This document discusses the rise of customer-centric marketing in the auto insurance industry. It notes that while marketing spending by insurers has increased significantly in recent years, this has not translated to growth in market share for many carriers. The document advocates for insurers shifting to a more segmented approach to marketing that considers different customer needs and behaviors throughout the purchasing process. It also emphasizes the growing importance of digital channels and the need for insurers to strengthen their use of social media and targeted digital tactics.
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This document was prepared by Corporate Excellence – Centre for Reputation Leadership and among other references contains statements made by Adolfo Fernández, Director for Customer Services at Millward Brown, Madrid; Javier Mancebo, Intelligence Director at Havas Sport & Entertainment; and José Carlos Villalvilla, General Director for Eco-Efficiency and Power Services at Iberdrola during a discussion titled New Measurement Frontiers: from Reputation to Customer Value organized by Anuncios magazine jointly with Conento and Millward Brown in Madrid, on October 18, 2012.
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For the retailer, this study provides a benchmark for today’s attitudes and efforts compared to those of a crosssection
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In addition, retail is often the “first mover” in digital when it comes to programs with a strong likelihood of ROI
impact. Thus, these findings are very relevant to marketers outside of the retail/e-tail sector.
Peste 150 de tineri din agenţii şi din departamentele de marketing ale clienţilor au luat parte,la evenimentul organizat de IAA Young Professionals pe tema strategiei şi eficienţei în comunicare, ce a avut loc joi, 12 martie, la IAA House.
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Cât despre propria strategie de marketing, Călin Clej a declarat că a reorientat o parte din bugetul de media spre activităţi care urmăresc rezultate pe termen scurt, cum ar fi promoţiile. El a adăugat că mediul online nu se numără printre cele mai eficiente canale de comunicare în perioada de criză, promovarea la raft fiind recomandată în acest caz.
---- copyright: Calin Clej; All rights reserved ----
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Estimation of a brand’s value and its contribution to business has always been considered the main challenge in measuring intangible assets. But what are those brands that make the highest contribution to business value? What brands achieve greater financial result? The stronger the brand, the higher the company’s stock price.
This document was prepared by Corporate Excellence – Centre for Reputation Leadership and among other references contains statements made by Adolfo Fernández, Director for Customer Services at Millward Brown, Madrid; Javier Mancebo, Intelligence Director at Havas Sport & Entertainment; and José Carlos Villalvilla, General Director for Eco-Efficiency and Power Services at Iberdrola during a discussion titled New Measurement Frontiers: from Reputation to Customer Value organized by Anuncios magazine jointly with Conento and Millward Brown in Madrid, on October 18, 2012.
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The study, conducted in December 2013 and January 2014, solicited information and opinions from leading
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current role that digital plays in marketing programs to the burgeoning interest and importance of personalized
one-to-one marketing.
For the retailer, this study provides a benchmark for today’s attitudes and efforts compared to those of a crosssection
of other retail industry leaders.
In addition, retail is often the “first mover” in digital when it comes to programs with a strong likelihood of ROI
impact. Thus, these findings are very relevant to marketers outside of the retail/e-tail sector.
Peste 150 de tineri din agenţii şi din departamentele de marketing ale clienţilor au luat parte,la evenimentul organizat de IAA Young Professionals pe tema strategiei şi eficienţei în comunicare, ce a avut loc joi, 12 martie, la IAA House.
„Strategia, în mintea unui client, înseamnă atenţia coordonată a întregii echipe: de la agenţie la echipa de vânzări”, a spus Călin Clej. El le-a recomandat tinerilor prezenţi la eveniment să se folosească de „word-of-mouth” şi să încerce să-i angajeze pe consumatori în comunicarea cu brandul. De asemenea, le-a sugerat să pună în practică cele mai curajoase idei, profitând de circumstanţele unei „perioade pilot”.
„Vă puteţi permite să pierdeţi consumatori loiali pentru că puteţi să-i recâştigaţi cu argumente legate de preţ. Lumea se uită acum la criterii raţionale”, a spus Marketingul Managerul PepsiCo. „Este momentul să vă daţi peste cap şi să veniţi cu lucruri absolut revoluţionare. Cei de pe poziţia mea abia aşteaptă să vadă şi altceva decât lacrimi, credit crunch şi dobânzi care cresc”.
