Monday, November 12, 2018

#32 Is Obamacare Costing Consumers $1.3 Trillion?

Issue #32 - Monday, November 12, 2018
http://dennyhatch.blogspot.com/2018/11/32-is-obamacare-costing-consumers-13_41.html

Posted by Denny Hatch

Is Obamacare Costing Consumers $1.3 Trillion?


This past year at age 83 I had a horrific 3-week bout with health problems.
Included were myriad doctors and specialists, ER, OR, recovery room, ICU, meds, CAT scans, X-Rays and hospitalization—the whole megillah.
The bill (so far) is $97,349.41.
 No kidding. Here's one of the actual bills. 


Imagine a young family or a single mom—with no health care—getting smooshed in a car crash and facing $97,000 in health care bills when 40% of Americans can't cover a $400 emergency bill.

Financial ruin on top of physical wreckage.

Okay. I have Medicare.

What do you have?

I Remember Medicare
I was thirty in 1965 when President Lyndon Johnson signed Medicare into law.
• My father loved it! He had contracted tuberculosis of the bone 60 years earlier and underwent 19 excruciating operations. He ended up with a shriveled right leg and was on crutches all his life. My family could afford it. If not, I wouldn't be here.
• I do not recall any wringing of hands or national debate how Medicare would be paid for. Congress and the president simply said, "Make it so."
• I thought it was nuts!
• Why only take care of geezers? I wondered.
• For God's sake everybody should be insured. The most important are those working people who are paying taxes and contributing to the economy. They should be able to get back on the job as fast as possible.
In terms of Health Care, the U.S. is alone in stupidity.

World Health Care

  Universal Health Care (Green), Free Health Care (Blue) 
Countries in Red Have No Free or Universal Health Care

Look at the bright red United States on the map above. No Universal Health Care—just like the primitive nations of Africa and Asia where the sick and injured die like flies.
Even with Medicare, Medicaid, corporate paid health plans and Obamacare, 28 million of us have no health care.
Twenty-eight million is roughly the population of Yemen (which has no Universal Health Care).
In Yemen, the under-five child mortality rate is 100 deaths per 1,000 births. That means 10% of all children under five dies.

A Yemeni's life expectancy is 64.95 years.
Universal Health Care—AKA Single Payer—
Is a Simple, No-brainer Marketing Challenge
 When I was an NBC page (usher) part time while at Columbia College, FICA (Federal Insurance Contributions Act) was deducted from every paycheck.
FICA deductions continued throughout my 60-year career.
Social Security, Medicare and Medicaid are no routinely dubbed "entitlements" by sad sack politicians.
"To balance the budget," Congress whines, "we must cut entitlements!"
"Entitlements" sound like we are all lazy leeches sucking undeserved cash out of the government and each other.
Let's get one thing straight:
Since 1935, FICA has been a financial contract from birth to death forced on us by the government. When a weasel politician threatens to "cut entitlements" he is advocating a breech of contract.
Obama's Grotesque Rip-off: The Affordable Care Act
The original Affordable Care Act runs 955 pages of dense, often indecipherable and twisted legalese.
It could have been reduced to 10 words:
Medicare is hereby expanded to include Americans of all ages.
The FICA deduction should be substantially increased to cover Medicare for all.
Like Social Security, there should be no choice of plans. No opting out. Healthy youngsters, sick oldies, everybody with pre-existing conditions—all much participate in the scheme.
Yeah, this means raising taxes.
Taxes are good. 
"Taxes are what we pay for civilized society," said Justice Oliver Wendell Holmes, Jr.—words inscribed over the entrance of IRS headquarters.
Taxes pay for the necessities of life—schools, infrastructure, military, courts and jails, legislative bodies, education, police and fire protection, clean water, disease control, FEMA, paying down the national debt, etc., etc.
You cannot order these necessities from Amazon. They come from tax dollars.

Taxes should pay for Universal Health Care, just like every other civilized country in the world.
Our Impoverished Congress
Every member of Congress has one overarching agenda that trumps all else: Get re-elected."
Base salary of a Senator or House member is a beggarly $174,000 a year. Other "earned" income cannot exceed 15% of that. Honoraria are disallowed.
 

The average Congressperson spends 4 hours a day—every work day—out of the office in a telemarketing boiler room with a script pleading with donors for campaign contributions. 

