be healthy. We’re getting way ahead of ourselves on the economy. This will be nice. Things were out of control. Let’s talk about during a reset. What are the things we need to do as provider groups to make sure that we are accelerating patient acquisition in a meaningful manner, while not breaking the budget? Lauren, what’s the first thing that comes to mind? The economy is changing and you have a provider group coming to you. What are you advising them not to do? Let’s start with the one of the big things you say, “Things have changed. Let’s not do that.”

Lauren: If the budget is going to get tighter, which it might, and if we need to focus on the people that need care versus elective procedures, then really cutting out, maybe, some of your upper funnel would be a place to start. Now, there’s two schools of thought here. Do you ride the brand and work on building that in a time when demand doesn’t exist? If you have the budget, great, but if your budget is getting cut, focus on bottom of the funnel. Let’s maximize capturing the patients that do still have a need for your service.

Alex: Yes. It’s tricky because upper funnel’s cheap now. You got CPMs down 30% to 50% on most upper funnel channel. Like [unintelligible 00:02:15] is significant. It’s like do you buy now that in a year or two when things are accelerating again? Do you look at the maturity of a provider group when making that advisement? Someone that doesn’t rank top three but their key words like, “Guys, why are you running the radio ad right now?”

Lauren: Yes, I would think so. If you have a solid foundation, if you’ve been working on building this over the last two years like we’ve been talking about, you have the capital, you did the website, you did the SEO, your Google business is in a great place, reviews, you’ve done all of those things, then yes, I think there’s tolerance to maintain some of the branding. Use video. Use the channels that do have the lower CPMs. Don’t throw money at the wall on assets and channels that are super high-cost. If you have not done those things or you’re creating a new MSO or you’re a newer group, there is still an opportunity to build your foundation and that should be where the budget goes initially.

Alex: I think the runaway economy we’ve had over the last year, it may have gotten some groups ahead of themselves and they were starting to look more at branding and upper funnel faster than they should, so this is a nice reset. If you had a lot of that stuff that you’re planning on working on and paying for TV spots and creative and you didn’t have the basic stuff, this is a good time to get back to making sure reviews are really good, your ranking, your Google Ads is solid, tracking is good. Take a reset. The economy will start to increase again next year when we get through this little thing. Depends on the material of the provider group.

Any specific provider group type, specialties, that you think are going to be more impacted by this little fun downturn you are having?

Lauren: I would expect, and this happened a little bit when COVID hit too, it’s going to be need-based is going to continue. You cannot change the fact that someone broke a tooth and they need an emergency dentist. You cannot, hopefully, I really hope in today’s world that people who need therapy and psychiatry are going to continue to get that care and not back off because of other economic reasons.

Alex: When you look at healthcare specialties that might get hit harder than others, when you look at something like behavioral health, I think we’ve got more behavioral health clients than just about any agency in the country, including the biggest one in the country. What do you think? If they were going to be perfectly fine, they have every kind of payer partnership, will specialties without all the payer partnerships or without cash pay, who’s going to get heard or needs to adjust their marketing or their messaging? What do you think?

Lauren: Unfortunately, cash pay businesses are probably going to take a hit when patients are tightening their purse strings. Hopefully, if you do have the payer partnerships and, in behavioral health in particular, that your patients are still going to see you as a necessary healthcare need. Areas like cosmetic dentistry. Am I going to go get my tooth fixed? Am I going to call my plastic surgeon? This may not be the time for that so in those areas in particular, do you need to be doing a ton of upper funnel demand generation or do you really just focus on the smaller subset of patients that do still seek you out?

Alex: That’s right.

Lauren: If your budget is being cut, then you probably want to cut the upper funnel.

Alex: Yes, and don’t go do TikTok right now, everybody. Getting too many damn requests for TikTok ads. Okay, so less fish are biting. There’s less patients that are going to be out there looking for care because they got dropped from their commercial insurance when they got laid off they don’t want to do the elective thing because cash is tight. We talk about reducing the upper funnel. Are there are other things you can do to try to grab more of the few fish that are in the sea?

