Insurance Agent Web Power

I have dabbled with Facebook and Twitter over the last several months and have immersed myself in the growing litany of webinars, seminars, blog posts, and white papers about social media and business marketing.  A few mornings ago,  I read a NY Times article about the US government requesting Twitter to delay maintenance that would have shut down the network just as Iranians were lighting up the Twit-o-sphere with election protest tweets.*  My prediction is that proponents of social media marketing will point to this as proof of Twitters power and applicability.   That’s exactly the level of rigor applied when pundits conclude that all businesses need to get on the social marketing bandwagon or suffer erosion of sales and market share.

I’m not converted.  Not yet.

I have opined in an earlier post that social media activities should be categorized as branding initiatives.  And I absolutely believe that companies need a social media strategy to protect and promote their brand.  But I’m ascribing a much narrower benefit and use for social media marketing than most of the effusive yea-sayers.

Consider the following factoids about Bank of America and Dell, Inc.:

Bank of America -  59 million customers worldwide

Dell, Inc. – 76,500 employees, about 300 million in unit sales in 2008

Let’s consider some differences between the two.  Bank of America appears to be doing little with social media while Dell has been aggressive.  BOA operates in the financial service and banking sector (most unpopular at the moment), while Dell markets sexy computer products.  BOA is far the larger company in terms of customers, employees and revenue.

Dell gets a lot of credit for using social media as a marketing tool, BOA, just about none.  Now, consider these factoids:

Twitter…

Bank of America – 1,279 followers.

Dell – 658,679 followers.   And you might take a look at this Twitter-friendly media placement regarding 2008 Dell sales:  Twitter has made Dell 1 Million in Revenue

Facebook…

Dell - has  31,391 fans.

Bank of America -  has 1,722 fans.

At first blush, it looks like Dell gets it right and BOA doesn’t get it at all.  Dell appears to have earned $1 million in 2008 sales from Twitter.  We’re left to guess at BOA’s Twitter revenue, but I’ll bet it’s nil.  BOA has 1,722 Facebook fans.  That sounds like a respectable number, but remember, BOA has 59 million customers.  Their ratio of Facebook fans to customers is a pathetic .00003.

But Dell, who ‘gets it’ has a Facebook fans to customers ratio of .0001.  A lot better than BOA, but still not very impressive.  And if we look at the ratio of revenue ascribed to Twitter as a ratio of income to followers the number is very modest $1.52 per follower.

I’m not suggesting with all this that Twitter and Facebook have no business marketing applicability.  But I am suggesting that before you launch your agency into a social marketing initiative that you take a sober look at the amount of time you will spend on it, and the likely tangible benefits.  And watch out for the hype.

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*”…there are less than 10,000 Twitter users in Iran (Sysomos via BusinessWeek) and less than 100 of them seem to be active.” – from a post in Gauravnomics Blog, questioning the media-attributed role of Twitter in the Iranian election protests.  It’s worth a read, and points up the effect Twitter hype has had in misrepresnting the impact of the service in other than business contexts.

I visited a new insurance agency customer of ours a week or so ago, and was happy to find him in his office putting together a bunch of quotes.  All that activity reminded me of something an insurance agent said to me almost two decades ago:  “You catch a lot more fish when the seas are roiling than when the waters are calm.”  But that begs the question, whose fish are you catching?  I spent a few minutes on the phone yesterday with an insurance company executive friend of mine who confirmed her company is concerned about flagging retention.

You catch more fish when the seas are roiling...

And that brings me back around to our new agency customer.  I worry about new agencies, it’s always tough starting a new business.  But over the last few weeks I’ve decided that this may be a better time than most to start a new agency.  New insurance agencies have a distinct advantage over established agencies in this economy – they don’t have to defend against defection of current customers.  The fish caught by new agents were dislocated from their former habitat by by the turbulent waves of this economy.

So good for new agents.  The moral of this story for established insurance agents is, that now more than ever, you need to be in contact with your customers.  That’s the only way to know if you are at risk of losing an account.  If you have been putting off sending e-newsletters, or implementing a legitimate annual review program, now is the time to end your procrastination.  And, if your customer development has applicability for developing prospects, then use it for that dual purpose.  After all, there are plenty of fish swimming outside your agency that belong to somebody else today and could be your customers tomorrow.

I read an enewsletter this morning, and the article started a chain of events that lead me to post here. The chain of events goes like this: I click on a link in the newsletter that leads me to an excellent blog post about the evolution of businesses using social media for marketing. That blog post compels me to look at a funny YouTube Video and check out Xerox’s corporate website. Finally, here I’ve come full circle, doing exactly the same thing the enewsletter did: summarizing and commenting on the blog post and Xerox’s social media campaign.

The blog post I read was from Jason Falls’ Social Media Explorer blog and it is worth reading in its entirety. Here is the readers digest version of the post, points that should be considered by any insurance agent on the precipice of jumping into Facebook or some other social media venture.

Social media is about relationships and social media works for businesses when people have something they can be passionate about.  In the case at hand, passion takes the form of amusement over a video (more on that in a minute).  It’s hard to get anyone to be passionate about insurance as a product, but let me reproduce a quote from Jason’s blog post here that is instructive:

I polled folks on Twitter Saturday, asking what compels them to talk about brands. Almost to a person, the answer was something along the lines of, “When I have an exceptionally good or exceptionally bad experience.”

So customer experiences, as well as humor are candidates for Facebook content.  But for heaven’s sake, leave the insurance products out.

Social media campaigns are generally about branding, and the bottom line results are going to be hard to measure, just as with any other brand building initiative.  What that means is that you better have some patience with your campaign, and you will need to find some other way to measure success besides new insurance policies written.

Everyone has jumped on the social media bandwagon by now, so standing out is going to take more time and effort than the early days when only a few businesses were using YouTube or keeping a Facebook group or page.  Success, however you measure it, might require more of your money or time.  To get a feel for the level of competition, take a look at the craft that went into Xerox’s Information Overload Syndrom video.

I’m not suggesting you throw in the towel, just that as a a small local insurance agency, you have to be realistic about social media competition , how you need to use social media, and the kind of results you can expect.

As a final note, let me point out that social media campaigns do work.  If that weren’t the case, you wouldn’t be reading this post.  Because you have, the brand awareness meter for Xerox, and for that matter Jason Falls, have been nudged a couple of notches.