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---- copyright: Calin Clej; All rights reserved ----
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Summary of my Understanding Mobile Youth Workshop @ <a>The Prepaid Mobile Summit IIR 22-25 September 2008 in Prague</a>.
Note includes extensive videos not available on PPT file. Head to http://www.mobileyouthnet.com to view on the street videos of mobile youth
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Your automotive or motorcycle dealership thrives on customer interaction and satisfaction. Now you have the opportunity to go beyond traditional media and engage prospects directly by expanding with social media, email and online marketing. If you partner with Benchmark Email, you gain access to open rates and unsubscribes - see what subject lines catch a customer's attention and which kinds of newsletters leave them flat. Best of all, in this comprehensive email marketing guide, we take you through the current state of automotive dealership marketing, compare metrics across dealerships and industries and prescribe a great, interactive way to connect with your customers and optimize your business.
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In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
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@Pi_vendor_247
Introduction to Indian Financial System ()Avanish Goel
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It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
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What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
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how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
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US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
5. Introduction
Beyond Price: Changing Insurance Shoppers
Core Marketing Capabilities for the Road Ahead
The Marketing Agenda for Auto Insurance
Executives
Contents
1
5
11
21
6.
7. Beyond Price: The Rise of Customer-Centric Marketing in Insurance
But the equation omits a true reckoning of how effective the spending is.
The explosion in marketing spend has had no measurable impact on in-
dustry premiums, which have remained stagnant. And more than half of
the marketing dollars spent in the last 10 years came from carriers that
did not gain share. Clearly, in their eagerness for top-of-mind considera-
tion, auto insurers are missing something crucial about what their cus-
tomers need, how they shop and how they make decisions.
The disconnection of escalating marketing expenditure and the realities of
consumer behavior raises fundamental questions for senior leaders of
auto insurance carriers, as evidenced by the findings of recent McKinsey
research:
• Marketing spend in auto insurance is targeted disproportionately at the
30 percent of auto insurance buyers who are most price-sensitive and
least loyal. Why have insurers aimed so much marketing firepower at
this one segment? What determines whether the other 70 percent will
remain loyal or shop around? How can insurers reach this majority and
motivate them to switch?
• Consolidation of market share at the top of the industry appears set to
accelerate, as shoppers typically consider only four or five brands as
they begin their shopping journey. What sustainable options and mod-
Introduction
Over the past decade, U.S. auto insurers have
increased their marketing expenditure 15 percent
each year. Spending totaled almost $6 billion in
2011 alone. A simple logic propelled this marketing
“arms race.” As one carrier increased its level of
spend to gain customer awareness, others
responded in kind to keep up.
1
8. 2
els exist for insurers outside of the top five? What alternatives exist for
insurers unwilling or unable to compete in the current spend-for-consid-
eration model?
• Digital and social media channels influence 40 percent of consumer de-
cisions made during the consideration phase. Can auto insurers – es-
pecially those outside the top five – use digital channels to influence
shoppers during the active evaluation phase in the consumer journey?
• Car insurance retention hovers around 90 percent, yet virtually all mar-
keting spend is focused on acquisition. Given escalating acquisition
costs, and the fact that strength of loyalty within a carrier’s policyholder
base varies significantly, how do carriers find the right level of marketing
spend and the optimal balance between attracting new customers and
holding onto their valued policyholders?
The answers to these questions will differ for individual insurers, based on
their current position and business model. But they are questions that all
insurers should address as they adapt to changes in how customers evalu-
ate and purchase an auto insurance policy.
This report is based on the results of McKinsey’s 2012 U.S. Auto Insurance
Buyer Survey and numerous interviews with marketing executives. It high-
lights new research on auto consumer needs and behaviors, and de-
scribes the core marketing capabilities that will define industry leaders for
years to come.
