Tuesday, July 3, 2012 | Edited by Daniel Moores
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Health-Care Ruling Likely to Lead to More Marketing From Insurers, Hospitals Companies Seek to Differentiate Themselves as They Court New Consumers Now that the Supreme Court has upheld the Affordable Care Act, expect increased marketing from insurance companies and health-care providers as they vie for the attention of consumers. The law, slated for implementation by 2014, requires that states set up exchanges through which consumers can purchase health insurance regardless of pre-existing conditions. It also mandates that consumers show proof of coverage through their tax filings. This means that insurance companies will continue to boost marketing aimed at a consumer base to which it never had to cater. And those that had put their marketing efforts on hold until the ruling was made will have to scramble to catch up, explained Lindsay Resnick, CMO of KBM Group, a WPP Health Services company. KBM works with a number of companies, including Wellpoint, Aetna, Blue Cross Blue Shield and Windsor Health. "A lot of people over the last three months had been saying let's wait for the decision -- now (they're) three months behind," he said. Marketing issues aside, many health-related companies were moving forward as if the law would go into effect. Wendy Lund, CEO of health-care PR agency GCI Health, told Ad Age: "Many of our clients have been preparing for ACA implementation since the bill was signed in March 2010; most do not anticipate any immediate, significant changes to their core business. As for specific implications of ACA to health-care providers and insurers, it's a little early to say. The hope is that reform will address several of the stress points in our health-care system, but the law will likely continue to evolve as the national discussion continues, especially in the context of the presidential election." Mr. Resnick said the next step for insurance companies will involve a lot of hyper-local targeting and attention to data. In many cases, health-care marketing agencies will be working closely with big consulting firms to look at clients' segmentation and necessary changes to operational functions like call centers. "You better know in your markets who the uninsured people are who will now have access (to care), and who most likely will be taking advantage of the health exchanges." In the short-term, marketers will seek to forge loyalty with existing customers. Mid-2013 is when the budgets will start to grow and health companies will launch more aggressive efforts to attract new customers, he said. "There will certainly be a trend toward localization." Insurers' actions pre-decision will also likely play a role in their loyalty strategy. A few weeks ago, three insurers -- Aetna, Humana and United -- pledged to uphold elements of the reform law, regardless of the Supreme Court ruling. As they look to forge loyalty, they can now remind consumers that they would have had their backs had the law been overturned. It's a meaningful message in a much more competitive landscape where insurance brands have less room for distinction. For health providers like hospitals, the Supreme Court decision means an influx of new customers and a short-term objective of setting expectations, Mr. Resnick said. "Say you have 15 million people pouring into (hospitals) with shiny new insurance cards. Providers have to figure out how to manage that. We'll start seeing some marketing from providers around setting expectations in their community. We might see an uptick in mobile (marketing) or in the clinic market." Employers will also remain a b-to-b target for insurers, as the law mandates that businesses with more than 50 people distribute health benefits. (Source: Advertising Age, 06/28/12) |
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Who Are the Underbanked? Don't overlook the underbanked. That's the central message of a recently-released Javelin Research report that describes the market for underbanked consumers and strategies for turning them into fully banked customers. The firm estimates 35 million Americans are underbanked; about 15% of the population. By "underbanked," Javelin is referring to people who don't have a checking account or a primary banking relationship. They may have a prepaid card. (The unbanked, who have no bank relationship at all, are a sub-segment of the underbanked.) The underbanked tend to be young -- 36% are 18 to 24 years old. The very nature of their youth means "a big portion of this group will change; they're not going to be underbanked in the future," said Mary Monahan, executive vice president and research director, mobile at Javelin. "What's interesting about this population is their income is not as low as you'd expect," Monahan said. The average income of the underbanked population is $52,000; the average among the total U.S. population is $73,000. They're slightly more likely to be African American or Latino than white. The underbanked is