Congresspersons need to raise $18,000 a day every workday or find another job.

On the first Wednesday morning in November after Election Day the four-hour-a-day fundraising starts again so they can buy their jobs in the next cycle.
 Bribing Congress with $414.1 Million a Year
In 2009-2010 the Affordable Care Act was being enacted.
That year—and every subsequent year—the health insurance and pharmaceutical industries bought their way into Obamacare with contributions to the campaign funds and private PACs of financially strapped members of the House and Senate:

Industry                                       Bribes to Congress
Health Insurance Industry               $168.4 million
Pharmaceutical Industry                  $245.7 million
              Total Bribes                      $414.1 million
ROI on $414.1 Million Bribes to Congress
Industry                                        Annual Revenues 
Health Insurance Industry               $938 Billion
Pharmaceutical Industry                  $450 Billion
Single payer health coverage would eliminate the health insurance industry and free up $938 billion annually that could go directly health care. 

What Do Bribes to Pill Peddlers Buy? No Negotiating Prices!
"Under current law, the Secretary of the Department of Health and Human Services (HHS) is explicitly prohibited from negotiating directly with drug manufacturers on behalf of Medicare Part D enrollee." 
(Unlike with the Veteran's Administration.) 

If drug prices were 20% lower, that wold free up another $90 billion that could go directly to health care.

Add these two amounts together—eliminate health insurance ($938 billion) and get drugs 20% cheaper ($90 million) in my opinion insurance companies and big pharma are stealing $1.3 trillion from health care.

 The Utter Failure of Obama's Marketing
The premise of Obamacare: involve every prospect in the deep weeds of health care. Give them choices to join or opt out (and pay a small fee) and offer myriad plans.

In the United States, 50% of adults cannot read a book at the 8th grade level. Thus half the country had no idea what the hell the Obamacare website was talking about.

Duh.

The Fact Is...
People do not want choices. They want to check a YES box that enables them to pay afforable premiums and be guaranteed they will be taken care of if they get sick or injured.

Obama's Non-P.R. Campaign
 I am a student and long-time practitioner of Public Relations/Publicity.

At age 15, as an apprentice (intern) at the Ivoryton, Connecticut summer playhouse, my teacher was Evelyn Lawson, a hard drinking, heavy smoking ex-Ziegfeld Follies showgirl. Evelyn said:

"Successful P.R. is letting people in on what you are doing."

"Editors are basically lazy. If you can give them a story they can use, they'll run it rather than going to the trouble of writing something original." 

 For starters, on opening day the HealthCare.gov website crashed and remained comatose for days.

Thirty million said the hell with it and opted out.

The financial viability of Obamacare was crushed at the outset.

Shudda. Wudda. Cudda.
What the White House should have done was hire a great P.R. Firm—e.g., Bob Dilenschneider, Edelman, Weber Shandwick, Ogilvy—consummate professionals that know the secrets of influencing public opinion.

From the moment Obamacare was signed into law, the country should have been blitzed seven day a week with heartfelt, deeply individual stories of men, women and especially children whose lives and family fortunes were being saved by Obamacare. (Or destroyed by having opted out.)

This P.R. coverage of Obamacare news should have been filled with the key copy drivers—the emotional hot buttons that make people act:

Fear - Greed - Guilt - Anger - Exclusivity - Salvation - Flattery

The ultimate hot button: FEAR. Scare the Bejeezus out of everybody without health care.

Instead nothing. Nada. Zippo.

"The sale begins when the customer says yes," is the mantra of the great freelancer Bill Christensen of Ellicott City, Maryland.

All politics is theater.

"We don't do theater" was the mantra of Team Obama.

And so this rogue legislation squeaked through, whereupon the White House did not follow-up and went on to other business.

Fast Forward to 2018
In the November midterm elections, Donald Trump held rallies all over the country scaring the wits out of his base these specious terrifying issues:
    Immigration
    Caravan of Foreign Invaders from Mexico
    15,000 U.S. Army Troops Being Sent to the Boarder
    The Wall
    War with Public Enemy #1: the Media and Fake News
    Witch Hunt Investigations
    Replacing Obamacare
    Blame Hillary Clinton and the Democrats

Health Care: The Issue That Threw the Rascals Out!
"A plurality of 41 percent identified health care as the issue most important to their vote, which Democrats made the centerpiece of their campaign races throughout the country."Benjy Sarlin, NBC NEWS  

Will Congress and the Executive Branch get it right?

