Ohio Association of Child Caring Agencies (OACCA)
How To Embrace New Marketing Tactics & Shift Away From Traditional Marketing Models
Howard Shiffman, Senior Associate OPEN MINDSApril 29, 2014
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1. You have a very large unrestricted endowment
2. You have guaranteed sources of future funding for what you do
3. You have no competition for your current sources of revenue
4. You are in a market with little change in either financing or service delivery
You Need No Marketing When. ..
If this is your
organization, you should sit in on a different
session. . .
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“Traditional marketing — including advertising, public relations, branding and corporate communications — is dead. Many people in traditional marketing roles and organizations may not realize they're operating within a dead paradigm. But they are. The evidence is clear.”
• —Bill Lee, • Harvard Business Review, August 2012
3OPEN MINDS © 2014. All rights
reserved.
I. Trends Driving The End Of Traditional MarketingII. The New Role Of Consumers Demands A
New Approach To MarketingIII. New Tactics For Successful Marketing In
Today’s EnvironmentIV. Forward Thinking Marketing StrategiesV. How To Adapt Your Organization’s Marketing Plan For The Future
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Agenda
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I. Trends Driving The End Of Traditional Marketing
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Technology is Here: Welcome To The Graveyard Of Traditional Marketing Strategies
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The Information Age…DATA
Technology to build relationships
“Bait and Hook” no longer works
Evolved buyer habits.. Being Informed/InvolvedLimited dollars
New Service Delivery ….Transparency
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What “Killed” These Strategies?
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Marketing meant advertising (and branding)
Advertising needed to appeal to the masses
Advertising relied on interrupting people to get them to pay attention to your messageAdvertising was one-way communication
Advertising was exclusively about selling products
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What Marketing Used To Be
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Businesses have traditionally been in the role of producing products or services that help a customer get the job done. In return the customer pays money.
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Old Customer Value Proposition
What the firm does
• Delivers products and services
Value to customer
• Gets the job done
Value to firm
• Provides money
This is now an old fashioned way of doing things…
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New Customer Value Proposition
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• Reference programs
• Communities & Social media
• Events• Advisory Boards• User Groups• Knowledge Centers
Measureable business value delivered
Increased social capitalExpanded peer networkIncreased professional status and reputation
Opportunities to partner, comarket and
designOpportunities to deliver
thought leadership
ReferralsReferencesInfluencers
Word of MouthImproved Strategy
Increased knowledge base
What the firm does
• Delivers products and services
Value to customer
• Gets the job done
Value to firm
• Provides money
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II. The New Role Of Consumers Demands A New Approach For Marketing
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With More Consumers With Coverage, There Is More Consumer Choices• Consumers have a new and more complex
role◦ Medicare -- and Medicare Advantage◦ Medicaid – and Medicaid managed care and
Medicaid premium support◦ Traditional insurance have rising coinsurance,
copayments, and deductibles◦ Increasing use of consumer-directed health plans
• “Safety net” taking on a whole new meaning in states with Medicaid expansion
• “Penalties” for lack of consumer participation in health management
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Consumers Are Paying More Out-of-Pocket
$307.7 billion or 11.4% of the total health care budget • Mental health – In 2005 consumers footed $13.56 billion,
or 12%, of $113 billion total market spending• Addiction treatment – In 2005, consumers paid for $5
billion, or 22.7%, of $22 billion total market spending• Mental health hospitalization – In 2011, the average cost
per-person spending paid out-of-pocket was $766 • Addiction-related hospitalization – In 2011, the average
cost per-person spending paid out-of-pocket was $889
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More Transparency In Fees• Competition based on price is happening• The internet has created more venues for
fee transparency
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More Transparency In Performance Measures• Many initiatives to measure and report on
“performance”
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New Tactics For Successful Marketing In Today’s Environment
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Marketing is more than PR
PR is for more than just a mainstream media audience
You are what you publish
People want participation and not propaganda
Marketing is about delivering content at the precise moment your audience needs it
The internet has now made public relations PUBLIC
Your content now has be customer-centric—write for your audience(s)—not you!
