When it comes to selling insurance – or anything, for that matter – on the Internet, we got off on the wrong foot. When the Internet was shiny and new, people thought it could be used to sell anything, even toothpaste. We thought the Internet would bring marketers a “new consumer,” and that, in turn, the Internet would give consumers access to perfect information. We know now that it didn’t turn out that way.
One major problem is that we paid too little attention to the realities of the Web. And in insurance specifically, marketers paid too little attention to the realities of the business: the challenges of getting the right product to the right consumer at the right time. Also, discussions about selling insurance online rarely focused on the product, and which products really could be sold to those “right consumers.”
How does an insurance marketer select a product for the Web? It’s important to remember that nothing is perfect. There is no “optimal” product, and testing is critical. The Web offers an ideal platform for quick, easy and cost-effective testing. Guidelines exist that have been tested and which work to help determine which products in your portfolio may be appropriate for online sale.
Insurance products that sell well online score high in these areas: consumer appeal, purchasing ability and infrastructure.
Does your product have online consumer appeal? Though it may be common to view the Internet as a mass medium with the potential to draw anyone from all over the universe, this thinking is flawed. The Internet is a direct marketing channel, and for it to work it must be leveraged as such. Instead of throwing all your products onto a Web site in hopes of selling something – anything – your money is better invested when you go back to basics. Think “targeted marketing” if you want to sell products.
Do this by creating a niche-oriented product or offering a product that meets the needs of an underserved market. Globe Life & Accident Insurance Co. found success selling juvenile life online. Think about a targeted demographic – seniors, students, children – and offer a product that meets the need of a targeted psychographic, such as tobacco users or classic car owners.
Geography is another consideration in determining consumer appeal. Limited geographies don’t cut it on the Web, as almost no media can be targeted. When selling online, go with a product likely to drive high enough volumes to make your investment worthwhile.
Then ask yourself, “Does this product make sense for the medium and audience?” Selling identity theft insurance might sound like a great idea, until you remember that a consumer who is worried about having his or her identity stolen is unlikely to offer personal information over the Internet.
Is your product purchasable online? Having an insurance product that can be bought online boils down to making it easy for a consumer to make the purchase decision and eventually buy the product online. But even before that action can occur, purchasing ability means ensuring that a product really can be sold via the Internet: that it is priced right for the Web and that it is properly underwritten. In the best-case scenario, a site designed for insurance buying – not insurance shopping – will feature one product from one carrier and either a bonus offer or a niche product.
An example of a low-face term product – simple, affordable insurance for adults with children – can be found at www.myfamilyprotection.com. The site markets a single product through a single offer, is reasonably priced and can be issued immediately. The site also is designed so that the decision to buy is easy and the product is easy to pay for. And the site makes an offer that can be acted upon immediately.
Can your product be supported by an online infrastructure? Because it is a DM channel, online marketing is readily trackable. Are you ready, willing and able to track online efforts and fulfill electronically? What payment methods can you accept? For best results, offer three options: credit card, electronic funds transfer and direct bill. Credit card and EFT offer high paid persistency. Direct bill helps build robust databases. What about cross-sell and upsell opportunities? If a potential customer leaves your site without buying, are you prepared to offer a more affordable alternative while still meeting the initial need for insurance?
You have the right product. How do you make it easy to buy? Contrary to popular belief, it’s unnecessary to provide live chats or needs calculators to entice an insurance purchase. Ask yourself the following questions to determine how easy it is for the consumer to navigate your site:
· Have we covered the product’s benefits succinctly?
· Is it easy for consumers to understand our offer and then do what we want (complete an application, request a quote)?
· Have we made it easy for an unsophisticated online user to buy the product?
· Have we made a simple offer with a clear-cut path to the response vehicle?
· What have we promised through other media channels (banners, ads, e-mail, etc.)? Have we delivered on those promises?
· Have we shown that we understand consumers’ needs and concerns and that we can solve their problems?
Matching an online product with a specific need is tough. Development of a multi-product strategy often differentiates what works from what doesn’t. A tight presentation of product, rates and benefits should be built upon a solid foundation of DM techniques.
The bottom line: The product you offer online needs to be simple. It needs to meet a niche or unmet need, and it needs to be presented in a way that makes it easy for the consumer to purchase. Selling insurance online is as easy as offering a salable product and viable offer made to the right audience through market-proven DM techniques.
When more insurance direct marketers take this advice seriously, more insurance will be sold online. Then we’ll be able to say we’re finally on the right foot.