What is Your Insurance Marketing Strategy? Part Two


What is Your Insurance marketing Strategy? Part Two

Competition Among Rivals

Consolidation. In the past, five million dollars in annual revenue was a big agency.

One of the biggest agencies in the United States had almost a billion dollars in annual revenue.

Guess what?

They’re getting bigger every year. At some point, they are going to do something innovative. (Listen to my recent podcast with Greg Williams, CEO of Acrisure. Excellent insights on the near-future of insurance.)

Inevitably, we will be going up against bigger competitors with more resources. While it may seem that ‘volume’ in and of itself is the core strategy of larger companies, my impression—from several direct conversations with leaders of mega-agencies—is that they are actively investing in a ‘new future’ for their agency force. (‘Being big’ is never enough to sustain disruption. See Kodak, Blockbuster, etc., for case studies.)

Conversely, there’s a force emerging at the opposite end of the agency spectrum that demands attention. (I’ve interviewed several of these agents in the podcast series.) Smaller, younger agencies run by millennials or Gen Xers are comfortable with technology. They know how to use it to deliver an outstanding Customer Journey. And, they grow at double, triple, or an even greater rate than the industry average.

What this Means for Agents and Brokers

Perhaps the remaining safe harbor for agents is ‘the land of fast growth’. The ‘guy down the street’ may have been the competitive thorn in your side in years past. Today, the competitive boundaries are blurry. Digital technologies expand the reach of the savvy marketer to the far shores of any market they want.

Savvy agents should take the threat of mega-agencies and fast-moving young agencies seriously. As the gap between your own agency and the marketplace gets wider, the luxury of waiting to ‘finally get around to that marketing thing’ is gone.

Commoditization. There’s another rival that can’t be ignored. The massive, growing direct channel – GEICO, Progressive Direct, etc.

Most analyses—my own included—would determine that the direct channel is a cheaper channel to run. (Logic would demand it: one set of business systems versus 40,000 independent systems.)

That’s why they advertise ‘save money’ on virtually every ad. In the long run, they can win that game. (Let them. As we’ll see in an upcoming section, there’s a much better game for us to play.)

But their message is powerful. And, your customers hear it. Every day. Many times a day. Save money.

It lends an impression: price is the only distinguishing feature in insurance. Some call this the ‘commoditization’ of insurance.

  1. Don’t play the price game. (See my guide, ‘4 Reasons Insurance Agents & Brokers Should Never Sell on Price’.) There are numerous reasons not to. One is that another channel is better suited. 
  2. Don’t remotely look or feel like a commodity. You must stand out with your own uniqueness.

The Power of the Insurance Buyer

There are some industries where you have very few buyers. Airplane manufacturers, for example. 

We have a lot of buyers. Everyone buys insurance. 

But, they’ve changed. I’ve established that earlier in my books. 

They do things they didn’t do before. Because they couldn’t. And, now, they do it all the time. 

Research online. Get opinions online. Shop online. 

To say that the ‘consumer is digital’ is an almost silly understatement. (The average age a U.S. citizen gets their first smartphone is ten.)

When they change, they expect you to change with them. (Or they’ll find someone who has.)

We recently surveyed the industry with one question: Do you feel the world is changing faster than your firm?

96% of the respondents said “Yes”.

Being behind the consumer is no way to capture them.

Jack Welch was CEO of GE said, “If the external world is changing faster than the internal world, the end is near.”

Consumers expect you to be present with them. Perhaps slightly ahead, providing leadership.

We constantly hear industry experts urge agents & brokers to use ‘cutting-edge’ technology.

When you adopt technologies that allow you to communicate effectively and meaningfully to customers, they don’t think you’re ‘far out there’ or ‘cutting-edge’.

They’ll simply think you’re there, where you’re supposed to be.

In the present with them.

The ‘good news’ of the ubiquitous consumer is balanced by the emergence of new competitors (and savvy agent-competitors) who are simply doing what consumers want. Being present.

What This Means for Agents and Brokers

I saved the juicy part for last: consumers. Control them and your worries go away. 

But the disconnect between the retail force and the consumer is deadly. If there is a call for urgent action anywhere, it is here. 

Most of what you need to do, I’ve covered above:

  • Today’s retail agency must adopt communication technologies and content that make it easy to communicate meaningfully with today’s customer. You can’t buy a marketing technology, check the box and forget it. Your marketing is the fuel that boosts your growth. Don’t just bring the tool into your shop. Make sure you’re getting the full use of it. 
  • Modern marketing tools have two sides to their success—and, you need some mastery of both: the technology and the content that gets delivered through that technology. Your agency needs to master both. Whatever your market (personal or commercial lines and so forth) content marketing delivers meaning and delight all year long. 

One Last Thing!

You’ve been patient. We’ve talked about the ‘big forces’ that are shaping the future of our industry. There’s one more very important point. 

Speed. The speed at which the world is changing. 

It’s very, very fast. 

If it’s moving faster than your agency, the end is near. 

Urgency and agility are life-and-death in times of change. 

The highest-level agency—the Innovator Agency—doesn’t merely move as fast as their market. 

They move faster. They lead them. 

That’s what you can aspire to. 

But, when speed is the new normal, agents need to gear up. 

Be fast. Or get left behind. 

The Next Step is Up to You

The hard work of strategy is getting clear on what’s ‘out there’. Discerning the forces that tell us which way the wind is blowing.

Once you know which way those winds are blowing, your strategic navigation is almost obvious.

Carriers changing. New competitors emerging. New technologies developing. Competing channels attacking the ‘lower end’ of the marketplace.

Of course, you need a carrier management strategy that gives you the most control. By moving the balance of power more toward your agency. Get bigger. Grow faster.

Of course, you need to control your customer. By connecting with them deeply. Deliver an ongoing stream of meaning and delight. Innovate. Master the technology. More important, master the creation of the content that makes your marketplace love you.

Of course, you need to examine your commitment to the lines of business you rely on. Depending on your Strategic Horizon, you may need to adjust—and lean upmarket.

In the next article, we will show precisely just how ‘the new marketing’ can solve your growth problems:

  • But, first, we’ll reveal why most digital insurance marketing is misplaced, misdirected, and misunderstood
  • Then we will show you how one $5 million agency added $2.4 million—without adding any new customers

*Conversely, notice the common theme—expressed differently—among the captive-agent channel ad messages: they’re all claims-protection based. ‘We can take care of that.’ ‘We’ve known a thing or two because we’ve seen a thing or two.’ ‘Good Hands.’ (Yup, after all these years.) Mayhem. There’s a reason for this.

This article is an excerpt from our new ebook, The Marketing Guidebook for the Modern Insurance Agency: How Savvy Agents are Taking Control, Shifting Direction, and Winning in the Modern Insurance Age. Download here to gain a crystal clear understanding of the strategies that will bring your agency long-term growth, build meaningful relationships at scale, and avoid the common pitfalls agents make every day.