Stephanie Wierwille: [00:00:00] Welcome to the No Normal Show, brought to you by BPDA marketing services firm that delivers the future to healthcare’s leading brands. This show is where we leave all things status quo, traditional old school, and boring in the dust, and instead, we celebrate the new, the powerful, the innovative, the bold, all focused around the future of healthcare, marketing, and communications.
I’m Stephanie Weill, your host, EVP of Strategy and Innovation here at BPD, and I’m so excited to be joined by two special guests.
We have Nicole James, SVP of communications from BPD, and we have Philip Giuliano, founding partner at Brand Active. Hi Nicole
Nicole James: Hi there. Great to be here with you both.
Philip Guiliano: Yeah, same.
Stephanie Wierwille: and hi Philip.
Philip Guiliano: Stephanie, good to see you again. Nicole. I.
Stephanie Wierwille: Well, I’m so excited for this conversation because Philip and Nicole, you are both at Becker’s. Um, and I can’t wait to hear, you know, what happened there, what you talked about. Um, and we’re also gonna dig into a, a, a new paper that was published in collaboration with BPD and. And brand active, which is called the Courage to [00:01:00] Save h.
So I know we’ve been talking about that a little bit on the podcast leading up to this episode. We’ve been sharing it, sharing the link, but we’re really gonna dive deeply into it today. Um, and I can’t wait. So before we do just a few little, uh, notes. Uh, first of all, speaking of reports, we also published a report this week, uh, which is all around AI and innovating with ai, and it’s called Crossing the Einstein Divide.
And that is out now. So our listeners can visit our website, bpd healthcare.com and download that. And then secondly, we always love to say, uh, make sure you subscribe to the No normal Rewind, which is where we will recap this discussion. We will share, um, the paper we’re talking about today, the courage to save millions, and we’ll share, um, a few additional stats and facts there.
So before we get started, Philip, since you are new to the No normal show, which I cannot wait to learn more about you, um, yeah. Do you wanna just give us a little bit of your background?
Philip Guiliano: Yeah. I, um, yeah, I mean, I started my career in, uh, in [00:02:00] mergers and acquisitions. Which was an interesting way to start your career. Uh, but it also led to sort of the genesis of why we’ve got this paper. Um, so most of my work was in financial modeling and organization and, and, and things like that. And, uh, I’ve been doing brand active now for about 20 years and, um. That’s about 20 years. And really, I mean, everything that we’re doing right is focused on the financial analysis and then the logistics of making, um, big change and big transformation happen when there’s mergers, acquisitions, brand change, um, split spinoffs, things of that nature. So a lot of stuff that we’re gonna talk about that’s, you know, more on the financial optimization and technical side.
And then we’ve got, you know, really the brand side with, uh, with Nicole and outside of here, I mean, I, I, I live in Colorado. I’m, uh, I’m outside pretty much most of the time that I can be. Um, I’ve lived my life traveling the world and, and climbing mountains and hiking and trekking and being in the water and basically everything to do with having [00:03:00] my hands in the dirt and being outside.
I.
Stephanie Wierwille: Oh, I love that. So hiking. So you hike in the Colorado Mountains, the Rockies, the Fourteeners.
Philip Guiliano: things, although I’m, I’m doing less fourteeners in my life these days as I get older. But, but uh, but yeah, I did a lot of that and, uh, no, just even hiking outside the house here, you got a mountain right behind us and get to climb up that with the dogs and yeah, it’s great.
Stephanie Wierwille: Wow. That sounds incredible. That’s the Friday energy I think that we all need right now, which is a little bit of outdoor vibe, a little bit of a, what do they call that? Forest bathing. I think we could all use a little bit of that Zen.
Philip Guiliano: forest bathing before. I like that.
Stephanie Wierwille: Yeah. Yeah. A bit of a, a woowoo term, if you will, but, you know, there’s science behind it and nature is very good for us.
Philip Guiliano: breathing, fresh air, touching dirt, um, being in the trees.
Stephanie Wierwille: Hmm.
Philip Guiliano: uh.
Stephanie Wierwille: Absolutely. Well, it’s great to get to know you a little bit better, and I just cannot wait to hear more about your experience in the m and a space, um, along with yours, [00:04:00] Nicole. So we’re gonna have a great conversation. Uh, before we dig into our main topic, I do wanna hear how was. How is Becker’s Healthcare?
