Customer Service Focus

Facing the Facebook

The insurance industry’s new challenge

By Barbara Zurawski, CISR

Insurance has always played a major role in society by creating a better life for those who use it. Through the centuries, the benefits of insurance have been fostered by innovators, visionaries and leaders who have recognized insurance needs and worked to fill them, often at great odds and significant risk. One of the challenges has been to determine the methods by which their messages were to be delivered.

Now, once again, the insurance industry is being challenged to embrace new, emerging, sophisticated methods of delivering its message. We now have to recognize the new sphere of a technology-based social network. We are forced to face “Facebook.”

What is “Facebook”? A phenomenon, a revelation, a lifestyle, the eighth wonder of the world?

While the company began as the pet project for a group of Harvard students, today’s Facebook has more than 1,200 employees, 400 million active users and a popularity that continues to grow day by day. The company claims that more than 700,000 local businesses have active pages, an average user is a member of 12 groups, and the number of active users doubles every six months. Facebook also claims to be the number one image-sharing service on the Internet, drawing more traffic than the second, third and fourth place sites combined.

According to available sources, the company is now worth around $11.5 billion. Not too bad for a program that a guy created in his dorm room for a school project!

Facebook is a key to social media networking. In its first five years, in some ways, it changed the way people live. I am afraid we live our lives more and more through Facebook, for Facebook and with Facebook. Insurance agents and insurance companies are just beginning to explore the world of possibilities through it.

Some would say that in the age of Google, social media should be in the DNA of an organization. But it is no surprise that the insurance industry—a conservative profession based on risk aversion—has not fully explored the social media tools and is falling behind the curve of mainstream acceptance of a new Web-based era.

Sure, there is E-surance, Progressive and The Lizard, but if you look closely into their media presence, it is pretty “traditional.” A few insurance companies have explored MySpace, Twitter or Facebook, but most have to work so hard just to get their ancient legacy systems up to speed to enable Web self-service that thoughts of investment in more sophisticated Web activities are just not there yet.

Fewer than 50% of insurance providers have a Facebook presence, which leaves many major players still on the sidelines. Facebook is used mostly to push occasional news announcements and respond to messages from customers/fans. The online content is varied, but most companies post video advertisements, links to Web sites, options to request quotes and basic information. AFLAC continues to have the largest fan base for the industry, with GEICO and Progressive following.

Many companies adopt a more laid-back approach on Facebook, promoting fun brand images or events; only a few currently adopt a strictly business approach. It would seem that the objective is to assist in lead generation with a twist. A fan of the company is its “public reference.” If one of your friends is also your fan, you would hope that they will create more of a referral than a lead.

The fastest growth in Facebook or any other Web-based social tool activity is in the 35-44 age group, with desirable income levels. Isn’t this a representation of prime insurance prospects? It is, and this group will use social media to communicate—with one another, if not with insurance companies or their agents.

While exploring social media, carriers are working to capitalize on its potential, but they also are wrestling with how to fit this “new-found” medium into their agents’ overall role. All of this has the potential to break relationships between agent/broker/carrier, which just by their nature are always somewhat fragile, and it’s never really been quite worked out online.

Social media should serve not only as a communication tool between insurers and their insureds, but, also—if not more important—between carriers and their agents.

While 73% of auto insurance customers shop online, 67% eventually buy from an agent, according to the April 2009 comScore Online Auto Insurance Report. Don’t let the numbers fool you. As an independent agent, you should feel obligated to stay “connected” at all times.

Agencies are on the forefront

Studies show that there has been an increase in agent and agency Facebook pages. Many agents use social networking as a natural extension of their activities.

There is no clear online strategy that can be used as a best practice to fully expedite agency Facebook pages, but it is crucial to the agent not to be left alone in a past era of an agency-mailed “newsletter.” Good agents don’t have to be the first on the Web; they just have to make sure that they’re the best at using social media.

Agents can and should use social media as a new way to reach that younger, computer-savvy generation, to deliver expected technological advance­ment and further build the relationships.

There are dangers both in creating or not creating a Facebook page. Not creating a page can result in your falling behind on a “fan” base acquisition, as other companies or agents establish marketing and lead generation channels that you cannot match. Facebook allows you to address specific demographic groups and increase levels of trust which are essential as you start to develop greater online sales.

In addition, remember that the page content needs to be refreshed, checked, and reviewed. You are inviting fans to write on your wall and they expect a response; you have to constantly manage your “page” or, if you prefer, your “image.”

So, there are really only a few things to remember: Be a part of the experience, maintain a dialogue and give your fans reason to share. Em­power your consumers to connect to one another by giving them “stuff” they can really use and “stuff” they really want.

Managing your Web presence is a crucial key. Keep in mind, however, that all of these fancy tools are only as valuable as the messages they deliver. As sales and service professionals, we know that it is far easier and much less expensive to retain an existing client than it is to find a new one. Although client communications and contact are most important in building and maintaining that relationship, it is not about quantity alone. It is also about quality. The most successful agents are those who have adopted and stayed true to this philosophy.

The most successful agents are also those who recognize the insurance needs of clients and potential clients as well as the myriad ways to meet them. Twitter, Facebook and agency newsletters are just a few of the many ways of doing so. And while the concept of an Internet era and its social networking possibili­ties is new, understanding your purpose, setting goals, and taking the appropriate actions are not new con­cepts. These are the steps that millions of successful people have used to achieve results, long before social media and networking came into existence.

Facing the “Facebook” is really nothing else but finding old friends and new fans, recognizing them all as potential clients while staying true to our profession’s mission to create a better life today and a more secure tomorrow.

The author
Barbara Zurawski works for Herlihy Insurance Group in Worcester, Massachusetts, and is a licensed insurance agent and broker. She currently has responsibility for both service and production efforts. In 2009, Barbara was chosen Massachusetts CSR of the year. For information on the CISR program, go to: www.TheNationalAlliance.com.