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
11. Beyond Price: The Rise of Customer-Centric Marketing in Insurance
For a small number of individual carriers the marketing arms race has
yielded gains in market share. These winners are likely to continue to thrive
in the current marketing paradigm. But the industry as a whole is treading
water; some carriers are spending heavily for broad brand recognition and
have little to show for it.
Why has insurance advertising not been more effective? The answer ap-
pears to be that most advertising is based on an overly simplified view of
the insurance consumer. For a percentage of insurance shoppers, saving
money on their policy is indeed of paramount importance – but they are
by no means the majority. The number of customer segments, and the
Beyond Price: Changing
Insurance Shoppers
In 2011, the personal lines insurance industry spent
nearly $6 billion on marketing, more than three times
what they spent in 2002 (Exhibit 1, page 6). Auto insur-
ers have vaulted up the list of advertisers in corporate
America (Exhibit 2, page 6). But the results of these in-
vestments have been mixed at best. While marketing
spend has increased by a robust 15 percent per year,
industry premium growth has been stagnant. In the last
decade, $19 billion, more than half the total marketing
spend for the entire industry, came from carriers that did
not gain share.1
5
1 This breakdown for marketing spend mainly reflects the failure of these companies to attract enough customers; to a limited
degree it also reflects efforts by some large carriers to lower exposure in certain states.
12. 6 Beyond Price: The Rise of Customer-Centric Marketing in Insurance
2011200420032002 201020092008200720062005
5.9
2.4
1.9
1.7
5.1
4.24.3
4.1
3.4
3.0
Marketing spend for P&C carriers, 2002-11
$ billions
>15% p.a.
Source: SNL Financial
Exhibit 1
Marketing spend for U.S. personal lines insurers has increased
dramatically
Visa
Samsung
Apple
Campbell Soup
Coca-Cola
American Express
Allstate
State Farm
Progressive
Nike
Sony
Procter & Gamble 5
GEICO
McDonald’s
79
1
8
23
24
32
42
43
44
46
62
66
76
82
2011 ranking based on U.S. advertising spend, selected brands from top 100
$ billions
P&C insurance
carrier
Rank Brand Spend
Source: AdAge
Exhibit 2
GEICO spends more on advertising than McDonald’s, Nike or Coca-Cola
13. 7
range of motivations that drive decision-making within each, are much
greater and more complex than has been assumed. To maximize return on
their marketing investments, insurers will first need to develop a more so-
phisticated understanding of customer segments and how consumer needs
shape their shopping behaviors. New approaches based on those insights
can then be designed.
How auto insurance consumers shop today
Many auto insurance consumers begin their shopping journey with four or five
brands in their consideration set, and historically most have chosen a policy
only from among these brands. Today the process is changing dramatically; it
is becoming more dynamic, and brands are not only dropped from the con-
sideration set but added throughout the active evaluation stage. So while
there is significant competitive advantage in being one of the few brands in
the initial consideration set, it is no longer the only way to be in the running.
One of the major drivers of this shift has been the rise of the digital channel,
which now plays an ascending and influential role at all crucial touch points
on the consumer decision journey (Exhibit 3). Shoppers are exposed to
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
Online
advertising and
earned media
could improve
brand awareness
and consideration
at a lower cost
Social media (e.g., forums and
boards) provide reviews on brands
under consideration
Products designed
and optimized for
digital channels lead
to better quote-to-
bind conversion rates
Brands can find
their advocates and
leverage them
through
word-of-mouth
marketing
Mobile apps can be used to
engage with products and
services on a daily basis
BuyConsider
Evaluate
Bond
ExperienceAdvocate
Source: McKinsey P&C Practice
Exhibit 3
Digital media can make an impact at every point on the customer
decision journey
14. 8
brands online through digital advocacy initiatives or online advertising,
and feedback and open-online communities are also playing a role in con-
sumer evaluation.