People all over the world can see your message
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New Rules Of Marketing & PR
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Consider Your Audience
Message differentiation
based on target
audience
Consumers
PayersProviders
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Deliver what you promise
Promptly fix things when they go wrong
Know your customer’s problems
Create peer networks among your customers
Provide your customers additional opportunities…either with you or with others
Always remember…you have leverage19
Create A Great Value Proposition
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• Advocates• Influencers• Contributors
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Accessing Your Best Resource for Increasing Market Share
In other words…
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• Provide positive information about you to their colleagues, networks, and industry audiences.
• Example: Consumer, consumer’s family member or caregiver
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The Hidden Potential Of Customers – Advocates
How Customers Act On Your
BehalfReferrals
References
Testimonials
Speaking
Videos
Interviews
Blog Posts
Social Networking Sites
TweetsOPEN MINDS © 2014. All rights
reserved.
• Experts with a neutral or objective view and share their expert opinions
• Examples: Associations, payers, government entities, authors, researchers, universities
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The Hidden Potential Of Customers – InfluencersHow Customers
Act On Your Behalf
Articles
Blog Posts
Speaking
Books
Interviews
Webinars
Attending events
Creating industry publications
Testing and commenting on new products or
offersOPEN MINDS © 2014. All rights
reserved.
• Provide insights or knowledge in a variety of ways—often for free—that helps you. (Not always individuals, but other companies who share data about you)
• Example: More involved patients, board members, partner organizations, local community collaborators
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The Hidden Potential Of Customers – Contributors
How Customers Act On Your Behalf
Input or feedback to improve your offers
Input to develop new servicesInnovate your products on their
ownCreating apps
Provide data or info that adds new value to existing offerings
Provide services and support to other customers
Improve your strategy and focus
Help you gain a position of thought leadership in your
industryProvide contacts and access to
new sources of valuable information OPEN MINDS © 2014. All rights
reserved.
◦ Referring other customers to you, taking calls, and accepting site visits from your sales prospects to help close deals
◦ Participating in your customer advisory boards to keep your R&D efforts grounded
◦ Having key-customer executives participate in higher-level forums and communities to help keep your strategy focused on top customer issues Local legislative advocates Local government entities, i.e., policy planning, school boards Community leadership Advocacy groups
Existing customers can be your best resource for new ones!
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Engaged Customers Will Take Other Steps Too
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III. How To Adapt Your Organization’s Marketing Plan For The Future
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Plan to accomplish organizational mission and objectives through specific tactics responding to a changing environment while making best use of available resources
Best practice strategic planning is framed in terms of the overall organization’s sustainability and is market-focused
Your strategic plan is the basis for your marketing plan
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It All Starts With Your Strategic Plan. . .
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1. Develop vision of future competitive advantage and market positioning
2. Scenario-based strategic plan incorporating alternate future positioning options3. Detailed plans – marketing, financial, operational, technology, capital, HR, etc. – to implement strategy and future vision4. Key performance metrics and metrics-based management to track strategy implementation (and allow mid-course adjustments)5. Optimization of current operations to keep current programs as competitive (and profitable) as possible as long as possible
6. New service model development to support future vision
7. Collaborations as needed to facilitate new market vision
The Strategy Development & Implementation Cycle
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1. All the business activities involved in directing the flow of services from the provider to the customer – the business function responsible for organizational revenues
2. Understanding the needs of customers and developing a service that meets those needs at an acceptable cost
3. Act of promoting, selling, and distributing a product or service
What Is Marketing?
The more competitive a
market is, the more important marketing
competency is to an
organization’s success. . .
