Death of a Salesman – Financial Marketing has changed
In the UK, the “man from the Pru” personifies a nostalgic relationship with insurance companies. Prudential, a UK insurer, built its brand on fostering a convivial working relationships with its customer base through door-to-door salesmen. 
The array of financial marketing tools available to today’s marketers has more in common with this approach than may first seem apparent. The democracy of social media provides greater opportunity for brands to engage – as in, regain that convivial relationship – across the digital space rather than the Welcome mat.
I wrote this post for my keynote at the LIMRA European Annual Meeting today: Winning Strategies For Tomorrow 21 – 23 September 2014
Hotel Pullman Tour Eiffel – Paris
Life Insurance Conference
“A revolution doesn’t happen when society adopts new tools. It happens when society adopts new behaviors.” – Clay Shirky
This summer, mobile and tablet traffic has surpassed desktop traffic in the UK. Furthermore, the mobile web is strongly dominated by apps with 86% of the time spent in apps vs. traditional browsers. What is more, 70% of Smartphone users in the UK wake up connected and 58% check their Smartphone 15 minutes before going to sleep. We no longer need to sit in front of a desktop and open a browser to search for a website or check our email. We wake up immediately connect and leave this connection only to sleep.
These fundamental changes in behaviour are revolutionizing the way that people interact with brands.
We are moving beyond what Google coined as customers’ ‘Zero Moment Of Truth’ (ZMOT) – the bit that comes before the traditional sales funnel of intent to buy.
Today customers are being prompted with relevant information even before they have identified a need. So the role of search and other media touch-points in the sales funnel is shifting. Media touch points are becoming proactive and responsive based on personalized content from users’ past behaviour and social networks’ intelligence.
The questions below are answered even before customers’ open a browser to search for the answer:
-Where do I find advice about how to protect my business from the unexpected – that I can actually trust?
-Which insurer seems friendly so that if I have to talk about my medical insurance it won’t be awkward?
-Who should I turn to for help with understanding how pensions work?
Therefore, successful digital marketers – should increasingly follow an integrated approach encompassing paid advertising, email marketing, organic search, referral web traffic, prompted
This isn’t the preserve of B2C marketing either; even insurance broker (and other B2B) relationships are informed and strengthened by a combination of offline and online marketing activity.
Though there are undeniably challenges that need to be overcome, they are surmountable and today’s financial marketing landscape provides a rich seam of opportunities for the insurance sector.
The Insurance sector is at a pivotal point
The UK insurance sector is the largest in Europe, making a vital contribution to the economy by employing more than 300,000 people, attracting global capital, serving consumer needs, and generating UK exports.
However, the insurance sector – in the UK, Europe and beyond – faces significant headwinds, both socio-political and micro-economic – and that’s before factoring in digital disruption!
The key headwinds are:
- Intense competition from cross-border competitors to the proliferation of aggregator sites which is a downward pressure on headline prices.
- Complex regulations, which are costly to implement and pervade every area of the business, from products to sales to advertising and digital marketing.
- Granular risk profiling of potential clients, supported by the availability of ‘Big Data’. This is a blessing to insurers because it helps to weed out more accurately higher-risk and therefore potentially costly claimants. It is also a curse in that more accurate premiums could price out a wider client base.
- Ageing demographics, which Western governments are responding to in unpredictable ways. For example, the UK government unexpectedly announced in March that pensions no longer need to be converted into annuities and instead can be drawn as cash by retirees. The announcement came without warning, causing a massive share sell-off for leading insurers (some by more than 50%). Some estimates expect the £12bn annuity market to decline by two-thirds within 18 months.
- The next generation, who are tech-savvy, highly indebted and largely ignored by current financial services. The industry is “still mentally domiciled in the suburbs of the 1950s relating to a vanishing generation of people who are interested in lifetime savings backed with job-for-life security” says the Chartered Insurance Institute (CII). Insurance companies need to increase brand equity with the next generation of consumer, who make purchasing decisions in a very different – and fragmented – way compared to babyboomers.
Shifting sands – emerging opportunities
No longer are insurers the stock market’s pin-ups of stability, but instead find their businesses built on shifting sands.
This means that today’s insurers need to be agile in a way previously inconceivable for the industry.
The fact that most consumers think of their insurance carriers only when it’s time to pay their premiums or when it is time to make a claim is no longer good enough.
A recent survey of 6,000 insurance policyholders by Accenture shows that more than 70 percent of insurance customers are ready to purchase insurance online.
When it comes to customers switching their insurance providers, lack of personalized services is second only to price as a reason for changing. Furthermore, over a third of the policyholders said that they would be willing to pay more for personalized services.
Even more interesting, 78 percent of customers said that they would share personal information with their insurers to obtain personalized services.
Behaviours are changing rapidly. Insurers need to start engaging proactively to put themselves at the heart of the customers’ everyday life and to build a positive customer experience on both the functional and emotional levels.
What we are all chasing is a pitch-perfect, seamless experience for our target audiences; however they come into contact with the business (through whichever ‘touch points’, on whatever communication channel) they receive a uniform, joined-up service that at least meets their expectations.
And, remember, our customers’ expectations are far more elevated than they ever used to be, due to their vast peer-to-peer (social) networks and instant access to myriad competing information and options. It’s a congested marketplace so today’s brands – including insurance companies – need to actively work to stand out from the crowd and grasp the myriad emerging opportunities.
By integrating campaigns across all of these areas, blending online and offline marketing campaigns, and orchestrating greater collaboration between previously siloed departments, insurers can blend valuable services with advertising and content: maximizing shareholder value and building a stronger brand equity.
