Advertising success: A silver bullet doesn't exist

Saturday, April 30, 2005

AMHERST, N.Y. -- When Associated Healthcare began using co-op advertising earlier this year to market Invacare's Venture HomeFill II transfilling concentrator, something unexpected occurred. Many of the leads came from existing patients who wanted to upgrade their equipment, said CEO Don White.
"We were hoping for new patients but what it did was alert existing patents to this technology, and since they are comfortable calling us anyway, they'd pick up the phone and say: 'I saw this on the TV and I want it,'" White said. "It runs up your cost per new patient because you are converting your own patient base."
The experience with co-op advertising made White realize that consumer advertising might not work as well with respiratory therapy as with other HME services.
Others agree.
"The problem they face is not unlike one faced by a telephone or insurance company where people are happy with their service," said Jeff Trent, owner of Billboardz Indoor Advertising Media in Portland, Maine. "It's painstaking to get someone to change, and in your message you have to give them a compelling reason why."
White estimates that it costs three times more to secure a new patient through TV advertising than via a sales rep who calls on referral sources. Additionally, good competitors populate his service area, making it doubly hard to lure away a patient via advertising.
Nevertheless, White said, he plans to continue using co-op ads for the HomeFill. His reasons are two fold. One, co-op dollars help defray the costs of his advertising. Two, even if existing customers see the ads and call to switch, that's OK. The HomeFill empowers patients to fill their own oxygen cylinders at home and that reduces Associated's delivery costs, he said.
John Ledek, Invacare's vice president/category manager of respiratory products, agrees that selling the benefits of high-end technology, like the HomeFill, direct to referral sources is a "very effective way" to build up respiratory business. But Invacare provider customers also have had great success using co-op advertising.
"People who use these co-op dollars most effectively are not only growing their oxygen business but growing their reputation," he said. "They get their name out into the community and do it in a way that tells patients, potential patients and referral sources that they are bringing to market innovative products. That has collateral benefits that last a long time."
Successful marketing means finding the right mix of print, TV and radio advertising and sales reps, he said, adding that "there is no silver bullet."