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Customers – Payers,
Consumers, & Influencers
Producers of Services
Two Forces in Competitive Market
Marketing is the function that assures that customers select a particular producer
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Intersection Of Strategic Planning & Marketing Planning
Key To Functional Areas:
MarketAnalysis
DefineMarket
Segments
CompetitorAnalysis
DetermineDifferentiationOpportunities
Define Missionand Key
Objectives
InternalAnalysis
Select Target Market Segment and Position
Develop MarketingPromotion and Tactics
Plan
Set Target Priceand Cost.
Measure StrategicPerformance
Develop OperationsPlan and Finance Plan
Re-EngineerTo AchieveTarget Cost
Marketing Strategic PlanningFinance
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1. Overall organizational vision and mission – which shapes market positioning
2. Markets to pursue3. Service lines to offer4. Revenue and return required for each
service line
Key Market-Related Decisions Are Made During The Strategic Planning Process
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• Organizational strategy to guide revenue generating activities
• Defines tactics (and customer interface) between the organization, its services, and its customers
• Must align to and build off of the strategies and tactics in the strategic plan
What Is A Marketing Plan?
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It all starts with the top line. . . How much revenue does your organization need to meet its
mission and objectives?
The strategic plan sets service lines – and revenue
and return required for each service line. . .
The marketing plan is all about how to engage customers (payers,
consumers, and donors) to make that happen.
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Product (what to offer)
Price (rates and rate structure)
Place (sales distribution
method)
Promotion (communication
for customer positioning)
Press and public (communication
to press and publics)
Political (political advocacy and
lobbying)
The Traditional ‘Marketing Mix’ (4Ps) Is Now The 6Ps
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• The purpose of segmentation is to determine the differences among buyers in order to develop specifically targeted marketing initiatives that meets customer interests and needs.◦ Example by consumer – Women, mature adult, child, suburban, etc.◦ Example by service need – Co-occurring, depression management, TBI, health
home, etc.
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Market Segmentation Increasingly Important
New ConsumersChild Protective ServicesHealth and Human Service AgenciesFoster Care AgenciesJuvenile Justice
Potential & Present
Residential Payer Sources for a specific service line
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• Revenue and other marketing objectivesPhase 1: Marketing
objectives from organizational strategy
• Service line descriptions and metrics• Analysis of market and customers• Competitive analysis
Phase 2: Market analysis
• Marketing strategies to engage customers and generate revenue
Phase 3: Marketing strategy development
• Developing marketing tactics for each strategy• Marketing budgetPhase 4: Marketing
tactical planning
• Implementation planning• Marketing plan timelinePhase 5: Marketing plan
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Elements In The Marketing Planning Process
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• Revenue for current service -- Net revenues in service X will be $X million in this fiscal year
• New contract acquisition – Win five new competitive contracts via proposal process
• New service line development -- Service Y will be developed and have two customers by the end of this year
• New service line feasibility analysis -- Market research conducted on new service concept Z and decision made whether to develop service within the first 6 months of the year
• Revenue diversification -- Decrease % of total revenue from Medicaid from 93% to 88% by increased new service sales of X services
Phase #1: Marketing ObjectivesCommon Organizational Marketing Objectives
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Example Of Marketing Objectives • Objective #1: Increase the financial stability of the
residential treatment program by establishing an average daily census of 250 and average daily rate of $225 in next fiscal year
• Objective #2: Selectively expand profitable community-based programs to match market needs and changing demands and increase community-based revenue by 100% - from $16M to $32 M in next fiscal year
• Objective #3: Increase and diversify revenue streams overall by expanding Medicaid billing to 25% of total revenue decreasing Federal/state grant revenue to less than 50% in next fiscal year
• Objective #4: Create better outcomes in the foster care program by reducing the number of disrupted foster home placements by 20% from last fiscal year in 2014.
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1. Service line definitions and metrics – what services do you offer and how do they ‘stack up’ against the competition
2. Analysis of market and customers – what are the available sources of funding and what customers control that funding? What do those customers want?
