Selling insurance when people don’t want it

Selling insurance has one of the single most difficult hurdles to overcome. How to convince audiences that they should buy something they believe they don’t need.

Selling insurance isn’t like selling something people want. Consumers want iPhones and a nice-looking car. They will gladly pony up for them.

Selling insuranceHowever, they don’t want to think about what insurance is protecting them from: Death, illness, fire, liability, etc.

Selling insurance includes another dilemma. People believe that insurance companies are simply out to take their money and will automatically fight any claims. Whether that’s belief is true or not, it is believed. We have conducted research in this industry and that belief is the single biggest hurdle for insurance sales reps.

What are the other selling insurance hurdles?

Without giving away findings that are preparatory to our clients, our research has borne out a few themes:

  • People, including white-collar professionals, believe insurance companies are unfeeling entities, which means claims of caring rarely resonate.
  • Fear-based messaging (“What happens when you die?”) is ignored because it’s seen as the start of a scam.
  • Policies are confusing, feeding into the belief of insurance companies being deceitful.

Here’s the catch. Agents, those chosen to sell insurance products, often feel the same way. They also believe that messages about caring are not believable. They are also sick of telling the same story. And they find working with insurance companies to be cumbersome.

This should not be a surprise to anyone in the industry. What is surprising is that too few in the industry do anything about it. Yet overcoming those hurdles is exactly what would increase market share.

Let’s address each hurdle.

Insurance companies are unfeeling entities:

This is the most difficult hurdle because few believe any company cares more about its customers than its bottom line. This belief is especially acute with insurance companies because insurance is a low involvement category until they have to use it. Then it is high involvement and highly personal.

An effective brand message is the best step. Any message must be aligned with that belief (insurance companies are unfeeling) and positioned against the competition.

Selling insuranceAsk yourself these questions: What is it that audiences seek in their lives? What are they truly seeking when considering insurance? What are they rebelling against if they are forced by an employer to seek a particular structure of insurance, such as a health savings account?

More importantly, the message should be about the customer, not you. You lose the audience’s attention the moment you begin talking about you (either in person or in an TV advertisement).

Selling insurance becomes even harder when the rep knows that all products are the same and the only effective tool is the personal relationship with the individual customer. This is one of the main reasons an insurance salesman is such a cliché. Customers need insurance, not someone pretending to be their newest best friend. Be expert and understanding.

Fear-based messaging is ignored:

So stop doing it. Advertising for life insurance is especially guilty of this, often asking the question, “What will your family do when you’re gone?” This might have worked decades ago when life insurance was a relatively new idea. At its best, protecting your family is a category benefit.

Today, audiences have become immune to that message and consider their own investments as savings against such an outcome.

Think about this. Thousands of messages come into our view every day. Even the logo on a pen is a message. Humans, though, have a filter. They only hear messages that are about them.

What insurance companies and agents must do is understand the emotional reason why someone would want to protect something with insurance. Not a rational reason. An emotional one. Too much messaging today is superficial and paper thin. (A better example for life insurance: “It’s what a good father would do.” A definition of who they are when they buy insurance.)

Policies are too confusing:

This is an industry-wide problem. Policies have variations on variations, papers upon papers, language that is too confusing. Even agents have trouble deciphering everything.

To potential customers, it looks like an attempt to intentionally confuse them so the fine print can’t be understood.

So much of the world seems complex, so we thirst for simplicity.

Simple is best. Make everything you do, including how you explain policies, as simple as possible. What is the final result? The details are usually ignored.

The most powerful way to clear the hurdles

The most effective way to address all of these issues, however, is through brand. So many  insurance companies get brand wrong. GEICO spends millions on a message – “15 minutes could save you 15%” – that isn’t believed. The result if market share stagnation. As an even worse example, Genworth Financial once said: “We’re big, safe and friendly.” Ugh.

Selling insuranceBrand is about the customer. Who they are when they use your brand. We are winners when we wear a Nike shoe because we “just do it.” Apple positioned itself against everyone else, saying that its customers “Think Different.”

