Back in my hometown of Detroit, I learned that consumer advertising decision-making by automobile manufacturers consisted of one part art, two parts science, and and some unknown parts corporate politics. I’m thinking that there may be a similar formula in place for decisions on digital advertising by insurers. I’d appreciate your thoughts on this.
“Digital Display Advertising Nine Times More Effective Than TV for Auto Insurance Brands”
… That was the headline of an announcement of results of a US based study conducted by media buyer Rocket Fuel. Key points were:
- “Top of Mind awareness is highly correlated with market share for both auto insurance (0.83) and homeowner’s (0.87) insurance….
- “Cross-channel ad spend was a key predictor of top-of-mind awareness for auto and life insurance providers, with digital display ad spend being nine times more effective at driving top-of-mind awareness than TV.
- “Nearly half (44%) of consumers only look at a single quote before making a purchase.”
The study was based on a survey of 1,026 consumers. The study also included detail on the impact of various advertising strategies, including ad types, time of day impact, and ad content (e.g., “Human faces improve conversion rates”).
There is a lot of other data suggesting that consumers are going on-line to research their insurance needs. These new data suggest consumers are heavily influenced by the results.
So, digital advertising is trending, right?
Perhaps … It depends who is reporting. Separating digital from other spending is not easy to suss out, so I had to rely on proxies.
Kenshoo, which supplies technology to assist in placing digital ads. reports that the insurance industry – which they note are not often associated with “digital” or “innovative” – are making substantial strides. Kenshoo notes that recent research has revealed that financial services – including insurance – is expected to increase digital spend by 83% between now and 2017 to respond to increased consumer interest in consuming digital information about financial products.
The demand estimate tracks with Rocket Fuel’s survey results.
However, a second report by Aite Group indicates that, within insurance, there is a digital divide impacting customer experience generally. An analysis of the top 20 US auto insurers’ digital capabilities found that “the top five U.S. automobile insurance companies by market share all have websites, mobile sites, and social media sites that are regularly updated, modern, and easy to navigate.”
However, “Farther down the list of top companies, fewer show involvement in social media activity, and some even lack accounts on major social networking sites.” I may be wrong, but I’m guessing you can’t really have a Facebook advertising strategy without a having a Facebook account.
Where will insurers take digital advertising? Do we need a Motown solution?
There is a consensus that insurers should embrace digital more aggressively in all parts of the transaction, including advertising. However, it takes a common vision of the digital future of the organization. Not easy to do. Which brings me to my Detroit story.
A friend of mine worked for an ad agency for one of the big 3 auto US makers (when they WERE the big 3). For one new model campaign, the agency developed a bold, innovative approach, supported by massive amounts of consumer survey data. The marketing department of the car company did a rigorous evaluation, including its own independent analysis, and concurred.
However, other members of the senior executive disagreed. The executives discounted the data, promoting their approaches as “common sense”.
The marketing department and the agency got together and devised a strategy that ultimately received approval by the COO. There would be two campaigns. One ran in the Detroit area, focusing on the TV stations, radio stations, newspapers and magazines that were popular with the executives. The other ran on various media using data-driven, segmented messages.
The dual campaigns were successful. The first kept the executive team happy. The second hit the marketing targets of the enterprise.
Where are you on digital advertising?
What do you think? Are you seeing the need to move more advertising to digital? Do you have a strategy in place? Are there reasons that you are holding back?