Not in my lifetime.

Alas, the Herculean struggle to get re-elected dominates the life of every single member of Congress.

Too many of them are emotionally—and financially—incapable of doing the right thing.

Takeaways to Consider
"The definition of an honest politician is one who, when bought, stays bought." —Simon Cameron (1799-1899) U.S. Senator from Pennsylvania, Lincoln's Secretary of War
• By eliminating health insurance and knocking 20% off drug prices, $1.3 trillion could go directly to health care.

• Single Payer Universal Health Care must be paid for by higher taxes.

• Taxes are good.

• Taxes pay for the necessities of life—schools, infrastructure, military, courts and jails, legislative bodies, education, police and fire protection, clean water, disease control FEMA, paying down the national debt, etc., etc.

• In the U.S. we pay the lowest taxes in the world!


• 44% of Americans pay no federal taxes.

Jared Kushner (Trump's son-in-law with net worth of $324 million) paid little or no taxes 2009-2016.

• With the looming $30 trillion national debt, we are human lemmings inexorably headed for financial Armageddon.

•Yeah, let's raise taxes and start to pay down the debt. We can afford it.


###
Word count: 1695


At age 15, Denny Hatch—as a lowly apprentice—wrote his first news release for a Connecticut summer theater. To his astonishment it ran verbatim in The Middletown Press. He was instantly hooked on writing. After a two-year stint in the U.S. Army (1958-60), Denny had nine jobs in his first 12 years in business. He was fired from five of them and went on to save two businesses and start three others. One of his businesses—WHO’S MAILING WHAT! newsletter and archive service founded in 1984—revolutionized the science of how to measure the success of competitors’ direct mail. In the past 55 years he has been a book club director, magazine publisher, advertising copywriter/designer, editor, journalist and marketing consultant. He is the author of four published novels and seven books on business and marketing.

CONTACT
Denny Hatch
The St. James
200 West Washington Square, #3007
Philadelphia, PA 19106
215-644-9526

Note to Readers:  
May I send you an alert when each new blog is posted? If so, kindly give me the okay by sending your First Name, Last Name and e-mail to dennyhatch@yahoo.com. I guarantee your personal information will not be shared with anyone at any time for any reason. I look forward to being in touch!

Invitation to Marketers and Direct Marketers: 
Guest Blog Posts Are Welcome. 
If you have a marketing story to tell, case history, concept to propose or a memoir, give a shout. I’ll get right back to you. I am: dennyhatch@yahoo.com
215-644-9526 (rings on my desk).

You Are Invited to Join the Discussion!

Thursday, November 8, 2018

#31 The Bankers That Trashed a Beloved USP



Issue #31 – Thursday, November 8, 2018
http://dennyhatch.blogspot.com/2018/11/31-bankers-that-trashed-beloved-usp.html

Posted by Denny Hatch

The Bankers That Trashed a Beloved USP


For my money, loose change is a pain in the neck.

Especially pennies. The U.S. Mint—which spends 1.82¢ to make a penny—lost $69 million last year producing pennies.

(Actually that’s a good deal. It costs the Mint 7¢ to produce a nickel!)

For many years we had a change jar into which went our spare change at the end of the day. Every three months or so, the jar overflowed. So began sorting, stacking, squeezing stacked coins into paper tubes and carting them down to the bank.

It probably takes one hour to sort, stack and stuff coins into tubes. This is not only boring and time consuming, but also a lousy ROI (Return on Irritation).

Commerce Bank’s Crown Jewel
Imagine our delight when two blocks from our house in Center City Philadelphia, Commerce Bank opened a branch with all normal banking services.

Plus a crown jewel—the magnificent Penny Arcade coin counter you see at the top of this post.

We immediately opened accounts at Commerce Bank—personal checking, corporate and savings. As a welcome goodie, they gave us a free safe deposit box for a year.

Easy Peasy No More Squeezy!
Instead of squeezing stacked coins into flattened paper tubes, we could take a plastic shopping bag of mixed coinage down to the bank and dump it into the Penny Arcade.

