Post - Getting the word out


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Post - Getting the word out

  1. 1. 28 | Post Magazine | 27 February 2014 GETTING THE WORD OUT How are insurance firms’ advertising tactics changing in response to the rise of social media and the emergence of aggregators? By Edmund Tirbutt Advertising C hange has been the name ofthegamewithingeneral insurance advertising throughoutthelastdecade, thanks primarily to the emergence of aggregator sites and to technological advances, which provide access to social media and other new channels. Prior to the arrival of the aggregators in 2005, most major personal lines insurers were spending seven or eight-figure sums annually on TV advertising because consumers tended to shop around between only two or three insurance brands – meaning a strong campaign could make all the difference. Now, however, insurers commonly spend amounts ranging from six figures right down to nothing at all. So what is the reason behind this sea change? With the notable exceptions of Direct Line and Aviva (which have refrained from being listed on price comparison sites), insurers have realised they are better off allowing the aggregators to do the bulk of the TV advertising themselves, while they instead focus on other forms of promotion. The days of relying on a single channel have long gone. 028-030_POST_270214.indd 28 20/02/2014 15:10
  2. 2. Post Magazine | 27 February 2014 | 29 30 For example, Esure now only dips in and out of TV advertising to maintain brand awareness, with the Sheilas’ Wheels ads of March 2013 constitutingthebrand’slastappearance.However, ratherthantelevision,Esureisparticularlykeen on Facebook, where it places mini adverts and educational and service information. Adrian Webb, the firm’s head of marketing and communications, believes social media is a good vehicle for insurers to advertise through, as they can measure the effectiveness of campaigns. “Facebook can reach very large numbers of people and we can quantify the impact very clearly,” he explains. “[Whereas] the effectiveness of TV advertising has dramatically reduced since the arrival of the aggregators [which are widely estimated to account for somewhere between 60% and 80% of general insurance business]. We are now dealing with multi-channel customers and we have different conversations via different media, ranging from phones and desktops to print and TV.” An increasing preference for social media is not the only development in the world of insurance advertising. Some insurers are starting to use advertisements to highlight their specialisms and niche services, going well beyond merely price competitiveness to promote more consumer-friendly products. One example of this is Hiscox, which has been spending heavily on TV and press advertising to promote its ability to add value in the area of high-net-worth household insurance. Simon Hayes, chief executive of brand communications consultancy Effective Image, says: “Hiscox’s advertising stands out a mile and delivers. It uses eye-catching design and includes a strong, clear proposition to pay claims. People like [the adverts] and actively recommend the company to others.” Another brand promoting aspects of its service apart from price is John Lewis, which made its first foray into TV advertising in August 2013. The firm is also unusual in focusing on building an emotional relationship between its customers and its brand – a strategy that has the knock-on effect of building awareness among its existing shoppers – as well as getting the attention of new customers. Similarly,inSeptember2013Zurichlaunched its For Those Who Truly Love campaign, which is aimed at making its brand more customer focused. This has only been shown on TV in Switzerland, but has featured heavily in trade press advertising in the UK. All of this has helped promote the message that Zurich is all about trust, expertise and financial stability. Protection insurers have also conspicuously increased their use of TV advertising during the past couple of years – but this is noticeable only because, with the notable exception of over-50s life cover, the sector originally barely advertised at all. Lucian Camp, founder of Lucian Camp Consulting, which specialises in financial services brand marketing and communications, says the increase in life insurance advertising activity still leaves the sector trailing behind the mainstream general insurers and aggregators, which he estimates spend between £200m and £300mayear.Hepointsoutthat–excludingthe over-50s ads – expenditure on consumer-facing advertising for protection as a whole is only half that of pet insurance. Online TV One imminent trend likely to have an impact on GI advertising is the use of targeted online TV, which TV channels are currently testing with major advertisers. Channel 4 has been making a big play in this respect, and others aren’t far behind. NickBarthram,principalplanneratcustomer engagement agency Indicia, is not aware of any insurers using this approach at the moment. However, he expects them to start moving into this area soon because insurers have such large armouries of customer data, for example, customers’ renewal dates, which can be utilised to carry out targeted advertising. “It’s definitely the next big trend – personalisation of messages is where it’s all going,” he asserts. “It mainly works by people logging into these services and getting shown the relevant advertising if it’s near their renewal date. Insurance companies and comparison sites have a huge amount of data, and online TV is just one example of how marketing teams need to become more data savvy.” And it is not just insurers – aggregators want to get in on the advertising act too (see box, above). Being able to recognise a meerkat or an opera singer is all very well, but being distinctive is no longer sufficient to maintain a market-leading position. Sarah Hennessy, deputy managing director at global media agency MEC, explains: “Price comparison websites are seen as essentially offering the same services as one another. [Like insurers] these brands now need to engender loyalty by adding value at the right touchpoints whenpeoplearemakingapurchase.Consumers aregettingincreasinglysuspiciousofbrands,and technology is allowing them to undertake more comprehensiveresearchonlinethaneverbefore.” Brokers falling behind All this means the aggregators are having to put a little more thought into advertising campaigns.Brokers,ontheotherhand,normally have smaller budgets than insurers and How can insurers and brokers use social media to shake up their advertising strategies? Insurers have realised they are better off allowing the aggregators to do the bulk of the TV advertising themselves Many will breathe a sigh of relief at news that they will be seeing and hearing slightly less of the notorious opera singer star of Go Compare’s TV ads in future. Gio Compario (pictured) now forms only part of a new campaign involving new characters that started last December. This focuses on a range of elements of the company’s brand, using the fictional town of Gocompare as the central theme. Go Compare head of marketing Nick Hall says: “The market is changing in the way that people are using aggregators. In the early days it was all about standing out and getting brand awareness. It worked very well, but we are now trying to communicate other elements of service. “For example, our TV advertising will soon be following our radio and press advertising in that we will be mentioning Defaqto ratings. This is all part of a trend for insurers to get away from simply selling on price.” Opera singer starts to be upstaged of marketing Nick Hall all about standing out and following 028-030_POST_270214.indd 29 20/02/2014 15:10
