Marketing - Playing the campaign game
Katherine Brandon investigates how brokers can extract best value from their marketing budgets
There is no escaping general insurance marketing. The recent re-branding campaign for Norwich Union's name change to that of parent company Aviva is one of many vying for consumer attention with television, radio, billboard and press advertising seeming to saturate the UK media at the start of this year. Most businesses cannot afford to bring in celebrities such as Bruce Willis and Elle Macpherson to act as their public faces and brokers' marketing activity in particular is low-key in comparison to other small to medium-sized businesses; it is also anything but consistent.
Andy Heap, chief executive at business development specialist Ignition, believes haphazard marketing spends can be blamed on expectations of instantly quantifiable results: "A lot of brokers do new-year marketing pushes but do not follow them through in the long term. The secret to getting a response to a campaign is activity; the brokers that do well from marketing are those that have a budget for every month."
While many may be tempted to blame the lack of a decent budget on the credit crunch, Howard Robinson, marketing consultant for the Willis Commercial Network, warns brokers that marketing is arguably more important in tough climates: "Marketing is more important than ever as clients review their spending in all areas and may be tempted to stray." Swinton has, for example, increased its projected marketing spend for 2009 to support the growth that it is seeing through the business.
Brokers cannot compete with the scale of Norwich Union's marketing and advertising, so a stratified approach is likely to yield the best-value results. Steve Manton, chief executive at marketing consultancy M-Consulting believes that, if a broker's campaign is going to have any impact on the customer, it must be highly targeted to a specific audience: "Shooting money all over the place is a waste; brokers need to address their specialisms."
David Saul, director at Fusion Internet Solutions, believes that targeting is especially important in digital marketing: "There is so much spam going around that campaigns have to be relevant to the individual and focus on where the broker can add value for them."
Before a broker can start a targeted marketing campaign, it needs to establish an audience profile and what the purchasing drivers are for them. These motivating factors are diverse and vary greatly between sectors, ranging from saving time, personal connection, perceived price-to-service ratios, location and the quality of cover.
"Marketing needs to be part of an overall strategic plan with a self-evaluation of the business. Discover what product or expertise is attracting existing clients and, if there is growth potential in this sector, implement this into your strategy. Historically, brokers have not researched issues that affect the sectors they operate in but knowledge is power. The more you invest in your research, the more you get out of your marketing. This research can then also be used as part of the marketing campaign by issuing any interesting results as a press release," advises Manton.
Targeting
Heap agrees that the intelligent use of research can help a broker tailor its marketing by identifying its expertise to then position it as an expert in that particular area. He says: "In this highly competitive world, what motivates buyers the most is knowledge and understanding of their market and current issues. This gives a marketing campaign something relevant to talk about and also places a broker in the position of offering extra services."
One broker that has made extensive use of research is Aon. The firm commissions a quarterly Market Pulse survey of UK underwriters to ascertain what they expect to happen with commercial premiums. The results are tailored to individual regions and trades affected by predicted market changes in order to make them as relevant as possible; these actions are then supported by public relations personnel approaching relevant media outlets to gain exposure.
The results of the broker's first quarterly survey for 2009 were sent to existing clients and potential prospects most affected by predicted premium rises. This formed part of a marketing campaign that aimed to show Aon's understanding of the way in which underwriters think and their capacity to negotiate the most competitive rates. The findings have also been sent to relevant sales teams to present to customers at renewal; this offers these teams opportunities to cross-sell risk management offerings where customers want help to stop their premiums rising.
Once research has identified the audience for a marketing campaign and its purchasing drivers, a broker can then tailor the campaign to fit these priorities. For example, if the key driver is price then the campaign should focus on the ability of the broker to negotiate lower premiums.
Mark Huxley, director at Lamb creative marketing and consultancy, believes that where research has identified a key purchasing driver of the target audience as expertise, it is especially important to use research to create newsletters and events that show a depth of knowledge of that community. He says: "It is important to share relevant information and news rather than just trying to sell brands, especially when communicating with existing clients."
Method
There is a wide range of marketing tools available to brokers and so the approach of the campaign should be determined by customer priorities. Personal lines campaigns tend to be delivered to large, essentially homogenous, price-driven audiences and so they tend to focus on cost of specific products. Conversely, commercial campaigns are diverse and so focus on other factors such as service and expertise.