You were both there in Chicago a couple weeks ago now. Um, I know that’s a huge event. Really, really important for the healthcare industry. So, um, I guess I’ll ask you, Nicole first, tell us a little bit about Becker’s and what it was like to be there.
Nicole James: Yes. Well, first, let’s, uh, let’s define that. This was the Becker’s CEO and CFO Roundtable Conference. And so this was, um, a very specific group and audience that was there, uh, from, uh. Most of your health system, uh, major health system, CEOs, CFOs, we saw some chief strategy officers as well as chief operating officers that were there.
What we did not see a lot of were marketing leaders that were there. And so you might, uh, raise the question, why were we, uh, at this, uh, conference with this audience talking about brands, uh, and marketing? Uh, and that is [00:05:00] where we really saw our opportunity, truthfully. Uh, is we wanted to be in front of this audience so that we could help them shape, uh, their understanding and inform their future decisions to inform, uh, to bring in marketing and brands, uh, at the conversation for important decisions like an m and a deal.
Um, and so this was, uh, such an incredible opportunity for us to be with this group. It also, uh, was an opportunity for us to understand. How do they think about it? What questions, uh, are they thinking about or do they have, what do they not know? And where was our opportunity to then provide some education for them, um, so that they can go back to their health systems, uh, to now have, uh, approach those conversations with their marketing leaders, uh, so that they can now, um, have a more, uh, informed path moving forward.
Stephanie Wierwille: That’s awesome and definitely a needed conversation and I think so important, giving the, um, [00:06:00] you know, critical aspect of collaboration in healthcare, right, of marketing, collaborating with fine. And is collaborating with strategy and operations and the list goes on. Um, so sounds like a really, really interesting, uh, group.
Uh, Philip, what was, what was your take? Uh, what, what, what did you experience at that event?
Philip Guiliano: I think for, you know, of the things that I think is, is really great is one, just having a forum with CEOs and, and CFOs in the health system space. Um, around this topic, right? Um, a lot, you know, about 50% of what we do right, is with the, the GEs and the Siemens and the Verizons and the CVS healths and, you know, those Fortune 500 companies that exist.
Um, where to be delay, right, the conversation about the financial implications of brand change, the financial implications of, you know, marketing and brand operations as it relates to m and a. Um, are more easily had those conversations with CFOs, CEOs, marketers. Marketers are typically brought to the table earlier in [00:07:00] those processes.
So having the forum to have this discussion with sort of the head of the tail, you know, of the CEO and the CFO, um, as opposed to trying to really push, um, the marketing led conversation up to them. Um, is just a, is just a great format and it’s really kind of the audience that, you know, BPD and brand active really strive to have within the healthcare space that we have outside of healthcare.
Stephanie Wierwille: Yeah. Well that’s, that’s wonder. Fold, you know, to your point, to start that conversation earlier. And in fact, that’s really what the paper kind of digs into. So why don’t we transition into the main topic here, um, because I think to your point about really having the conversation at the CEO level, um, this paper also digs into the importance of er having a conversation earlier rather than later.
Uh, not deferring a critical decision. So the paper we’re referring to is called the Courage to Save Millions. Um, how making brand identity decisions during an m and a deal can save millions in ebitda. And I know we’ve talked about this a little bit on the [00:08:00] podcast leading up to this, and I think that, um, you know, it’s, it’s so, it’s obviously so critical financially, but also the fact that you all have really quantified, um, what this means to the bottom line, what this means in terms of how much can really be saved and given that healthcare is so financially strapped at the moment and really trying to look at cost containment measures.
This couldn’t have been more timely or relevant. So I would love to hear, uh, Philip, just from your vantage point, I know you, um, helped create this paper and really helped, uh, on the financial case side of it. Um, so maybe just tell us a little bit about where this, uh, kind of originated from and how, how, how you, how you landed here at this interesting topic.
