In early April, INN reported on a study that estimated only 16 % of small businesses in the United States using social media sites to promote themselves. On the other hand, large businesses—large insurers included—are taking advantage, and for good reason, according to research and advisory firm Celent. The firm’s report, “Leveraging Social Networks: An In-Depth View for Insurers,” asserts that there are three principle reasons for participating in social networks:
1. They are a cheap method of advertising. Most social networking sites offer their services for free, for now. The business model is centered on allowing third parties to pay for targeted advertising to customers of the social networking Web sites, and this is why they are so relevant to digital marketing and insurers.
2. They are growing as a communication channel to customers. A study by Anderson Analytics on the demographics of social networkers and non-users in July 2009 found that the average user logs on five days a week, four times a day, for a total of about an hour a day. Unlike e-mail, Celent says, social media is a multimedia experience with video, images, audio and text content all expected. And, unlike other channels, interactions through social networks are expected to be more human, rather than with a corporate entity.
3. They are increasing in influence. Experian Hitwise reported that Facebook was the most-visited Web site in the United States for the week ending March 13, 2010, having more visits than Google for the first time. Celent points out that this is important because to utilize the vast majority of content on Facebook, you must be a Facebook user. Celent contends social networks will grow to define most people’s experience of the Internet in the future. Much more of the media that people are exposed to, including advertisements, will be tailored based on their social networks. Even comments and reviews will be prioritized so that friends’ reviews appear first.
Spending effort now in seemingly frivolous activities on social networks can drive real business value, according to Celent. The huge popularity of comic mascots in social media has paid dividends to insurers who have invested in them and executed them well.
In the United States, nine of the top 10 non-life insurers have at least one Twitter account, and eight of those have at least one Facebook page. Of 10 leading U.S. insurers, Nationwide has the most Facebook fans, while State Farm and Allstate have the most Twitter followers.
Celent attributes Nationwide’s success to its comedy character at the heart of an advertising campaign, “World’s Greatest Spokesperson in the World” campaign. The model uses amusing social media content on social networks along with other advertising media.
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