With targeting options limited, Pittsburgh insurer mines its database
An insurer that’s required to solicit all prospects within its area of coverage would seem an unlikely candidate for a marketing database. But by using a database to determine channel effectiveness, Pittsburgh-based Highmark Blue Cross Blue Shield has added analytic techniques to its strategy.
Highmark, which offers policies in 17 western Pennsylvania counties, has some of its marketing process determined by law. For SecurityBlue, its Medicare risk product, everyone in the area of coverage must be solicited at least once a year. Still, the database is used to analyze both effectiveness and cost per lead of media buys on inquirers, as well as the impact of different creative approaches and the conversion of prospects to members.
Highmark’s database is managed by DMW Worldwide of Wayne, PA, which took the file over last year when it grew beyond the capacity of Highmark’s partly internal, partly outsourced system.
“We were not getting the turnaround we wanted [on reports],” says Highmark marketing communications director Marcia Conley of the firm’s original data management process. This stymied the company’s ability to do timely analysis of its outreach campaigns.
For products geared to under-age-65 marketing, such as its HMO KeystoneBlue and indemnity coverage CompleteCare, Highmark has more flexibility in its targeting. Back-end analysis has led the insurer to rely primarily on DRTV and freestanding inserts to promote its under-65 coverage.
For customers on the cusp of 65, Highmark maintains a file of prospects and inquirers who have not signed up for coverage.
About a year before their 65th birthday, the company starts to communicate with these individuals via newsletters, in an effort to educate them. Even if they elect to go on Medicare, these prospects are still candidates for Highmark’s MediGap coverage – supplementary health insurance for people over 65 – and the company solicits them accordingly. By tracking inquirers, it was able to increase the conversion rate for SecurityBlue to 3%. By comparison, cold prospecting yields a return of 1.5%.
Future plans call for the insurer to explore product migration among its customers. In addition, the database will serve as a backbone for a survey of those who dropped their coverage. Highmark will also rely more on the database’s channel-evaluation features.
Earlier this year the Health Care Financing Administration approved Highmark’s petition to divide its coverage into three regions. Data analysis during the next few months will enable the company to explore which rates, benefits and solicitations to offer in each region.
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