We ended up with a little printed receipt that could be presented to a teller who would give us cash (bills and a few coins) or simply deposit the total in our checking account.

In terms of P.R., the Penny Arcade was brilliant.
Little kids were delighted because a goofy recorded voice talked them through the process. The whirring and clanking sounds heightened the excitement—like a circus orchestra.

Kids could also win a prize for guessing in advance the total amount their coins would bring it.

It was a hoot—a veritable automated Frank Brock, who was The World’s Greatest Banker! Brock, president of the First Bank of Troy, Idaho had 6,000 active accounts worldwide in a town of 555 residents. How? He got children into the bank and kept them for life. 

The Penny Arcade Was a Beloved USP!
Remember the USP—the memorable Unique Selling Proposition—that feature/benefit that makes your product or service stand out from the competition:

Memorable USPs—Unique Selling Propositions
           “99 and 44/100% pure.” —Ivory Soap (Procter & Gamble, 1892)
           “The skin you love to touch.” —Woodbury Soap, (J. Walter Thompson Co., 1911)
           “When it rains it pours.” —Morton Salt (N.W. Ayer & Son, 1912)
           “We try harder.” —Avis (Doyle Dane Bernbach, 1983)
           “We’ll leave the light on for you.” —Motel 6 (Richards Group, 1988)
           “Bags fly free.” —Southwest Airlines (GSD&M, 2010)
 
 Trashing the USP
In 2007, TDBank (Toronto Dominion) bought Commerce Bank for $8.5 billion. Nine years later Peggy and I moved six blocks and began doing business with the Penny Arcade at the TDBank branch nearest us.

Two years ago I lugged a bag of coins to my TD Bank branch.

The Penny Arcade coin sorter was gone!
“Where’s the coin sorter?" I asked a young officer at desk in the lobby.

“We’ve discontinued the service.”

“What? Why?”

“Management decided it wasn’t worth the trouble.”

“Does another branch have a coin counter?”

“They’ve been removed from all 1,300 branches.”

“Can I take these coins to a teller and get them counted?”

“Bring them in rolls and we can accept them. You won’t be charged for the service.”

Enter Lawyers
The bank was the subject of both a New York lawsuit and a report on NBC, which found the machines short changed multiple deposits of $300 worth of coins by as little as 5 cents and as much as $43.10. "Offering free coin-counting to our customers has been a long-standing service at TD," said Michael Rhodes, the head of TD's consumer banking. "However, recent accounts regarding the performance of our Penny machines have led us to reassess this offering. We have determined that it is difficult to ensure a consistently great experience for our customers." —Chris Isidore, CNN Money

Here’s How to Get Your Money Back
The bank, headquartered in Cherry Hill, removed all the coin counters. But they still faced a class-action lawsuit from plaintiffs in three states seeking to recoup the amount they believe they were shortchanged over the years. Now, after four mediation sessions and much back and forth, the bank has agreed to a settlement that would cost it more than $9 million dollars. Of that, nearly $7.5 million will be shared among customers who used the machines, if the settlement gets final approval. —New Jersey Real-Time News

The End



Takeaways to Consider
• With no Unique Selling Proposition, TDBank can no longer call itself “America’s Most Convenient Bank.” It’s like every other dreary local bank.

• If 50 Penny Arcade users in each of TDBank’s 2450 U.S. and Canadian branches are unhappy, that’s 122,500 pissed-off customers.

• Commerce/TDBank exhibited sloppy research by lazy incompetent decision makers.

• The result: CRM (Customer Relationship Misery).

• All banks have machines in the back that can measure coinage to the penny.

• A quick search on Google turned up four industrial coin counter manufacturers: Cummins Allison, SCAN COIN, CTcoin and GLORY.

• It seems to me any one of the above would be delighted with an order 2450 coin counters, would be thrilled to gussy them up for consumer use and keep them running perfectly under a maintenance contract.

• A bank with a public coin counter that cannot accurately count coins is a jerkwater institution and a good reason to switch banks.

• “Always go first class.” —Bob Teufel, President of Rodale Press

• The only people who make money on class action suits are lawyers.


