Big, employer-paid health policies are still the bread and butter of the insurance industry, but that's not the growth segment it used to be. Today, the industry's forward-thinkers are focusing on "retail" -- pushing products, policies and health advice directly to the consumer.
Eyeball-glazing terms such as "one-to-one marketing," "consumer engagement," "retail segmentation" and "multidimensional brand experiences" are being thrown around by health insurers.
Because of the economy, because of the reform winds, because of new technologies, health insurance is increasingly becoming an individual, personalized commodity.
"There is a fork in the road," said Matt Fiddler, director of retail marketing at Highmark Inc., the Pittsburgh region's largest health insurer. "Consumer expectations have changed immensely in retail, let alone retail insurance."
Insurers, by necessity, are changing, too.
But what's the end game?
Well, there's the obvious -- reaching new customers in new places means new revenue streams. But it's also about involving consumers to the point that they are aware of their own medical- and health-related decisions, their responsibilities as consumers of care.
The hope is that engaged consumers will ultimately be healthier ones. They'll use their benefits less often, and when they do use, it will be in a preventive fashion to catch problems sooner. Healthier customers, in the end, reduce costs across the system.
And retail-style sales techniques may be one approach to creating engaged consumers.
Highmark, for example, is taking the retail side of the equation literally, having opened a store called Highmark Direct, where individual buyers and small-business clients can get information on products.
Foot traffic has exceeded expectations -- 7,000 or so since March -- and for the most part, customers have avoided the temptation to use the store as a place to vent about their coverage problems.
It's not just health insurers pursing new retail strategies. All sorts of service firms, from electricity providers to credit card companies, are toying with "consumer-driven" sales theory.
"I call it retail for non retailers," said Diane Rambo, creative director at Columbus, Ohio-based Big Red Rooster, the branding and design firm responsible for the sleek new Highmark retail outlets. "They wanted to extend themselves out into the public .... What would happen if they were actually in the fiber of your day, next to Walgreens?"
One-on-one engagement goes beyond the physical retail space. In March, Highmark rolled out two new "mobile marketing vehicles" -- big trucks that can serve as information depots, enrollment centers and conference rooms.
Finding out which customers want to be "engaged," and which ones don't, help a health insurer better focus its marketing efforts.
By offering discounts or gift cards in exchange for, say, filling out a health risk assessment survey, a company finds out which customers are willing to take their health care a bit more seriously if given the right nudge.
"It isn't enough to give (customers) the tools and information," said Sue Shick, the new CEO of UnitedHealth's Pennsylvania division.
"Those kind of carrots and those incentives really work."
Along those line, UnitedHealth also offers health care "discount programs" to some members, a menu of health-related services -- gym memberships, smoking cessation -- for which the members receive what are essentially health care coupons. UnitedHealth says the coupons connect most strongly with women, who make most health care decisions in a family.
Rambo, of Big Red Rooster, says there's irony to be found in the multi-front push toward retail. Earlier in the decade, with the rise of Amazon.com and eBay, prognosticators were predicting the demise of retail. Bricks-and-mortar was out, "clicks"-and-mortar was in.
But some problems are better solved face to face.
"When cell phones first came out, it was all about acquisition (of customers) at first, not retention," she said. Now, everybody has a cell phone, and organic sales growth possibilities for suppliers are limited, so wireless companies are fighting for existing customers among various other carriers.
It's the same in health insurance. Fewer customers are tied to a specific insurer through their employer; more of them are free agents, so to speak, looking for the best deal.
And to them, "Service is important," Rambo said.
Bill Toland can be reached at btoland(at)post-gazette.com. For more stories visit scrippsnews.com
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