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Review of the Digital Marketing for Financial Services Summit

Screen-Shot-2014-12-16-at-15.52.28In episode 19 of Hearsay Social On the Air we review the main themes explored at the Digital Marketing in Financial Services Summit in New York. In addition, we provide our commentary on the recently released Putnam Investments Advisor Survey on Social Media use.
Join the conversation on Twitter with @VictorGaxiola and @ronnykerr using hashtag #HSonAir
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Live updates from the LIMRA Distribution Conference

We are thrilled to be here in Orlando for the first day of the LIMRA Distribution Conference. Please check back here for real-time updates from the most interesting sessions and conversations.

Distribution Design: an Executive Perspective
Rand Harbert, Chief Agency, Sales & Marketing Officer, State Farm Insurance
Catherine L. Honor, President, RBC Insurance Services, Inc.
Duane M. Morrow, CMO and EVP, Primerica Life Insurance Company
James W. Kerley, LLIF, Moderator, President, LL Global Services, Inc.

The opportunity to insure North Americans remains an enormous opportunity, according to learnings from this panel. Around 70 million North Americans  have no life insurance at all.
At the same time, the industry faces a distribution crisis: the American population continues to grow, but the American agent population has declined and is aging. Increasingly, agents are not diverse enough to match population growth in the general population, particularly among women and Hispanics.
Rand Harbert, EVP and Chief Agency & Marketing Officer at State Farm, specifically spoke to the “rise of the consumer.” In the mobile and social era, consumers want to be served how and when they want, meaning the industry must adapt to serve. Specifically, insurance organizations should focus on strengthening their multichannel efforts to reach and connect with this new brand of consumers.

Better, Faster, Stronger – New World of Predictive Analytics for Insurance
Richard Berry, Deloitte Insurance Practice

Marketing, technology, and service in the insurance and financial services industries are changing in substantial ways thanks to a new world of predictive analytics, according to Richard Berry, Deloitte.
Underwriting is the first major area to be affected by predictive analytics. Traditionally, data sets used to predict insurance risk include demographics (age, gender), face value and duration of policy, alcohol/tobacco use, adverse medical history/family health, annual income, and MIB. Today, traditional data can be combined with “new” data sets such as household data and consumer purchase and financial investment behavior. The most innovative data sets today can also tie in social media behavior data and friend network behavior.
Predictive analytics can be used not only for calculating risk in pricing but can also be used upfront to save time, money, and client disappointment. For example, some data sets such as personal medical history are costly to obtain; upfront analysis identifies factors that may have a bigger impact than medical history for a particular client, giving the insurer the option to skip medical history altogether. This saves the insurer and producer both time and money. Coincidentally, it’s also better for the client: if the client qualifies, they still appreciate a shorter, less onerous application process. In the case of non-qualification, we can reduce client disappointment since advisors won’t then sell clients on policies for which they are likely to be declined.
Second, predictive analytics is also immensely valuable in marketing because it helps with client segmentation. Data helps predict which insurance policies a prospective customer is likely to be interested in, enabling you to focus on marketing those policies alone. Conversely, insurers can avoid marketing to anyone who is not likely to qualify for a policy, saving time and effort on all sides.
Third, predictive analytics can be used to identify which customers are most likely to lapse as well as whether the insurer needs to focus retention resources on keeping the customer. On the other hand, if a customer is at low risk of attriting then fewer resources need to be used for retention.
In the IA market, predictive analytics can be used to identify which independent agents are most likely to sell the most. You have the best data on your longest-standing, top-producing agents, allowing you to identify unique attributes that might indicate which newer agents have the same potential.

Thanks for reading! If you’re attending the LIMRA Distribution Conference, please take a moment to stop by the Hearsay Social booth and say hello.

The social media ROI journey

Ed. note: This post is the fifth in a series drawing from Mainstay Salire’s study on Social Media ROI: Quantifying the Benefits of Social Media Marketing Platforms for the Enterprise. Download the entire report for free here.

Although social media has been around a few years, most businesses are just beginning to learn how to harness its power to build sales and customer loyalty. Most of the companies we studied had already made forays into social media, typically by launching a corporate Facebook Page. Early marketing tests also convinced executives of the value of extending these social media initiatives to branches and affiliates in local markets.
But often these efforts stalled after executives confronted the complexities and costs of building a broader presence at the local level. For regulated companies — including banks, insurers, and educational institutions — the prospect of turning agents, advisors, and school administrators loose on Facebook and Twitter raised compliance concerns.
Companies in non-regulated industries, while less focused on legal and compliance issues, wanted to protect their brands with message and brand consistency but still allow for authentic content. The logistics and expense of distributing corporate content to local networks, enabling staff, and monitoring local communications presented a daunting challenge.

