The Current Marketing Model
Today I happened to notice the TV at the restaurant while eating brunch at with my family. The pre-game football fact was sponsored by Aetna and one of the football teams was sponsored by Florida Blue. It piqued my interest because at first it seemed novel, but as I thought more on it I wondered if it was a high-value use of marketing spend.
Recently, I have noticed the proliferation of health insurance companies sponsoring major sports franchises. As a marketer and capitalist, I get it – exposure to large audiences – but as a healthcare executive on the consumer side of the business, I hesitate. I pose this simple question, would it not be more sensible to invest advertising dollars in actual consumer sports leagues rather than professional sports? I believe that health insurance companies should sponsor sports, not sports teams.
Let me make clear, this is not a commentary on insurance companies – I recognize that as businesses they need to attract consumers and I feel they are a necessary part of the healthcare equation in America, and for the most part really do try to bring value to their customers. But with the affordable care act now in place, these traditional B2B companies are rushing headlong towards consumer markets. It is unfortunate that the advertising agencies they use have convinced them that their dollars are best spent associating their brands with Lebron James and Tiger Woods, as opposed to their actual constituents.
We did some research and found this interesting website that shows which companies sponsor what businesses. The graphic below from sponsorship.com is very telling – assuming it is accurate. Even without offering a total spend number, you can assume it is large as both professional sports and healthcare are big business.
Here are some examples of major insurance plans and their sports franchise sponsorships:
- Humana is the “Official Health Benefits Provider” of the PGA TOUR and the Champions Tour.
- Humana Vitality also sponsors the Kentucky Derby.
- Aflac is the “Official Supplemental Insurance Sponsor” of the PGA Tour and Champions Tour.
- Florida Blue sponsors the NFL’s Jacksonville Jaguars, NBL’s Tampa Bay Rays, MLB’s Tampa Bay Lightning, and the NBA’s Orlando Magic and Miami Heat.
- Kaiser Permanente sponsors the NBA’s Golden State Warriors.
- UnitedHealth Group sponsors the MLS’s New England Revolution and its own pro cycling team.
It even extends past the majors into college sports: Aetna sponsors the Taxslayer.com Gator Bowl in Jacksonville, Florida and Florida Blue sponsors the Florida Classic. Florida Blue also sponsors the Florida Sports Foundation which promotes Florida’s sports industry.
I am sure I missed more than a few, as this was just a basic search.
So, I asked myself, what is the motivation for an insurance plan to use professional sports as a brand booster? It must be two-fold, 1) the linkage with the sports as a model for healthy behavior and 2) brand differentiation via the association.
So, this is where the model breaks down for me. I can see Nike sponsoring pro sporting events as their constituents want to emulate the pro athletes that wear Nike gear. Seeing their favorite quarterback wearing branded wristbands results in a purchase decision for a young athlete. It also plays well for non-athlete fans that want to wear their favorite player’s jersey. A purchase decision ensures and the brand association works either way.
Now consider seeing a major insurer’s logo on a teams jersey, or up on the jumbotron. What effect does this have on influencing a consumer’s purchase decision? I would argue that the answer is resounding NONE. To be clear, I am arguing that a health insurer associating with a professional or college sports team has little or no bearing on a purchase decision by a consumer to buy or forgo an insurance product. Unlike the Nike example above, there is likely no transference of that brand association on a point of sale decision of one insurance product over another. One might argue that it actually has a negative effect in that with the perception of insurance premiums being so high – is that money better spent making insurance more affordable?
If this is actually not true – please someone show me, as I am very curious as to the true return on investment for this type of marketing spend.
A Better Way
There are some insurers that are actually focusing on sponsorship of sporting events that will likely result in healthy behaviors for their customers. This is a better model as it promotes the outcomes they most desire – healthy members. Remember, healthy people use health insurance products less than unhealthy ones do. The result is a more profitable customer for the insurance plan.
- Cigna has been involved heavily in the Walt Disney World Marathon Weekend.
- Humana sponsors the National Senior Games Association, the governing organization for the largest multi-sport event in the world for adults over age 50; They also sponsor, thru their subsidiary HumanaVitality, many endurance sporting events (like the Kentucky Derby Festival Marathon and miniMarathon) to promote their wellness loyalty program.
- Florida Blue sponsors a series of running events throughout its state. In fact, almost all health insurers sponsor local 5 and 10K in their hometowns.
This model makes great sense and should be continued. They might even consider getting some of the paid athletes to meet the insurance plan’s customers at the finish line as a reward. Something like “run a 5K and get a picture with your favorite sports hero” – this would be motivation for consumers indeed.
A Much Better Way
But I believe there is even a better way. Here is my idea. Health insurance companies should 100% subsidize both youth and adult sports leagues for the communities they serve.
This is good for the plan and consumer for a host of reasons:
- First, Insurer X would actually be contributing to ensuring their customers are living healthy lives by investing in a healthy activity. They could then reward participants in the free league that are also their members – creating an incentive for those who are not to consider. Coupled with a well-designed channel-threading strategy plans could “gently” direct non-members to online, telephone, and in store sales reps to learn more.
- Second, the publicity it will create for Insurer X. This would in effect be a perpetual positive PR generation machine.
- Third, the experience it will create with mothers, who in fact are the key healthcare decision makers. Knowing they can afford to have their child participate in youth sports because of the investment of Insurer X would go a long way and yield fantastic word of mouth advertising.
Why not extend this sponsorship to adult sports leagues as well? All those twenty-somethings’ being influenced by the brand that cares which may translate to who they choose on the exchange.
What do you think?
To your health,
The Team at imagine.GO