RENEE MONTAGNE, HOST:
In just a few months, the health insurance exchanges outlined in the health law will open for business around the country. That law will penalize many Americans for not buying insurance, and it also makes it illegal for insurance companies to deny people coverage, all of which means a lot more customers out there shopping and insurers trying to sell themselves. Sarah Varney has this look at the potential challenges those insurers will face.
SARAH VARNEY, BYLINE: It sounds like a marketer's dream: captive shoppers directed by the government to buy your product. But when the product you're selling is health insurance, there are undoubtedly some pitfalls. Your customers may not love you. In fact, they may despise you. You doubled, tripled, quadrupled their premiums. You denied them coverage because of a preexisting condition just when they needed you most.
JAMES PERCELAY: I think it may be too little, too late for health insurance companies to now come out, like, hey, we were just kidding the last 50 years. You know, we're really not the people that you think we are.
VARNEY: I sat down with James Percelay - the cofounder of the viral marketing firm ThinkModo - in New York City to talk through some solutions to these challenges. Not only do people dislike insurance companies, they're hard to tell apart. Customers will go to a website and see a boring list of indistinguishable names: Humana, Oxford, Blue Cross, Healthnet. The products and prices won't look that different.
It's the perfect moment, says Percelay, for a little humor.
PERCELAY: You cannot really differentiate one insurance company from another. But you can differentiate who has the wackiest mascot, or scenarios that are kind of fun to watch.
VARNEY: And is that why we ended up with the Geico gecko?
PERCELAY: Exactly. I think Geico is the model insurance companies are probably going to gravitate to.
(SOUNDBITE OF GEICO COMMERCIAL)
UNIDENTIFIED MAN #1: Good thing about Geico is, they've got, like, real live people working there 24-7.
VARNEY: Geico has its talking lizard. Progressive car insurance has that perky woman named Flo. If comedy can work for a boring product like car insurance, it could work for health insurance, too. Another challenge health insurers face: They want young, healthy people, the people least willing to pay for coverage.
Percelay says insurers need to craft their message to reach that demographic.
PERCELAY: There could be product placement of Oxford within a "Jackass" movie, so subliminally, you know, when Steve-O is bungee jumping with a rubber band off the roof of a building, perhaps that rubber band has an Oxford logo on it.
VARNEY: Health insurance companies could start claiming the same advertising spots reserved for Red Bull and Corona - poolside parties at the Humana Cabana? And companies will have to go to where young adults spend their time: on their phones and inside video games.
PERCELAY: You could even see video games integrate health insurance marketing, you know, "Angry Birds," you know, maybe there's "Angina Birds."
(SOUNDBITE OF MUSIC)
VARNEY: Or how about a health plan underwriting one of MTV's awesome reality television shows? The next "Jersey Shore" brought to you by Blue Cross/Blue Shield. Percelay has the tagline ready.
PERCELAY: Don't binge without blue. You know, really tie into this lifestyle that, allegedly, kids want to have.
(SOUNDBITE OF TV SHOW, "JERSEY SHORE")
UNIDENTIFIED MAN #2: Our motto around here is whatever happens, happens.
VARNEY: As fun as all this sounds, it costs a lot of money for an insurance company to sign you up for the first time, so they want you to stick with them. Health plans will have to give customers a reason to pick a brand and stay loyal.
PERCELAY: Customer retention for insurance companies is going to be based upon some sort of reward, some sort of reason to stay with them.
VARNEY: Percelay could easily see iTunes credits or a Starbucks card for paying your bill on time or staying healthy. Indeed, the health insurance company Humana already allows its customers to earn "Vitality Bucks" that can be redeemed at the "Humana Vitality Mall." Keep your blood pressure in check, earn a digital camera. One thing is for sure: We're all about to be blanketed with health insurance advertisements, and for the first time, the customer will become king.
For NPR News, I'm Sarah Varney.