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Harnessing Deep Industry Expertise to Capture New Markets

Darren Rodgers’ current passion in marketing is to unlock the opportunities of the Affordable Care Act. This represents an entirely new challenge for Rodgers and Health Care Service Corporation (HCSC)—where he’s CMO—as well as the healthcare insurance sector as a whole. Fortunately, Rodgers brings an entirely new perspective to the game, having stepped into his CMO role—his first marketing leadership position—only two years ago. The 22-year HCSC veteran explains how he applies his deep healthcare expertise, and broad organizational experience, to marketing in an industry in the throes of historic transformation.

What’s your marketing passion?
The Affordable Care Act (ACA) opened up new markets, and my passion is helping our organization find and leverage those opportunities.

How do those markets differ from HCSC’s traditional market?
HCSC is the largest customer-owned health insurer in the United States and fourth largest overall. We operate through our Blue Cross and Blue Shield plans in five states: Illinois, Montana, New Mexico, Oklahoma, and Texas. Before the ACA was implemented, our traditional members came to us through large employer healthcare plans, which subsidized all or part of their coverage for their employees. Originally, our organization was built to speak to a company’s CFO, the VP of human resources, or another executive who purchased health insurance for the entire company. The ACA has made our product more affordable to many more individual buyers, including lower-income segments of the population. While we’re still marketing to our traditional customers, we’re also figuring out how to make the most of the opportunities the ACA offers. A big part of that means marketing to the lower-income individual buyer—those who’ve never had insurance before and never faced the decision-making process that goes with that.

So, that’s a brand new segment to reach for a CMO who’s relatively new to marketing. Tell me about your background.
I’ve been with HCSC for 22 years in various positions. Prior to marketing, I worked in sales and healthcare management—an area of the company that ensures that our members are getting the best care possible, and government relations. Before taking my corporate position, I served as president of Blue Cross and Blue Shield of Texas.

I’ve only been in my current role for about two years, so marketing really is something that’s new to me. Until a couple of years ago our individual plans [within each of the company’s states] did all of their marketing locally. Since then we’ve created a corporate marketing infrastructure to help us ensure that we’re leveraging our assets across all five of those plans cost-effectively and applying learnings and best practices to each market.

What are your priorities and initiatives as CMO?
First, I want to be sure that corporate marketing thinks horizontally across our five geographic markets and also horizontally about our customer experience. In the past we sometimes thought of the customer experience only as the purchasing of health insurance or the renewal process. Given my broad-based experience throughout the company, I’m trying to be sure we understand that every time someone walks into a physician’s office and presents a Blue Cross and Blue Shield ID card, that’s a customer experience opportunity. Any time someone logs on to our website, that’s a customer experience opportunity. It’s really the totality of all the experiences that members have with our brand that we need to be sure we’re maximizing. If we’re building a new type of provider network or offering new types of provider contracting, for example, we have to understand how that will affect the customer.

How are you applying that thinking to the potentially huge new individual market that the ACA created?
We’re tying the entire thought process and all of the work together into an endeavor that we call Customer of the Future. Those customers include our traditional group plans, as well as the people who purchase health insurance through the ACA’s subsidized exchanges. How deeply do we understand those individuals, starting with the purchasing process and continuing all the way through their entire customer journey? What are all the ways and places in which those individuals will use their coverage and how do we make sure those are as positive as they can possibly be?

How are you developing that deep understanding of this new market?
I’m an extremely data-driven person so I’m focused on maximizing the use of data to understand these new marketplaces and to help guide our decisions. One data point that pops out when we look at potential customers on the new healthcare exchanges is that many of them are Hispanic. In fact, 25% of all Hispanics in the U.S. live in our five states. So, we dug into the 16 largest metropolitan areas in our five states and quickly realized that the Hispanic market segment was an area of opportunity for health insurers. We’re working to ensure that we have a very deep understanding of the purchasing behaviors and service needs of this population.

What have you learned so far?
A basic insight is that many people in this segment—even though they speak English—use Spanish as their preferred language. Obviously, we have to offer all of our marketing materials in Spanish, as well. We’ve learned that this group is much more likely than the rest of our market to engage in our Web services via a mobile phone as opposed to a PC or laptop, so we need to make our marketing materials more mobile-enabled. We’ve also learned that personal interface and influence is very important in this segment’s purchasing decisions. Although we’ve done much to provide a great online shopping experience for the Hispanic community, we know that this segment prefers to speak to someone before they purchase.

How do you adjust your marketing approach to respond to that preference?
Again, this is a brand new market for us, so we don’t know yet for certain what’s going to be most successful. Traditionally, we’ve worked through a network of agents and brokers. We’re now collecting information about which agents and brokers speak Spanish in their office so we can refer potential members to an insurance expert who speaks their preferred language. Additionally, last year we opened three pop-up retail service sites, two of them in Texas, for the first time. These stores were up and running during the open enrollment period to give people a place to go to have their questions answered. We continue to look for new ways to experiment with this idea.

Have you taken any other notable steps to help you market to the Hispanic, individual-buyer segment?
I recognized that I personally don’t have a lot of experience with this consumer group, so we hired someone who has done a lot of Hispanic marketing in the mobile phone industry. We have tons of people who know everything about health insurance so it was important to expand our team to include people who really understand the consumer-purchasing process, with particular focus on the Hispanic shopper.

It sounds like you’ve been busy with some historic changes in your industry.
In the 22 years I’ve been here, I don’t recall a faster-paced environment. Change is coming at us pretty quickly, but that makes it a very exciting industry. I think in five or 10 years there are going to be some great business school cases about how successful companies adapted to the new healthcare marketplace. I’d like to see Health Care Service Corporation be one of the companies featured in those case studies.

  1. Analyze: Rodgers says his team conducted a “deep dive” analysis of the 16 largest metropolitan areas in HCSC’s five-state region and discovered that the Hispanic market for individual healthcare customers “is relatively untapped.”
  2. Hire: Rodgers hired a seasoned marketing professional from the mobile-phone industry because he had deep experience marketing to individual consumers, especially Hispanic customers.
  3. Translate: HCSC translated marketing materials to Spanish (many Hispanics identify Spanish as their preferred language) and adapted other marketing approaches to better connect with the unique preferences and behaviors of the Hispanic segment. One adaptation is increasing the use of mobile marketing materials, because this segment is more likely to access online services via mobile phones.
  4. Experiment: HCSC opened three pop-up retail service sites during the ACA’s open enrollment period to give potential new customers a physical location where they could meet with healthcare insurance experts, including those who speak Spanish.
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