Another important driver of change in auto insurance shopping behavior is
the growing presence and use of multiple channels. However they eventu-
ally finalize a purchase, consumers are increasingly using multiple chan-
nels on the way to their decision. They may conduct research online,
contact a carrier’s call center to ask questions, or reach out to their local
agent. In fact, consumers are using multiple channels on the same step of
their shopping journey. McKinsey research reveals that more than 80 per-
cent of insurance customers began their shopping process using direct
channels (Internet and call center), compared to 10 percent in 1998. Per-
haps more tellingly, online is increasingly the initial channel of choice even
among customers who value the agent relationship: about 60 percent of
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
Total 100100 1002
100
7
5
12
13
6
100100 100
59
14
2
2
25
3
32
23
4
41
8
44
7
20
31
8
32
1
23
18
59
19
29
52
6
40
54
Purchase
Post-purchase
service
Information Quote
Sales
channels
Percent of purchasing auto insurance customers Top 3 most
common journeys
Direct:
Call center,
online
Mixed1
:
Both direct
and agent
Agent:
In office and
over phone
Note: Includes only shopper data
1
Including online aggregators
2
Normalized; some respondents may not have had servicing with current carrier at time of survey
Source: McKinsey Auto Insurance Buyer Survey, 2012
Exhibit 4
The Internet is the predominant research channel for insurance
shoppers, even when they purchase through an agent or by phone
15. 9
policyholders who purchased through an exclusive agent gathered quotes
through direct channels (Exhibit 4).2
The blurring of distinct lines between channels complicates the marketing
strategies for auto insurance carriers, because they can no longer segment
customers based primarily on channel preference. This challenge is also, of
course, an opportunity for insurers that can develop a more sophisticated
and granular view of what drives customers decisions in each segment.
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
2 The importance of multiple channels is more deeply explored in the paper “The Multichannel Imperative for Property and Casualty
Carriers in Personal Lines,” McKinsey & Company, March 2011
16.
17. Beyond Price: The Rise of Customer-Centric Marketing in Insurance
Both answers demand a new approach, one that goes beyond tweaking an
existing strategy or implementing a few innovative tactics. To thrive, insurers
will need to develop a far more sophisticated view of the segments of insur-
ance shoppers and customize their approach based on the specific needs
and behaviors of consumers in those segments. They will also need to shift
some of their attention to the sometimes overlooked challenge of retaining
their valued policyholders. Finally, they must dramatically improve the organi-
Core Marketing Capabilities for
The Road Ahead
For U.S. auto insurers, the ability to grow profitably will
increasingly depend on whether they can reinvent their
approach to marketing. Only a few carriers will be able
to sustain the high-octane advertising barrage that char-
acterizes today’s market. The top five insurers, each of
which spends upwards of $500 million per year on mar-
keting, have pulled away from the industry in terms of
awareness (Exhibit 5, page 12). And even these leaders
are realizing that the narrow focus on price-sensitive
shoppers will not deliver sustainable profitable growth.
For the rest of the industry, this competitive dynamic
raises a strategic question: should they pay the price to
command presence in the consumer’s initial considera-
tion set, or aim at converting consumers downstream in
the decision journey?
11
18. 12
zational strength of the marketing function in order to consistently ensure suf-
ficient return on their marketing investments and deliver on the promises they
make to consumers.
Segmentation rules
From the moment roughly a decade ago when GEICO and Progressive up-
ended the traditional view of insurance shopping segments by focusing on
price and convenience alone, most marketing messaging has focused relent-
lessly on price. Price-centricity has succeeded on one level: it has condi-
tioned a segment of customers to shop – and frequently switch – at every
renewal. But this segment is not as large or as valuable as the marketing fire-
power aimed at them would indicate. In fact, McKinsey’s auto buyer research
shows that over 50 percent of quotes come from price-sensitive customers
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
Considered
Percent
2011 marketing spend
$ millions
Quote
Consideration versus marketing spend for U.S. personal lines carriers
U.S. auto insurance shoppers
0
0 200 400 600
1
1
800 1,2001,000
10
20
30
40
50
60
1
Esurance also enjoys 10% consideration; 21st Century enjoys 9% consideration
Source: McKinsey 2012 Auto Insurance Buyer Survey; JD Power 2012 shopping study; SNL Financial
Exhibit 5
The top five spenders have pulled away from the pack in terms
of brand awareness
19. 13
who account for less than 30 percent of policyholders (Exhibit 6). In other
words, a very busy segment of serial shoppers make the price-centric mar-
keting message appear more successful than it actually is.
