Case Study for Agency
03-1015023-056

CASE STUDY: Keystone East - Keystone 65 Launch

Situation

The Agency has worked as the direct marketing partner with Keystone
East for over 5 years. In addition to development and implementation of
specific direct marketing programs, the Agency has employed profiling
and modeling techniques to both increase current market penetration and
expand successfully into new geographies.

In recent years, Keystone East -- like most traditional health care
providers -- has been faced with increasing competition from both new
providers and alternative managed care product lines. In response to
these pressures, Keystone developed a Medicare Risk product, Keystone
65, to expand its product portfolio, retain current healthy and/or
"price sensitive" customers, and significantly expand its market share.
The Agency was charged with successfully orchestrating this product
launch.

Marketing Challenge

The objectives of the Keystone 65 launch were to:

· Successfully launch the Medicare Risk product line
· Minimize disruption of the existing senior market customer base in
terms of market confusion and/or negative disintermediation
· Overcome the perception of Blue Cross Blue Shield as the staid,
traditional provider of high cost health care products
· Overcome senior market aversion to managed care product alternatives
· Establish a sustainable barrier to increased market competition.

Application of Solutions

The Agency developed a multi-phase launch campaign that combined:

· Targeted direct mail for lead generation and seminar attendance
· Customer advance notification direct mail retention
· Multi-media "pre-heat" market conditioning utilizing television,
radio, print, and billboards
· Expansion into multi-media lead generation

Based on the success of the initial direct mail campaigns, media
expansion programs were developed. These lead generation programs
combined broad reaching DRTV and newspaper inserts with targeted:

· Direct mail for new customer acquisition
· Expanded mailings for seminar attendance
· Newsletters/direct mail/telemarketing for the Turning 65 birthday
program
· Direct mail for current customer retention

Multiple creatives were tested within each medium prior to full service
area expansion. Strategically, the creative approach involved a dual
thematic positioning of Keystone as the low cost leader in product
innovation, with the message delivered through concurrent media
executions.

In addition, as additional products became available (Keystone 65 POS
and Personal Choice 65), an integrated alternative offer strategy was
developed and employed within the lead fulfillment process. This
ensured maximum sales production by allowing the prospect to select
either the lead Medicare Risk product or a traditional alternative.

The Agency's alternative offer lead fulfillment process included a
combination of inbound/outbound telemarketing lead qualification, mail
fulfillment, and mail/telemarketing follow-up. Mail fulfillment
required extensive complex handling of both appropriate offer and
personalized matching, with accuracy driven by product, legal
compliance, data management, and client reporting requirements.

Results

As a result of the successful launch and expansion program, Keystone
East:

· Established a leadership position within the senior market
· Established itself as the 3rd fastest growing HMO in the United
States
· Expanded its current birthday program into a successful multi-contact
effort
· Identified winning control positions and media combinations for
subsequent expansion.