Social media is used by millions of consumers and businesses every day with more frequency and more time spent than any other single online activity. So it goes without saying that insurers must have a social media strategy. However, reviewing the social media activities of insurers, while nearly all are active, most have yet to create a clear strategy.
One question I always ask insurers, “What is your business objective for using social media?” And the most frequent response is “to be closer to our customers, to develop relationships, have dialogues and to engage with them.”
But is this realistic? A recent study, which I must admit has serious flaws and relates to banks rather than to insurers, does nonetheless come to some conclusions that pass the common sense rule. A whopping 87 percent of the consumers surveyed think banks’ use of social media is annoying, boring and unhelpful. One leading journalist, on reviewing the results, summarized the study saying: “Customers just don’t seem to care what banks are doing on social media.”
So apply the common sense rule to yourself — do you personally interact with any of your personal policy insurance carriers on social media? Come on, why would you? I would be shocked if more than 5 percent said yes. And before you claim that you may not be a good test and point to the GenY-ers and Millennials who seem to live on social media, do you really crave a relationship with an insurance company?
So is it a lost cause? No, I don’t think so, but insurers may be thinking about the problem in the wrong way.
Reaching consumers via social media is hard not only because they “don’t seem to care what you have to say”, but also because social platforms such as Facebook are significantly limiting the reach of free posts.
That’s not surprising; after all. Facebook needs money, and giving away free ads to large insurers, or any corporate entity seems a tad dumb. Of course, it’s possible to buy access to Facebook news and Twitter feeds, but who wants to see a message, however friendly, from an insurer while checking out news about babies, engagements, vacations and gossip? The plain fact is that most customers have no interest in speaking with an insurer until they experience a disaster.
There is light at the end of the tunnel however. On Facebook, while overall engagement rates are plummeting, one metric is increasing. When you post a message, your “fans” can “like” what you say, add a comment or share the post with their own network of friends. The percentage of interactions that are shares is increasing, and shares are arguably the most valuable interaction. Shares expose your information to new people with an implied recommendation. It no longer a brand message carefully disposed of by Facebook; it becomes helpful information from a friend.
So why is the percentage of shares going up? Partly, this is because the total number of interaction is going down, but this seems to be affecting the more superficial interactions. Shares are the domain of advocates. This includes employees, some customers and, of course, agents. Agents are fast realizing that social media is really good for client research (LinkedIn) and then creating ongoing connections (Facebook and sometimes Twitter). Agents, in their early social days, tended to lean heavily on carrier content and advice orientated information in particular.
The point is that social is becoming an indirect route to the customer. Whereas insurers are on social to reach the customer directly, the fact is that the best way to succeed may be to identify and enable advocates. Advocates tend to be people (not corporations, and that is key) with close personal ties; they speak about experiences, not products; and they share information when it is relevant. A local agent might be very connected to his or her local community; a mommy blogger might have a strong affinity for other at-home moms; and a supported charity will have emotional links to its members.
Social media is not some quirky advertising channel, which is how it seen by many insurers. It is an amazing, interconnected network that makes it easy for people to share news and information with like-minded people.
To get some understanding of how it might work for insurers, we’ll take a recent example. Progressive is trying to disrupt the auto insurance model with telematics and its Snapshot product. Research tends to show that telematics customers are happy with the product, which is logical given they have self-selected to join the program. Consumers who don’t use the product tend to be skeptical and concerned about privacy. So it is logical to get telematics customers to talk to consumers not using the product. Progressive sought out, recruited and provided content to Snapshot customers who were also bloggers. These customers, most likely would be advocates, simply because they had selected to use the product, and they already have a way to communicate.
This can be scary for insurers — bloggers are a fickle group with a message that might be influenced but never controlled. I have seen no results as to the success of the program, but if you Google “Progressive Snapshot Blog”, you’ll find hundreds, if not thousands of bloggers that have “elected” to post on the topic. It does, however, look to be a good use of the influence of advocates through the use of social media.
This does not mean insurers should shutter their Facebook pages — you need a social media presence on the major platforms. However, plan for rising costs, decreasing engagement and an increase in customer complaints and venting on social platforms. The corporate Facebook page or Twitter feed is unlikely to be where most value will be gained.
This blog was posted with the permission of the Customer Respect Group.
Terry Golesworthy, president of The Customer Respect Group, covering technology issues and innovations in the insurance industry.
Readers are encouraged to respond to Terry using the “Add Your Comments” box below.
The opinions of bloggers on www.insurancenetworking.com do not necessarily reflect those of Insurance Networking News.
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