If the other 70 percent – the “silent majority” of policyholders – appears to be
difficult to reach, this is likely because they are unresponsive to marketing
messages based solely around price. McKinsey’s Auto Buyer Survey results
reveal that this 70 percent is composed of many distinct segments, each
with differentiated needs, behaviors and preferences. Some carriers have
been successful with one or two segments (e.g., GEICO with customers who
value “ease of shopping” or State Farm with those who prioritize “protec-
tion”); others paint their customers with a broad brush, and miss the oppor-
tunity to sharpen their value proposition for specific segments.
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
29
49
Switchers
54
44
71
51
46
56
Number of quotesShoppersPopulation
100% 27% 9%Percent of total
population
27%
Share of population, shoppers and switchers, by segment
Percent, 2012
Other
Price seekers
Source: McKinsey Auto Insurance Buyer Survey, 2012
Exhibit 6
30 percent of the consumer population accounts for over 50 percent
of all quotes
20. 14
An example segment, loyal policyholders, have varying motivations for stay-
ing with their carrier. The majority is actively loyal; that is, they are satisfied
and renew without shopping because they value the relationship for one
reason or another. A significant minority (18 percent) of loyal customers,
however, is passively loyal. They stay put more out of inertia than from any
active satisfaction. Insurers that can reach and dislodge these customers
will open up new opportunities for growth.
The requirements of taking a segmented view of the insurance customer go
beyond understanding preferences and needs. McKinsey’s research shows
that the relative importance of each stage in the customer decision journey,
the brand equities that resonate and even the specific marketing vehicles
that are most effective – all vary by customer segment. The most effective
marketing efforts will therefore be those that are tailored both in terms of
message and medium.
One way to focus marketing efforts on specific segments is to develop
stand-alone microbrands, a trend that emerged recently in the U.K. in the
context of heightened price competition. Admiral, a British auto insurer,
launched its Diamond brand, targeted at women; Elephant, focused on on-
line-only consumers; and Bell, focused on rewarding drivers with low claim
activity. In the U.S., a few sub-brands have emerged to broaden market ap-
peal at carriers such as Allstate (Esurance) and Farmers (21st Century,
Foremost and Bristol).
To succeed in a segment-based approach to marketing, auto insurers
should keep the following imperatives in mind:
• Target segments based on an explicit appreciation for lifetime value of
the customers.
• Develop a deep understanding of segments’ needs and behaviors, at
every step in the consumer journey.
• Follow through with targeted strategies, and focus on offers that provide
a call to action for customers to make the switch.
• To support their more sophisticated views of segments and tailored mar-
keting messages, insurers must be able to track the effectiveness of
each tactic by channel and segment.
• Dislodge competitors’ passively loyal customers with value propositions
and calls to action tailored to their unmet needs.
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
21. 15
Digital weapons
TV commercials and other traditional media may still be the most visible form
of auto insurance marketing, but carriers are gradually adopting new digital
tactics such as targeted paid search campaigns, search engine optimization,
banner ads and social media. Digital marketing is fast becoming a major bat-
tleground in the auto insurance marketing wars. Brand reputation and word-
of-mouth recommendations in particular are now strong drivers of consumer
choice in insurance (Exhibit 7), and a handful of carriers have launched social
media campaigns via carrier-sponsored Facebook fan pages, Twitter ac-
counts and even games. But the scale of social and digital marketing in in-
surance still pales in comparison with that of the leaders in other categories
such as Starbucks, Procter & Gamble and Coca Cola. Insurers that can rap-
idly build capabilities and sophistication in the digital arena will be well-
placed to grow.
