If the answer is yes, the advertising also comes to the checkout
Vote If voters decide in favor of one instead of 86 health insurance companies on March 11, this would also have an impact on the communications industry.
Vote If voters decide in favor of one health insurance fund instead of 86 on March 11, this would also have an impact on the communications industry. "The savings potential with a single health insurance fund would be enormous. Today, health insurance companies squander huge sums on advertising, administrative expenses and bureaucratic changes of insurer ..." With these words, SP National Councillor Christine Goll made the case for a single health insurance fund in the Tages-Anzeiger newspaper on February 7. The politician's statement points to an aspect of the upcoming vote that has hardly been discussed in the communications industry to date: Because a single health insurer would eliminate competition between insurers, communication and marketing expenditure is also likely to be significantly lower. Paul Rhyn, Head of Communications at the health insurance association Santé Suisse, puts the total annual marketing expenditure of the 86 members of the association at between 150 and 200 million francs. This amount includes all advertising expenditure as well as the costs of materials and personnel required to prepare dossiers and insurance certificates when changing health insurance companies or to handle the formalities involved in leaving the insurance company. Also included are commissions and salaries for external and internal customer advisors and brokers as well as the costs of providing information to policyholders (mailings, customer magazines). However, Rhyn is not in a position to break down the marketing expenses by individual items.
However, the Advertising Index Switzerland (AIS) from Wemf provides a certain indication, at least for direct advertising expenditure. According to this index, the 86 health insurance companies spent CHF 26.7 million on traditional advertising last year, 6.9 percent more than in 2005. By comparison, Orange's Swiss advertising budget was similarly high in 2004. At that time, the telecommunications company was the ninth most active advertising company. However, the health insurance companies' advertising expenditure mentioned above does not include expenditure on direct mailings or telemarketing or the costs of offers aimed at encouraging potential customers to switch health insurers.
In view of these figures, Piero Schäfer from the Swiss Advertising Agency (SW) therefore expects "very serious consequences for agencies and media" in the event of a yes vote for a single health insurance fund. "It would be just as drastic as if there was only one car brand or one publishing house," he says. However, the foundations of the SW itself would "hardly be shaken", Schäfer adds: the SW counts only a few individual advertising clients among its members - and a maximum of three insurers among them.
SWA and BSW would sufferThe situation would be different for the Association of Swiss Advertisers (SWA): Although only two of its 141 members are pure health insurers, five others offer health insurance in addition to property and pension insurance. Acceptance of the initiative for a single health insurance fund would therefore primarily result in a reduction in the association's budget. According to SWA Director Jürg Siegrist, the amount of the SWA membership fee depends on the annual advertising and media budget of the individual member. As the latter would also be reduced for insurers with health insurance, the membership fee would also be lower.
Walter Merz, Managing Director of BSW Leading Swiss Agencies, also anticipates a loss of income for his members. "Today's 86 insurance companies run perhaps 50 different campaigns. These would certainly no longer exist in the future," he says. Based on the AIS figures, he estimates the concrete losses for the advertising agencies alone at three to five million francs, which corresponds to around one percent of the BSW agencies' total gross operating income. "That wouldn't be the death of the agencies, but for some of our members these orders are very important," says Merz.
However, Merz's fears may be unnecessary and Goll's statement quoted at the beginning may not be entirely correct. In view of previous experience with single insurance funds, it is by no means certain that savings can also be expected in expenditure on traditional advertising. The Swiss National Accident Insurance Fund (Suva), for example, is also a single insurance fund that operates accident prevention by law: in 2005 it invested 105 million Swiss francs - for advice, company inspections and education by means of TV commercials, posters and brochures. Suva was unable to say how much of this was spent on traditional advertising. Nevertheless, even with a single health insurance fund, advertising and media agencies will not necessarily come away empty-handed, but the briefings are likely to be very different from the current ones. Rather than image advertising or customer poaching, a single health insurance fund would probably focus more on prevention advertising - as is the case with Suva. Ultimately, however, this would depend on the specific structure of the future health insurance fund and therefore on politics.
But one thing is certain: all the call centers that could count on orders from health insurance companies in the autumn would be left empty-handed in future. And the numerous health insurance customer magazines would probably have to make way for just one per language region.
Markus Knöpfli
However, the Advertising Index Switzerland (AIS) from Wemf provides a certain indication, at least for direct advertising expenditure. According to this index, the 86 health insurance companies spent CHF 26.7 million on traditional advertising last year, 6.9 percent more than in 2005. By comparison, Orange's Swiss advertising budget was similarly high in 2004. At that time, the telecommunications company was the ninth most active advertising company. However, the health insurance companies' advertising expenditure mentioned above does not include expenditure on direct mailings or telemarketing or the costs of offers aimed at encouraging potential customers to switch health insurers.
In view of these figures, Piero Schäfer from the Swiss Advertising Agency (SW) therefore expects "very serious consequences for agencies and media" in the event of a yes vote for a single health insurance fund. "It would be just as drastic as if there was only one car brand or one publishing house," he says. However, the foundations of the SW itself would "hardly be shaken", Schäfer adds: the SW counts only a few individual advertising clients among its members - and a maximum of three insurers among them.
SWA and BSW would sufferThe situation would be different for the Association of Swiss Advertisers (SWA): Although only two of its 141 members are pure health insurers, five others offer health insurance in addition to property and pension insurance. Acceptance of the initiative for a single health insurance fund would therefore primarily result in a reduction in the association's budget. According to SWA Director Jürg Siegrist, the amount of the SWA membership fee depends on the annual advertising and media budget of the individual member. As the latter would also be reduced for insurers with health insurance, the membership fee would also be lower.
Walter Merz, Managing Director of BSW Leading Swiss Agencies, also anticipates a loss of income for his members. "Today's 86 insurance companies run perhaps 50 different campaigns. These would certainly no longer exist in the future," he says. Based on the AIS figures, he estimates the concrete losses for the advertising agencies alone at three to five million francs, which corresponds to around one percent of the BSW agencies' total gross operating income. "That wouldn't be the death of the agencies, but for some of our members these orders are very important," says Merz.
However, Merz's fears may be unnecessary and Goll's statement quoted at the beginning may not be entirely correct. In view of previous experience with single insurance funds, it is by no means certain that savings can also be expected in expenditure on traditional advertising. The Swiss National Accident Insurance Fund (Suva), for example, is also a single insurance fund that operates accident prevention by law: in 2005 it invested 105 million Swiss francs - for advice, company inspections and education by means of TV commercials, posters and brochures. Suva was unable to say how much of this was spent on traditional advertising. Nevertheless, even with a single health insurance fund, advertising and media agencies will not necessarily come away empty-handed, but the briefings are likely to be very different from the current ones. Rather than image advertising or customer poaching, a single health insurance fund would probably focus more on prevention advertising - as is the case with Suva. Ultimately, however, this would depend on the specific structure of the future health insurance fund and therefore on politics.
But one thing is certain: all the call centers that could count on orders from health insurance companies in the autumn would be left empty-handed in future. And the numerous health insurance customer magazines would probably have to make way for just one per language region.
Markus Knöpfli
