What health insurance can learn from Starbucks

It’s that time of year again, the health industry’s annual enrollment period. While it’s a key time for health insurers (payers) and their marketing partners, consumers don’t typically show great interest. Although health insurance is often literally a life-saving benefit, consumers spend the least time making their smartest coverage decisions. Doing nothing is the easiest choice, which is why health insurance “switchers” are at an all-time low.  In fact, many put more thought into their coffee orders than their health care coverage. Perhaps the industry needs to try a new approach to customer engagement.  One need look no further than the ubiquitous Starbucks brand for inspiration.

Convenience, customization and rewards

Think of how many times you open your iPhone, order your coffee from Starbucks and grab it the minute you arrive.  While there, you quickly pick up a last-second latte for your co-worker with your Starbucks pre-paid card.  Or even better, you redeem a free drink based on your loyalty status, which you use on your co-worker’s drink. You got exactly what you and your “coffee dependent” wanted, while earning loyalty points — all in seconds. 

I know what you’re thinking: How can you compare health insurance and coffee when they are vastly different?

While this is true, consumer expectations for all consumer experiences are remarkably similar. We all want simple, streamlined experiences customized to anticipate specific needs today, while also expecting ongoing innovation in the future. Simply put, we want to be at the center of the consuming experience. That’s something Starbucks owns and has invested in heavily, while the health insurance industry has not.

Coffee’s customer-centric vision

Starbucks has been perfecting this for years. Its customer loyalty program has harvested reams of customer data, from which Starbucks gleans insights, which leads to targeted offers that encourage retention, cross-selling and more frequent transactions.  In fact, its app operates just like a physical loyalty card.  Starbucks has mastered the art of true omnichannel customer experience — direct mail, email, online, in-store and app — both analog and digital dialogue along each customer’s choice of journey. The key lesson here is that consumers drove these innovations ( even the option to personalize cups with whatever names they fancied.) 

The marketing myopia of the health insurance industry 

By comparison, health insurers have historically been viewed as having a complicated product menu; being highly selective in who they prefer to insure; being very expensive; difficult with claims handling; and essentially operating like a government bureaucracy.

Payers have made progress, but remain decades behind the Starbucks paradigm. Their websites are a hodgepodge of information where members/prospects cannot quickly navigate to the content they seek.

Moreover, most payers have barely utilized multichannel marketing (forget about omnichannel) to its greatest effect, leaning heavily on direct mail. As we head toward 2019, payers should be able to communicate via omnichannel messaging to 100 percent of their own customer base and at least 60 percent of targeted prospects.  Health care marketers’ ability to catalog and message based on personally identifiable information for both customers and prospects is critical to achieving true consumer-centric, marketing success. Even today’s most robust multi-channel efforts lack the ability to connect analog (direct mail) and digital journeys. 

The patient can see you now

We must understand how consumer shopping habits have changed health care. Ever-expanding self-health online resources like WebMD let consumers become their own gatekeepers for diagnosis, research and treatment. This may not sound like choosing between a latte and espresso, but it shows how consumers prefer to own their choices.

In years to come, fewer members will seek professional health advice in-person or even from a physician. More will depend on health-modeling algorithms linked to their personal identities through a relationship with Amazon and large anonymized health databases. They may be able to transfer their basic health information into an online portal for professional analysis and notifications. If patients are merely feeling unwell, a simple and inexpensive teledoctor video appointment could be just what the patient ordered. And that teledoctor may be able to fill medications that day through Amazon’s recent acquisition of PillPack, an online pharmacy with a uniquely convenient medication-distribution and patient-efficacy system.

It goes even further, to continuous monitoring and data collection. Imagine stepping on your wireless scale or using your wireless blood pressure monitor, each synching to your watch or phone and communicating data to your doctor, who can identify through algorithms that you need to see a specialist ASAP. Those with Type 1 diabetes already can have a small monitor under their skin that tracks blood glucose and activates an embedded insulin pump — not merely a convenience, but a potential lifesaver.

The industry can also borrow from successful loyalty programs and offer points for proactive health measures — physicals, dental visits, labwork, physical activities, shared from wearables — used toward discounts on health-related items and goals. It would reward members and benefit payers by promoting a desired behavior.

A payer-centric experience reinforces consumer perceptions that health insurers have too much power.  Payers would be better served if we flip the script and empower prospects/members to control their own health insurance.  We can do so by identifying the ideal customer journey(s) with current content and channels,then fill any gaps with new content and additional delivery systems.  We can do so by doggedly pursuing an omnichannel approach that synthesizes every prospect/member interaction through data.  Finally, we can do so by creating loyalty plans that reward healthier lifestyles. 

We can transform the image of health insurance among consumers. We can reach them where they are and get them more involved, to both their benefit and ours. But first, we must market in ways and with solutions they prefer.

The ball is in our court. Do we want to be the Starbucks of tomorrow or the Sanka of today.

Jay Miller is VP, Client Partner-Health at Merkle, a leading  data-driven, technology-enabled, global performance marketing agency owned by Dentsu Aegis.