 ###
Word count: 903

At age 15, Denny Hatch—as a lowly apprentice—wrote his first news release for a Connecticut summer theater. To his astonishment it ran verbatim in The Middletown Press. He was instantly hooked on writing. After a two-year stint in the U.S. Army (1958-60), Denny had nine jobs in his first 12 years in business. He was fired from five of them and went on to save two businesses and start three others. One of his businesses—WHO’S MAILING WHAT! newsletter and archive service founded in 1984—revolutionized the science of how to measure the success of competitors’ direct mail. In the past 55 years he has been a book club director, magazine publisher, advertising copywriter/designer, editor, journalist and marketing consultant. He is the author of four published novels and seven books on business and marketing.

CONTACT
Denny Hatch
The St. James
200 West Washington Square, #3007
Philadelphia, PA 19106
215-644-9526

Note to Readers:  
May I send you an alert when each new blog is posted? If so, kindly give me the okay by sending your First Name, Last Name and e-mail to dennyhatch@yahoo.com. I guarantee your personal information will not be shared with anyone at any time for any reason. I look forward to being in touch!

Invitation to Marketers and Direct Marketers: 
Guest Blog Posts Are Welcome. 
If you have a marketing story to tell, case history, concept to propose or a memoir, give a shout. I’ll get right back to you. I am: dennyhatch@yahoo.com
215-644-9526 (rings on my desk).

You Are Invited to Join the Discussion!

Saturday, October 27, 2018

#30 How Database Analysis Saved the Great Dane's Business

Issue #30 – Tuesday, October 30, 2018

http://dennyhatch.blogspot.com/2018/10/30-how-database-analysis-saved-great_27.html

Posted by Denny Hatch

How Database Analysis Saved the Great Dane’s Business


In the 1970’s I wrote two novels. Movie rights were sold and I got a small pot of money. (No film was ever made, alas.) But Peggy and I splurged and bought a top-of-the-line Bang & Olufsen stereo rig like the Danish beauty you see above—big bucks in those days.

It was glorious to listen to as well as to look at. This model was on exhibit at the Museum of Modern Art. Every time we put on an LP or listed to FM radio, it was thrilling.

At the time I was 42. I probably mailed in a warranty card back in 1977. It was a period well before sophisticated analysis and modeling. B&O no doubt stuck my registration card in a shoebox that was consigned to a warehouse, whereupon they forgot about me.

What's more, B&O had no idea who I was, who was buying their products or how to reach their market.

Who Were Bang & Olufsen’s Customers?
In the early 1990s, Bang & Olufsen began an aggressive campaign to expand its share of the audiophile market.


At that time the company had 17 retail stores across the country. All B&O management had to go on was a little list of 32,000 buyers.

When building a business, it's a good idea to:
• Know who your customers are.
• Go where the folks with those demographics are.

Bang & Olufsen was operating on the assumption that its typical buyer was a single professional male between the ages of 25 and 30 with an average income of $50,000.

Wrong.

The First Sad-Sack Survey
In 1994, Bang & Olufsen decided to survey its customers to find out more about them. An outside research firm designed the survey on single sheet of paper with a business reply envelope and mailed it to the list.

Thanks to the incentive of a free CD for completing the survey, it generated a 20-percent response. It was learned that the typical buyer earned more like $70,000 than $50,000.

Still very wrong.

Turning to Direct Marketers for Answers
In 1997, Bang & Olufsen decided to get serious about developing a customer profile. Chicago-based agency Lighton Colman brought the database wizards at Metromail together with Bang & Olufsen.

Lighton Colman's John Tomkiw recommended INSOURCE—a co-branded product created by Metromail and Experian (née TRW).

INSOURCE contained more than 300 individual data elements on 95 percent of the 100 million households in the U.S.

When the Bang & Olufsen wee housefile was bumped up against INSOURCE, the results astounded the corporate executives. (I was not astounded.)

It turned out the typical customer was:
• A married professional male.
• Average age: 50-55.
• Homeowner with grown children.
• Making an average salary of $150,000+.

“The data were full of surprises. Our previous suppositions were demolished. Through the INSOURCE enhancement, our data was amplified to such an extent that we really came up with a profile that's pretty unique—and that we can take action on. The differences are not subtle.” —Keith Lennartson, B&O Communications Director.

