Master health insurance marketing

Mastering Health Insurance Marketing in the Age of Health Care Reform1Mastering Health Insurance Marketing in the Age of Transformation and Growth Health Insurance Marketing Update: Q4 2014

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Mastering Health Insurance Marketing in the Age of Health Care Reform2

CONTENTS.

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03 04

Beginning the Journey: Campaign Startup Challenges

Implementing 4 Key Strategies to Reach Acquisition Goals• Sizing and Segmenting the New Market• Understanding What Makes New Prospects Tick• Auditing the Competitive Landscape• Forecasting Leads and Implementing Analytics Gearing up for 2015: TPG’s Essential Marketing Checklist

Resources


Beginning the Journey: Campaign Startup Challenges

01


Beginning the Journey: Campaign Startup ChallengesA pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.

One year after struggling to start up marketing campaigns in the age of healthcare reform, the words of Winston Churchill couldn’t ring more true. Yes, everything is changing, and that creates difficulties. But, on the plus side, never before has the American health insurance market had the opportunity to engage 48,611,600 prospective new members. It’s no surprise then that the competition is fiercer than ever before.

With the health insurance exchanges now open, your big spend flowing into media channels, and not a lot of information yet on what’s happening and why, it’s a good time to review the situation. Where did you start? What strategies did you put in place? And what do you need to monitor in the crucial months ahead?

No two businesses are alike, but it’s fair to say most of the nation’s health insurance companies shared many of the same start-up challenges and assumptions. Here’s a quick recap.


In the beginning (2010), we knew . . .

• 16.3% of Americans were uninsured

• 31% relied on the government for health insurance, up from 24.4% in 1999

• The percentage of individuals covered by employer-provided healthcare had fallen to 55.3%, down from 64.1% in 2000

And we knew that by the time these uninsured entered the health insurance market in 2013-2014, a huge knowledge gap about insurance products, processes, prices, benefits, and much more would have to be closed. The federal government would do its part, but that wouldn’t be enough to ensure a new customer would understand what your insurance firm had to offer and why it was preferable to your competitors’ offerings.

From the marketing campaign planning perspective, it meant that merely launching a brand awareness/lead generation campaign wouldn’t cut it. We had to begin at the beginning—with education—and rethink our marketing strategies, consumers’ journeys, budget allocations, and channels.


The startup campaign model that emerged was a two-pronged approach that put the focus on 1) education and awareness and 2) acquisition.

These assumptions also informed campaign planning:

• The uninsured customer’s lack of experience with health insurance to confusion, worry, and uncertainty.

• A lower awareness of health insurance meant a lower awareness of all insurance carriers and perceived parity in products and service.

• The media couldn’t be counted on to provide a balanced positioning of Affordable Care Act impacts.

• Consumers wanted to shop where they could compare plans and prices.

• Competitors continued to invest large sums of marketing dollars to establish their brands in the minds of consumers.

EducationGenerate creative content

across their journey

Awareness Establish Health plan provider

as the trusted source of protection and advice

AcquisitionDrive uninsured consumers to Brand to learn about and

purchase our products


• Broad promotion of the federal exchange expected by the federal government.

• Navigators and brokers played vital roles in guiding customers to products and marketplaces.

• Establishing and re-establishing connections with customers through communications helped keep brands top of mind.

• Retaining current membership were critical to success.

So we’re now in the fourth quarter of 2014: Are you positioned for success? TPG’s Marketing Plan Milestones timeline below maps a statewide insurance provider’s deployment dates for the wide range of education and acquisition tools and activities—benchmarks that serve firms of all sizes.


Implementing 4 Key Strategies to Reach Acquisition Goals

02


Implementing 4 Key Strategiesto Reach Acquisition GoalsLike businesses, no two acquisition campaigns are exactly alike, but it would be hard to argue with the notion that health insurance carriers are looking for the same results: more new members at the lowest possible cost.

From our perspective as insurance marketing strategists, it’s clear some strategies and tactics are working better than others. Below we share four strategies and how we developed them for local, regional, and statewide carriers.