The combination of marketing tools used depends on the focus of your campaign and its objectives. Heap says that there is no definitive answer as to what the best marketing mediums are: "The spread of media that works best is unique to each broker."
One tool used by many brokers is telemarketing. Michael Gaughan, managing director of FWD marketing, believes that telemarketing is popular with brokers as it is very easy to track costs and the revenue that it generates. He explains: "The philosophy of brokers when it comes to marketing is very much focused on revenue generation. Telemarketing generates tangible new business leads, so its success is easy to track."
FWD quotes a standard lead conversion ratio for a commercial broker as 1:10, therefore a new business appointment is achieved against 10 businesses approached with a three-month lead time. Gaughan is confident that a commercial broker can have a high success rate from new business appointments generated by telemarketing: "It takes 10 leads to generate one appointment on average but then the interesting thing is that the broker then converts between 30% to 43% of those appointments into clients. So, the broker can work out the return generated using fees and commission income from the investment made."
However, diversification is key. Heap believes there are too many brokers relying on telemarketing to provide the majority of their marketing results: "Brokers often interpret marketing as simple lead generation but they need to do more than just getting appointments. Retention rates of those that just do telemarketing tend to be a lot worse than those with broader campaigns. Telemarketing feels good as you are out there talking to people but you can achieve a better return for your money elsewhere."
He continues: "Using the internet, a broker can have a low spend but still generate good new business leads, especially with cross-selling to existing clients. Web technology has made it possible to talk to people in a way that was not possible a year ago."
Huxley agrees that digital marketing has now become an essential element of any successful campaign: "You cannot now exist as a business without some kind of digital presence: customers make conscious decisions on the web, therefore you will lose out if you are not there. However, online marketing needs to be approached entirely differently: online brochures do nothing for your brand and a bad website can sometimes be more damaging than not having one."
One broker that has embraced online opportunities is Vantage Insurance Services. As well as having a central internet presence, the firm has several different websites that focus on discrete products, such as Vantage's clubcareinsurance.co.uk, which is dual-branded with the Camping and Caravanning Club. With individual identities, each site is associated strongly with its speciality.
Online presence
Manton believes that a good website can drive large quantities of business to the door of a broker: "You would be amazed at who googles. A website can be an interactive marketing tool that is more powerful than you can imagine but the insurance sector is yet to grasp online marketing. It is stunning how many brokers will send mail-shots but do not invest in constant updates of their websites to reflect their marketing messages."
A well-presented and easy-to-understand digital marketing is a vital marketing tool for schemes brokers. Saul notes: "Schemes brokers can sell anywhere in the country, so this is where internet marketing really pays off. However, it is not an opportunity that many are grabbing to take advantage of those already being driven to the internet. Tools such as search engine optimisation take time and expertise but are not unreasonably expensive. It takes months to set up a decent website, so if a broker takes the plunge and starts marketing online then it can suddenly find itself months ahead of its competitors."
He continues: "Many brokers are wary of the internet, believing that it takes away the personal touch. However, technology platforms on the web to support agents can help a broker's partners deal personally and quickly with customers."
A more traditional form of marketing available to brokers is print advertising. While the national newspaper adverts and billboards used by Norwich Union in its re-branding campaign as it becomes Aviva may be out of reach, there are many publications that offer options to suit more modest budgets.
There have been arguments put forward by some that print advertising is dying but that is far from the case. One broker that is a believer in print advertising is UK Facilities, which advertises frequently in the trade press alongside its email shots and word-of-mouth strategies. Managing director Albert Robinson believes that print is particularly relevant for wholesale and schemes brokers looking to make other intermediaries aware of them and their products. He says: "If we were to cease advertising, it would affect our flow of business: out of sight is out of mind."
Howard Robinson agrees that print advertising can hold good opportunities for specialist brokers. He argues: "Local brokers can have difficulties in finding the right kind of publication to advertise in but if a broker has a scheme then the trade press for the relevant industries can be a good opportunity."
However, Manton advises that it is important for a broker to keep its overall marketing strategy in mind when choosing what publications to advertise in. He warns: "Print advertising needs to be approached carefully and has to be part of a considered and co-ordinated strategy. If it isn't thought out then it can rapidly burn through a budget."