Developing a brand like that is hard work. It takes in-depth research, leadership willing to slay sacred cows and an understanding that emotion works better than the rational.

Insurance companies and agents should take note. Because audiences right now believe you are out to get them. And get them good.

Insurance branding to create preference

The purpose of insurance branding.

Any process of insurance branding includes questions about creating preference. How do we gain preference for our products when, basically, they are identical to that of the competition? How can we convince target audiences to buy insurance when, if I’m being honest with myself, they don’t really want insurance? How can I assure our message is getting through when we go through a middleman, such as a broker or an independent agent, to sell it?

The insurance industry is one of the most heavily regulated of all, right there next to pharmaceuticals. It must respond to changing laws, reimbursement issues, market forces and, especially, health care requirements.

Insurance brandingIts other hurdles, however, are not that unique to its industry. Most markets are mature ones, meaning that products and offerings are similar, and true innovation is rare. Most of the products consumers buy they don’t really need (c’mon, who really needs an iPad?). And most brands don’t sell directly, meaning they depend on a retailer or distributor for sales.

Does that mean the answers to those questions posted above are the same for any industry? Yes and no.

Facing the belief about insurance branding

The reason they are not all the same is that insurance brands have an image problem few have. They are seen as a scam. We’ve done research for various insurance companies and respondents are very wary of insurance companies that make promises on which they don’t deliver. Any number of the general public can tell you a dreadful story about filing a claim and having to hire an attorney to goad the company into complying.

You could retort that all industries have failures and breakdowns, but the anger is stronger with insurance brands because the issues seem to be embedded into the process itself.

You pay your premiums without filing a claim for years, then you are denied when you actually do file. As it’s said in a Liberty Mutual commercial, “Why have insurance when you have to pay more to use it?”

In some ways, this anger is similar to what consumers felt about banks. In the face of the 2008 recession, anger at banks was at an all-time high.

Why do so few take action?

But few financial institutions, such as credit unions, aligned themselves with that anger to steal market share. Our studies showed that about 15% of customers seriously consider switching banks at any given time, but few actually do it because switching seems complicated and no one has a message that gets them over that hurdle.

In the insurance industry, switching is certainly one of the end games of insurance branding. But another is adding to the policies you already have with that customer. In that situation, customers are usually reluctant to add policies because of the negative feelings they have about insurance companies.

The Liberty Mutual ad campaign has been successful largely because of the belief among consumers that insurance companies scheme their way to take your money. It works as a message, but it would be more effective if the emotional pain of that the audience was embedded in the Liberty Mutual brand. Then Liberty Mutual could be preferred, rather than just considered.

hamster wheelSure, Liberty Mutual says “Liberty stands with you,” but that’s just marketing garble and identical to “Nationwide is on your side.” (We liked the question it asked years ago, “What’s your policy?”) To really make an impact, and provide preference, its theme should not be so forgettable and easily overlooked. It should hit the heart of how prospective customers feel and how they should see themselves in the Liberty Mutual brand.

Brand answers the questions

Therein lines the answer to all the hurdles discussed. Your products are basically the same as those of your competitors? They will become more important to target audiences if they are given emotional reasons why they exist beyond the tired of messaging of protection against the future. How to open up more policies for customers? If the brand fulfills an emotional promise, then those customers will be more open to listen to you.

That’s what insurance branding should do.

Want better control of the message? Then have a brand message that is unique because most agents, according to our research, are bored stiff repeating the same message over and over, regardless of carrier. That is why most of them compete on price. They have nothing else to say.

Let’s consider Liberty Mutual’s “Liberty stands with you” theme one more time to get at the root of the insurance industry’s problem. Intellectually, you might think that theme would be the answer. Here’s the problem. Like most insurance companies, Liberty Mutual truly doesn’t understand the power of brand.

The brand theme here is about Liberty Mutual, not about the prospective customer. Nike’s “Just Do It” and Apple’s “Think Different” are powerful because they are about target audience, not the company.