Lauren: Let’s be realistic and hopeful that a recession is still a short-term. Maybe a year or two years, however long it takes to rebound. I think dropping all of your upper funnel is definitely the necessary short-term adjustment. When it does come time to come back online, when the world does bounce back, knowing what you want to say to people, how you want to say it, what your position is in the marketplace, is going to be critical, so take the time when things are a little bit quieter to align with your leadership team.

Everyone’s value proposition is that they take insurance so that they’re open tomorrow. What really sets you apart? Is it the quality of care? Do you have a unique perspective on bedside manner or is your in-office experience different? Really, really sit down and think about what sets me apart that is not the top five value props that every other company is using. Then make a game plan. Think about how you’re going to incorporate those into video and into messaging so that when it comes time to reopen our upper funnel strategies to go out and create demand again, we have the opportunity to earn that business because we really are different.

Alex: That’s right. With the economy is changing, we’re talking a little bit about Creative and getting aligned with leadership on value propositions and positioning. Should you also get aligned with all of your leadership on new expectations for patient volume increases and how you’re going to drive demand and certain things you need to be okay with them cutting to focus on the things that are going to drive demand now?

Lauren: When we think about what is it going to take to acquire a patient, it’s likely going to be that cost per clicks are going to go up. Maybe get a little bit more expensive. I think just having open lines of communication with either your agency or the in-house team that you’ve retained to execute those channels and then communicating that on a regular basis and update on what the marketplace looks like.

If you have five providers in your group, it’s not going to change that their books need to be filled so your tolerance for what it’s going to cost to acquire a patient is going to have to go up but you’re still going to be looking. New patient acquisition is going to be the name of the game. It’s just not going to be as profitable.

Alex: Does that mean because everybody’s going to be competing on Google instead of running [unintelligible 00:08:08] with clicks? Their higher impressions are cheaper over the phone, Facebook, Instagram too. It’s kind of this catch-22. One final question, Lauren. Our clients are the smartest provider groups in the country. W know that, they know that, everybody knows that. You can be too. You always tease me that you’re going to quit this job and I won’t lie to you. If you want to go in-house and run a provider group’s marketing, what would you be doing right now? Would you say the leadership, another CEO, let’s just say you had a different one, you’d say, “Screw that. We’re not pulling back,” or “Yes, we’re pulling back.” Would you say let’s go crazy, let’s accelerate while the economy’s making a [unintelligible 00:08:42]? What would you do?

Lauren: If the capital is there, I wouldn’t want to be so short-sighted. I understand that that is oftentimes what has to happen and that’s okay, but if you can have the foresight to understand, listen to what the economists are saying about how long things are going to last, and not completely put the brakes on, if you keep a little bit of activity, if you can just do a little bit more than what your competitor is willing to do to stay ahead of them, because it’s all going to come around full circle. I would be fighting to just keep a little bit of the branding and messaging going.

Alex: Yes, don’t stop. Don’t stop. Accelerate. It’s cheap right now. Keep going, but make sure the core things like website SEO and Google Ads are done correctly. Remember, guys, don’t get panicked. Don’t watch CNBC. I love those guys. I watch it every day, but it really just hyped like Fox News or CNN. Don’t watch too much of this stuff because at the end of the day, two years ago, a little over two years ago, we had a huge economic hit and our clients didn’t slow down. They accelerated. Sometimes I even thought they were crazy. I’m like, “Oh my God, how long is [unintelligible 00:09:50] thing going to last?” The ones that kept moving forward, kept innovating, didn’t turn the whole thing off, they’ve done really well coming out of it.

Don’t pull back on the whole thing. Just do the core things right. Go back to those if they’re not being done right and keep iterating and innovating and betting on things like upper funnel. Make sure your brand is available to everybody coming out of this thing, okay? All right, keep the accelerator pedal down. Thank you for joining us on Ignite, and thank you, Lauren, for also being with me. I would love for you to keep tuning in every single week so wherever the subscribe or the follow or the plus or the heart or the love or the like is, make sure you hit that button so you can hear from Lauren every single week. It’s just going to keep getting better and better.

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Announcer: Thanks for listening to this episode of Ignite. Interested in keeping up with the latest trends in healthcare marketing? Subscribe to our podcast and leave a rating and review. For more healthcare marketing tips, visit our blog at cardinaldigitalmarketing.com.

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