Guest Blog by Patrick Toner, President, Customer Benefit Analytics and Lodestar Alliance Partner
- Benefits are purchased for a combination of emotion and rational motives
- Marketers need to connect on an emotional level to secure the enrollment
My previous blog promoted how data analytics improves the benefits experience by making it more personal. The general idea is to collect data about employees as consumers. We build smarter buyer profiles that guide design of communications and engagement programs. Data for the buyer profile includes past benefits selections, demographic and lifestyle data, and psychographic data about WHY employee make the choices that they make. Good psychographic data is hard to find.
To get this psychographic data we commissioned our own study: Who Buys Voluntary and Why—2016 Benefits Enrollment Research. Employee Benefit News published some key findings from the research on its web site. It’s also available here. The psychographic data is as a revealing window into the employee’s enrollment mindset.
We asked 2,877 employees which benefits were offered, which they took and which they waived, and the reasons—including the primary reasons—for their choices. The findings showed clearly that employees “enroll” for benefits based on emotional drivers—primarily for a feeling of “peace of mind”. This may not be a total surprise for insurance products, or most other products for that matter. The research corroborates more extensive studies that consumers make purchase decisions based on “gut” instincts, and then support those decisions with more “rational” justifications.
Take voluntary Long Term Disability for example. Nearly half (43%) cited Peace of Mind as the single, primary reason for selecting the coverage. The leading rational response—Good Value for the Cost—was a distant second at 14%. Rational responses were relevant factors, however, as can we seen in the list of ALL reasons (Good Value for the Cost – 39%, Plan Details – 25%), but were not significant primary drivers.
Today, our industry communicates the value of LTD to employees with an over-reliance on rational approaches like calculators, comparison grids and lists of features and benefits. These devices have their place, but only after we connect with employees on an emotional level about how LTD will make them feel less anxious, and then reinforce their “gut” feelings with rational arguments to support buying LTD. Adapting our marketing communications to the emotional and rational needs of employees—as reveal through research—makes benefits more personal, and will likely lead to higher participation.
Mr. Toner is CEO of Customer Benefits Analytics (www.customerbenefitsanalytics.com), a New Providence, NJ-based firm that connects employees to the right benefits by using advanced analytics modeling of consumer-level data to provide rich customer insights and in-depth targeting. CBA’s prescriptive analytics optimize participation rates and premiums from benefits enrollment. Its userfriendly dashboards put customized, data-based recommendations at the fingertips of marketing, enrollment, and sales professionals.
Prior to founding CBA, Patrick spent 12 years of in employee benefits marketing, enrollment strategy, and ebusiness roles at Cigna and Metlife. He can be reached at firstname.lastname@example.org or 908.868.8382.