If there’s a larger problem in insurance branding than what we’ve listed before, this is it. Insurance brands spend millions of dollars in advertising to sell a message that simply will not resonate. That is insanity.

American Fidelity. A case study in branding insurance.

The American Fidelity Case Study.

How we helped American Fidelity find the right brand promise.

American Fidelity is one of the leading providers of supplemental insurance and benefits, specializing in auto dealerships, education, municipalities and health care. Its core customers are employers who offer supplemental insurance to their employees in those segments.

American Fidelity
The old logo of American Fidelity had little brand meaning.

As a business, it operates in divisions based on those specialites. At issue was that American Fidelity had no overarching brand promise that brought the divisions together, increase preference with existing customers and attract new prospects.

Finding meaning for American Fidelity.

To achieve that, the project entailed qualitative and quantitative research with employers, employees and associations – both current customers and those who use a competitor. Also, an analysis of the competition and a brand audit was conducted to see where the current brand stood in the market and what it could claim.

Our competitive analysis found that competitors, which range from regional carriers to giants such as Aflac, focus solely on price, coverage and, in the case of Aflac, quick results.

American Fidelity
The new logo for American Fidelity redefines who its customers are: Those who always seek a different opinion.

The research demonstrated that administrators and employees believed all supplemental benefit providers were basically the same.

For the employer, who has complete control in selecting a supplemental benefits provider, the research clearly showed that they viewed their individual organization’s needs as unique. To find the right coverage for their particular needs, they seek something different.

Wanting something different was also part of their belief system, which is the emotional driver of human behavior.

Using an existing strength of the company – its niche focus – the new brand promise of American Fidelity stated that it represents a different opinion from the status quo because it is a specialist that knows there are no pat answers.

As the company says now, “When it comes to making health decisions, many seek a different opinion from a specialist. When choosing supplemental benefits, it’s important to seek a different opinion too.”

To reflect that brand, a new logo was developed that demonstrated American Fidelity being different and more important than the rest of the pack.

From advertising to collateral systems, signage to stationery systems, Stealing Share created a comprehensive brand structure for American Fidelity. Included was a brand standards guide that demonstrated cues for logo uses along with messaging and brand personality guidance. Stealing Share also conducted brand training for its thousands of employees.

Nationwide Baby, the right approach

It is not a new commercial but Nationwide is running one right now that grabs a brand message and drives it home in a memorable way. Most insurance companies talk about themselves and can’t seem to get past an expected and boring litany of benefits that are supposed to ignite a change in their competitor’s customers. This means, at the end of the day, they all try to compete on price and, therefore, rely on their customers to be blind to fair pricing.

Competing on price is a loser’s game when there does not appear to be any other value to justify a higher price. Everyone then talks about service, 24/7 support and bundling of insurance policies.

Nationwide can claim the higher ground. We will wait and see if this commercial is another one-off in a forgettable din of category-like messages or if it represents a sea change.

What makes the Nationwide baby ad resonate is because it seems to understand that irrational attachment we often have with our automobiles. By making the baby so overwhelmingly huge, we get the analogy and accept the silliness we all feel in thinking about our car as a baby. It allows us to see ourselves honestly and gives us personal permission to place such silly values on a bucket of steel, plastics, leather and vinyl. In short, we are allowed to be irrational without judgment. Smart. Very smart.

Understanding precepts.

We preach to all of our clients how important it is to understand the belief systems of the prospects they wish to influence. We tell them it is important to identify with a belief (precept) that can lead to the self-identification of the target audience. We tell them how important it is to connect with the highest emotional intensity.

The Nationwide baby spot seems to have hit the nail on the head. Will it continue this intelligent marketing? Not sure Nationwide knows that this sort of thinking is catching lightening in a bottle and is much more important than receiving a small check for a perfect driving record. In this commercial at least, Nationwide is on your side. Please try to stay there.

