Predict Consumer Adoption for Product Launch


Challenge
Launching new insurance plans for the 2006 Medicare Bill, Humana sought a combination of marketing strategy and product design that would provide competitive advantage and differentiation. Current tools are unable to analyze new product launches or competitive environments with hundreds of product offerings.

Approach
Icosystem developed an agent-based model (ABM) as a way of simulating, predicting and optimizing consumer behavior. We applied this technique specifically to understand how WOM impacts marketing and improve return on marketing investment. This model helped Humana understand how marketing initiatives are influenced by a rich network of interactions that include competitive messaging, government information, as well as direct exchange of information among consumers and between consumers and other members of the healthcare “ecosystem,” such as physicians, nurses, pharmacists, service professionals and sales reps.

Outcome
Icosystem’s simulation tools helped planning for new product launch for both national and local plans. Humana improved its position from #6 to #2 in the Medicare space. The tool was extended to help Humana compare plan designs in order to maximize market penetration.

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"We achieved a 100:1 return on our investment."
--John Bertko, Chief Actuary (retired), Humana

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