Philip Guiliano: I think it’s, um, I think it’s a great question. Really. I mean, Chris, sorry, I shouldn’t go there, should I? Um, about that. Yeah, it’s a great question. I mean, we’ve collaborated with, um, with BPD, um, for years, right? And, you know, the clients that we’ve gotten to work on have gotten to experience how we can collectively, you know, really cut the cost of, of implementing brand change as directed by BPD and, you know, directed by the clients or shaped by the [00:09:00] clients. again, you know, we’ve been doing this stuff outside of healthcare for, you know, an incredibly long time. Um. As well. And so really, I I, I had a conversation, you know, we started this conversation here’s what, you know, the, the leading corporations in the world outside of healthcare are really doing to. Not just save in a beta, but you know, to cut the cost of rebrand implementation, to really identify synergies that are hidden within this and to, to make this entire pro process more, more impactful and increase brand value and increase enterprise value. Um, and so. This, this had the, well then, okay, why aren’t health systems doing that right.
Kind of element to it. And so that really brought the brand active financial discipline and the BPD brand culture change management communications element kind of brought them both together into [00:10:00] something that, um, can really have this conversation in a more sort of fulsome way. Nicole, I don’t know if you wanted to add anything to that,
Nicole James: now I think we, what we’ve learned through this process is that, uh, there are so many synergies that both of our teams bring together to the table that we have to think about this holistically, uh, and also in a way that we’ve just seen so many misses. Within health systems and it that caused us to get into the question as to why. And can we then provide, um, more prescriptive guidance to help health systems really, uh, reshape that, to turn that around to, uh, and what is that, what are we encouraging them to do? And then who are the people that we need to bring to the table to all be aligned around that.
Stephanie Wierwille: That’s great. And I think, you know, Philip, as you were talking about the outside in of healthcare lens. I think that’s just so important, um, because when we can pull from, you know, to your point, fortune 500 organizations, [00:11:00] so many have really developed a sophisticated muscle around brand and the value of brand.
And so applying that to the m and a space, I think is, is, is really important given how health systems. The m and a activity has just continued to really remain strong and pick up even this year. So Nicole, you know, I know you work on quite a bit of, uh, mergers and acquisitions for health systems specifically.
Tell me a little bit of what you see happen at that moment when, um, a merger or a deal of any kind is occurring. What’s the, you know, what’s the kind of, um, focus that the C-Suite has and where is brand in that mix?
Nicole James: Yes, so this situation actually is going to come from experience that I’ve had over the last 15 years in sitting both within health systems. uh, now in this seat getting to counsel clients, um, over their m and a deals for the last five years. And so I am representing both, um, sides of this [00:12:00] perspective.
Um, but something that we’ve seen across the board of all of them is there’s one situation that is all too common. Um, so let’s imagine for a moment, uh, that you have, uh, your leaders are considering a deal to whether partner to acquire or merge look promising the operations. synergies are modeled. The cultures seem aligned. The legal teams have reviewed the fine print on paper, the deal looks sound, uh, yet there’s one critical question that often remains addressed, unaddressed, and that’s the brand. It usually does start with a familiar moment where someone brings it up to the table, uh, and. You know, you get a lot of blank stares, uh, and they don’t know what to do, and they truthfully don’t want to have to address that.
It feels too scary. So they say, you know, let’s just keep both names for now. We’ll figure that out later.
Philip Guiliano: Yeah.
Stephanie Wierwille: That’s, that’s so I, it, you just paint that picture so well. [00:13:00] Nicole and I, I think the paper paint paints it really well as well, and I just think it’s, it’s funny, it makes me chuckle, but it’s so true because there’s that moment when someone’s like, oh, what should we call this? And there’s so many emotions behind that, right?
It’s often a political decision. It’s often, you know, oh, you know, I, I know we’ve worked with a lot of health system partnerships and even from an advertising and and standpoint, the question of the logo lockup and who comes forward and who gets that, you know, it’s just, it becomes a, um. Much more emotional than financial.
And what I love about this work you all have done together is really quantifying it and making it more of an objective decision and bringing it up to the start. So I’m curious, Phil, Philip, um, as you’ve done this work, both, you know, across all industries, is tell me like, how have other industries really solved this?
How, how are they addressing it sooner or earlier that healthcare could learn from?
Philip Guiliano: mean, so there’s a lot of things in that, right? There’s, um, there’s again, the element of, you know, [00:14:00] how soon is marketing brought to the table and how soon are the. Brand implementation related or marketing implementation related, um, costs and synergies being identified, um, within that deal. Right.
