Estimated Reading Time [est_time]

The changing insurance market needs a strong digital footprint – here’s why

The world of digital marketing is a fast-moving one: new opportunities and techniques pop up each week, whilst Google, your number one arena for search engine marketing (SEM), changes at an even faster rate.

The world of insurance marketing is equally fast-moving; the evolving industry combined with our increasingly digitalised society means that this sector is driving to modernise quickly.

Marketing a product or service that is a need rather than a want can be a challenge. This is particularly true for services like insurance policies, as many consumers struggle to differentiate between products from different companies.

Insurance companies are increasingly spending more on advertising. The below graph shows data on the advertising spending of selected insurance companies in the United States in 2017. In the measured period, Progressive spent 622 million U.S. dollars on measured media advertising in the United States:

Where Digital Marketing comes in

The use of digital marketing techniques and strategies is becoming an essential part of any business; this blog will discuss this in relation to insurance companies. Digital marketing is an exciting and growing field that will benefit insurance carriers tremendously. Compared to other types of marketing, digital marketing delivers measurable results. Most insurance executives realize they have to step up their digital investments, yet many remain unclear about exactly where to start and how to proceed in organizing for digital innovation and redesigning their processes.

The importance of Digital Marketing

The term ‘digital marketing’ encompasses several marketing strategies and channels including search engine optimization (SEO), search engine marketing (SEM), pay per click, social media marketing, content marketing, display advertising (advertisements in websites), messaging (SMS, push notification), e-mail, etc.

The Financial Times defines digital marketing as “an umbrella term for the marketing of products or services using digital technologies, mainly on the Internet, but also including mobile phones, display advertising and any other digital medium.”

An article written by Andy Donaldson (2017) discusses several things that insurance companies should know about digital marketing. Firstly, companies must have a secure website beginning with ‘https’ rather than ‘http’; this gives them a ranking boost on search engines. As well as this, a secure website builds credibility and trust between the company and customers.

According to WordStream, the word ‘insurance’ is the most expensive keyword to bid on; voice search enables search queries to be more conversational and complex, therefore bidding on individual keywords is a waste of money. As well as this, it is important to utilise SEO tactics to ensure that your insurance company ranks well in the search results.

Knowing your Audience

Having a clearly structured social plan is also important; social platforms can serve very different purposes when it comes to supporting your overall campaign strategy.

Knowing how your audience engage and interact with similar brand across social media can help your insurance brand gain a wider understanding when it comes to how to best use each social platform. Research by LIMRA, the world’s largest association of life insurance and financial services companies, discovered that 93% of life insurance companies had social media programs in place.

Social & Mobile Channels

When done correctly, social media can establish your brand’s reputation as being customer focused, reputable, and trustworthy. Consumers also turn to social media when looking for information to help them make a decision about which insurance carrier or broker to do business with. A study by Accenture found that 48% of consumers would consider comments on social media when making insurance-buying decisions.

Mobile and digital channels play a critical role during the insurance decision-making process. It is therefore essential for websites to be optimized to suit mobile devices; according to Google, 67% of consumers were more likely to buy from a mobile friendly website. Many browse on their phones now and it’s essential to pick up on this traffic.

The challenge for insurance companies today is reaching the different consumers; plenty of baby boomers and Generation X customers are shopping for new insurance options. Millennials and post-millennials are buying homes and cars, and building insurance portfolios, for the first time. The younger crowd are also the most active users of social media. Pew Research states that as of November 2016

approximately 86% of those aged 18-29 are active on social media, compared to only 34% of those aged 65 and older.

Social media is therefore a hugely important aspect of digital marketing when it comes to targeting a younger demographic.

Research conducted by Nielsen, xAd and Telmetrics found that:

40% of insurance research time was spent on mobile devices (smartphones, tablets) and 25% of study participants used mobile devices exclusively in their research.

Half of insurance buyers began their research on mobile devices as well.

Research by PwC found that 71% of consumers surveyed used some form of digital research before buying insurance (e.g. price comparison or social media) and 26% of consumers surveyed bought their policies online (e.g. web or via a mobile device).

Furthermore, a report by Sundar Vallinayagam stated that 30% of time online is spent on social media, including Facebook, Instagram, Snapchat, Twitter, etc. It is therefore in the best interest of Insurance companies to use these mediums to engage with customers and create a following.

Developing a digital presence

Digital marketing can benefit insurance companies in many ways. Developing a digital presence, and utilizing the available tools like social media allow consumers to understand these changes, trends, and customer preference, enabling enable a more targeted approach towards identifying your market and providing customized solutions for their changing needs. This also allows you to identify potential customers and target them accordingly.

In recent years, customers have developed a preference for contacting companies through social media rather than phoning or emailing. With an increasing number of consumers switching to other providers because of quality customer service, being able to address your customers’ concerns exactly where they are has become of paramount importance.

Many of the biggest insurance companies spend huge amounts on their marketing. The image below ranks the top 100 brands according to their average U.S. advertising spend in 2011; the insurance companies are in bold. GEICO came third, closely followed by Progressive, Allstate and State Farm, which all beat Apple, Coca-Cola and Samsung in their average advertising spend.

Harvesting digital data has amazing potential in today’s world where people leave behind them great amounts of data when they visit a website. Many carriers are already mining data from social media to track a policy holder’s life events for sales, and also using this data to check for fraudulent claims.

Analysing digital data can help insurers calculate a driving score, what customers to attract etc. Although there are well placed privacy concerns, the benefits for both insurers and customers are significant. The adaptability of insurance companies will make a difference for them in the future. Not only in case of digitalization, but also with new technologies rolling out every new day, the market leader would be the one that learns to evolve with the changing time.