Seven Ways to Use Market Segmentation at a Health Plan
Marketeers have a long list of tools at their disposal. One of the oldest and most proven methods is market segmentation.
A quick google search reveals that "market segmentation" is a technique in which businesses divide their customers or potential customers into different groups in order to determine the best way to reach them with the best possible outcome. Marketers use demographics, psychographics, geographical location, current and past behavior, social media data and more to select which audiences are relevant for their message or product. This can help identify what motivates people to purchase certain products as well as increase brand loyalty from consumers across various segments.
Below, we'll explore how segmentation strategy can improve the business and provide actionable insights.
Customer Segmentation
Segmentation allows businesses to better understand their customer base. Identifying what consumers want allows marketers to identify opportunities and deliver products that they are excited about. This in turn, increases the chances of a sale. For example, a pharmaceutical company may determine that men who like sports have higher than average heart disease risk and target them with a message about the benefits of their cholesterol lowering medication. Similarly, if a health plan identifies that its members who live in more rural areas tend to be overweight, it can increase screenings for diabetes or heart disease in those regions through its provider network.
The overall goal of segmentation is to have the most relevant audience reach with the right message at the right time. To do this, marketers will spend a great deal of time and resources to learn more about their customers. From there, they can identify the right message to engage them and make them aware of the value of their product or service.
Providers Segmentation
Health plans need to work with providers in order to help them better serve their members. As buzzwords go, this one is underutilized by health plans when it comes to provider marketing and communications planning.
Often, health plans don't know much about the providers they work with. They may only be familiar with their name and the type of services they offer. In some cases, health plans have even reached out to a provider without knowing if the plan's members can get care from them.
With his internal marketing team, Matt Bihuniak of Wellcare Health Plans decided to take a step back and look at provider marketing as an opportunity for his company. He worked with his internal communications team to identify which providers currently had the best relationship with members through interactions across social media platforms and word-of-mouth communication. In doing so, he discovered that members were very vocal about their experiences with certain providers both good and bad.
Bihuniak knew that if he wanted to be able to provide the most value to his members, he needed a plan that would allow him to reveal this in a clear and consistent way across multiple channels.
Ultimately, Bihuniak's marketing team used its Nielsen data and consumer insights about member preference to segment providers based on how people normally interact with them.
For example, Bihuniak and his team learned that overweight members responded well when they saw messages about their weight by providers with a history of weight loss success. To figure this out, they analyzed all the provider marketing messaging done by each health plan over the last 12 months within relevant categories like diabetes management, hypertension management, asthma management and weight loss.
Starting with those categories, they grouped providers around those types of message. For example, providers that had a history of success weight loss were then assigned to a top tier category when it came to marketing messages. After this process, Bihuniak and his team were able to classify more than 70% of the members they serve into at least one level of segmentation.
Plan outreach messages then went into specific segments based on how the providers already focused on their members from a messaging standpoint. This allowed Bihnayik and his team to be more targeted than other health plans in their space when delivering important messages about their programs, cost sharing or provider network enhancements.
The result of this strategy was an overall increase in member engagement. In the first quarter of 2015, the health plans reported 6.9% more new members and 5.4% more renewals compared to the first quarter of 2014.
Utilizing Market Segmentation in Your Health Marketing Strategy
At Blue Spring Healthcare, we understand the importance of defining what your plan's members need from your providers when it comes to health care messaging and program marketing. We also understand that you don't have time to figure this out on your own when you are supposed to looking for ways to improve member satisfaction and retention across an entire network of providers that serves millions of members.
We can help you with this! We can segment your members based on their information and behaviors and develop a plan to deliver the right message and at the right time to improve member engagement, retention and satisfaction.
Learn more about how we do that by clicking below or reaching out to us today.
Sources: http://www.forbes.com/sites/thefiscaltimes/2014/07/08/the-top-5-things-health-plans-should-do-to-increase-performance/#1d68fc6c15e4; http://www.elucidatingservices.com/wp-content/uploads/2014/09/Big-Healthcare-Marketing-Study.pdf; https://www.healthplansdaily.com/newsroom/healthessentialshealthplanshealthcareplanstrategiesofthersalesforce; http://www.hbr.org/2013/05/the-5-ditchable-things-in-newmarketing; http://www.forbes.com/sites/michaeltarini/2012/07/22/the-top-10-healthcare-marketing-mistakes/.
Karen J. Snedegar is a client services manager at Blue Spring Healthcare, a value-based health plan that helps employers and health plans improve their performance by optimizing utilization, quality and overall member experience. She specializes in marketing development, communications planning and strategic consulting projects in the health insurance industry. Karen has more than 20 years of progressive experience working with the administrative, claims processing and healthcare delivery sectors. She has held previous positions at several top healthcare marketer's including benefits consulting firms and industry services providers. Contact Karen at [email protected] or 919-619-8327.
Sources: http://www.forbes.com/sites/thefiscaltimes/2014/07/08/the-top-5-things-health-plans-should-do-to-increase-performance/#1d68fc6c15e4; http://www.elucidatingservices.com/wp-content/uploads/2014/09/Big-Healthcare-Marketing-Study.pdf; https://www.healthplansdaily.
Conclusion
The decision to choose a specific health plan can be described as one of the most important life decisions a person makes. If a person had the option to have all their life savings in one bank account, they would likely choose that plan based on the perceived safety and security it represents.
Unfortunately, many health plans don't seem very safe or secure to plan shoppers. They are not easy to differentiate from competitors when shopping for plans and many offer very little incentive or value for their members because they haven't been able to get a good grasp on who their members are, what they want from them or how they want them counted toward quality measures like HEDIS® (Healthcare Effectiveness Data and Information Set).