The Insurance Industry Needs To Wake Up
Insurance industry marketing is hardly working
The insurance business is overwhelmingly dominated by non-brand brands. This seems unlikely considering the awareness that some brands enjoy — brands like GEICO and Progressive. However, both of these brands support my claim that the brand sphere of insurance is basically a desert. What is persuasive about their positions?
You would think there are only two brands possible, judging by the marketing messages abounding. Brand 1) is lower cost and brand 2) is dependability. However only one of these is a real position for insurance, and it is crowded at that. The other simply proves my point.
What is left for competitive insurance brands?
In any market space there is a battle over low cost provider. It is a terrible scramble for one-upsmanship because it requires a constant proof point and enough reach to make up for the lack of margins.
Does it work? Well, yes. It is the position GEICO has taken for years and certainly is claimed by others, ranging from Progressive to Allstate (from time to time). In retailing, Wal-Mart has made this its bread & butter and has such a rock solid hold on it that it has left former pretenders to the throne. (Read: K-Mart, which is scrambling to justify its no-frills and under quality position without the value of lowest cost provider.)
The problem with owning low cost provider in a regulated industry like insurance is that the truth of the claim is constantly put to the point and a competitor (like Allstate) can refute your constant claim that “15 minutes might save you 15% or more.” The customer is left to ponder the real meaning of “might.”
However, if you are an insurance company playing as lowest cost provider, good luck to you. No need to read any more of this article because you need to keep your head down and your mind focused on chasing that market position into dominance or oblivion. (It is a very fine line.) You have your insurance preference and it better be that of a market leader or your margins won’t support your business.
Winning Is Not Being Cheapest. Insurance Brands Have Not Figured Out Much Else to Mean.
For the rest of you who aspire to greater dominance without having to be cheaper than everyone else, this is for you. This is for every company that wants to understand how you can increase preference and steal market share while protecting your margins. That is, to battle for the hearts and minds of customers without sacrificing your share of wallet.
First, we must look at when change is most likely. In other words, when do you need to be in the considered set of potential insurance customers? The insurance industry shares this moment with banks — the time that customers are most interested in changing is at the point of failure.
That failure is always assumed to be yours, not that of the customer. Failure, in the eyes of those you wish to influence can come in a variety of ways. A change in price, a change in premium, a missed bill, a claim dispute, even a reduction in fees can spurn the target customer to look for other options.
Find The Switching Triggers for Insurance Brands
I need you to think for a moment about switching triggers. Those nebulous ideas that run through a potential customer’s head that encourages them to switch. These are real issues to the customer and are not imagined. They always represent a yearning for something they believe they do not already possess. If this were not so, they would not qualify as a trigger at all. Try getting someone to ask for a new cup of coffee by encouraging them to switch because the coffee you are serving them is hot. Obviously, it only works when the coffee they are presently drinking is cold.
Please: Slay The Sacred Cows
This seems simple and logical enough but look for a moment at the promises your brand makes right now. Are they addressing a switching trigger? In other words, are they promising something that the otherwise happy customer of a competitor lacks?
Well, if your brand promises to be reliable (like “be in good hands”) or to be substantial (like “a piece of the rock”), then it is logical to assume that current insurance customers have chosen a brand of insurance that they believe is unreliable or shady.
Let’s get real here. Insurance preference dictates that the reason anyone chooses to buy insurance is because they believe that you will be there when they need you, will pay legitimate claims when they are required, and are reputable. There is no middle ground here. It does not matter if you sell life, casualty or medical insurance. All of these supposed brand values are minimum requirements to be an insurance company.
If you were a restaurant you might just as well hang out a shingle and declare to all that pass by to “EAT HERE, WE SEARVE EDIBLE FOOD.”
When building an insurance brand to steal market share, it is important to follow the process and uncover the precepts and triggers that go beyond the minimum requirements. Force yourself to stop talking about the mundane and real brand will become possible.