The Survey Revolutionized B&O’s Marketing
Now, instead of blazing away with a shotgun, Bang & Olufsen was armed with a sniper’s rifle. Among the immediate changes instituted as a result of the INSOURCE connection:

Radical Media Repositioning
For years, B&O was blowing advertising dollars on media with the wrong readers. The old schedule included: The Robb Report, Where, Departures.

The new schedule: Cigar Aficionado, Worth, Conde Nast Traveler, Wine Spectator, Audio Visual Interiors, The Advocate, Saveur.

New Retail Opportunities
By running the INSOURCE customer model against its database and doing a ZIP Code analysis, Bang & Olufsen uncovered potentially profitable new sites for retail stores that were previously below the radar screen. Among them: Washington, D.C., North Carolina and Minneapolis/St. Paul. The next step: use GIS mapping software to more finely target its retail store locations.

What's to Be Learned?
What Bang & Olufsen discovered is what direct marketers had known for years: database analysis can yield information so basic and low-tech that it can change the fundamental model of the business.

Database Analysis vs. Surveys
Bang & Olufsen's first survey garnered a respectable 20-percent response—but it was way off. You would think that based on those results, a fairly accurate customer profile could be assembled.


Why the Survey Was Probably Flawed
Consumers in the upper income brackets are too busy to fill out a survey. Very likely, only 25 percent of those making $150,000 a year bothered to fill out the survey while only maybe five percent of those making $250,000 responded. The result: a skew that could have been very dangerous to the health of their business had they not connected with INSOURCE. For example, Peggy and I weren't making anywhere near the average $150,000+ per year back in 1977 when I filled out that survey.

The Eye-Popping Changes in the 21st Century
Bang & Olufsen is now in the world of teeny geeky goodies for pocket, purse and studio apartment…


… On up to obscenely high-end audio extravaganzas to bedazzle friends, family, business associates and neighbors:


 A personal aside: Can you freakin' believe a tacky little 3-year guarantee on a $63,720.00 product? Oh, those sphincter-tight Danish bean counters!

And This!


Who buys this stuff? 
It ain’t Trumpy Country bumpkins who love beer, Big Macs and the hopeful resurgence of coal. Here’s B&O’s current footprint in the U.S.



13 B&O Dealerships Nationwide (plus Amazon, Best Buy, Crutchfield and others)


Here's B&O in the Rest of the World


316 Dedicated B&O Dealerships—Iceland, UK, Europe, Turkey, Saudi Arabia 

How’s B&O Doin’?
                              2018              2017              2016             2015   
  Sales/Revenue       $504.7           $452.4           $403.9          $359.2
    (In millions)
  Sales Growth                11.56%              12.02%               12.41%            8.63% 

It’s amazing what basic direct marketing data analysis can do to (and for) a business model!

Takeaways to Consider
• Concentrate on your own core competency (e.g., making and selling high-end electronics) and spend money on outside professionals for their core competencies (e.g., database enhancement and analysis).

• "Fish where the fish are." —Macrae Ross

###

Word count: 996

  


At age 15, Denny Hatch—as a lowly apprentice—wrote his first news release for a Connecticut summer theater. To his astonishment it ran verbatim in The Middletown Press. He was instantly hooked on writing. After a two-year stint in the U.S. Army (1958-60), Denny had nine jobs in his first 12 years in business. He was fired from five of them and went on to save two businesses and start three others. One of his businesses—WHO’S MAILING WHAT! newsletter and archive service founded in 1984—revolutionized the science of how to measure the success of competitors’ direct mail. In the past 55 years he has been a book club director, magazine publisher, advertising copywriter/designer, editor, journalist and marketing consultant. He is the author of four published novels and seven books on business and marketing.


CONTACT

Denny Hatch
The St. James
200 West Washington Square, #3007
Philadelphia, PA 19106
215-644-9526
dennyhatch@yahoo.com


Note to Readers:  
May I send you an alert when each new blog is posted? If so, kindly give me the okay by sending your First Name, Last Name and e-mail to dennyhatch@yahoo.com. I guarantee your personal information will not be shared with anyone at any time for any reason. I look forward to being in touch!

Invitation to Marketers and Direct Marketers: Guest Blog Posts Are Welcome. 
If you have a marketing story to tell, case history, concept to propose or a memoir, give a shout. I’ll get right back to you. I am: dennyhatch@yahoo.com
215-644-9526 (rings on my desk).

You Are Invited to Join the Discussion!