As customer-facing intermediaries, brand personality can play an important role in broker marketing campaigns. There are many opportunities for local and specialist brokers to get across their personality to communities through events and sponsorship.
Lloyd Hanks, managing director of LAH Consulting, believes that events and sponsorship should play a greater role in broker marketing. He argues: "Not enough regional brokers talk about their businesses; they should be talking about them through the Chamber of Commerce, local press, radio and definitely the trade press. Sadly, many are reluctant to tell an audience what they do and how good they are. The days have gone when business came to the broker; you need to rise your own profile and go find it."
Huxley agrees that brokers could do more to raise their profiles within their communities: "Brokers are very good at the sales element of marketing but not as good at standing out from the crowd as a brand personality."
Some brokers are already doing this. The Argyll Insurance Group, acquired by Jelf last year, sponsors local sports teams and is involved in community projects and initiatives to promote excellence in business. Argyll's sponsorship commitments include Worthing Rugby Club's first XV and the firm has generated new business appointments from people that have noticed the distinctive logo on the boxes at the rugby club.
Exposure
Heap believes that, while events do not always result in new business, brokers should not write off the potential benefits. He remarks: "By inviting clients and prospects along to events with topical, relevant content, a broker can position itself as the number-one alternative. Businesses are unlikely to swap brokers just as they have attended an event but they'll remember you when they have a problem with their current broker."
Brokers should be cautious when becoming involved with sponsorship. Marton says: "When looking at sponsorship, a number of rules need to be set. It should deliver a return, enable corporate entertainment, enable advertising and press coverage and be relevant to your target audience. Clients need to be able to see it."
Ideally, a broker would be involved in all areas of marketing but budgets are limited. Gaughan argues that brokers still need to try to establish as wide a spread of these marketing media as possible if their campaigns are to be successful.
Robinson believes that, if a broker is to have sustained results from its marketing, it is important to monitor where it is having the most success. He highlights: "Remember to ask new clients where they are being driven from: it is the easiest way of tracking what tools are having the most effect for you. Training staff to identify where clients are coming from can help a broker measure the success of its campaigns and edit them accordingly." (For more information on measuring the success of marketing campaigns see PB Jan/Feb 2009, pp.11-12.)
Enterprise-wide
Manton agrees that the best marketing campaigns involve the whole company, not just the business development team. He notes that image is cultivated through things as simple as an office's appearance and the type of language used in communications. He says: "Marketing should be led from the top and given board priority. The best campaigns in marketing have everyone involved. Even the way the phone is answered can have an effect on the success of a campaign."
The jargon and array of options can be confusing when people talk about marketing but specialists can help to assuage bewilderment. During Venture Preference's re-brand to Bluefin this year, the company used a branding agency with credentials in financial services to design Bluefin's logo. Henrietta Flynn, Bluefin's brand and communications director, was pleased with the results.
Some brokers may be sceptical about what a marketing agency can add to their business but this has not stopped insurance broker specialist consultancies emerging.
"The secret to a good marketing campaign is planning; this is where a marketing agency can really help. Marketing consultancies are seen by many as being too expensive but there is something available for every budget; it needs to be an investment measured by return and a good agency will help you work out this measurement based on your objectives," explains Huxley.
While an agency can stress-test your strategy, there are drawbacks. Robinson suggests seeking help elsewhere: "Agencies can be very expensive, with feedback suggesting in many cases that it is not worth it. Marketing is simple but very easy to get wrong. Using the help of a professional will ensure campaigns are properly researched and measured. If your broker network does not offer access to marketing specialists then I would consider changing it."
Assistance
Many insurers already offer practical help to their broker partners. For instance, Aviva has a mobile team of marketing consultants to help broker partners in areas from web diagnostics to creating bespoke campaigns. Meanwhile, Groupama runs strategy days for its regional brokers on which an independent marketing consultant and Groupama's own development and customer services staff assist on-site at one of its local offices.
It is also possible to enter partnerships to piggyback someone else's marketing spend. Swinton features on several aggregator adverts, including Tesco Compare, Go Compare and Money Supermarket and head of marketing Mark Hallam has been pleased with the results: "The partnerships we've forged through our relationships with aggregators have helped us build brand awareness. We have featured in prime-time advertising slots without having to spend any money on the space ourselves."
