Take the Risk Out of Starting Over

in Healthcare Marketing

DMA:2011

Michael Meadows, Highmark Inc.

Tom Reid, Hacker Group | HealthHG

Background &

Situation

Background

• Highmark– Serves 4.8 million members in Pennsylvania and West Virginia– One of the largest Blue plans in the nation– 19,500 employees across the country– Mission:

• To be the leading health and wellness company in the communities we serve

• Michael Meadows, Highmark– Director - Senior Markets Marketing– 7 years of health care marketing experience

 

Background

• Hacker Group | HealthHG– Full service direct / digital agency– HealthHG dedicated insurance practice

• Tom Reid, Hacker Group– Executive Director and Chief Strategist– 24 years of agency and client-side experience

• Medicare Advantage market is highly regulated– Marketing materials filed with CMS– Enrollment limited to 8 weeks per year

• Mature & change resistant – most seniors have some type of additional coverage now

• Many stakeholders– Sales, Product, Brand, BCBS Association, Compliance

• Mistakes are costly – no time to recover• Intense pressure on marketing efforts

Medicare Advantage Market

• Operational complexity: multiple brands, products, regional competition

• Product-centric marketing

• Launched market segmentation approach to messaging a year prior

• Limited marketing performance metrics

• Not satisfied with lead volume or cost-per-lead results

• Needed a more scalable and predictable approach to improving results

Strategies for

Reducing RiskWhen Starting Over

• Level set on performance and metrics– Agree on available market– Use historical results and industry

benchmarks to set realistic objectives– Establish metrics that will be used to judge

success

Strategies for Reducing Risk

• Combine new creative / messaging with known winning formats and offers– Draw upon winning formats for same

audience– Focus on the immediate objective:

engagement vs. selling a specific product

Strategies for Reducing Risk

• Understand the Audience – What problem are we trying to solve?– Bombarded with information in a short period

of time– Searching for help with a complicated

decision– Different views on health care

Strategies for Reducing Risk

• Maximize audience reach – Integrated media strategy– Develop offers that appeal to the shopper– Solution messaging versus product specific

messaging where possible

Strategies for Reducing Risk

Starting Over!

Starting Over: Evaluation

• Begin with an analysis of media budget allocation and performance

– Benchmark prior year media mix

• Establish next year objectives– Brand awareness vs. immediate results?– Available market, available budget– Leads, Members, Cost-per-Member

Starting Over: Implementation

• Mitigate marketing risk with multiple touches, formats and executions– More shots on goal with many touches– Variety works with rotation strategy– Enables lots of testing in the season

• Make it easy to respond– Maximize response by using multiple

response channels

Starting Over: Implementation• Media mix –

– DRTV• Align production and media budget• 60s vs 90s vs 120s?• Tune media spend weekly

– Mail• Many packages and components• Harvest credibility from DRTV

– FSI (Free Standing Insert)• Format testing makes a difference

– Test and Measure EVERYTHING!

Starting Over: Implementation• Fulfillment

– Speed and accuracy count

– Opportunity for more than just fulfillment data processing

• Marketing Database– Response management and lead qualification

– Fulfillment management

– Daily and weekly metrics on each vehicle

• Weekly Metrics Review– No surprises

Results

Starting Over: Accomplishments

• Significant increase in market engagement– Reallocated budget to more efficient vehicles

• Increased mail by 190%, from 1.1mm to 3.2mm

– Shifted DRTV budget to media vs. production• Reduced overall DRTV budget by 21%• Increased number of spots run by 31%• Ran 11,100 spots vs. 9,100 spots prior year

– Delivered 54% more response• 51,400 vs. 33,300 in prior year

Starting Over: Accomplishments

• Identified controls– 3 winning mail packages above 1.4%– Winning lists / newspapers / stations

• Improved results tracking and attribution – Direct marketing credited with over 2x the

sales of prior year

• Reduced marketing acquisition costs– Lowered marketing cost-per-member by 63%

Starting Over: Accomplishments

• Reduced data processing costs by 30% and produced a robust marketing database

• Clear view into campaign performance on weekly basis — all key metrics:– Summarized pipeline view of each vehicle and

execution• Solicits / Response / Leads / Cost-per’s

– Regional performance– Segmentation summaries

Creative

23

Starting Over: Mail Examples

Starting Over: FSI

Starting Over: DRTV

Conclusions

Starting Over: Key Learnings• More online

– Over 5% of response via online

• DRTV– Motion graphics & 60s spots paid off

• Mail – Testing paid off: 3 winners identified, enabling

more efficiency gains in subsequent year

• FSI– Focused distribution yielded higher response,

lower cost-per-member results

Taking the Risk out of Starting Over

• Take time to do the evaluation

• Set clear, measurable performance metrics

• Build on what works

• Provide solutions for audience problems

• Cast a wide net

• Identify operational gaps

• Review and optimize often

Postscript: 2010 – 2011 Does the approach scale over time?

YearResponse Volume

Gain over Prior YearCost per Response Gain over Prior Year

Cost per Member Gain over Prior Year

2011 32% -3% -14%2010 9% -4% 20%2009 54% -36% -63%

• Consistency: delivers year after year

• Improvement: testing and refinement drives cost per response down year over year

• Results: continued growth in the face changing regulations and fierce competition

Starting Over: Questions?

Thank You!

Michael Meadows, Highmark Inc.

Tom Reid, Hacker Group | HealthHG