THERE are few obvious connections between serial entrepreneur Sir Stelios Haji-Ioannou and a mutual established to help TB sufferers.
Marc Bell, the marketing specialist who is leading York-based Benenden Health into a new era, worked with Sir Stelios at the turn of the century, and he feels that the mutual sector could learn a lot from the tycoon’s relentless focus on the customer.
Mr Bell wants Benenden Health to remain true to its founders’ principles, while helping the public sector handle the strains of austerity. Back in 2000, Mr Bell helped Sir Stelios to launch easyEverything across the UK, Europe and the US.
“I worked with Stelios to develop the internet cafe business,’’ Mr Bell recalled. “He was fantastic. He had a passion for customer service.
“He was very entrepreneurial, and had a very clear vision with very aggressive growth targets. He wanted to paint the town orange.
“He believed that the devil was in the detail when it came to customer service. Stelios was a master of PR and he had a very confident approach to risk. He liked to challenge the norm.”
Challenging the norm is precisely what Mr Bell plans to do over the next few years. He was promoted to the CEO’s role at Benenden last year, after joining the company as marketing and business strategy director in 2008.
To understand the challenges and opportunities ahead, it’s time for a brief history lesson.
Benenden was founded in Kent 109 years ago to provide treatment for postal workers who were suffering from tuberculosis.
In the early 1900s, the philanthropist Charles Garland had the idea of creating a mutual self-help organisation. Each member contributed a small weekly amount to a fund which provided support in times of need. Benenden has been based in York since 1990, and until 2012, membership was only available to public sector workers and their families, as well as staff from organisations “whose aims and objectives are compatible with the society”.
In June 2012, a decision was made at Benenden’s annual conference to remove this membership criteria, which gives it the potential to dramatically increase its market share. Benenden rebranded in January 2013. It also launched a major marketing strategy, including prime-time TV advertising for the first time.
The growth prospects are enormous. Benenden’s marketing team can now target the entire UK population, instead of just focusing on the public sector. It plays a significant role in the local community. It employs 550 staff altogether, including 220 in York.
It’s also the main shirt sponsor for York City Football Club, which meant that the club’s unexpected late run into the Division Two play-offs last season was a godsend in marketing terms for Benenden. The decision to remove the membership criteria has already attracted an extra 50,000 members.
Mr Bell observed: “It strengthens our balance sheet and underpins capital investment, to pay for hospital refurbishments and possible acquisitions in the insurance space.”
Last year, there was a 17 per cent growth in top-line revenue to £90m, and Benenden is also set to grow by acquisition. Benenden Health’s subsidiary business – Benenden Insurance – now provides a wider range of insurance products, to add to Benenden’s core healthcare product range. Acquisitions are also in the pipeline.
“We’re looking at an insurance broker that has a good chance of completing in the near term,’’ Mr Bell added.
Although recent economic data has been encouraging, the UK has faced a prolonged period of belt-tightening. In the longer term, Mr Bell believes a debate is needed about how we continue to provide a world-class health service.
He added: “One of the key elements of the strategy is to see how the mutual model can help the NHS, which is facing problems because the funding model is unsustainable.
“We are in discussions with York City Council about how we could assist with a case management role in terms of social care.
“That could mean that some people around York who require a home help would be able to find that service through Benenden rather than being placed through a local authority. Public authorities are facing budget cuts and they are having to look at ways to meet their requirements.
“It’s early days, but if we can do it at a more cost effective price, then it’s a good thing. It’s indicative of the strategy of diversification.”
Altogether, Benenden has just under 900,000 members, and the churn rate is under 10 per cent.
“We’re looking to broaden that community,” said Mr Bell. “We hope people will stay with us for a long period.”
At the same time. Mr Bell is aware of the dangers created by growing too quickly.
He said: “The thing that underpins Benenden is quality. We don’t want to overstretch ourselves. As a mutual we put customers at the heart of what we do. We raise our own capital through members’ money.
“In five years’ time we will be a much bigger complementary provider to the NHS, within a changing UK healthcare sector, and we will have established a general insurance business. We will have kept that mutual ethos and will be offering more products in the healthcare and wellbeing space.”
If all goes to plan, Benenden’s balance sheet will be a third bigger in 2019.
“We will also work closely with policymakers,’’ said Mr Bell. “The health service is at a turning point. The NHS is owned by the public and they are not getting the service they deserve. We want to talk about this in a sensible way and offer a solution.”