3. Competitive analysis – who is competing with you for customers and their funding?
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Phase #2: Market Analysis For Marketing Planning
Phase #3: Marketing Strategy Development
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Achieve Marketing Objectives
=• Revenue• More
Customers• New
Services• Diversificati
on• Profitability
Market Environment
• Regulation• Customer
Preference• Competitors
Marketing strategies – the plan to achieve objectives in the face of
environment
Objective #1: Increase the financial stability of the residential treatment program by establishing an average daily census of 250 and average daily rate of $225 in next fiscal year.
The Marketing Strategies: 1. Establish the XXXX School as a “center of excellence” for
the treatment of children and youth with special needs across all payer types
2. Garner an increasing share of referrals from educational consultants
3. Increase the number of managed care contracts 4. Win residential treatment contracts with the surrounding
states and the counties in those states5. Improve the conversion rate of inquiries to admissions
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Example Of Marketing Strategies: Residential Program Revenues
Objective #2: Selectively expand profitable community-based programs to match market needs and changing demands and increase community-based revenue by 100% - from $16M to $32 M in next fiscal year.
The Marketing Strategies: 1. Aggressive marketing of current community-based
services (50% of increase)2. Development of new community-based services
(40% of increase)3. Acquisition (10% of increase)
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Example Of Marketing Strategies: Increase Community-Based Service Market Share
Objective #3: Increase and diversify revenue streams overall by expand Medicaid billing to 25% of total revenue, decreasing Federal/state grant revenue to less than 50% in next fiscal year.
The Marketing Strategies: 1. Develop more contracts with Medicaid managed care
plans for current services2. Conduct market research and feasibility analysis of
offering a case rate-based program to Medicaid managed care plans
3. Increase consumer marketing to Medicaid populations eligible for current services
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Example Of Marketing Strategies: Diversification Strategy
• Objective #4: Create better outcomes in the foster care program by reducing the number of disrupted foster home placements by 20% from last fiscal year in 2014.
• The Marketing Strategies: 1. Create a foster care crisis team available to
foster parents and market this program to payers
2. Offer managed care a pilot project that is financially supported by a pay for performance bonus for successful outcomes in foster care
Example Of Marketing Strategies: Improved Outcome Strategy
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IV. Forward ThinkingMarketing Strategies
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Marketing Tools
Referrals
Newsletters
Reports, case studies
Social Media
Website
Customer communities
Corporate Magazine
Word of mouthSpeaking
Analyst reports
Industry events
Life events
Private events
Broadcast media
Webinars Teleconference
s
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1. Thought Leadership
2. Website Content
3. Social Media• Blogging• Video and Podcasting
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Three Important Marketing Strategies
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‘Thought Leadership is establishing a relationship with and delivering something of value to your stakeholders and customers that aligns with your brand/company value.
In the process you go well beyond merely selling a product or service and establish your brand /company as the expert in that field and differentiate yourself from your competitors.’
—Craig Badings
Thought leadership should be an entry point to a relationship. Thought leadership should intrigue, challenge, and inspire even people already familiar with a company. It should help start a relationship where none exists, and it should enhance existing relationships.
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1. Thought Leadership
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White Papers, Case Studies, and Articles
eBooks
Blogs
eNewsletters
Webinars
Research and Survey Reports
Audio and Video48
Forms Of Thought Leadership
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• Do NOT write about your company and its products or services
• Ask what problems can you solve• Understand your audience• Write for your audience—storytelling rules!• Create titles that grab attention• Promote your efforts • Let the media know your point of view• Track your results
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How To Build Your Thought Leadership Regimen
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You become a key Influencer
Your expertise builds your brand
You become “the” authority in the public eye
You change the conversation about your industry and your solutions
You don’t have to spend lots of dollars to get it out there
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Why Thought Leadership Works
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The Buyer’s Decision JourneyAwareness and education phase
Solution phase
Selection phase
Website gravity
• Thought leadership• Peer Information• Access to peer communities
• Thought leadership• Competitor
differentiation• Customer videos
• Customer ROI case studies
• Community affirmation• Reference calls, site
visits
Target early adopters and influencers
Thought leadership must address buyers’ business issues
Emphasize emotional factors
Help your buyer make the business case
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• Does your website have a purpose?• Is your content tailored to meet your
purpose?• Are your service options clearly defined?• Have you organized your site for intended
audiences?• Have you established a pathway for visitors
to contact you?• Is your website visually attractive?
