Earlier this year, I contributed a guest post to the Insurance & Technology Blog discussing how insurers can use web analytics and social networks to support a market segmentation strategy.
On the Accenture Blog for Insurance, Michael Costonis has already talked about the importance of market segmentation to an insurance marketing strategy. Certainly, traditional market research and feedback from the sales team can assist with these strategies, but insurers must also consider harnessing the proverbial power of the web. With social media gaining popularity as a communication tool, insurers can gather valuable data to create targeted products for specific channels.
Consumers research insurance online
First, consider that a growing demographic of consumers—particularly those under the age of 40—uses the Internet to do substantial research before purchasing insurance products. Most insurers use their websites as a way to direct consumers to offices or agents, as opposed to a distribution channel itself. Currently, the majority of insurance websites do not supply the details and information to satisfy the needs of the consumer who is doing online research. Insurers can leverage their websites as another distribution channel, or as part of a multi-channel strategy.
Social media benefits the insurance industry
Social media is another valuable channel that has largely been unexplored by the insurance industry. Social networking sites like Twitter and Facebook may seem frivolous, but consumers post an astonishing amount of information on these networks. This includes information about how old they are, what field they are employed in, and how educated they are. Even more valuable, users of these networks post updates about their lives and life changes: getting married, purchasing property, having children. By gathering and analyzing this data, insurers can create customized products for a very specific target audience, timed to coincide with significant life events.
Online tools benefit consumers and insurers
Taking that one step further, insurers can develop online tools for consumers. For instance, providing a place for consumers to set up a user profile with information about financial goals and data is an excellent way to engage potential customers and build an emotional connection. At the same time, the information supplied provides valuable data for the insurer. Again, this can be used to develop products targeted at a particular market segment.
As social media and social networking continue to grow, the opportunities for insurers follow accordingly. Savvy insurers will embrace, not fear, these technological tools. As we move forward, leveraging these tools will be critical to achieving competitive differentiation and high performance.
Are you using social media and online tools to improve customer engagement, distribution effectiveness or product offerings?