It is only when products flop do intelligent individuals realize the importance of marketing. The problem with many product failures is that decision makers often forget just what marketing is -- the art and science of satisfying customer needs.
This means, no matter what others think, marketing does not get people to buy what they do not want. And for this reason, the Affordable Care Act’s (ObamaCare) destiny can only be product failure because it does not satisfy the needs of most Americans.
Each year approximately 2,000 new products are introduced to American consumers.After countless research hours, 95 per cent of these products fail when they go to market. Only those consumed by hubris could ever believe, “build it and they will come.”
The reality is that when it comes to customer behavior, it is not about you, it is all about your customers.
This customer-oriented approach referred to as “Marketing Myopia” (Levitt, 1960) was introduced in the Harvard Business Review and can be used to dissect the missteps of ObamaCare’s rollout.
For Levitt “businesses will do better in the end if they concentrate on meeting customers’ needs rather than on selling products.”
To be fair, ObamaCare is satisfying some needs with popular features like, the elimination of pre-existing conditions; parents having the ability to keep children on their family health care plans; and providing healthcare to the un-insured.
However, if there is one thing Americans love, it’s their ability to choose.
So where did ObamaCare go wrong? By not testing, listening or executing effectively? Those reasons are obvious and have been discussed.
The real culprit lies with the ObamaCare brand itself -- not responding to the needs of the various segmented markets (micro targeting) that was done so effectively in the two elections that preceded ObamaCare’s product introduction.
It seems that ObamaCare managers forgot about the marketing after the election even though it is how they got to the “dance” in the first place!
The lesson here -- “always be branding” which means always be listening to what customer’s really want, not what marketers think customers want.
Using this “micro-targeting” model, there are three groups that can be identified as potential causes for ObamaCare’s poor rollout -- the young, the presently insured and the un-insured. The first group (the young) includes all those (18-34) folks who voted for the president.
One would think they would never leave brand Obama behind. After all, the president is cool. Except for one important fact -- brands are only embraced when they satisfy needs.
It is no secret that health care is a not a young, single person’s product. With this in mind, the real question is how do you motivate young people to buy health insurance when they do not perceive it as a real need for them NOW!
Remember that marketing is all about what the customer needs and this demographic, simply does not care about health care.Add to it, that young people (under 26) are now included on their parent’s family healthcare plan and you have a brand being cannibalized by its own success.
Another segment, the presently insured (the largest group which include democrats, republicans and independents), is where most of the problems now lie.
This set of individuals have great concern about the brand and where the “wheels can really come off” the ObamaCare brand wagon.
When marketers make changes to already existing products that their customers like, product failure may not be far away. This is especially an issue for the “non-committed” presently insured base, which includes republicans and independents who are more practical than ideological.
Consider at what happened when users of Coke (New) and Netflix were told by marketing executives that changes were being made to their beloved products.
There were protests in the marketplace.
The lesson here: people like their brands and marketers should always think twice about changing them, no matter how much better they think the product will be, when the new improved product features are implemented.
The un-insured, those who do not want insurance unless they have a pre-existing condition or have a pressing medical issue is another group whose needs are not being met by the ACA.
In a recent NBC/WSJ poll, only 24 percent of this group thought that ObamaCare was a good idea. In addition, ACA designers have failed to identify the psychographic reason(s) behind why, the non-insured do not purchase healthcare insurance -- if I am not sick, why should I pay for medical care.
This is the very same inertia we see with the young’s resistance to purchasing health care insurance and their willingness to pay a penalty when a malady occurs. Health care is personal. And to ask them to pay for something that they really do not want unless they get sick, well, therein lays the problem.
Offering health care insurance and changing our respected healthcare delivery system is not an easy process. It needs times to evolve and cannot be changed overnight.
Assessing what Americans really wants for themselves should be the goal of our new “customer centric” health care delivery and healthcare insurance systems. Leaving that to marketing oriented healthcare professionals is the logical choice especially when keeping your customers in mind.