Making it work
Large, multinational financial services organisations can be unwieldy bureaucratic machines – precisely the type of businesses for whom this shift to collaborative departments and seamless process integration is a serious challenge.
In my experience, failure to implement a blended approach to online and offline marketing comes down to a lack of alignment and communication between:
- Top Management which should define the direction of the campaign and support social media activity. However, this requires massive education as 64% of CEOs do not use social media at all and only 5% of Fortune 500 companies’ CEOs use Twitter; half of boardrooms do not believe social media is a valuable corporate communication tool.
- Product Development Department, which should define the functional and emotional rewards of the product based on genuine client needs
- Marketing, which should package the product/service into an omni-channel brand experience that is relevant to the target market and differentiated in its marketplace
Tackling C-suite scepticism
Some modern marketing approaches, particularly social media marketing, has suffered from chronic C-suite scepticism, largely because of its alleged failure to perform under traditional return-on-investment (ROI) metrics.
We’re asking the wrong questions!
As previously mentioned, the concept of a ‘ZMOT’ has changed the parameters. But while some social and digital marketing efforts are harder to track, they are not so different to the assumptions made about page views or print circulation for conventional advertising. The closer to a buying decision a consumer is the more clearly they show on a brand’s radar – and their behaviour tracked and assigned to various departments.
Google’s ‘big data’ provides interesting insights into the customer journey to an online purchase. While non-digital activity is hard to quantify – highlighting the importance of brand equity (being known – and what you are known for in the minds of your consumers).
Google’s data demonstrates sector and geographical differences in purchasing behaviour across channels. In France the role of Social in the sales funnel is mostly to create awareness. While in the UK it plays a closer role in assisting a purchase by having a major influence on a customer’s the intent to buy.
The Role of Communication Channels in Finance sector, France
Social media marketing first, followed by email marketing, paid search and then online search and direct web traffic.
The Role of Communication Channels in Finance sector, UK
Display first, followed by email marketing, then other paid advertising and social media marketing, followed by online search and direct web traffic.
The importance of the different media touch points in the sales funnel is shifting significantly. The latest data published by Google is from 2012. I believe that with the recent growth of the app-based mobile web, new social touch points (such as prompted notifications) have gained importance in the sales funnel.
In a recent survey by Martini Media among financial brands worldwide, 59 percent said that they plan to increase their mobile spend. 58 percent plan to increase their social spend. While only 40 percent plan to increase their search spend.
Taking an omni-channel approach to insurance marketing and blending campaigns across offline and online has the greatest opportunity to capture prospects and leads. It also does double-duty in increasing brand equity across all stakeholders and boosting organic search engine optimization (SEO).
Content is King, Context is Queen
The deluge of information means that content – whether online or offline – must be hyper-personalised to the target audience, with personal messages and tailored content specific to not only their demographic (as with traditional marketing) but elements such as their positon in the sales funnel and reaching them on the channel they prefer at their preferred time, in order to be successful.
The socially integrated event I produced for Saxo Capital Markets – #TradingDebates – was featured as a case study in The Guardian Social Media Marketing series (read it here).
Even large financial organisations can integrate their content marketing – and stay compliant.
Key lessons on how to integrate social media with event marketing:
- Co-ordination across all relevant business divisions is fundamental. Pool resources, work collaboratively but within clear remits, and use shared resources
- Harness the power of those who are social influencers to your target audience. Brand partnerships can be valuable in aligning your brand with the audience’s interests, and influential peers amplify your campaign message for you
- Incentivise social media engagement – but make interaction meaningful and specific to that audience
- Produce a variety of meaningful content across a range of multi-media, from white papers to illustrations and infographics
In financial services, managers are afraid of regulatory challenges, think that their products are boring and that their target consumers are disinterested in them.
This could not be more far from the truth.
While it is important to define a social media framework and guidelines to be compliant with regulations, we must remember that money is still the interface between an individual and his resources and hence people love discussing what they can do to better manage their financials and maximize their possibilities.
In the insurance sector to be customer-relevant, insurers will have to develop the ability to respond to customer preferences, interactions and other customer data across channels. They will also need to be able to predict customer needs and use those predictions to personalize interactions at any point in time and in any channel.
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I wrote this post for my keynote at the LIMRA European Annual Meeting: Winning Strategies For Tomorrow 21 – 23 September 2014 and would like to dedicate it to my father Ignacio Alvarado Rodriguez for teaching me how to live and work driven by Passion, always!
“Cuando las cosas se hacen con toda el alma, es difícil fallar.”
Hotel Pullman Tour Eiffel – Paris
Life Insurance Conference
Sources http://www.thetimes.co.uk/tto/business/industries/banking/article2500407.ece  http://www.intelligentpositioning.com/blog/2014/01/mobile-and-tablet-traffic-set-to-overtake-desktop-by-mid-2014/  http://www.flurry.com/bid/109749/Apps-Solidify-Leadership-Six-Years-into-the-Mobile-Revolution#.VAxDeqi11p0  http://www.emarketer.com/Article/Do-You-Check-Your-Smartphone/1011164  http://www.thinkwithgoogle.com/articles/zmot-why-it-matters-now-more-than-ever.html?  Page 13, http://www.cii.co.uk/downloaddata/CII-Reform_Moneys-to-tight-to-mention_October2008.pdf  http://insuranceblog.accenture.com/author/accentureins/  http://www.accenture.com/microsites/consumerdriveninnovation/Pages/explore-the-data.aspx  http://www.theguardian.com/media/2014/aug/04/c-suite-social-media-marketing-adoption-boardroom  From Q4 2012  http://www.thinkwithgoogle.com/tools/customer-journey-to-online-purchase.html  http://www.thinkwithgoogle.com/tools/customer-journey-to-online-purchase.html