UK update for the Vitality Group Webinar - 14th May 2020

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UK update for the Vitality Group Webinar - 14th May 2020
UK update for the Vitality Group
Webinar
14th May 2020
UK update for the Vitality Group Webinar - 14th May 2020
Purpose

     The purpose of this paper is to provide a summary update on
     the recently launched “Vitality at Home” initiative, looking at:

     1. Benefits
     2. Early engagement analysis
     3. Covid-19 behavioural change.

                                                                        2
UK update for the Vitality Group Webinar - 14th May 2020
UK Vitality’s response to Covid-19

     Keep every staff member safe              Ensure business continuity         Shared-value model as an
             Maintain connectivity          Ensure products are fit-for-purpose   antidote to some of the potential
             Maintain productivity           Keep people healthy and active       shifts to our world

                    Protect and                     Protect and
                                                                                  Support
                    support our                 support our clients
                                                                                  society
                      people                       and advisers

                                     Maintain financial strength and resilience
UK update for the Vitality Group Webinar - 14th May 2020
Section 1: Benefits

                      3
UK update for the Vitality Group Webinar - 14th May 2020
We have had to recalibrate our programme with relevant benefits
to allow our members to be active and rewarded at home.

                                                             Key focus areas

      Fitness and staying active                                Healthy eating                                Rewards at home
  4 months        12 months         50% off selected                 25% cashback                    Earn up to 2                   Monthly coffee
   access           access             devices                      on healthy food                 movies a week                   to your home

      Points automatically                                         Regardless of activity       One movie for 12 points, two   Ground coffee or capsules, plus
   awarded for home workouts                                          points earned                movies for 40 points         50% off other items on order

       Status Protection: For plans renewing in the next 3 months, we apply the higher of the previous or current year’s status, on the next plan year
                                                                                                                                                             4
UK update for the Vitality Group Webinar - 14th May 2020
Virtual Vitality Healthchecks

                                                                              Branded Home Testing Kits

                                Automated booking platform for appointments
                                    with our Vitality Coaches and Nurses

Last updated 23rd April 2020.
                                                                                                          9   6
UK update for the Vitality Group Webinar - 14th May 2020
VitalityHealth’s benefits have been adapted to continue
offering excellent value to members despite the pandemic

Launched Covid-19 Cash benefit which pays £250 per night            Increased availability of virtual GP services by 20%, and
  for the first 8 nights, plus £500 for each night in hospital           extended our GP Advice Line to VitalityLife and
             thereafter, up to a maximum of £5,000                                  VitalityInvest members
                                                                          Vitality GP              GP Advice Line          292%
                                                                                                                        increase in
                                                                                                                        utilisation
                                                                                                                    
                                                        Launched                                                                 Launched
                                                        20 March
                                                                                                                                 9 March

  Fast-tracked launch of Member Care Hub, which gives                   Reimbursing specialists for initial and follow-up
      members access anytime, anywhere through                      consultations performed remotely, with the majority now
     a digital platform to search, find and book care                             offering virtual consultations

                                                         Launched
                                                         23 March
UK update for the Vitality Group Webinar - 14th May 2020
We have introduced options to help members in financial difficulty

             VitalityHealth Premium Saver                      Launched    VitalityLife Cover Buy Back Option           Launched
                                                                                                                         14 April
                                                                3 April

                                                                           Members can choose to reduce
Clients can choose to reduce premiums by                                  premium and cover by 25%, 50%
            50% for 3 months.                       Cover reverts
                                                     to normal
                                                                                or 75% for 3 months

                                      3 months

              3 months                                                             3 months

                      When they resume payments in full, they will
                                                                                              Cover and premiums
                       be subject to a 3-month waiting period on                         automatically revert to prior level
                       hospital authorisations for anything other                        w/o UW at end of 3 month period
                                      than cancer
UK update for the Vitality Group Webinar - 14th May 2020
Since the start of the lockdown, we have been engaging members with
relevant content delivered via social channels by Vitality’s
Ambassadors

                        Vitality at Home Instagram series    Launched
                                                             28 March
This healthy and active ‘stay at home’ content is now being amplified
to the entire UK via the new Vitality at Home brand ad

                                                               • In the advert, Vitality ambassadors
                                 At Home                         invite the UK over to their homes

                                                               • For a 2 week period, this will run
                                                                 on ITV, Channel 4 and Sky,
                                                                 reaching in excess of 8.1m
                                                                 viewers

                                                               • The campaign aims to maintain
                                                                 Vitality’s strong brand awareness
                                                                 at a time at which most of our out
                                                                 of home advertising and
                                                                 sponsorships are paused
Section 2: early engagement analysis

                                       5
Summary Engagement

                                                     Summary engagement

    Fitness and staying active                                Healthy eating                                Rewards at home
 4 months       12 months          Up to 50% off                   25% cashback                    Earn up to 2                   Monthly coffee
  access          access          selected devices                on healthy food                 movies a week                   to your home

                             15,000 sign-ups
                             100,000 home workouts

                                                              25% growth in                    41,000 sign-ups               51,000 registrations
                             8,000 sign-ups                   benefit take-up                  215,000 movie                 (c44k eligible)
                                                              17,000 registrations             vouchers issued