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
ExamplesNeed
Least
significant
Most
significant I’m willing to work with a brand that is not well knownBrand strength
I like to shop around
It is important for me to work with someone who knows
me personally
Preference to
shop
I prefer to work with a local agent
Personal
relationship
I want a specific person accountable when I have a claim
Access to local
agent
I want the lowest price
Personal claims
help
I want to make purchases online
Price
Ease of purchase
I tend to follow the advice of my agentAdvice
I am willing to pay to get better coverageCoverage
Source: McKinsey Auto Insurance Buyer Survey, 2012
Exhibit 7
Brand strength is the strongest differentiator across
customer segments
22. 16
Retention is the new holy grail
Marketing in the insurance industry has historically focused disproportion-
ately on acquisition. Hence, vast amounts have been spent on above-the-
line, mass market advertising to drive brand awareness. However,
marketing messages inducing shopping based on price are driving more
customers to view the policy as a commodity, leading them to shop and
switch more frequently.
The combination of higher acquisition cost and lower retention for frequent
shoppers drives up the relative value of retaining existing policyholders. For
large carriers, each percentage point of increased retention is equivalent to
a boost of several points in brand awareness. In light of this, carriers must
recalibrate their marketing efforts to achieve a better balance between ac-
quisition and retention.
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
Direct written premiums
$ billion
Decision point
Switched carriers in the past year
“Switcher”: 9%
$12
Shopped then renewed with existing
carrier
“At-risk”: 18%
$33
Renewed due to satisfaction with current
carrier
“Active loyalist”: 55%
$93
Renewed due to inconvenience of
shopping and switching
“Passive loyalist”: 18%
$32
Shopped for new carrier
in past year
“Shopper”: 27%
$45
Renewed with existing
carrier in the past year
without shopping
“Loyalist”: 73%
$125
Auto
insurance
consumers
$170
Source: McKinsey Auto Insurance Buyer Survey, 2012
Exhibit 8
27% of consumers shopped for a new carrier in 2011; 9% switched
23. 17
While retention in 2011 was 91 percent (up from 2008-2010 levels), this is
not a cause for complacency. Among the “loyal” majority of policyholders,
18 percent remained with their carriers only after shopping and comparing
quotes (Exhibit 8). Protecting the valuable customers within this group as
well as the actively loyal customers against attackers with aggressive
growth objectives is critical to the survival of many carriers.
Understanding the relative value of existing policyholders
If joining the ranks of the initial consideration set for insurance shoppers
is an exercise in blunt-force advertising firepower, retention efforts
should be the opposite: a targeted, layered strategy to identify and
reach high-value policyholders. McKinsey research shows that degrees
of loyalty vary significantly from one segment to another (Exhibit 9);
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
Segment
9
38
17
Segment
8
30
16
Segment
5
29
17 16
Segment
7
24
30
41
4849
5958
7578
56
30
21
11 11 12
19
21
13
Segment
3
9
8 8
Segment
2
16
25
7
Segment
1
14
Segment
4
18
9
17
Segment
6
7 4 4
Total
12
25
3.2 6.4 1.8 1.32.3 4.6 2.65.4 2.5 2.0
Most active loyalists Least active loyalists
Propensity to shop and switch by segments1
Percent
Active loyalists
Passive loyalists
Active/passive ratio
Shoppers
Switchers
1
Segmentation based on consumer needs
Source: McKinsey Auto Insurance Buyer Survey, 2012
Exhibit 9
Segments differ significantly in level of loyalty
24. 18
most insurers, however, do not have a view of their customers’ behav-
ior and preferences that is nuanced enough to carry out a highly effec-
tive retention effort.
This is in part due to a tendency to segment policyholders based on
pricing attributes and binding channel preference rather than on their
needs. Once they have an accurate view of the needs-based segments
that comprise their existing policyholders, insurers can determine
which segments are worth actively defending. For instance, a percent-
age of a carrier’s book is comprised of customers for whom price is all
important. These serial switchers will more
than likely leave for a competitor at their
next renewal. Insurers must decide
whether these customers are worth the re-
tention efforts, or whether they should
focus on retaining their more valuable
loyal policyholders.
This is a complex challenge. Many touch
points can influence a policyholder’s deci-
sion to renew and a good number fall out-
side the direct control or influence of the marketing function (e.g.,
claims, problem-resolution). This means that retention efforts demand
both strong marketing capabilities and the organizational alignment to
deliver on the brand’s promise consistently across all touch points.
