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Social Media Insurance Strategies – A Tale of Two Insurers

As insures and agents/brokers think about how to use social media in business, there is an interesting compare and contrast of two approaches that is materializing in the real world.  This is articulated nicely in a recent post by Terry Golesworthy, President of The Customer Respect Group, in Insurance Networking News.

On the one hand, there is Farmers Insurance which recently attracted significant attention by collaborating with the authors of a Facebook game, ‘Farmville’, to attract new fans by offering virtual gifts.  Over the  24 hour period the promotion ran, Farmers attracted over two million new fans on Facebook.  Farmers is planning to extend its partnership with Zynga, Frameville’s authors to other on-line games.

On the other hand, there is USAA, an insurer which has take a different approach.  According to Golesworthy, “they have attracted fans with whom they actively engage, discussing products and relevant subjects such as the potential government shutdown. They trust fans to publically rate and review their products and services.”  The result has been a steady increase of 6% to 8% month over month for the past two years, resulting in 172,000 fans to date.

It looks like a classic Hare and Tortoise race, but Golesworthy does not wish to play Aesop and offer a moral to the story, and we would not want to do so either.  First, the two different approaches are clearly targeted at different goals  USAA is well known within its primary market, and may be using social media as another channel to reaffirm its relationships whereas Farmers is obviously seeking a larger audience, likely to grow awareness of its brand (among other things).

Second, and more importantly, this is still very new territory, and the cause-effect relationships are not fully understood.  what is clear is that both organizations have sketched a path that they wish to test and support.  Golesworthy summarizes with a rhetorical question:  “So is social media about transparency and creating a dialogue with customers; is it about changing the way we do business or a relatively inexpensive way (to date) to reach large numbers of potential customers?”

In this respect, they are both winners as they will have gained knowledge that only experience (combined with aggregated response data) can teach.  We wish them both luck and will be following results with interest.

 

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