Insurance Digital Strategy Requires Real-World Enablers – QuickLook Blog | Deloitte US has been added to your bookmarks.
Insurance digital strategy requires real-world enablers
Refine traditional marketing for digital success
Insurers need to recognize the importance of a comprehensive digital strategy and the critical role that digital and mobile communication platforms will likely play in building a connection with consumers.
Recently, I told my eight-year-old son a story from my college years in the late 1990s. My final semester engineering project involved miniaturizing a programmable logic controller (a device to control other devices). One day, I was home nursing a cold when my project partner, who did not know the status of the project, used the wrong voltage and ended up burning the chipset.
My son’s reaction was, “Why didn’t he call you?” I explained that cell phones didn’t exist back then, and reaching someone quickly on a landline could be quite a task. I also mentioned that until 10 years ago phone calls were about the only thing you could do on most cell phones.
His response: He refused to believe me! The idea that phones once lacked screens that respond to touch, didn’t allow you to browse the internet, and had no “apps” were all alien to him. It took me the better part of an hour to convince him that I was not making this up.
While my son finally believed me, the incident has stayed with me. Landline phones and non-smartphones have indeed become relics of the years gone by. And insurers seeking to avoid a similar predicament need to recognize the importance of a comprehensive digital strategy and the critical role that digital and mobile communication platforms will likely play in building a connection with consumers.
Insurers, like most businesses, have upped the ante on digital media spending to prepare for this shift. According to eMarketer, insurers spent $1.3 billion on online ads in 2016 in the United States, a rise of 16 percent over 2015. Contrast that with offline advertising, where except for television, insurer ad spending dropped by double digits in most channels, including radio, magazines, and newspapers.1
With most carriers increasing their online media presence, the battle for mind share has spilled over to digital channels, which likely will lead to a continuing decline in the return on investment (ROI) from digital ad spending. According to Analytic Partners, digital display ROI has already decreased 14 percent in the last six years, while ROI has dropped 27 percent for paid search and 32 percent for online video.2 Therefore, merely shifting marketing dollars from traditional media to digital channels is likely not enough because a simple reallocation of ad spending is not necessarily translating into improved consumer engagement.
The battle for mind share has spilled over to the digital channels.
So how can insurers better connect with their customers in the digital world?
In today’s digital world, where people scroll through their lives with rapid-fire thumbs, insurers must create experiences that truly engage consumers. Insurers can no longer afford to miss moments because of faulty messaging, incorrect timing, run-of-the-mill brand experiences, or disjointed product promises.
Ironically, the keys to success in the digital world may very well be in doubling down on and refining some of the more traditional marketing capabilities. Consider the following options:
- Employ an analytics platform to supercharge data: Data has always been a core component for the insurance industry, from underwriting to pricing to claims management. However, leveraging digital channels and technologies, such as established social media or the emerging Internet of Things (IoT), can potentially drive a greater level of insight from data. Employing this strategy could be a game changer for insurance marketers. A strong analytics platform using advanced and predictive analytical techniques is essential to mine the right insights at the right time for effective customer segmentation and personalized communication.
- Develop a content strategy to personalize communication: Companies that deliver personalized web experiences can expect a higher level of customer conversion than the ones that do not.4 Personalizing communication, which grabs the customer's attention, is therefore a critical capability for companies to develop. Insurer communications have to create memorable experiences through messages that are timely and contextual so that they appeal to consumers with different behaviors and attitudes.5 But this is easier said than done; personalization programs are creating a growing content burden on marketers.6 Insurers need to put in place an effective operating model to manage content across the organization, a plan to deliver it, and the enabling talent and technology to execute it.
- Align the organization for omni-channel orchestration: A company might have all the data and content in the world, but if its channels are not coordinated it will inevitably miss opportunities to strengthen a developing relationship or, worse, annoy its customers with redundant or inconsistent messaging. Customers should encounter the same version of a company’s image and message across all channels, whether on social media, the website, in emails, over the phone, or on any offline channel.
To ensure harmonious omni-channel orchestration, insurers need to align customer-facing departments, develop new competencies and skills in marketing automation, and define clear roles and responsibilities. They also need to develop incentive mechanisms to encourage desirable skills and behaviors, which will lead to a more memorable brand experience.
Such an alignment will also help in gathering, listening, and responding to customer feedback more effectively, and then relaying the messages across the organization for continuous innovation. After all, a company’s marketing can only be as good as its core value proposition.
Three keys for success in the digital world:
- Employ an analytics platform to supercharge data
- Develop a content strategy to personalize communication
- Align the organization for omni-channel orchestration
Insurance industry should transform to succeed
The above capabilities are key in creating brand experiences that resonate with customers, evoke positive associations, and convert customers into brand advocates. Ultimately, however, insurers will have to transform their entire organization to succeed in the digital world, or risk becoming as outdated as landline phones.7
1 “US Financial Services & Insurance Industry Ad Spending, by Media, 2015 & 2016,” eMarketer, March 2017.
2 “ROI Genome: 2017 Marketing Intelligence Report,” Analytic Partners, 2017.
3 “'Click and connect' with consumer products consumers,” Deloitte, 2017.
4 Sneha Nalawade, “Understanding the Importance of Personalization in Digital Marketing,” MarTech Advisor, June 2016.
5 Chad Caldwell, “Four Ways Marketing Operations Can Help Your Insurance Company,” Centric Consulting, July 2017.
6 “Why Personalization Is Key for Content Marketing," eMarketer, August 2016.
7 Felix Richter, “Landline Phones Are a Dying Breed,” Statista, May 2017.
QuickLook is a weekly blog from the Deloitte Center for Financial Services about technology, innovation, growth, regulation, and other challenges facing the industry. The views expressed in this blog are those of the blogger and not official statements by Deloitte or any of its affiliates or member firms.