1. Sizing and Segmenting the New Market

In the past year we have seen a significant—and increasingly sophisticated— shift in the way marketers and health insurance firms are approaching segmentation of their consumer market. Healthcare reform has contributed to that trend as insurance providers find themselves refocusing their attention from groups and employers to individual consumers—from B2B to B2C.

With the Affordable Care Act, the old assumptions no longer hold water. In rethinking segmentation from a holistic perspective, the healthcare research team


of Brent Walker, Casey Albertson, and Rob Freeberg offered the Consumer Diagnostic, an updated model sponsored by TPG. It focuses on four key questions—Who, Why, What, and How—that provide insights and guidance for effective Demographic and Socioeconomic, Behavioral, Attitudinal, and Psychographic segmentation.

For example:

Who: A large regional firm began its campaign development by looking at the total number of uninsured in their market and then determining the percentage that would—and would not—be eligible for Medicaid or subsidized care.


They first determined the percentage of individuals in their market between ages 24 and 54 as well as the percentage in blue-collar jobs. They also figured prospects’ incomes relative to the Federal Poverty Level (FPL - a measurement that revealed more than a third were under), which became a number that would be critical to their product offerings and messaging.

Why: A statewide carrier seeking to identify its most promising segments of opportunity and what motivates them to act planned a segmentation approach that rolled out in four steps. The plan called for them to:

1. Select key attitudinal variables relative to health insurance and personal finances.

2. Develop a cluster analysis with a two-segment solution—for uninsured IU65 and another for Medicare Eligible.

3. Profile each segment with demographics, behaviors, and attitudes.

4. Analyze segmentation outputs against the TPG Healthcare Core Needs Pillars.


What: To drill down into the drivers and motivations between the uninsured and insured in their market, another health insurance company conducted interviews with 500 individuals that were pre-screened based on demographics, age, income, zip, uninsured, or insured. Respondents were all from working households and represented African American, Hispanic and White/Caucasian ethnicities. The knowledge the carrier gained from the interviews informed their understanding of the new prospects’ wants, needs, and desires. The result: an essential framework of the motivations and behaviors of three key segments—the “Young Invincibles,” “Low-Income Working Families,” and “Single Low Income”—toward Health, Productivity, Balance, and Knowledge.

Insights from Simmons data to create these need pillars


Once segmented, the insurance firm was able to analyze target customers’ needs according to the TPG Healthcare Core Needs Pillars.

These core needs form the support structure for the segments’ campaign messaging and customer journeys.

• Simple, for example, points to plans that are easy to understand, easy to purchase, oriented toward healthcare reform, with one-stop shopping and easy to realize claims.

• Personal suggests plans with dedicated case managers, illness and health management programs, preventive care, an outstanding help center, and hyper-local service.

• Affordable means, “Price within my budget” and “good value,” with a variety of plan and payment options.

• “Beyond Insurance” implies, “Recognize me as an individual, offer me support and advocacy, and reward me for good health choices.”


Taken together, the segmentation and analyses provide valuable insights for:

• Sizing the market by opportunity.• Targeting the appropriate customers to increase profitability.• Increasing profitability by understanding the risk of each

segment.• Better matching our customer preferences.

And the research guides us in addressing the last key question of how to tailor communications to the ways in which customers want to interact.

2. Understanding What Makes Your New Prospects Tick


A health insurance company that had made inroads into its Hispanic market in years past recognized that with the barriers of income significantly reduced by the Affordable Care Act, they could finally put their muscle behind an all-out campaign.

The temptation, of course, was to take their tried-and-true route to lead generation and conversion and simply scale it. Taking that decision would have meant tweaking their general individual and family health insurance messages and increasing their spend in Hispanic media under the assumption that these new prospects would take essentially the same consumer journey as their existing members.

The company chose a different, more focused—and more promising—route based on two fundamental understandings:

1. Hispanics are not one homogeneous group.

2. Hispanic marketing must now be viewed as a core business, not a project.

They also delved into prospective Hispanic customers’ approaches to healthcare as they are shaped by a holistic view of health, a bent for living in the present, and comfort with medical pluralism, expertly navigating both the traditional and alternative healthcare worlds.