                             5x increase in
                             daily run rate
                             8,000 devices
    Points automatically                                         Regardless of activity       One movie for 12 points, two   Ground coffee or capsules, plus
 awarded for home workouts                                          points earned                movies for 40 points         50% off other items on order

     Status Protection: For plans renewing in the next 3 months, we apply the higher of the previous or current year’s status, on the next plan year
                                                                                                                                                           10
Cross-sectional view of take-up

     Benefit                 Distribution
     DEVICE ONLY                12.1%
                                            Number of Vitality
     PELOTON ONLY               16.4%                            Distribution
                                            at Home Benefits
     RAKUTEN ONLY               54.2%                1              82.7%
     PELOTON AND DEVICE         0.4%                                            17.4% have
                                                     2              16.8%       taken-up
     PELOTON AND RAKUTEN        15.0%
                                                     3                          more than
                                                                    0.6%        1 benefit
     RAKUTEN AND DEVICE         1.3%
                                                  TOTAL            100.0%
     PELOTON AND RAKUTEN
     AND DEVICE                 0.6%
     TOTAL                     100.0%
   (accurate to mid April)

                                                                                         11
Cross-sectional view
 AGE BAND                                   GENDER                             TOP 5 REGIONS                 STAFF                      VITALITY STATUS

                                                       Female     Male          24%                                    Yes
  01…        0%                                                                       19%
  10…        0%                                                                                                            4%            Bronze    14%
  20…                10%                                                                    10%   9%    8%
  30…                                 38%                                                                                                 Silver   16%
                                                                     42%
  40…                                37%
  50…                  12%                       58%                                                                                       Gold     22%
  60…         2%
  70…        0%                                                                                                       96%               Platinum          48%
 80+         0%

 FAMILY DESCR.                              FAMILY SIZE                        BOOK                          PRODUCT GROUP              PLAN LEVEL
     44%                                                                                Health                              36%                    Plus
                                            5+         4%                                                                         27%
                                                                                                                     21%                           1%
                24%       24%                                                                                 16%
                                             4              15%
                                                                                  36%
                                9%           3           10%

                                             2                    27%
                                                                                                  64%
                                             1                           44%
                                                                                                                                                   99%

Last updated 23rd April 2020.
                                                                                                                                                                12 14
Cross-sectional view

 AGE BAND                                     GENDER                      TOP 5 REGIONS                    STAFF                      VITALITY STATUS

                                                        Female             23%                                     Yes    No
   01-09          1%                                                             20%
                                                                                                                     2%
   10-19          1%                                                                                                                   Bronze                  44%
   20-29                        22%                                                     9%      8%    8%
   30-39                               40%                          41%                                                                 Silver           17%
   40-49                        25%
   50-59             9%                           59%                                                                                    Gold           16%
   60-69           1%
   70-79          1%                                                                                                98%               Platinum            23%
     80+          0%

 FAMILY DESCR.                                FAMILY SIZE                 BOOK                             PRODUCT GROUP              PLAN LEVEL

                                                                                       Health                             43%                          Plus
    53%
                                              5… 3%
                                                                                                                                27%              14%
               23%                            4     11%                                                      16%   14%
                          18%
                                      6%                                     43%
                                              3    8%
                                                                                                57%
                                              2         25%

                                              1               53%                                                                                        86%

Last updated 23rd April 2020.
                                                                                                                                                                 14 15
Section 3: CV-19 behavioural change

                                      15
Covid-19 – activity behavioural change
   The analysis (until mid April) demonstrates that initially during lock-down we saw Coronavirus was having an impact on top
    of the usual seasonality we see of decreasing physical activity from Jan/Feb through into March.

   Where members do drop activity, the magnitude is typically one activity band i.e. 10 points or less.
          Gym members have been more likely to drop a points-band than non-gym members.
          Members that only use Cinema + Starbucks appear to be slightly more impacted than other members.
          Apple Watch members appear to be less impacted than non-Apple watch members.
          Amazon members appear to be less impacted than non-Amazon members.

   Members with lower engagement levels have been more likely to drop to ‘zero’ points. This is particularly strong for:
          Gym members and members that only use Cinema + Starbucks
          Single parents
          Lower ages
          Larger family sizes

   Very interestingly, we are witnessing previously unengaged members now engaging:
           9%, 5% and 28% of all Peloton, Rakuten and Device members, respectively have never used a benefit over the past 12 months.
           25% of all Rakuten members have never been awarded cinema codes over the past 12 months
           31% of all new Device members have never earned a physical activity point over the past 12 months

   All of the above has been cut by demographic (age, geography, family structure – single, couple, family, single parent –
    product and plan type, gym members, cinema & Starbucks users, AW users, Amazon users etc).

                                                                                                                                         16
Impact on Physical Activity

Over 1 in every 6 physically active members had a drop in their average physical activity band per week from
‘Jan/Feb’ to ‘mid April’ 2020 (above and beyond normal seasonality).

