Awareness, Personalization, Connection: How Insurers Can Master Top of Funnel Marketing

Acquiring new top of funnel customers is expensive, especially for P&C insurers. The insurance industry spends seven to nine times more acquiring each new customer than it does retaining an existing customer, says Lynn Thomas at the Independent Insurance Agents of Dallas.

The awareness phase is the top of the marketing funnel that leads new customers to make their first purchase. For insurance companies, it’s often the most costly.

To maximize the impact of resources spent on top of funnel marketing, insurance companies will need to leverage two tools: data and relationships.

Do Customers Know You Exist?

Top of funnel marketing focuses on raising awareness of your company, brand or products. It’s where companies first connect with people who offer the potential to be good customers, says Jacob Porteous at SocialBakers.

As a result, top of funnel marketing encompasses not only the basics — who, what and where — but also why people should take a second look at what you’re offering.

“When people buy they aren’t just trading money for an object or service. They’re using their money to support brands they trust and believe in. If you want to increase your conversions, you need to give your audience enough to really know your brand and what your company values,” says Jacinda Santora at Optinmonster.

Insurance companies that use top of funnel marketing to communicate brand, mission and values also improve their chances of attracting customers who stay with their insurer for longer.

Communicating this information is important because fewer customers spend time educating themselves on insurance options than companies might expect. For instance, 40 percent of auto insurance policyholders say they rarely shop for a new policy, says Maggie Overholt at Reviews.com. What’s more is that 32 percent only look when their policy expires, while 19 percent do so when they’re buying a new car.

These policyholders may not be looking for insurance, but that doesn’t mean they’re uninterested in saving money, experiencing better customer service or buying insurance from a company that shares their values. Insurance companies have an opportunity to grab the attention of these potential customers through personalized outreach and cross-selling partnerships with non-insurance companies.

“The challenge insurers face is to reach customers at the right moment,” adds Susan Wu, director of Forrester’s ForecastView.

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Do Customers See You as the Best Option?

Unlike other types of purchases, insurance isn’t typically seen as an exciting buy. We purchase it in the hopes that we’ll never confront the kind of accident, injury or calamity that requires us to use it.

This sense of aversion alone makes it harder to attract insurance customers than to attract customers for other types of business, says Ted Vrountas at Instapage. It can also make it more difficult to penetrate customer awareness, since it can be easier simply to ignore insurance advertising than to admit the need for coverage.

Even the most generalized top of funnel marketing content can have a personalized feel if it reaches potential customers in their preferred format. For instance, video and voice search optimization both create the opportunity to engage potential customers where they are, notes Ryan Lessard, vice president of marketing and growth at Ease.

Voice-based tools, like voice search and smart speakers, are increasingly popular. More than 10 percent of homes with Wi-Fi service also have a smart speaker, says Susan Engleson, senior director of emerging products at Comscore.

For users of tools like Amazon’s Alexa, information about insurance options can feel less like an advertisement and more like a recommendation from a friend. Optimizing for voice search can help insurance companies recommend themselves when potential customers search for information on related topics, from auto care to home repair.

Can Marketing Automation Aid Personalization?

Automated marketing may seem to work at odds with personalization. When outreach happens automatically, there seems to be little opportunity for message customization.

But today’s automated marketing tools leverage artificial intelligence. This allows them to better understand and communicate with potential customers in a streamlined way, says Charles Musselwhite, owner of Musselwhite Marketing.

For example, Musselwhite explains that the right automated marketing tool allows businesses to connect marketing and CRM efforts in one app. This allows companies to generate better insights about the customers who respond best to top of funnel outreach — and which of these customers are most likely to remain loyal to their insurer.

Data collection tools also make it easier to communicate that your insurance company provides the experience your customers want.

“Insurance customers don’t have complicated needs. They want to be able to choose from a good selection of policies at reasonable prices. They want clear, transparent information, and they want smooth, hassle-free interactions,” says Bain & Company’s Henrik Naujoks.

However, Naujoks says most insurance companies still fail to deliver value consistently. This suggests that insurance price comparison tools and insurtech startups are attracting a large portion of the potential customers that top of funnel marketing efforts are meant to attract.

When insurance companies leverage the information available to them, they develop a clearer sense of what their best customers look like — and how to reach new customers with the same desires, behavior and habits.

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What Else Can You Do For Your Customers?

Increasing customer retention rates by 5 percent can boost profits by 25 to 95 percent, says Frederick Reichheld of Bain & Company. While customer retention may not ping the radar of many marketing teams until later in the process, effective cross-selling partnerships can be a powerful tool for top of funnel outreach.

“To nurture your existing clients, it’s important to be a connector for them,” says Lauren Cracower, Suite 203 Communications president. Partnering with financial firms and other businesses allows them to be the connector for their customers, solidifying those relationships while simultaneously helping insurers connect with a vetted customer base.

Several banks and credit unions have partnered with insurance companies to offer policies to financial customers. For example, Michigan First Credit Union enables customers to learn about insurance products and to check whether they have the coverage they need.

“Insurance is a product 100 percent of our members need. We can help them save money on it,” says Jennifer Glenfield, CMO at Michigan First Credit Union. When a bank or credit union’s customers save money, they’re more likely to maintain higher balances, and they’re more likely to build stronger, long-term relationships with both their financial institution and their new insurance company.

Insurtech companies are already reaping the benefits of partnerships with non-insurance businesses. For instance, UK insurtech company Wrisk was only in business for two years before becoming the sole insurance provider for BMW, says Scott Carey at TechWorld. Wrisk thrived on access to BMW customers, and BMW appreciated that it was easy for customers to insure their new purchases with Wrist — thus improving the entire customer experience.

Building connections between your business and non-insurance companies can help both you and your partner companies save money on marketing, customer acquisition and customer retention. Customers develop stronger relationships with both the business that introduced them to their insurer and the insurer itself.

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