And when is that being budgeted for? Right. What, what we find that typically happens, right in, in health systems in particular is that delay in those decisions of, you know, what are we going to be in the market? And it’s not, it’s not that we’re promoting a. You should make a big, big brand change. That’s actually not what, you know, Nicole and I are really standing up there saying it’s, you need to make the decision to decide who you are and go to market like that, um, earlier than you’re currently doing. And then you need to figure out whether it’s, you know, from?
a brand or stakeholder engagement or communications or, you know, lawns, events, track, traction, measurement. And then, you know, on our side. The cost to do signage, transition and vehicles and [00:15:00] badges and uniforms and you know, all the things that need to be there.
And then looking at technologies and processes and people and all the thing, vendor relationships, agencies, all the things that can really uncover and drive synergies that can pay for this entire transition, you know, year over year. what’s happening outside of healthcare is those conversations are happening way earlier in the process. Those budgets are being created as a part of potentially even the deal financing. So more of this can be capitalized, right? More of this can actually not be an operational hit to the organization and healthcare. Almost all of these costs, whether it’s even brand development, which improves enterprise value, or whether it’s brand implementation, which is a set cost that we’ll talk about a little bit more later. But, um, that stuff is not being accounted for in the deal. It’s hitting the operational spend and it’s costing the organization significantly more. You know, kind of to build on Nicole’s story. I mean, I’m not the brand [00:16:00] person on this table, right? So I can be a little bit more blunt about this. I mean, we see amalgamations of names that just make no sense, and it’s done that way because they have so much equity in the market and they have so much equity in the market, but nobody’s actually measured any of that.
Or what the implication is of changing any of that. We see these temporary brands going to market, which are then going to be replaced by another brand a year and a half from now, and there’s gonna be another acquisition and that’s gonna be replaced another year and a half from now. So we see three times the spend that would need to be spent from setting a real critical strategy.
So these are all, all things that we don’t see nearly as much outside of hospitals and health systems.
Stephanie Wierwille: Yeah, and I, you know, I think it’s just so important, you know, from a marketing perspective, marketers are often focused on their own budgets and maybe don’t have the purview or the visibility into the broader, um, finance landscape of the organization. So, for example, when you talk about how, [00:17:00] if you make this.
Decision, whatever the decision is. If you make the decision earlier, then it can actually be part of the deal financing. Um, and then it’s not, Hey, I’m a CMO and I’m coming to the table a year later and saying, oh, by the way, like my budget needs to be three times bigger this year because we haven’t factored in signage and we haven’t factored in all these, um, you know.
Things that we have to do, and then that’s not an easy argument. Right. So maybe just if you can just double click a little bit Philip into, um, you know, what the marketer should be asking at the moment that the deal is the first, the first. You know when they get of a deal, first of all, when is the right moment to kind of come to that table and make sure this conversation is happening?
And then secondly, what do they need to be kind of looking at or thinking about to understand that broader financial lens in terms of how the budgets can be allocated earlier?
Philip Guiliano: Nicole, do you look like you actually wanna say something about that? Do you want.
Nicole James: Yes, so I will. Actually bring [00:18:00] us back one step before we answer that question. ’cause I think it’s important for us to understand why our health system is missing this value in the first place. I think when we understand some of that, why it will help us then, um, consider some of that into the context. And so across. Uh, the dozens of transactions that, uh, we have worked on. I think both Philip and I have identified a few consistent reasons of why they’re not capturing the value in the first place. Uh, so first I think that’s, uh, having a misunderstanding of the brand’s value. Uh, we see too many times where leaders are. Viewing brand and treating it as a marketing exercise rather than what it truly is, is a financial asset. When you treat brands as an asset and you can quantify it, then you’re, you’re able to leverage it just like any other part of the deal. I think a second, uh, barrier that we see. a bit more emotional, uh, but it’s fear of losing the brand equity. Uh, we [00:19:00] hear we have spent decades building this brand. We can’t just change it overnight. Um, but as Philip just outlined, keeping multiple brands alive, and definitely it’s going to confuse your employees. It’s going to slow integration, and it’s ultimately gonna weaken the story that you’re telling the market.
Philip Guiliano: Also
Nicole James: And lastly, uh,
Philip Guiliano: costly to
Nicole James: very costly.
