Insurance Agent Web Power

A recent survey from Forrester Research suggests independent insurance agents need to have a little more fun.  Consider:  ‘When it comes to “enjoyable,” consumers rated independent agents “poor,” but gave them “good” ratings for “meets needs” and “easy to work with.”’  Well, two out of three ain’t bad, but what if your agency could cancel out that insurance dread and score 3 out of 3?  This low ‘fun’ score is precisely why insurance agents find it so challenging to come up with social media content – social media is all about fun, and…well, socializing.

Who was #1 on the enjoyable list?  USAA.  USAA is a unique animal, to be sure, but there is something to be learned from their Facebook page.  I just scanned their currently displayed wall, top to bottom.  Nowhere did I see a we-can-save-you-money sales pitch or read a dreadful claims scenario wherein someone found out they didn’t have the right insurance.  USAA understands that Facebook isn’t a medium for the hard sell…it’s for fun.

A new blog can be set up in a snap.  You can add a Facebook page for your insurance agency in just a few minutes.  Your insurance agency can prove it is in the know by setting up a Twitter profile.  Starting a social media account is easy.  Keeping up your shiny new blog or Facebook profile takes time, so much time, that most blogs quickly fall silent; in 2008 Technorati – the blog devoted to blogs – found that of the over 130 million blogs they tracked, only 5% had been updated in the last five months.

Deriving real business benefit from social media takes even more effort, and likely some cost, despite all the pundits who extol the virtues of this fee medium.  There is no doubt that blogging and Tweeting can add first stage SEO benefits for your insurance agency if you put the time and effort into these communication tools.  But what about the benefit of attracting a legion of loyal friends and fans to your social media space?  This may be most difficult of all for an insurance agency.

This week, Marketing Sherpa published a chart showing why consumers become fans of businesses.  While all of the reasons people friend businesses can be leveraged by insurance agencies, the top two, “Learn about new products and features” and “Learn about specials and sales” can probably be ruled out.

Why Consumers Become Fans of Businesses

( Note:  Max Connectors are defined as people with over 500 ‘connections’)

Insurance regulation prohibits discounts and sales, so unless you can be really creative, you are going to be hard pressed to post any content in this category that will attract a consumer following.  There is plenty of product innovation taking place in the insurance industry, as those of us working in the business know, but new product features and services tend to hold interest only to industry insiders.  That new coverage provision just can’t mesmerize the populace the way the newest iPhone, Windows operating system, or hybrid sports car can.

The remaining two content categories – “Company Culture” and “Entertainment” are probably rich enough to provide a thematic basis for your insurance agency social media content, but regularly posting this type of compelling content isn’t something most of us have been prepared to do.

I’m not suggesting that leveraging social media for the business benefit of your agency isn’t a strategy you should consider.  But I am saying that Facebook and blogging are not money-for-nothing, get-rich-quick schemes.  Social media takes as much time, effort, and expense as other business development options, so weigh your expectations and commitment accordingly.

Poor old email.  Celebrities don’t use it to communicate their fans, and infotainment talking heads encourage viewers to check their Twitter tweets. So is email dead?  Should we send out the funeral service notices?  The chart below tells the tale.

Poll:  How do you share information you receive in email?

Despite the hype surrounding blogging, Facebook, Twitter, and social networking in general, email is still the way most people share information with friends, family, and associates.  Social media is a very, very distant second.  That doesn’t mean that your insurance agency shouldn’t be developing a social media strategy, but the chart should give you a visual clue as to the amount of time you should be spending on that social media vs. gathering, managing and using email addresses.

There is ample evidence that suggest too many options delay decisions and increase dissatisfaction with the choices we make (See Barry Schwartz’s excellent book on the topic: The Paradox of Choice: Why More is Less). Enter a new definition of quality, posited in a Wired Magazine article: The Good Enough Revolution: When Cheap and Simple Is Just Fine. The article leads with discussion of the cheap, and easy to use Flip Ultra camcorder. Despite the lack of features, the camera has sold like hot cakes, grabbing a 17% share of the camcorder market in just two years.

Other ‘good enough to get on with it’ products and services cited in the article include gmail and Zoho Writer, a Microsoft Word substitute with fewer bells and whistles (but most of the features you are actually likely to use). Oh yeah, and what about the advantages of a (relatively) unsophisticated, unmanned Predator aircraft vs. a $45 million F-16 (options, including pilot, may cost extra)?

Wired isn’t alone in noticing that cheap and simple solutions are often the best ones. In the upcoming sequel to Freakonomics – called Super Freakonomics – Steven Leavitt and Stephen Dubner have included a chapter chapter entitled The Fix Is In – And It’s Cheap and Simple.