  3. 3. 30 | Post Magazine | 27 February 2014 their brand, so they can respond accordingly. People tweeting about particular types of insurance can be detected and contacted, and guides can be produced that answer questions tweeters are asking. But it is also important to realise that you are only as good as your marketing campaign, and that social media is not a silver bullet. Indeed, it can prove something of a double-edged sword. Joe Friedlein, managing director of online marketing agency Browser Media, says: “You are putting yourself on a pedestal – which can work wonders if you have a good idea of what people like, because you can get a lot of people doing your advertising and helping to spread your reach very cost-effectively. But if it’s a bad idea it won’t go anywhere, and if it’s a really bad idea it will get exposed in the public domain.” For example, crisis managers used to be largely restricted to having to deal with the press, but nowadays everyone has a voice. Brokers and insurers previously had little to fear from a few people moaning in a pub about poor products or service standards, but in the era of social media such sentiments can go viral very quickly – even to a global level. ■ aggregators – so tend to have to be more targeted with their promotions. Nevertheless, experts emphasise that brokers have fallen behind insurers when it comes to their use of social media and other forms of promotion, despite the fact that it usually falls well within their budgets. Social media consultant Roger Edwards, founder of Roger Edwards Marketing, says: “I’m not aware of any insurers not using social media, although I would question how many are fully integrating it into their marketing strategies. I have, on the other hand, heard that only 60% of intermediaries are using social media for business purposes. “Intermediaries must know who their customers are and what aspirations they have. This means they can use social media to engage with customers, as opposed to advertising to them. Intermediaries can even film their own You Tube products from a mobile nowadays – whereas in the old days you needed a film crew.” Examples of brokers that have excelled in engaging consumers include Lancaster Insurance – which is using Twitter, Facebook and Google Plus to effectively spread the word about classic car insurance to niche audiences – and Bennetts, which is employing similar methods for motorcycle insurance. Motor trade specialist Quote Me Today is also notable for putting content on You Tube and getting the motor trade to notice. Kevin Taylor, chief executive of digital marketing agency Gravytrain, says: “Some brokers going after niche markets are making good use of paid advertising via Google, as well as getting their websites noticed by using keywords and search-engine optimisation. It all comes down to fighting the fight you can win, and if you are a small broker there is no point in going up against the big aggregators. “So it’s all about picking a niche area and doing it very well. If you are going to create educational videos for You Tube then the quality of videos is paramount for reaching out to the right people.” Customer feedback Advertising is not the only use for social media – insurers can also use sites such as Facebook to get feedback from customers on their services. Both insurers and brokers should be paying considerableattentiontosocialmediaasameans of monitoring what people are saying about Advertising Intermediaries must know who their customers are and what aspirations they have. This means they can use social media to engage with customers, as opposed to advertising to them 29 For all the latest news Email us your opinions  Peter Matthew, managing director of Jacksons Wealth Management, an independent financial adviser, has been successfully promoting life and health insurance through weekly podcasts – and he doesn’t see any reason why other brokers shouldn’t use the approach. He racks up 2500 listens per week from subscribers to the free service, who automatically download his latest episode to their phone or computer. “It definitely results in business and is my second-highest source of client enquiries after personal recommendation,” Matthew (pictured) explains. “Although I spent £1000 on equipment to get started, even this wasn’t strictly necessary as you could easily do it for £100. All you need is a set of headphones with a microphone and free software for the laptop. “Online marketing is all about giving valuable information and content that is educational and actionable. No one responds to a product push, yet massive companies are spending millions of pounds doing them and failing.” Intermediary benefits from podcast push Determined to use social media “to stand out from the crowd in a noisy marketplace”, in late January Ageas launched an animated video about storm damage featuring the newly created Mr Ageas, a colourful and somewhat accident-prone character. The video, which is proving popular on You Tube, is designed to provide a quick reference point for brokers and customers in a fun and memorable way on the measures they can take to reduce the risk of damage to their homes and the loss of irreplaceable possessions. Paul Lynes, the firm’s director of communications and public affairs, says: “The idea is that brokers use the video as part of their own communications strategy, complementing the Weather Net alerts we already provide. “Consumers want useful information through the channels they use. The watching levels of educational videos on You Tube grew by 99% between 2011 and 2013, and we are now capitalising on that ongoing growth.” Mr Ageas goes down a storm about storm popular on You Tube, is designed to provide a quick reference point for brokers and customers in a fun and memorable A screenshot from the Mr Ageas video 028-030_POST_270214.indd 30 20/02/2014 15:10