Philip Guiliano: so yeah.
Nicole James: And third I would add, um, there’s a fear and of upsetting the deal. Uh, and I think this one honestly is, uh, is real. It is a real fear, um, understanding that raising brands in the negotiations, uh, it that critical moment, it potentially could derail the deal is a, is a peer that people bring. Um, however, if you think about this way. You would never avoid talking about your payer contracts or your facilities or your workforce integration at the table. And so we advocate that brands belongs in that same category. And truthfully, I think when you can handle that decision early and [00:20:00] transparently, it’s going to signal to your partner that you are taking your future seriously about the integration and the long-term success. So these are some of the reasons of why we see brand, um, health systems miss the brand and just wanna set that context first.
Stephanie Wierwille: That’s so helpful. And I think, um, you know, it, it, it may be even that to your point, you know, marketers need to be thinking about establishing the value of brand. Well, of course, every day, all the time, but. This, this whole conversation of the value of brand, if it starts in the middle of the deal or you know, at the end of the deal that’s even too late perhaps, right?
Like the value of brand needs to be established in the organization on an always on ongoing basis. Uh, because a brand is on a logo, a brand is identity and. And it’s not just about changing the signage, it’s about who we are and what we stand for. Um, and so that value can even then be, if you do it right, negotiating [00:21:00] power to say, here, here’s how much we have quantified our brand equity.
Um, and then the conversation, uh, of that at the table becomes less scary and less emotional. Right, Nicole? Because then you’re not just coming saying like. Oh, let’s just make sure that we think about the name. It is, no, no, no. We have this brand equity and that makes our company more valuable. That makes our enterprise more valuable.
Um, and now we need to have this conversation, um, earlier.
Nicole James: Stephanie, you just set up Philip perfectly because I think he brings a really important perspective to how we actually quantify that.
Philip Guiliano: Yeah.
Stephanie Wierwille: Okay. Let’s go, let’s get into it. Philip.
Philip Guiliano: dive into the how I will say, you know, yes. Value of brand needs to be set up earlier in the organization for sure. Right? And before the deal even happens or else, you know, you asked me what question do marketers need to ask? And I would, I would say like. kind of highlights the point, right?
It’s not really a question. It’s what [00:22:00] conversation does a marketer need to leave to need to lead, right? And that is, you know, a conversation that removes conjecture. And we see conjecture all the time, right? Whether it’s, you know, this brand has equity or that means too much to the community, or, um, you know, in our case we can’t possibly do that because it’s gonna cost too much.
You know, blah, blah, blah. There’s all these thoughts and ideas that executives have that need to be. Put into actual fact, right? And, and reality. So whether that’s research that needs to be done or whether it’s, you know, cost modeling or opportunity analysis that needs to be done, all these things can be done.
They just have to be done, right? So, um, and you know, the value of brand, I mean. There’s a lot of valuation models out there to value brand. That’s a real thing that exists. People put that on their balance sheets. Um, whether you believe in that or not, don’t believe in that. I mean, the biggest way to really drive brand is through experience, right?
And trust. And the biggest way to build [00:23:00] trust is through consistency, reliability. And that happens at the asset level. That happens at the communications level. It happens, you know, wherever, right? So financially, that’s what you asked me about. Right. Um, so I’m gonna highlight three, three different areas of, um, things for an organization to think about really quickly when it comes to the finances.
You, you know, the, the paper’s positioned around, you know, save millions on a bda, right? That’s a. That’s one element, right? And yes, thinking about enterprise value and thinking about brand and integration as an enterprise value driving activity, there’s a lot of argument to be made around how you actually then account for brand transition costs within that, right?
Accounting for all of that earlier in the deal process allows. Allows you to either finance it through the deal or use the deal accounts as opposed to it hitting operational spend down the line so you get better, um, interest rates with that, you know, there’s better tax implications, you’ve got more free cash flow as a piece of that, right?
[00:24:00] There’s all sorts of efficient reasons as to why you should account for this earlier on in the process so it doesn’t hit operational spend, and that’s the a beat element. Right. The other element is, you know, the same rebrand within an organization, and honestly this is something that, you know, clients really hire us to model is, you know, the same rebrand for a 100 hospital, 3000 clinic, you know, operation could cost $150 million.