                      COHORT             2019 PERIOD      2020 PERIOD        IMPACT
                      DECREASED             22.8%            37.5%            14.7%
                      NO MOVEMENT           58.7%            49.3%            -9.3%
                      INCREASED             18.5%            13.2%            -5.3%
                      TOTAL                  100%             100%             0%

Members at higher engagement levels were more likely to see a drop in points-band.

                       PRE-COVID        2019 PERIOD       2020 PERIOD        IMPACT
                           1-10             26.4%            36.0%             9.6%
                          11-20             24.8%            36.5%             11.7%       Proportion of total entities
                                                                                             that DECREASED in
                          21-30             25.9%            44.4%             18.5%         each band of physical
                                                                                                activity points:
                           31+              16.9%            33.9%             17.0%
                          TOTAL             22.8%            37.5%             14.7%                              17
Impact by Demographic

Lower ages were more likely to see a drop in points-band. The       Members in London were most likely to see a
impact was statistically insignificant for the 80+ age band.        drop in points-band.

Proportion of total entities that DECREASED in each AGE BAND:   Proportion of total entities that DECREASED in each REGION:

     AGE           2019          2020                                                 2019         2020
                                              IMPACT                 REGION                                    IMPACT
     BAND         PERIOD        PERIOD                                               PERIOD       PERIOD
      10-19         29.4%         47.0%         17.7%           East Midlands          21.8%       32.9%        11.1%
      20-29         28.5%         44.8%         16.3%           East of England        22.5%       36.8%        14.3%
      30-39         23.6%         39.9%         16.3%           London                 23.3%       45.7%        22.4%
      40-49         19.9%         34.5%         14.5%           North East England     22.7%       34.2%        11.5%
      50-59         20.1%         31.2%         11.1%           North West England     23.8%       33.2%        9.3%
      60-69         19.6%         26.7%         7.2%            Northern Ireland       22.7%       31.2%        8.5%
      70-79         17.1%         26.5%         9.4%            Scotland               22.8%       34.0%        11.2%
       80+          25.9%         36.9%         11.0%           South East England     22.0%       35.5%        13.5%
                                                                South West
                                                                                       22.4%       33.0%        10.6%
                                                                England
                                                                Wales                  23.4%       33.6%        10.2%
                                                                West Midlands          23.3%       33.3%        10.0%
                                                                Yorkshire and the
                                                                                       22.7%       32.6%        10.0%
                                                                Humber
                                                                                                                         19
Impact by Demographic (cont’d)

Couples saw a slightly smaller impact compared to other family structures.

                                  Proportion of total entities that DECREASED in each type of FAMILY STRUCTURE:

                                           FAMILY
                                                             2019 PERIOD     2020 PERIOD           IMPACT
                                         STRUCTURE
                                            Single               24.0%          39.3%              15.2%
                                            Couple               22.6%          35.4%              12.8%
                                            Family               21.1%          36.1%              14.9%
                                         Single Parent           20.6%          36.0%              15.4%

Health members were more likely to drop in points-band than Life members. The biggest impact has been on
singles for Health and larger family sizes for Life.

   Proportion of total HEALTH entities that DECREASED in each FAMILY SIZE:      Proportion of total LIFE entities that DECREASED in each FAMILY SIZE:

             FAMILY        2019          2020                                              FAMILY         2019          2020
                                                      IMPACT                                                                         IMPACT
              SIZE        PERIOD        PERIOD                                              SIZE         PERIOD        PERIOD

                 1          24.3%        41.4%           17.1%                                 1           23.6%        35.7%         12.0%
                 2          23.0%        37.4%           14.4%                                 2           22.1%        34.2%         12.1%
                 3          22.4%        37.7%           15.3%                                 3           19.1%        32.7%         13.6%
                 4          21.5%        36.3%           14.7%                                 4           17.3%        33.0%         15.7%
                5+          22.6%        37.0%           14.4%                                5+           18.7%        37.2%         18.6%
             TOTAL          23.4%        39.3%           16.0%                              TOTAL          22.1%        34.7%         12.6%             20
With more recent data we can see that some activity levels are normalising once
again

       Members with 40 activity points in week to date     Members with 12 activity
                                                                     Members        points
                                                                              with 12+        inpoints
                                                                                       activity  week to date
                                                                                     week to date
             70,000                                              250,000

             60,000
                                                                 200,000

             50,000

                                                                 150,000
             40,000

             30,000                                              100,000

             20,000
                                                                  50,000

             10,000

                                                                      0
                 0                                                         Mon Tues Wed Thurs Fri        Sat   Sun
                      Thurs     Fri   Sat       Sun
                                                                            Pre Cov19 Ave           30 Mar
                      Pre Cov19 Ave    30 Mar
                                                                            06 Apr                  13 Apr
                      06 Apr           13 Apr
                                                                            20 Apr                  27 Apr
                      20 Apr           27 Apr

     It appears with our most engaged members that       For our moderately engaged members activity is
         activity is normalising to pre-Covid levels               at c75% of pre-Covid levels                       21
UK update for the Vitality Group
Webinar
14th May 2020
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