Using Healthcare Customers Segments & Personas with modelH (3 of 8)
In our last installment of this 8-part series, we delved into the modelH Customer Discovery Process, a tool specifically designed for the healthcare industry. This process is instrumental in answering the crucial questions that complete the Customer Segment portion of the modelH canvas. Our aim in this series is to assist you in refining your understanding of your customers, thereby confirming the alignment of your value proposition with your customers’ needs. This alignment, known as Product-Market Fit, is the cornerstone of a successful healthcare product. We will explore Product-Market Fit in more detail in our next post.
We have two objectives today:
- Understanding customer segmentation models in healthcare
- Help on how to create high-level Customer Personas
Understanding Healthcare Customer Segmentation Models
Before we get into the modelH work, I wanted to offer insights into using healthcare customer segmentation models.
Healthcare customer segmentation models are powerful tools that categorize patients or healthcare consumers into similar groups. These models offer invaluable insights into the diverse needs and preferences within a Customer Segment. Armed with this knowledge, for example, a healthcare digital app can enhance patient engagement, satisfaction, and health outcomes by tailoring interventions, programs, and communication to each segment. The practical benefits of these models are evident, making them a must-have for any healthcare innovator.
In healthcare, a hypothesis I believe to be true (as I made it up) is that customer’s attitudes (may) stay the same, but their needs and behaviors never do. What do I mean by this statement? Most businesses group humans into simplistic segments of like-minded buyers. In healthcare, we need a more nuanced approach. For example, grouping people by age, race, gender, or any other slice of demographics does not tell you anything about their needs, wants, and feelings. When dealing with a company that thinks like this, you get a sense of “one-size-fits-all”. This method is not an ideal way to approach health decisions. True, some companies segment based on attitudes and behaviors. While this is better (because it is more personal), it is limiting because it assumes people can be classified this way for more than a point in time.
Let me explain by telling you a story about a friend of mine. This person is a stellar runner — a natural athlete who thinks going for a 10K is a warm-up. When my friend is trying to learn something new about his favorite sport, he only wants to talk to the best experts about the latest techniques and products in the most exact terms. He does not need help — he needs facts and choices. A running company would say that he is a “super consumer.” My friend found out that even though he is an avid runner, his family history of hypertension started to find its way into his own life. So when it came to understanding his blood pressure and, more importantly, how to control it, he was not a super consumer. He was uninformed, very concerned, and needing serious attention and help.
As a healthcare business, you must know who you are talking to, what they know, and how they feel about the conversation. That way, you will learn how to provide the most meaningful experience.
In addition to the customer segmentation models in the Osterwalder Model, the healthcare-specific ones developed for modelH are listed below alphabetically.
Customer Segmentation by Archetype (Behaviors)
This method looks at segmenting people into Archetype categories based on their needs, attitudes, and behaviors regarding healthcare decisions. Some defining elements are health behaviors and attitudes, the perceived control over health now and in the future, and individual preferences for seeking and receiving healthcare information. Some excellent commercial models are available, such as the VALS framework, which categorizes individuals into eight different consumer segments based on their primary motivations and resources.
Customer Segmentation by Life Condition (Health Status)
Unlike Archetype segmentation, this method looks at segmenting by the different health concerns that can affect us all as we age. It seeks to understand and assess our health status and navigate a complicated and fragmented health marketplace. The “status” of health becomes more relevant to consumers once diagnosed, so this model looks at pre- and post-awareness of and management of a consumer’s health conditions. Life Conditions include segments such as high blood pressure, cholesterol, diabetes, etc.
Life Conditions are a better market indicator for how healthcare consumers act than age. To illustrate, let’s consider music preferences. Seniors and 30-year-olds rarely like the same music (unless it is Bruce Springsteen!). However, a 30-year-old diabetic acts pretty much the same as a 65-year-old diabetic. And correspondingly, a 65-year-old ‘health nut’ acts much closer to a 35-year-old ‘health nut’ than a 65-year-old diabetic. These relatable examples highlight the relevance of Life Conditions in healthcare customer segmentation.
Customer Segmentation by Life Stage (Demographics)
This method looks at segmenting by the significant milestones each consumer reaches in life, such as birth, adolescence, young adulthood, adulthood, retirement, etc. In the context of healthcare, these Life Stages are marked by significant healthcare decisions and their associated jobs. For example, the Life Stage for Becoming a Parent may involve tackling multiple healthcare-related jobs, such as getting pregnant, childbirth, preparing the home environment, etc.
These milestones make for a natural way to define targeted value propositions. For example, seniors have very different healthcare needs than young adults starting a family. The three highest-cost milestones in each person’s life are usually their early childhood (including birth), followed by having their child, and then when they enter retirement through death.
Customer Segmentation by Life Style (Job-to-be-done)
This approach is one that I developed when I built a consumer health-focused ecommerce company called GuideWell. We approached a segmentation format based on Clayton Christianson’s concept of consumer jobs-to-be-done (JTBD), which refers to the tasks or problems consumers try to solve. This method is a non-traditional approach. Traditional segmentation puts a consumer into a single-segment bucket. In healthcare, people are multi-faceted, and segmenting them into N of 1 leads to improper product market fit.