not one group of people, but rather several different groups, Monahan noted. One is the unemployed. Although the national unemployment rate is only 8%, that number doesn't include people who have been out of work for a long time, so the true percentage of unemployed is much higher. Among the underbanked, the unemployment rate is 12%. "Being unemployed hurts people's credit, and sometimes they can't get a checking account," Monahan observed. Another group is the tech-advanced underbanked, who make heavy use of smartphones and use their smartphones as computers, watching TV and paying bills with them. There's a tech-challenged group that uses prepaid phones or phones with no data plans. These consumers will need simple SMS banking and alerts. Another category of underbanked is the immigrant who needs to send money back to people in his home countries. This group tends to use a lot of wire transfers and remittances. More than twice as many underbanked consumers send wire transfers as all consumers and three times as many use remittance services such as Western Union. But even more say they are likely to use mobile international P2P, even though it doesn't yet exist. "Remittances are expensive because they're cash based," Monahan said. "If you can turn that into mobile transactions, that lowers expenses but also creates opportunities for other companies to serve this population. Once they're able to do things like take pictures of checks to deposit them, they don't have to turn them into cash, they can transact using person-to-person payments and prepaid accounts. That really opens the door to turning a cash-based economy to a digital economy." This can help the countries receiving the money, she says, because "now something that wasn't showing up in GDP is showing up. It's good for institutions because they can get a sliver of these transactions, and it's cheaper, better and safer for the consumer. They don't have to carry cash and they don't have to walk over to the drugstore to cash a check." The underbanked typically have less access to desktop computers (60% vs. 72% for all consumers) and are less likely to pay for broadband services (34% vs. 59%). "If you try to make them use online banking, you're cutting off your nose to spite your face because they're not going to do it," Monahan says. "You want to allow them to transact via mobile. They're already showing a higher propensity to do mobile banking." What are these people doing instead of using banks? Mostly they just use cash. About 8% use prepaid cards. "These are people who don't have other habits, you're not displacing anything," Monahan says. "It's real easy to supply something that works better." Several banks are going after the underbanked with prepaid cards, Monahan says. (She did not give specific examples, but Chase launched a prepaid card called Liquid for this market in May.) (Source: American Banker, 06/14/12) |
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Study Shows an Increase in Planned Purchases of New Vehicles For the first time in six years, planned purchases of new vehicles has risen, according to a soon-to-be released National Report from The Media Audit. According to the 81-market study, 5.5% of U.S. consumers plan to purchase a new car, van, truck or SUV in the next 12 months. The figure represents more than 8.1 million consumers across The Media Audit's measured markets. The figure also represents a modest increase of 1.8% over the previous year, when 5.4% of U.S. consumers planned a new vehicle purchase. Previously, the figure had been in decline for five straight years, down from a high of 8% in 2005. Planned purchases of automobiles, regardless of new or used, is also up. According to the same survey, 14.6% of U.S. consumers plan to buy a new or used vehicle in the next 12 months, compared to 14.3% for the previous year. The figure also represents the first time in six years that the figure has risen instead of fallen. The figure had been in decline for five straight years, down from a high of 18.3% in 2005. Among those U.S. cities with the highest percentage of new car buyers is Sarasota-Brandenton, Florida, where 9% of the metro area's population plans to purchase a new vehicle in the next 12 months, followed by Miami-Ft. Lauderdale, Florida (8.6%), Detroit, Michigan (8.2%), Cleveland, Ohio (7.7%), and Boston, Massachusetts (7.2%). Among those U.S. cities with the highest percentage of consumers planning the purchase of a domestic vehicle is Detroit, Michigan, where 15.5% plan to purchase a new or used domestic vehicle, followed by Tulsa, Oklahoma (13.5%), Toledo, Ohio (12.2%), Tyler-Longview, Texas (11.9%) and Albuquerque, New Mexico (11.2%). The survey also revealed that among those consumers planning the purchase of a new vehicle, 43.5% plan to buy a domestic vehicle, 39.3% plan to purchase a foreign vehicle, while the remaining consumers are unsure. More than 104,000 respondents were surveyed. (Source: The Media Audit, 06/27/12) |
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