Tips on How to Break Into the Wellness Market

A primer for breaking into a growing and potentially lucrative market.

Sleeping is all in a days’ work at Aetna. The U.S. health insurance giant recently announced it would pay employees to get at least seven hours of sleep each night. Workers use their own devices such as Fitbits to track their sleep patterns, and those who successfully meet the goal can earn up to $300 a year.

While its pay-to-sleep program is a bit unorthodox, Aetna’s commitment to employee health isn’t. A recent HR management report shows about 70% of U.S. companies now offer their workers wellness programs, hoping to capitalize on a trend that’s already backed by strong ROI.

A Harvard University study, in fact, found that for every $1 invested in a corporate wellness program, companies could receive a $6 return on investment, a direct result of reduced medical costs and a drop in absenteeism. Companies that jumped onboard initially for the financial benefit are also finding additional, less tangible perks, like energizing and motivating their workforces.

Indeed, corporate wellness – which has evolved into an $8 billion industry according to IBISWorld – is clearly an important business strategy, impacting firms’ bottom lines, as well as employee productivity and culture. Promoting these initiatives, and enticing employees to participate is critical to their success.

“This is not just an opportunity, it’s the opportunity for promotional product distributors for at least the next 10 to 15 years,” says Ron Williams, a former sports medicine physician who’s now the director of marketing at Fey Promotional Products (asi/54040).  

Here, Williams and a number of wellness experts share their experiences and advice on how distributors can tap into this expanding market segment.

The Basics
With group health-care rates spiking – some soaring by double digits in 2015 – companies are promoting healthier workplaces to help cut down on health-care claims. “Some insurers offer lower premiums to companies that offer wellness programs,” says Mark McCormack, owner of Identity Marketing Group (asi/229993). In turn, healthier employees make fewer medical claims and take fewer sick days.

The approach is proactive versus reactive, encouraging employees to take charge of their health and make positive changes, rather than waiting until they develop serious health problems, which are much more expensive and harder to correct. While you can’t position yourself as a health-care consultant, you can become familiar with the Affordable Care Act (ACA), related wellness initiatives, as well as their costs and their results.

“Become the subject matter expert in your locale,” says Williams. The more distributors know, the more easily they can understand their clients’ pain points and provide targeted promotions, he explains.

“The Wellness Council of America (WELCOA) is a great point to begin with wet feet and be steered in the proper direction,” says Williams. WELCOA provides training, resources, webinars and case studies, all about workplace wellness. “While it’s not critical to have an association with a group like WELCOA, it helps fast-track the education and understanding of complex issues.”

Prospecting Ideas
McCormack has been selling to the health-care/wellness sector for about 17 years. His company benefits from its Omaha location, home to the University of Nebraska Medical Center and many health-care and insurance companies.

Local chapters of the Society for Human Resource Management, McCormack believes, are great places to prospect for wellness clients. “Let them know you have programs available. Ask if you can attend a local meeting or even sponsor an event,” he says. “They want to know who does these in your location and want to partner with people like you. Go get the business.”

McCormack has partnered with both SimplyWell and United Healthcare, which provide metrics as well as medical and onsite tools for wellness programs. “Both companies are really getting that information out there so human resources has the information it needs to make purchasing decisions,” he says.

McCormack suggests seeking out and networking with wellness providers in your region. Later, when pursuing sales opportunities, he believes you should focus on promotional items and incentives that boost program engagement. “We work with SimplyWell as their brand agency, and also refer business back and forth,” he says.  

Since “every business is affected by rising health-care costs,” Don Sanders, owner of Don Sanders Marketing (asi/318050), thinks every prospect should be a wellness target. In larger companies, the HR department is the best place to start, he says, and in smaller ones, either the owner or the personnel department should be the point of first contact.

Who’s Driving the Wellness Boom

Baby boomers are the leading force in health and wellness, and no other demographic has more buying power, says Fey Promotional Products (asi/54040) director of marketing Ron Williams. “Baby boomers are sick and tired of being sick and tired: 73% have chronic health issues, while 77% of all prescription drugs and 61% of over the counter medications are bought by boomers. No wonder they’re concerned about getting their health back.”

Behind them are the Generation X-ers and millennials, and according to Williams, both these groups are even more concerned about their health than the boomers. “They don’t want the same health issues as their parents and grandparents. They don’t want GMOs or preservatives in their food, and they are opting for a healthy lifestyle,” he says.

Williams, a former sports medicine physician, is such a believer in the ad specialty potential of this sector that he’s educating distributors through a webinar titled “Solving the Wellness Puzzle.” In April, his webinar attracted over 400 distributors.

“This is not a fad,” says Williams. Becoming an expert on consumer trends in healthy living and eating, plus helping to establish corporate wellness programs are distributors’ top two opportunities to generate substantial sales gains now and for decades to come, he adds.

Making the Pitch
If a company already has a wellness program in place, distributors shouldn’t consider the door closed to new business. Instead, salespeople should pursue a company meeting to “reverse engineer” a program that addresses whatever wellness pieces might be missing, says Fey’s Williams.

For firms that don’t yet offer wellness programs, Williams thinks distributors can wield great influence. He sees the best opportunity in clients with 40-90 employees, as he says these companies will be faced with greater ACA-related challenges within the next 16 months, due to iterations and updates of the law.  

As ACA effects persist, Sanders thinks distributors should aim right for the wallet, emphasizing cost savings to these mid-sized firms. He creates flyers and cards with the message, “Let me help you reduce your insurance premiums next year,” which he backs up with supportive collateral materials containing facts and figures. He also offers webinars and presentations titled, “How to Afford the Affordable Care Act” and “Don’t Let Obamacare Put You Out of Business.”