This method looks at segmenting by each consumer’s JTBD at a specific time. For example, a physically fit individual may want to avoid having an extensive conversation about basic exercise principles but may want to know a great deal (read exhaustive conversion) about better sleep. The same person reacts differently to their different JTBD despite being in the same Life Stage and Life Condition. Life Style segmentation is a way to look at people based on the tailored guidance they seek for the key activities they pursue. Companies that offer lifestyle solutions aim to help consumers with their specific JTBD, such as ‘Look and Feel Younger,’ ‘Get Ripped,’ ‘Get Outside,’ ‘Have a Better Smile,’ or even ‘Go Green.’
The problem lies in making an educated guess on the consumer’s JTBD. This method works well when your business model’s value proposition is designed to bring the consumer a tailored set of goods from everything available but narrowed down based on their specific JTBDs. By the way, this method is much more complex and requires AI. But, it is the best of all of them.
Defining Customer Personas
Creating personas for your Buyers and Users is not just a task but a strategic action to evaluate how closely the business model serves their needs.
Personas are detailed descriptions of imaginary people constructed from well-understood, highly specified data about real people. For instance, you might create a persona named “Sarah, the busy working mom” or ‘“ohn, the tech-savvy Care Manager.” The aim is to zero in on what matters most to those who matter the most to you. To do this, we look at Personas to understand who might buy from you and why. And when the Buyer and User are different, will the User be happy with the Buyer’s purchase decision of your solution?
By focusing on consumers’ purchase and usage decisions in the markets you want to serve and the channels you control, we can align your offerings with their expectations and drive business growth.
This workstream explores the following questions:
- Who are your primary target customers?
- What products and services are they seeking from you?
- What drives their perceptions of value?
- How do they determine if they are receiving value?
- Where (else) will they look for that value?
The deliverables for this workstream include:
- Completion of a Persona per User and Buyer.
How To: Persona Development
A modelH Persona is a tool for breaking down customers into segments to identify Buyer archetypes and how their buying process works. It also works for User types. Keep in mind, Customer Personas are:
- Not exhaustive.
- Focused on the primary target.
- Dynamic and evolving.
There are three stages of Persona Canvassing I like to do at this point:
- Persona Category Typing
- Persona Affinity Diagramming
- Persona Outlining
Persona Category Typing
Persona Category Typing is a brainstorming exercise in which you try to create one or more high-level groupings of Buyers and Users that fit your business model. You must keep them basic and answer three high-level areas per Persona.
- Segment: shared organizing principles of the user/buyer. Ex. Payer, provider, managed service organization, payvider, etc.
- Role: high-level job functions of the user/buyer. Ex. Care Managers, Quality analysts, etc.
- Goal: the desired outcome for the user/buyer. Ex. Lower acquisition costs, lower HbA1c scores, faster enrollment times, etc.
As with any brainstorming exercise, there is no wrong answer. Duplicates are OK; you will clean them up as you process the categories into unique Persona groupings. Once you have exhausted your thinking, place the Category Cards in logical groupings and resolve them into one per Category.
Persona Affinity Diagramming
Once you have your main category cards, you want to assimilate data into them using the Persona Affinity Diagramming technique. This process is used to:
- List factoids about your Persona Categories.
- Record assumptions about your Persona Categories.
- Place them under the right Persona Categories.
- Identify and label your Persona Category clusters.
- Debate and confirm your user/buyer categories and details.
Persona Outlines
Now, you are ready to semi-formalize the work from above and create Persona Outlines for each of your users/buyers. Once done, transform the Persona Outline into an informal final product (using many of the good templates from the web) with all your assumptions about each Persona. Include an image of the Persona as a visual to help guide readers.
Note: We are not yet into the full-blown Persona. We have to cover the Jobs to be done section first. All of these steps build upon each other. We are creating something like the image below to validate it in the Problem-Feedback interviews we will discuss in the next post.
Who are the Healthcare Personas?
I won’t enumerate them all (maybe someday), but here are a few key ones.
Consumer-Patient-Member
A patient is someone seeking medical attention. This care can occur in a hospital, clinic, or home. Patients may have a regular doctor they see, or they might visit different providers depending on their needs. Patients typically cover the cost of medical services through health insurance (where they’re known as members), by paying out of pocket, or through a combination of both.
Provider
In healthcare, a provider is anyone or anything that delivers medical care or treatment to a patient. This patient can also be a member of a health insurance plan. The term encompasses a wide range of professionals, facilities, and businesses. Some examples are Doctors, Nurse Practitioners, Midwives, Radiologists, Laboratories, Hospitals, Urgent Care Clinics, and medical supply companies.
Payer
In healthcare, a payer is anyone or anything that funds medical services. It’s important to remember that health insurance companies are not considered providers. They act as payers, not caregivers. They often have networks of providers that their members can utilize.
Managed Service Organization
In healthcare, a Managed Service Organization (MSO) is a company that takes care of the non-medical side of running a medical practice. They handle the business stuff so doctors can focus on seeing patients. MSOs can be owned by different groups, like hospitals, doctors, or even investors.
What is Next?
Next, we will dive deep into jobs to be done and Problem-Feedback interviews. We will then look at Solution-Market fit. Then, we will wrap up with Customer Segmentation Models by returning to look deeply at how Intermediaries affect healthcare business models and conclude our Customer/Who section of modelH.
Interested in what I am doing and want to learn more? You can read all about modelH business model innovation for healthcare on Medium.
to your health,
- Kevin Riley