It could cost $350 million. It could cost $75 million. Right? How you do that, you know, in what prioritization with what quality levels, leveraging operational cycles, you know, all the things that can influence what that cost means. That’s the, the second biggest element is making and modeling the decisions that are going to create the, the brand that you intend to create in the market for the least possible cost, right, is an art. Right, and that’s, um, that’s something that can take [00:25:00] a $200 million rebrand and make it cost a hundred million dollars. So you’re cutting a hundred million dollars off of that by just being intentional and making the right decisions and knowing how to look at all that stuff. So That’s. a big piece, right? The next is marketing is brought to the table so late. Um, typically in a health system, all of the opportunities for synergy that exist within marketing right, are not thought of in the same way that it, HR facilities, you know, all the other areas that have an m and a playbook around them.
Marketing generally doesn’t have an m and a playbook around it. And there are generally, in a, in a large health system, there’s millions of dollars of synergies to be created through consolidating brands, through consolidating vendors and agencies and media buying communications, but also at the asset level itself.
Right. And how you specify those assets, whether it’s signage or fleet vehicles, or documents and forms, or, you know, there’s all this rationalization that could be done and cost improvement that can be done, [00:26:00] that can take, you know. $10 million year over year out of an organization across areas that exist inside and outside of marketing, but that affect brand experience, right?
And then that can be used to actually drive revenue, right? So those are kind of the three areas I would say, you know, not hitting operational spend and accounting for this stuff earlier in the deal. Huge financing applications to that and huge bottom line implications to that. Making it cost less in the first place because you’ve given your ti your team time to actually think through how to optimize all those asset areas.
That’s another piece. And then uncovering and identifying the synergies. That’s, that’s the, the third kind of nugget.
Stephanie Wierwille: That’s. Was just an absolute masterclass in, uh, you know, how to think a little differently about brand and in a, in a deal situation and, and digging into the details. Thank you. Um, we are coming up on time, so I just, before I wrap, I wanna note, is there anything that we haven’t covered, um, either one of you that you wanna dig [00:27:00] a little bit deeper into?
Nicole James: Now I think that we’ve talked a bit about how to think about how to show up and approach and take advantage in your next deal from a brand and marketing standpoint. Um, but there are things that. I think all of us can be doing today, uh, even in preparation for that next deal. And so these are some things that, uh, we encourage everyone to take, to take back.
And most of you are likely doing this, but if you’re, if not now, might be your, uh, your moment to, uh, get a kickstart to that. So one is just making sure that you can quantify your current, your brand’s current equity. Make sure you understand your awareness, your trust, your loyalty. Internally and externally and have that data so you’re, you’re prepared and ready to bring that to the table. Uh, go ahead and have conversations with your growth leaders to be part of the conversation to show how you wanna be, uh, align your brand strategy with your business growth strategy. I think a few other things [00:28:00] is one, um, making sure that you have, uh, an overall, uh, understanding and an inventory of all of your, uh, your brand and your marketing data.
So where your signage, your digital, uh, your collateral, uh, your uniforms, your vehicles, making sure that you have this inventory. Um, so you have that data and that list ready to present to finance when you are going to approach a deal. then as, uh, Philip, uh, outlines this is go ahead and model some brand scenarios early.
Um, have those ready, have those conversations with finance. Um, whether it is a unified brand, whether it might be a hybrid model, uh, or an immediate rollout versus a phase rollout. Um, going ahead and having some of those, uh, scenarios built out will then help turn your brand from being a marketing topic into more of a financial lever.
Stephanie Wierwille: That’s great. Yeah, and I think that the key point is here is don’t wait, don’t wait until you get wind of a deal. But also, so many health systems are, you know, going through a lot [00:29:00] of m and a activity on an ongoing basis. And so it will happen at some point and you wanna be ready, but also it’s. About the value of brand in general and even more broadly.
So thank you to both of you. Um, we will make sure that we share this paper in the show notes, uh, and, uh, folks can also go to bpd healthcare.com and download it. Uh, but as always, we love to, um, tell our listeners to share the show with friends and colleagues. Give us a rating and review. And until next time, don’t be satisfied with, you know, not defining brand early.
Don’t be satisfied with sitting back and waiting. Push the dough normal, and we’ll talk to you all soon.
Philip Guiliano: Thank you.