I think this movement toward ‘good enough is more than effective’ is good news for agency manager perfectionists. Instead of wrestling with decisions about which expensive and complex software or web service to work with, just go with what works, and can be had for little or no money. Here’s a few favorites that insurance agency managers should be thinking about:

For video calls, and free long distance, try Skype. Depending on features you may wish to add (a traditional phone number, the ability to call out to land line or cell phones, e.g.), you may pay a few dollars a month.

And speaking of YouTube, there is no simpler way to get your video converted for streaming and to add it to your website.  We have been using YouTube for a variety of purposes at Confluency Solutions, and set up our own channel a little over a year ago.  Use YouTube videos to explain insurance coverage, the claim process, or to highlight safety issues.  Oh, and the cost – free.

Video email can be free, or you could pay as much as (gasp!) $99 a year.  Eyejot is our service of choice.  At Confluency, we use it for proposal deliveries, conference/trade show follow ups, and to set up renewal reviews.

Email management, CAN SPAM compliance, and newsletter sign ups can be facilitated by several services.  MailChimp is free, as long as your ’subscription’ list is $500 or less.  After 500, the monthly fees are low.  (Your insurance agency might have 2,000 customers, but how many email addresses do you have?)

For web conferencing, including document and screen sharing, try DimDim.  The service is reliable, easy to use, and free for up to 20 attendees in a session.

The list could go on and on, but in my experience, these are good places for most insurance agencies to start.

I can’t quite leave the theme raised in the last post:  is it technology or is it communication?  I also can’t quite move on from using the lazy approach to posting:  video.  Watch as I opine:  I don’t see the reticence many insurance agents have toward using email as being a new phenomenon; and watch as I wax nostalgic on managers from my distant past not setting a good example using tools they encourage others to use.  Insurance agents are under utilizing email, a tool that is certainly in decline as social networking gets bigger.  It’s time to maximize email benefits before it’s too late.

You could say ‘insurance’ is the answer, and at some level, it is.  But that glib answer makes many of us miss several of  the imperatives of any business:  getting customers, keeping customers, and making sure our customer relationships are profitable (so we can stay in business).  I attended a recent agency association convention where I heard two comments repeated that I have heard for years:

1.  Oh, you guys do web stuff?  I’ll give your information to my technology guy to review.

2.  I’m in the insurance business, not the technology business.

I felt the need to post my take on those comments, but I didn’t feel like typing.  So here’s what you get:

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.

Please take the time to read to the end and answer our poll question.  I’ll share the results in this blog.  If you would like to know when they are available, you can follow me on Twitter – @cfluent; or you can subscribe to the RSS feed to this blog.  Or just check back here.

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I picked up a new guide to writing web page sales copy about a month ago, and finally, due to a power outage the other day*, I had time to really think about it.  One common ‘hook’ in sales copy – the thing that grabs your attention sufficiently that you scan a little further – is the problem-solution formula.    That’s the most pervasive one, both on and off the web, in insurance sales copy:  ‘Your insurance costs too much and we can save you money.”  It is a hook that works, of course, or else GEICO wouldn’t continue to beat it to death.  I think that is also the easiest one for an insurance agent to latch on to, even though it leaves some of us with the queasy feeling that we are demagoging and commoditizing a service that shouldn’t be a commodity at all.

There is another variation on the problem-solutions recipe that shows up in insurance sales messages.  I’m going to call that the Allstate angle after their recent TV advertising campaign:  “If you don’t have the right insurance, you could find yourself leaving a courtroom bare-chested, the shirt having just been sued off your back.  We won’t let that happen.”  That’s a message that seems to work for Allstate, and many independent agents have adopted that same sales hook.

But as I read the copywriting guide, I was struck  by the effectiveness of using scarcity as the sales hook – you know, “this offer expires at midnight tonight”, or “we only have five widgets left” (a la QVC).  The scarcity message is problematic on a web page – “Look! I just refreshed the page after 2 hours, and there are still ‘only 5 widgets left!”  It also requires a little more thought in an insurance context; I mean, is there a limit to the number of insurance policies that can be printed?

But scarcity does fortuitously present itself from time-to-time.  A recent example here in Florida followed in the wake of State Farm’s announcement to pull out of the homeowner market.  A few of Confluency’s insurance agency customers seized that occasion to let customers and prospects know that their agencies had a number of financially solid markets that could accept State Farm homeowner customers at competitive rates.  They also warned (accurately and honestly), that due to market volatility, they might not have the capacity to place homeowner policies indefinitely.  The message:  procrastinate and increase your risk of not finding quality coverage at competitive rates.  And it worked.  All three agencies that I know of that used this approach more than doubled their new customers over about a two month period.  And then the tumult sibsided, scarcity moved off stage, and new business reverted to normal levels.  But what if your agency could manufacture scarcity and make a compelling case to a prospect for why they should act now?  I think it can be done, and I think it will improve agency bottom line results.  But first, some more background.