McCormack recommends asking specific questions upfront. For example, you might find out how many smokers a company has so you can establish cost benefits of tobacco cessation programs. If there is a significant cost reduction, there can be a savings in creating a plan or implementing an incentive for these customers.

McCormack also creates a pitch document that caters to clients’ needs, and contains facts and health-care information. He puts together a demo with good, better, best sample products, as well.

“Work with an open mind. Even when the buyer tells you the spend is small, once this program is in place it becomes an annuity,” says McCormack, adding, “they never cancel these programs, as it looks bad for the HR department. The long-term residual sale of a program is better than the one-off, just be ready to be responsive if anything changes.”

Incentives Matter
About half of LHD Benefit Advisors’ clients have a wellness program in place, according to senior benefits advisor Frank J. Grimm. The Indianapolis-based full-service employee benefits firm primarily works with companies that have 50 to 1,000 employees. “In our space, companies are looking for wellness recommendations, communication, education and delivery,” says Grimm.

The adoption of wellness programs according to Grimm is more about the culture of a company than its size. In the early stages of wellness, cost was the focus, but progressive companies are recognizing the add-on benefits. “The best programs positively impact costs, and encourage team activity and participation,” Grimm says.

One LHD client, Clarke Engineering Services, recently made its first foray into wellness. In order to qualify, employees had to get a physical within one calendar year. In return, workers got back $20 per paycheck for benefits, for a total of $40 per month. Clarke has about 100 employees.

This proved to be a powerful incentive – every single employee signed up. “We decided to start slow with our group and build on it in the future,” says Clarke HR manager Aimee J. Parrish. “My goal is to get this group healthy.”

Incentives, no doubt, are key, but cash isn’t always king. “The most successful programs have multiple designs, which might be gift card programs, challenges that allow participants to enter drawings for gift cards or rewards, Web stores and promotional items. Sometimes something like a water bottle gets employees excited,” says Grimm.

McCormack, too, has seen the value of offering wellness incentives. He created a supplemental program for a large university that wanted to emphasize well visits. Employees had already received Fitbits to track the existing programs, such as calories burned. So, McCormack pitched a program with A, B and C incentive products ranging from $10 small headphones to $200 Bose speakers.

The program involved continual messaging for this customer: one quarter, it encouraged employees to get up from their desks, the next pushed staffers to drink more water with bottles that had a measuring device on the side. The third quarter offered up a lunch bag and calorie guide, and Q4 included a duffle bag and gym membership.

If members completed well checks and achieved their goals, they got a free year membership to a gym, as well. They could also receive an incentive prize from an online system, which varied depending on how many points they earned from the program administrator.

Meanwhile, Joshua Ebrahemi, vice president and partner at Jack Nadel International (asi/279600), provides launch kits to get clients’ employees excited about wellness programs. “When I pitch, I don’t push commodity stuff – I show custom wellness items that they will use. I’m a big fitness guy, so if I won’t use it, I won’t pitch it,” he says. The items need to tie in with the program. “Make sure it’s useable, teaches and is accurate,” Ebrahemi says. Among his top picks: Custom hot/cold packs in the shape of a client logo and easy-to-pack exercise bands that can be used on the road, uniquely packaged with an insert instruction card.

Programs With Buzz
There’s no such thing as a one-size-fits-all wellness program. Every business is individualized, and while certain aspects of wellness programs might work well across numerous companies, understanding the basis of an employers’ workforce and their employee health tendencies is crucial, says Fey’s Williams.

Of Aetna’s 50,000 employees, some 34,000 currently participate in its wellness programs, says communications director Ethan Slavin. About 40% of participants use a wearable device to log their healthy activities.

In addition to its year-round Healthy Lifestyles program, which uses cash incentives, Aetna also offers a “Get Active Aetna” initiative in the fall which is a team-based wellness challenge for employees. If they meet certain healthy activity requirements during this period, they have the opportunity to earn Aetna gear, like gym bags, yoga mats, water bottles and other apparel, or they can donate an equivalent to charity, Slavin says.

The program that garners the most buzz and participation among LHD Benefits’ clients is the Biggest Loser challenge. “Obesity is the biggest challenge we face. Data confirms weight and exercise are the two biggest challenges for employers,” says Grimm. Driving excitement is important to get people participating and then to follow through, says Grimm. Some clients do programs multiple times a year, and some do continual programs with quarterly evaluations.

“Initially everyone wants to lose weight, but when you peel back the onion, there’s always a root problem – stress for example,” says Jamie Howard, vice president of sales and marketing at Cultivate by Standard Process, a provider of on-site wellness programs. “As we dig deeper into our clients’ claims, it always comes back to prescription drugs, one of the biggest drivers of health-care costs.”

As more data and analysis becomes available, Grimm says wellness providers will continue to develop new programs to address topics like disease management, or to manage chronic conditions and find better ways to engage different populations. Some firms are even tackling topics like financial wellness and stress reduction – areas that savvy distributors can target with practical products and programs, too.

“Always bring more than just products when pitching wellness programs. Bring ideas that you can implement. It’s tougher to price an idea than it is to price out products. If you have an idea and tell them you can provide a product that will get results, the pricing on the product won’t really matter. You’ll create value rather than just selling a commodity.”  Mark McCormack, Identity Marketing Group

Jean Erickson is a contributing writer for Advantages.