They gained two more vital insights:

1. Having good health is connected to perceptions of well-being, but, at the same time, being and staying healthy is stressful due to cultural barriers that make it hard to be proactive about health.

2. Health is about being well today, and well-being includes being connected to family, spirituality, and community.

Because “familialismo” is a core Hispanic value, the family is involved in all aspects of healthcare, from discussing treatment options to patient care, information sharing, referrals, and recommendations. At the helm is Mama. Long known as the caretaker and nurturer in Latino families, she is emerging as a more proactive healthcare gatekeeper, and is upgrading her tool belt. She is relying more on the Internet. At the same time, she appreciates and welcomes information from sources she trusts to be reliable—family and friends, social and professional networks, church, community leaders, associations and organizations, and media.


Research also told us:

Hispanics are looking to insurance companies to help them with rising costs, a conclusion supported by data on their needs, attitudes, and shopping behavior.

Hispanics trust the insurance industry is treating them fairly.1

• 16% Hispanic vs. 7 % NH White

Hispanics feel they need to start searching for better insurance rates.1

• 33% Hispanic vs. 23% NH White

More than half of Hispanics use online to search for insurance.1

• 59% Hispanic vs. 46% NH White

With this knowledge, the company was ready to examine channels and plan messages for lead generation and nurturing.

Source: 1) Futures Multi-Cultural Marketing Study 2010 (Yankelovich) Trust based on top 3 box/Search for insurance by those who are not doing this but should start/ Internet access for insurance based among those who go online and use the Internet. - Base: 16+


3. Auditing the Competitive Landscape

Who and how large are your competitors’ target markets? How are they reaching them? Through which channels? With what size budget and where is it allocated?

When a West Coast insurance company approached TPG to audit their competitive landscape in order to answer those questions, one of the first places we looked was a new exchange. At the time, in March 2013, it was anticipated the exchange would invest more than $40 million in education and outreach, with two-thirds of the plan allocated to TV and radio. Ethnic marketing, including PR, partnerships, and events also were expected to receive a significant portion of the spend.

In that environment, it would have been reasonable to assume that competitors would launch equally aggressive education and awareness efforts. However, our research into the national and local competition’s online and offline presence revealed that while two major national firms were pursuing that strategy, others were not.


We found that the microsites and landing pages of the two major national firms offered:

• Engaging and clear online presences and well-defined paths to conversion

• Multiple interactive tools such as comparison, doctor’s finder, cost estimator, and health evaluator

• Health and wellness education and plans information available via video, podcasts, recipes, and downloadable PDFs

• Family-focused creative

Meanwhile, other large firms in the market offered only basic information, and the microsites and landing pages of local/aggregator competitors provided fundamental information and a simple path to conversion but limited educational content on plans, health, and wellness.

Research extended to competitors’ plans and budgets for radio, DRTV, paid search, alternative media, and direct mail—useful information for the development of budget assumptions for creative, production, and media, including budget allocation per channel. This research, along with projections for leads, cost per lead, conversion rate, sales, and cost per sale, were incorporated into a media pipeline model (below). The pipeline, supported by the insurance firm’s thorough research of the competition, contributed to the marketing team’s case for a significant investment in the company’s campaign.


As Henry J. Kaiser once declared, “Taste the relish to be found in competition—in having put forth the best within you.”

Media Pipeline Model - Building a Solid Investment CaseIFP Latino

4. Forecasting Leads and Implementing Analytics

An accurate forecast of volume and cost of leads and sales across channels fosters financial accountability in lead generation programs. Take the case of a health insurance carrier whose goal for the 2013-2014 campaign is to gain 14,500 new members by the end of 2014.