Delivering on the brand promise
The emerging importance of segmentation and retention as elements of
a successful marketing approach in auto insurance leads inevitably to
the need for a third core capability: strength in delivering on the value
proposition and brand promise that carriers make to their valued cus-
tomers. The most sophisticated view of the needs and preferences of a
valued customer segment will be for naught if promises made to those
customers are not consistently kept.
This can be a tall challenge, because the touch points at which a cus-
tomer can gauge an insurer’s fulfillment of the promise run the gamut of
the value chain, starting with the initial interaction with an agent or on
the company Web site or Facebook page, through the billing and re-
newal process, all the way to claims and customer service.
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
The most sophisticated view
of the needs and preferences
of a valued customer segment
will be for naught if promises
made to those customers
are not consistently kept.
25. 19
To meet this challenge, the senior management team will need to assume
collective responsibility for delivering target segment needs and developing
effective customer engagement.
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
26.
27. 21
The Marketing Agenda for Auto
Insurance Executives
Over the last 10 years the marketing arms race has
reshaped the competitive landscape in auto
insurance. This expensive battle for customer
consideration is not going away. However, changes
in consumer behavior and in the understanding of
the diversity of auto insurance customer segments
are presenting opportunities for new approaches to
attracting and retaining those customers. Insurers
with the tools and talent to develop sharp insight on
the segments they want to reach – and the most
effective channels and messages for swaying them –
will make inroads. In the new age of marketing in
auto insurance, sophistication, savvy and
organizational strength will count for as much as
spending power in the battle for profitable share.
To set an agenda for success, senior management teams will need to en-
gage in a sustained debate around five strategic imperatives and important
related questions:
1. Target customer segments with compelling marketing messages. Which
segments fit best with our strategy and value proposition relative to the
competition? What brand equities and marketing touch points are most
effective for our target segments? How do we strengthen our understand-
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
28. 22
ing of consumer needs, and make decisions on where and how to invest
in meeting those needs?
2. Get more mileage from marketing spend. What is the optimal level of mar-
keting spend and the right media mix across multiple distribution chan-
nels, geographies and customer segments?
3. Balance acquisition and retention marketing. What is the right balance be-
tween acquisition and retention? What strategy, investments and tactics
will help us successfully retain consumers?
4. Upgrade marketing organization and capabilities. What capabilities should
we build versus buy? What organization structure will deliver greatest im-
pact? What talent do we need, in which roles, and where can we find it?
5. Ensure senior executives are engaged in the marketing challenge. How do
we make sure that our business executives understand and drive our mar-
keting agenda, and that they support a strong marketing function?
* * *
Auto insurance shoppers are not as single-minded as the advertising aimed
at attracting them would indicate. There are multiple segments, and the con-
sumers in each of these segments are driven by different needs and prefer-
ences, and respond to distinct messages at distinct touch points in their
shopping journey. All of which is to say that marketing in auto insurance is
not a simple challenge.
Fortunately, this challenge is also an opportunity. Auto insurance marketers
that begin to grapple with this complexity and translate new marketing insights
into new marketing strategies will be well set to grow in the coming years.
Beyond Price: The Rise of Customer-Centric Marketing in Insurance
29. 23Beyond Price: The Rise of Customer-Centric Marketing in Insurance
About the McKinsey Auto Insurance Buyer Survey
For the McKinsey Auto Buyer Survey 16,000 car insurance shoppers
were surveyed in June 2012. The survey explores the reasons behind
shopping and switching behaviors by customer segments as well as the
performance of carriers, brand equities, touch points and marketing
techniques along the consumer decision journey.
30. 24 Beyond Price: The Rise of Customer-Centric Marketing in Insurance
Devin McGranahan
Director
(412) 804-2745
devin_mcgranahan@mckinsey.com
Tanguy Catlin
Principal
(617) 753-2467
tanguy_catlin@mckinsey.com
Sharmila Ray
Associate Principal
(617) 753-2283
sharmila_ray@mckinsey.com
Contact
For more information about this report,
please contact:
The authors would like to acknowledge the contributions made to this
report by Thongchie Shang and Justin Budd.