Geico is beating back the negative perceptions in Insurance brands

Auto Insurance brands

By Tom Dougherty

It sounded like a simple process when the dentist said our oldest son had a tooth lodged in his head and a simple procedure would bring it down where it should be. You know, like in his mouth.

Insurance brandsBut the problem wasn’t with the procedure. It was with the insurance company, which refused to pay for the procedure because the tooth wasn’t affecting his health – yet. If it was coming out of his cheek, well, that was another thing. Then they’d ante up.

It’s those kinds of stories that have made most of us come to despise the insurance industry. However, insurance companies – and other companies and industries with faulty reputations – can reverse that perception and even create preference when the negativity that comes along with the industry (and even your brand) threaten to bring you down. You must find a way to reduce negative attributes

The trick is not in public relations or even advertising that tells customers how much they are going to save on a rate or that you’ll “get the protection you need.” It’s about being different and better, and how those are defined is what separates those who emerge from a bad reputation and those who get swallowed by it.

Different and Better

All of us know different means what Webster’s says it is, “Dissimilar in form, quality, amount or nature” but it’ astonishes how many brands fail to meet that definition in comparison with their competitors. Take just about any industry – banking, autos, beer – and what you see are a cornucopia of brands that are similar in message, tone and personality. When that happens, consumers simply buy (or not) into the industry as a whole, based on that wide-reaching similarity in perception, and default to the market leader. (Read how to use your brand value to build preference here)

gecko Insurance brandsIn the insurance branding industry, for example, being different in tone and attitude is one reason why Geico, the nation’s third-leading auto insurer, is so often recalled. (The other is the sheer amount of marketing dollars it spends, courtesy of owner Warren Buffett.)

Whether it’s the caveman, the gecko or the dollar eyes, Geico feels and looks unlike any other insurance company.

However, it forgot the second part: Being better. You could take an EXIT sign and turn it upside down, and it’d certainly be different. But it wouldn’t be better and, just because Geico is different, possibly separating itself from the negative connotations of the insurance industry, doesn’t mean it’s creating preference either.

At its core, Geico is telling the same story as its competitors. (Read a market study on the insurance industry here) The “dollar eyes” are about price. The cavemen are about easy of use. And the gecko, well, he’s all over the map. Even a recent spot featuring an actor playing a Geico executive with the gecko on in his desk is about all the things you hear insurance companies believe makes a difference to consumers: Longevity, value, etc.

Therefore, because the message isn’t all that different and it certainly isn’t better, consumers don’t believe Geico really is cheaper, has better value or is any easier to use than the competition. Therefore, it just gets lumped in with all the rest of the insurance companies we have grown to dislike. The insurance industry does not do it well. They need to re-look into the science of insurance branding and understand that different can be better.

Reflecting back to the customer, not the industry

To be better, that means having better understanding of your target audiences beyond the wants and desires of product and category benefits. You have to know what drives them as people, within context of your brand, by understanding what they believe about themselves and the world, and how that relates to self-identification.

Ultimately, we all buy ourselves. If we consider, for example, laundry detergent, many of us buy the same brand each time. Why is that? Is it because we have tested all the detergents in the market and determined which one is best? Of course not. We buy the things that say something about us and mark us as the brand. That’s how we choose a car, the clothes we wear and even the computers we buy.

Insurance brandsThe best brands – Apple, McDonalds, Harley-Davidson, Disney, etc. – say something about who we are when we use the brand in order to create preference and even overcome the negative perceptions that may be associated with the category. Same is true of insurance brands.

The Insurance industry is certainly among them. Stealing Share recently conducted national research and found that 50.8% of all Americans say they don’t trust insurance companies. That lumps them in with credit card companies, car dealers, tobacco, big oil, mainstream media and airlines as the most hated industries today.

What’s astonishing is how little those in those industries attempt to overcome the negative perceptions of their categories by being different and better than its competition. They all follow the leader, which carries to continued unrest, little change in market share and preference left to be determined only by the category benefits all the competitors have.

Maybe they should be hated.