Learning when to avoid the one night stand

[Photo by Search Engine People Blog via Flicker]

I remember conversations I had with other insurance professionals back when I was first discovering social media. I knew that social media would eventually gain traction in the world of insurance, but the possibilities were so great in number that it was hard to really focus on one area.

When I would discuss social media with others in my field, I would usually get the question “but how can social media be used for life insurance?”

Leveraging social media for other forms of insurance like auto and health was more intuitive I suppose. Social media involves a conversation between people. Listen, respond, and repeat.

Not all insurance encounters are the same. Some can be one night stands; others can lead to ongoing relationships. To form a relationship, people must converse on a regular basis. Some forms of insurance just clearly lend themselves to a regular relationship more than others.

Back to that question: “how can social media be used for life insurance?”

For starters, what is life insurance? Is it level term? Mortgage protection? Whole life? Universal life? Variable annuities?

Yes. It’s all those things. And that’s the problem with the question.

It’s like asking “how can the internet benefit Third World nations?” It’s too broad, and any answer to that question doesn’t give the asker enough information to move forward.

Focus

We’ve entered an era of unprecedented specificity. Embrace it.

When evaluating whether social media can aid you or your business, ask very specific questions. Don’t ask “how can social media be used for life insurance?” Instead, ask “how can social media help me retain variable annuity clients who mostly seek customer service online?”

The key is to look for ways that social media’s relationship-building nature can benefit both you and your clients. Ultimately, you need to understand how much of a relationship your customers really want.

Hutch Carpenter recently pondered that very question. Hutch presents a concise graph that relates customers’ desire for a relationship to the complexity of the job they’re hiring you to do.

Getting more specific

Extending Hutch’s graph to insurance could have interesting implications. There are certainly some insurance products that are extremely simple and hands-off. One example is basic level term. For such a product, it’s reasonable to expect that customers want very little interaction.

But other types of insurance are far more complex and require more frequent interaction between the customer and insurance company. Perhaps this is why using social media with auto insurance clients seems more obvious than “life insurance.”

However, there certainly areas under the broad title of life insurance where product complexity begets the desire for an ongoing relationship. Products like variable annuities, variable universal life, and indexed annuities tend to require more ongoing forethought from clients than basic term.

For these markets, social media may be the most promising to help develop an ongoing relationship – one that lasts well beyond the initial point of sale. People in these markets typically aren’t looking for the one night stand approach. They want more.

If you have products where it’s clear that customers are implicitly asking for a relationship by regularly calling customer service or regularly visiting their accounts online, it’s likely that social media would be of the most value there.

Again, it’s about asking very specific questions — and listening what your customers are already trying to tell you. I think this will become more obvious over time as niche marketing efforts focus more on micro segments of individuals and groups.

Let me know how you’ve put the power of specificity to work for yourself in the comments or by contacting me.

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