Changing the Priority of Social Media Tools
Insurance Experts' Forum, August 5, 2011
I received a tweet from @stnickmedia with a link to the article titled “Executives Fail to Focus on Social Media Marketing Strategy.” Some of the comments about the article took issue with the fact that leaders “still weren’t getting it.” I have a different opinion. I can completely understand why social media marketing strategies are not a current priority with many at the senior level. I don’t believe that social media efforts have “earned” their attention yet, but, I think they will as the use of social information moves from marketing into operations and begins to increase revenue and decrease costs.
We have a report that was issued this week on social media monitoring tools and the vendors that supply such automation. In it, there are multiple examples of how social media data can impact operational results at insurance companies. Given the limits of a blog posting, here are only a few examples:
* Improve loss ratios through more accurate and automated reunderwriting of risks at renewal: Consider the enterprising underwriter who happened to find a YouTube advertisement for a general contractor who was an existing client. The video enthusiastically described the superior roofing services that the company provided. Given that their general liability policy was rated for a general contractor, the description of operations was changed at renewal (after an active discussion, I imagine, between the company’s risk manager and the underwriter!). This one individual case happened to be found through a manual search by a single person. As the ability of monitoring tools to interpret unstructured text improves, running continuous, automated scans looking for similar information on existing customers should give underwriters additional sources of information from which to accurately assess the on-going risks in their accounts.
* Increase revenues by providing qualified leads to distribution channels: With some few exceptions, agents do not have the scale or expertise to take advantage of automated social media monitoring tools. However, insurers that have already invested in them (usually to scan sites in order to protect their brand), can easily turn them to social sites look for postings that proudly tout new car purchases, or announce new additions to the family (births or adoptions). Agents prospecting for new accounts, or who want to provide proactive service to existing accounts, will greatly appreciate learning about such developments.
As social media monitoring tools continue to evolve in marketing and move into operations, their impact will increase in direct, meaningful ways. Look for the top executives to increase the priority as this happens. I expect to see a pattern similar to the early days of the internet, when websites were first a curiosity for a company to have, then a profit center (eg. on-line banking) and now continually deliver new ways for companies to both engage and service their customers.
This blog has been reprinted with permission from Celent.
Mike Fitzgerald is a senior analyst in Celent's insurance practice, and can be reached at email@example.com.
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