The Social Media “Chasm’”

We refer to this set of obstacles as the social media “chasm”—and each company in our study overcame it through a combination of innovative strategies and investments. The below figure illustrates the chasm as faced by regulated companies. Non-regulated companies face a similar journey, minus the compliance issues.

Accelerating Value

Marketing executives agreed that implementing an integrated social media marketing platform helped their organizations overcome the social media “chasm” and achieve value sooner than if they had continued to rely on fragmented social media environments. Lacking an enterprise platform, most organizations would have delayed rollouts to branches, agencies, stores, and local affiliates, or they would have spent too heavily on technical and marketing staff to maintain corporate- local networks. Specifically, the Hearsay Social platform:

  • Eliminated compliance as a barrier to social media
  • Simplified and optimized creation-to-post process
  • Accelerated local adoption of social media
  • Supported scale-out of social media programs

As shown below, companies investing in Hearsay Social’s enterprise social media platform passed over the chasm earlier than otherwise and realized business value sooner. Moreover, by promoting greater adoption and innovation (more than just compliance) at the local level, companies saw value beyond what was expected.

Thanks for reading! If you want to learn more, download Mainstay Salire’s study on Social Media ROI: Quantifying the Benefits of Social Media Marketing Platforms for the Enterprise.

The sales and marketing impact of social media

Ed. note: This post is the second in a series drawing from Mainstay Salire’s study on Social Media ROI: Quantifying the Benefits of Social Media Marketing Platforms for the Enterprise. Download the entire report for free here.

Expanded Marketing Reach

Companies embracing social media marketing solutions reported a significant increase in the number of people reached through various channels, notably Facebook, LinkedIn, Twitter, and Google+. One insurance company, for example, saw a 150% to 420% increase in its local Facebook fan base, largely because the platform’s simplicity enabled agents to post more frequently and effectively.
A major educational institution reported a 189% increase in its fan base because teachers and administrators could post more customized, relevant content and build a “feeling of community” among current and prospective students. Feedback through the platform’s analytics also helped fine-tune the content to focus on messaging that generated strong local-consumer engagement.
Findings

  • Local agents and branch managers that adopted Hearsay Social’s platform saw a two-to-five times increase in their local fan base over locations without Hearsay Social
  • 95% of local financial advisors said they now reach more customers through social media
  • 40% of the study participants reported a “positive sales impact” from adopting the social media marketing solution

Surge in Consumer Engagement

As companies established integrated corporate-local social media networks, they not only saw more fans signing up, but these fans and followers also responded more frequently to communications from the company. Marketing managers said that the platform’s automation and scheduling features allowed local marketing staff to “concentrate on crafting more pertinent and appealing posts,” thus attracting more engagement (including clicks, comments, views, and check-ins) from local fans and followers.
Findings

  • An educational institution adopting Hearsay Social saw a 13X increase in online consumer engagement as measured by the number of Facebook “likes” recorded per page
  • Businesses saw a doubling of customer check-ins (Facebook, Foursquare) after implementing Hearsay Social
  • Agents at an insurance company reported a 5X increase in Facebook “likes” after adopting a social media marketing platform, as shown in the figure at left.

Drove Transactions

Better outreach and engagement of consumers at the local level positively impacted sales and other measures of business growth at the companies studied. Several companies reported jumps in sales conversion rates, with one retailer doubling sales tied to specific promotions, largely due to the ability of marketers to design more attractive deals with targeted local social media offerings.
As shown in the figure below, an insurance company adopting Hearsay Social saw business improvements in several areas, including a boost in lives insured, premiums, and total assets. The volume of posts and tweets increased overall, but especially among junior advisors who adopted social media as their primary channel for stimulating sales growth.
Findings

  • 50% to 500% increase in revenue performance measures at insurer adopting social media marketing platform
  • Sales conversion rate jumped from 1.5% to 3% at retailer due to targeted offerings

Thanks for reading! If you want to learn more, download Mainstay Salire’s study on Social Media ROI: Quantifying the Benefits of Social Media Marketing Platforms for the Enterprise.