Based on its segmentation, audit of the competitions’ channel usage, and available resources, they projected a total budget of $2MM, with 16% allocated to Education & Awareness and 84% to Acquisition. Given their membership acquisition goal and budget, what they wanted to know is their cost per lead to generate the 14,500 new members. Knowing “a” and “b,” we could solve for “c” as the dashboard here illustrates.

(numbers in dashboard do not reflect actual results)

Most important, they needed to know their allowable—up to what could they spend and remain profitable.


A critical strategy, forecasting involves constantly measuring channels’ activity, analyzing data, and monitoring budgets. By setting parameters for maximum and minimum spends and calculating variables—remember slide rules?—forecasting makes it possible to determine what’s a sure bet and what’s a risk not worth taking. With a 360-degree view of a firm’s acquisition activity, marketers can project the optimal mix and then apply analytics to continuously improve campaign performance.

2013-2014 Forcasted Members by Projection Level

Analytics ensure that you are keeping your forecasted costs in line—or, better, reducing them—while getting in front of the right audiences through the best-performing channels. Whether you are operating with a legacy system, custom Google analytics tags and modifications, and/or an omnichannel analytics platform that allows daily understanding of marketing spend vs performance, data analysis and the insights gained from it will guide critical decision making going forward.


Gearing Up for 2015: TPG’s Essential

Marketing Checklist

03


Gearing Up for 2015: TPG’s Essential Marketing Checklist Marketing Checklist If you’re good to go forward, great. To help you stay ahead of the pack on acquisition and, at the same time, not lose members, we’ve prepared the following checklist, which we’ll update on our blog in the crucial weeks ahead.

Study recent historic data to predict your sweeter spots in the immediate future.

Review your acquisition tools, activities, and channels: Are they working together effectively to meet your campaign milestones?

Assess your budget allocation and the performance of your Education & Awareness campaign. Ask yourself:

1. Are prospects coming to you for information and comparisons instead of going to the exchanges?

2. Have you succeeded in building awareness of your brand and the distinctive benefits of your products and services?

3. Are you ready to move the uninsured to action?


Use integrated analytics to access real-time activity across multichannels.

Stay on top of user interaction with your website to increase conversion and lower acquisition costs.

Watch for switching in the first quarter of 2015 when individuals and families with private plans start investigating their options.

Be ready to attract and capture switchers with compelling offers.

Make sure your retention campaign is ready to kick into high gear before your members start checking out new insurance options.

Promote the benefits they have come to rely on—members-only services, newsletters, email updates, and concierge line.

Report, analyze, and improve . . . repeatedly.

If at any point you feel that your campaign would benefit from objective review, recommendations, and/or hands-on help, TPG welcomes the opportunity to talk with you. To learn how we can help you with web traffic, forecasting, lead generation, and other key insurance marketing services, visit us as tpgdirect.com/contact


Resources

04


About TPG For more than 23 years, TPG has provided insurance marketing solutions to America’s top providers in the auto, life, and health verticals to help attract and retain profitable policyholders. With strong talent and capabilities in digital, direct, content marketing, and analytics, TPG understands insurance marketing and advertising like few others.

How We Do It We use lifetime value as a lens to focus on strategic marketing opportunities. We generate a Predictor Score and apply it to online and offline databases for modeling purposes. We segment your most valuable prospects based on needs, attitudes, and behaviors and map each segment’s unique shopping pathway. We rank order customer acquisition marketing opportunities across multiple channels and recommend your most profitable strategy. We create highly engaging, breakthrough multichannel campaigns that leverage our proficient understanding of each channel and your prospects.


What Makes Us Different Our experience in regulated markets like insurance, financial services, telecom, and healthcare allows us to understand complex customer acquisition challenges that face marketers in these industries and others. We create unique solutions that optimize your marketing investment in response to your prospects’ behavior. We help you leverage data so you can rapidly and precisely recalibrate your marketing mix. We have the “can do” attitude of a small agency, and the resources and strength of Omnicom, the world’s most respected Agency network.

ContactSteve R. Longley, CEOemail: [email protected]: 215-592-8381website: tpgdirect.com

Date post:	14-Jul-2015
Category:	Healthcare
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