July 05, 2010
Marketing is a fundamental step when launching a new venture to determine if it will be successful. Is very important to complete a study of the market gaps in a particular industry to know whether or not a product or service is needed and how and how a product or service will be purchased. Understand customers and the market for a product or service is very important to achieve the success of a firm. One of the most competitive markets in the health care industry is the home health care. Because of the new laws and regulations created to fight against fraud and abuse, and to attempt to decrease the cost of health care, many home health care agencies have problems to provide high quality and cost effective care and gain profits. According to Davis, Marino, & Davis (2007), the different changes applied to the prospectively-based payment system have impacted several health care organizations finances, causing their bankruptcy. New firms should determine what group of people is interested on the firm’s product or service, and the characteristics of the group selected, this is a target market. Selecting the target market is one of the most important steps of the marketing process. Before start to develop the marketing strategies, new firms must aim the market that they want to attract, and to establish the firm position (Barringer & Ireland, 2008). The different market segments are determined by a group of people with similar characteristics. Market segmentation is important because new firms have the opportunity to select a specific group to target what benefits then because the limited resources availability the new firms have (Barringer & Ireland, 2008). Home health organizations target different markets. One target market is the individuals needing this type of service. In general home health care organizations target homebound individuals with chronic diseases, functional and mental limitations who require some kind of assistance for personal care, disease, and medication management. Other important factor is the ability to pay for services, hence home health care organizations target individuals with health insurance that cover this type of service, such as Medicare and Medicaid. Physicians, hospitals, and long term care facilities are other target market of home health care organizations because these health care institutions constitute sources of referrals. For home health care organizations is very important to determine their sources of referral because this constitute an important factor for the success of the organizations. The elderly population that prefers to stay longer at their home and to return to home after hospitalization rather than go to a nursing home or to a rehabilitation facility is one of the most important target markets of home health care organizations. This group of patients generally have several limitations and they want to stay in the community, to achieve this they need services, such as nursing, home health aide, physical therapy, and medical social work. Selecting a target market is very important step of the marketing process. New firms must select a target market to develop effective marketing strategies focused on the characteristics of the target market selected. Many new firms have limited resources available for their marketing process and market segmentation provides them with the opportunity to select one market segment to attract what can be easier and beneficiary. Market segmentation indentifies groups with similar characteristics that make the same product or service attractive to them (Barringer & Ireland, 2008). The study permits companies to know their prospective customers needs, they preference, spending habits what will permit to identify what group or segment or segment will be a good customer for the firm. Understanding the value,...