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2. Key Factors In Managing Your Web Presence
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Content is key
Understand your clients’ needs and then address them
Create peer interaction, not just client interaction
Share information often
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Making Your Website Work
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• Social media is the use of web-based and mobile technologies to turn communication into interactive dialogue.
• Social media is "a group of Internet-based applications that build on the ideological and technological foundations of Web 2.0, which allows the creation and exchange of user-generated content."
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3. Social Media
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• Facebook• LinkedIn• Twitter• YouTube
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Social Media Options
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Face Book : In January 2013, the
countries with the most Facebook users were:
United States with 168.8 million
members
Brazil with 64.6 million members
India with 62.6 million members
Indonesia with 51.4 million members
Mexico with 40.2 million members
All total 309 million members or about 38.6 percent of Facebook's 1
billion worldwide members.
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Social Media: Face Book
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Social Media: LinkedInAs of January 2013, LinkedIn reports
more than 200 million acquired users in more than 200 countries and territories
LinkedIn has 21.4 million monthly unique U.S. visitors and 47.6 million globally
In June 2011, LinkedIn had 33.9 million unique visitors, up 63 percent from a year earlier and surpassing MySpace
Twitter is an online social networking service and micro-blogging service that enables its users to send
and read text-based messages of up to 140 characters, known as "tweets”
Gained worldwide popularity, with over 500 million registered users as of 2012, generating over 340
million tweets daily
Twitter has become one of the ten most visited websites on the Internet
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Social Media: Twitter
YouTube was founded in 2005
In 2006, YouTube was purchased by Google for $1.65 billion in stock
In 2007, YouTube went global
In March 2013, YouTube had 1 billion viewers per month
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YouTube
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Generation YAge 18-32
Generation XAge 33-48
Baby BoomersAge 49-67
Matures68+
• 90% Facebook• 55% Linkedin• 55 % Twitter• 97 % YouTube
• 77% Facebook• 59% Linkedin• 92% YouTube
• 71% Facebook• 46% Linkedin• 81% YouTube
• 59% Facebook• 58% YouTube
Informatics & Analysis…Use Of Social Media (Example)
1. Target a specific audience2. Be a thought leader3. Be authentic and transparent4. Create LOTS of links5. Encourage people to contact you6. Participate in the discussion7. Make it easy to find you8. Encourage people to BOOKMARK9. Try new things!
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9 Tips for Optimizing Your Social Networking
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• Blogs are usually maintained by an individual with regular entries of commentary, descriptions of events, or other material such as graphics or video.• Most blogs can be interactive, allowing visitors to leave comments and even message each other via widgets on the blogs and it is this interactivity that distinguishes them from other static websites.• As of February 2011, there were over 156 million
public blogs in existence.
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Blogs
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Requires minimal investment to establish.
Requires commitment to provide updates and new information to stay relevant.
Requires strategic approach to information shared as everyone can see your information and point of view.
Requires intentional content—what purpose will the blog serve?
Requires constant moderation if visitors can comment.
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An Effective Blog
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You-Tube is still the most popular, but more and more are showing up!
Doesn’t have to be expensive
Don’t make it long
Show what you’ve done
Show what is possible
Focus on solutions and ideas
Feature your customers to showcase your impact
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Video & Podcasting
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V. Discussion
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reserved.
• Do you have a Marketing Strategy in your organization?
• What is your organization doing to become a thought leader with:◦ consumers ◦ payers ◦ Donors
• What technologies are you using in your marketing program? How are you using social media?
Discussion
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Upcoming Education Events
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