Heap believes that marketing partnerships will become common in the future but that brokers need to exercise caution when considering entering such an agreement: "With dual-branding, there can be a lot of confusion with potential buyers as to what the different brands represent. Many buyers will see the broker as the insurer, so get confused when presented with the supply chain. However, branding partnerships are a big growth area for the future. High-street retailers are struggling to win new customers through traditional means and are looking for partnerships where they can offer benefits."
Hanks asserts that brokers investing in raising awareness in the current climate will see strong returns: "It's in these tough times that brokers need marketing to maximize opportunities that are sitting under their noses. Many brokers are wary of marketing as they fear trying new tricks but it is not complicated and there is plenty of help around. There will never be a perfect time to explore marketing strategies, so set goals and go for it."
HOW WE DID IT
Neil Walton, chief executive officer at London-based Centor Insurance and Risk Management, tells PB about how his firm managed its recent marketing campaigns.
- What was the first thing you did when considering your most recent campaign?
We looked at our business plan and spoke with both our management consultants and our marketing agency to discuss what we wanted to achieve from the campaign. Then, we were able to map out the best ways to achieve our goals.
- What is your relationship like with your marketing consultant?
From the start of our relationship with M Consulting, it was made clear to us how important it is to build a level of trust and to communicate on a strategic level so that our marketing communications are in line with our objectives. We use the consultancy for public relations and marketing initiatives, as well as award entries, offering advice on direct mail campaigns and creative concepts, as well as developing key communications messages.
- How do you identify key demographics and the desired outcome of a campaign?
Our recent campaign was targeted at the construction sector. This is an area of expertise for us and we were well aware that, in the current climate, it was a sector that was being affected badly. We knew that budgets were being cut and we knew how important it was to communicate the very real risks of cutting back on insurance.
- What marketing tools did you use?
We've used a combination of profile-raising PR, awards entries, direct mail and e-marketing over the last 12 months. More specifically for this campaign, we used both direct mail and e-marketing.
We used any events attended as a support mechanism and were very pleased to have exceeded our expectations in terms of awards in 2008. We have put awards logos on our website, letterheads and key marketing material to reinforce the quality of our service.
- Do you have a specific spokesperson that attends events to raise your brand profile?
I will attend most corporate events as the face of Centor's corporate profile. If an event is relevant to a specific department or specialism then the most relevant person will attend.
- How can a broker compete with the big spend of insurers and aggregators when marketing to clients?
It's important to do your research: work out what you could realistically handle in-house and what you need to outsource to the experts. We've managed to re-build our website and our e-marketing platform in-house, which has saved us money and that also means we've built and trained a project team in-house capable of taking ownership of the website. We then outsource our PR and direct mail campaigns.
TELEMARKETING BASICS
Agencies FWD and Origin describe the process of telemarketing.
- Acquire and assess data. Select a data source and ensure the data matches the required profile.
- Design and build a contact management database. Select appropriate contact management software that offers full recording of contract information, diary management and mail-shot systems, then import the data.
- Data validation and verification.
- Direct marketing and response mailings.
- Prospecting calls and renewal date population. Timing is vital and a targeted approach is needed. Speak to buyers pre-renewal.
- Appointments and leads made close to policy renewal. When buyers are close to their renewal date, follow up calls need to be made and appointments secured.
- New business appointments. Arrange face-to-face meetings with buyers to secure the business.
HOW TO WIN BUSINESS AND INFLUENCE PEOPLE
Marketing agency Lamb spells out the basic precepts of a good marketing campaign
- Be completely clear about what the marketing campaign aims are - use research and analysis to help define these.
- Make sure that your management is on board to communicate targets.
- Ensure that your marketing department or agency has provided a clear brief that covers all parts of the campaign, the tools that will be used to execute it and how they will work from together - do not discount any available platforms.
- Have a project plan with realistic budgets and timeframes in place and be clear about who is responsible for what.
- Have checkpoints in the plan to assess where you are and how the plan can change - stick with the fundamental aims of the plan but do be prepared to accept changes.
- Know how you will measure the campaign outcomes and ensure that these yardsticks are unambiguous.
First Published in Professional Broking Magazine - March 2009. All Rights Reserved