Doctors and dentists use a scarcity sales hook when they say they are not taking new patients or they are accepting only referrals (and some agencies work on a referral only basis).  These health care providers may not think about positioning their exclusivity as a sales hook.  A doctor may have a patient maximum imposed by their malpractice insurer.  Or a dentist may simply want to preserve free time and quality of life instead of piling in even more income.  But most always, professional service providers recognize the reality imposed  by time constraints and the necessary trade off:  if I take new patients, I’ll have less time to spend with my existing patients.  Insurance agents face the same trade off.

Suppose your agency were to set a monthly new business quota and then let potential customers know that if they wait too long into the month, they may not be able to become a customer.  OK, I get it.  Who among us is going to say no to a new customer.  But hear me out.  And by the way, this is something we wrestle with at Confluency Solutions; I firmly believe that within the next 6 – 12 months we will limit the number of new customers we take on for the very reasons I am about to explain.

The fact is, new customers cost money; we all know that.  For every quote that converts, somebody had to produce quotes for 3, 4, or 5 prospects that didn’t convert.  And  every quote opportunity was earned through multiple phone calls, emails, and other lead nurturing activities.  All that takes time.  How much?  Four hours per each new customer?  Five?  I don’t know, and it will vary from agency to agency.  The point is, every minute spent acquiring new customers could be spent nurturing incumbent clients.  There are things you do for your customers (or would like to do, if you had the time):  personal annual reviews, claims monitoring, educational safety or risk management seminars, etc.  And we all know that multiple, high-touch, value-added customer contacts result in better retention, more policies per account, and more referrals.**  In short, spending more time with your customers means more income.

All agencies need new customer growth and I’m not arguing against that.  But every agency eventually bumps up against a dilemma, wittingly or otherwise.  That dilemma is encapsulated in this question:  Is my insurance agency producing income from new customers at the expense of income (and better profit) we could produce by developing current customers?  To answer that question, you need to have specific customer development activities and results you can measure.  Maybe your agency does, maybe not.  But for the sake of illustration,  and my only hope of wrapping up this post, I’m going to assume a hypothetical agency does have a customer development program in place and can measure the results.

This hypothetical agency has determined the optimal number of new customers is 20 a month.  Further, the agency recognizes that half those new customers come from referrals.  So the agency decides to set a quota of 10 new customers a month, aside from referrals.  Then they craft a sales hook for their website sales pages and other sales collateral that goes like this:

We want to make sure you are never on your own when you have an insurance claim; our agency wants to be available to answer every question you have, in as much depth as you want; we want to recognize when a change in your lifestyle or business situation requires different insurance.  Because of that, we may not be able to accept you as a customer.  We have to protect the time we need to provide for all our customers’ needs, so we can only accept 10 new customers a month, exclusive of customer referrals.  We hope you understand.  And we hope you contact us as soon as possible, because we really would like to have you as a customer.

Think about the implications of a sales hook like that.  It creates a sense of urgency.  It articulates a value (actually value-added) proposition instead of just doling out the usual ‘we’re all about service’ platitudes.  It communicates to agency staff the commitment behind the kind of service you expect them to provide customers.  It also probably boosts office morale because the sales hook implies that you care about stress and overtime – you want to manage and protect staff time and sanity.

So there it is, scarcity vs. ‘you could save 15% or more’.  The anti-GEICO.  The question is, would you ever seriously consider implementing an approach like this in your agency.  I’d love to know.

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*In his book, The Age of Unreason, Charles Handy wrote about the benefits of unstructured time – protecting time for creative development and ideas; in particular he made not of several top performing companies that allow employees 15% of paid time for tinkering on their own projects.  I must confess, that except for sitting around in the dark without electricity for several hours, I can’t remember the last time I enjoyed any unstructured time.

**Of course, not all customer contacts need to consume a lot of time or cost money.  For a short video discussion about how to use a gift card program to improve agency results, check out Agency Resources website.

Two ways to use the inexpensive Eyejot video email service to differentiate your insurance agency by making a distinguishing impression on new customers,  and compressing the sales process by using video references.  For more, check out the video:

There are 3 levels of the Eyejot service, the first is free, the top level Pro Plus is $100 a year. Try it out at the free level, to get comfortable, but the uses and benefits at the $100 level will pay for itself over and over again.