Client: Prime Health
Agency: Communication Solutions
Campaign: Private Medical Insurance
Prime Health is the private medical insurance (PMI) subsidiary of Standard Life. A combination of regulatory, competitive and market pressures were causing a decline in quality, profitable leads. By refocusing the proposition, changing the creative treatment and fulfilment, and leveraging existing call centre and IT infrastructures, the company met its income targets for 1999 at a lower cost through improved conversion rates from direct mail and press advertising.
Health insurance is complex to sell direct because of industry regulations. Since 1998, health care cannot be sold off the page or through one-stage direct mail. Much of the marketing material had evolved, rather than been specifically designed, and was slanted towards legal caveats and medical terms. The creative execution focused on negative aspects, such as having to undergo an operation, or was comparative with other providers.
Because of approaching Y2K issues, the existing call centre screen structure could not be changed, while personalised quotes and fulfilment literature had to use the existing number and type of fields. Product innovation was not possible, nor was there any possibility of increasing the marketing budget to undertake brand awareness activity.
The brief was to position Prime Health under the Standard Life umbrella as a holding exercise, pending their name change to Standard Life Healthcare in April 2000, and to create a unified approach in all marketing materials. The programme had to generate quality, profitable business through cold and warm direct mail and press ads, with new fulfilment literature.
Prime Health offers five main PMI products, plus two hospital list options, a variety of excess levels and four add-on options. Instead of assuming that consumers understand the product and differences, one product – Primecare – was positioned as the pivotal plan within a logical hierarchy of products.
New scripts were developed for the call centre taking the caller through a “needs” analysis. A quotation for Primecare was offered at mid-point, and each caller assessed for an upgrade or downgrade. Before closing a sale, add-on options – dental, accident and critical illness – were offered to all callers. This approach was supported by a revised incentive structure.
A new creative approach focused on peace of mind first and medical facilities second. The use of medical and legal terms in copy were challenged and the whole tone was kept clear and customer-focused. A new fulfilment pack with personalised quote form made specific reference to the original call.
Cold direct mail was aimed at the over-35s, with an emphasis on ABC1 51- to 60-year-olds. Warm lists of previous enquirers matching this profile were also used. A range of creatives was tested against a control pack, and new press ads were developed to produce hard-hitting work in both small and medium-sizes cost-effectively.
Income targets for 1999 were achieved, despite an 18 per cent reduction in marketing spend. This was achieved by generating equal response and 6.5 per cent higher conversion rates.
Overall, cost per lead fell by over ten per cent and cost by policy by four per cent. There were fewer cancellations and markedly increased sales of the top two income products.
Direct mail generated the highest level of leads in any medium, with 50 per cent of media spend, and produced the largest number of policies and highest level of income – double what had previously been achieved from direct mail. Over 70 per cent more leads were generated from warm mailings, with conversion rates double the forecast. Warm mailings doubled the number of polices and income, at seven per cent lower spend. Press ads generated 63 per cent more policies, on 20 per cent less spend, with the cost per policy halved.