Social Media Forum
Social media trends for 2011
Agencies can use their experience with social networks to plan ongoing efforts
By Tom Wetzel
There has been steady growth in the use of social media within the insurance industry over the past year, and the next 12 months promise more of the same. More insurers and agencies will be jumping on the bandwagon. And many not yet participating are considering such a move. What will drive more and different social media participation in 2011, however, will be increasing competitive pressures and greater regulatory scrutiny.
There will, no doubt, continue to be the introduction and breathless promotion of new networking and content sites, upgrades to Facebook and Twitter and improvements in social media monitoring software; however, there are six broader trends to watch.
1. Strategy first, tactics second
As Facebook's numbers exploded, going from 20 million users in June 2007 to more than 500 million users as of July 2010, the number of insurers and agencies participating in social media also increased, though at a far slower pace. Some of the early carrier adopters recognized the medium for its potential as a listening post and as a means to engage insurance buyers in a more conversational, less adversarial, manner.
As Facebook's numbers became too big to ignore, other firms started their own pages. Some of these firms, however, started on Facebook without fully understanding the medium by treating social media as just another channel with which to push out the corporate message.
Some of these later adopters also added Twitter for the same reason, as the number of tweets rose from 5,000 per day in 2007 to 50 million per day now. "Others were doing it, so why shouldn't we?" was the thinking. In other words, for many firms the tactics were driving increasing participation, not because there was a defined, written strategy dictating it.
Now, however, some firms are starting to take a step back to look at how and why they are participating on a variety of social media sites. What are we trying to accomplish with social media? Are we using Facebook to its fullest potential? How does Twitter help us meet our corporate goals? Should we be using YouTube or adding a blog? What other sites should we consider?
This evaluation process will accelerate throughout the year and create two effects: 1) greater innovation and creativity in social media participation, and 2) increasing competitive pressure for those insurers and agencies that are not already participating to do so.
2. Mounting pressure to substantiate ROI
According to a Forrester Research study issued last September, content creation on social media sites dropped slightly this year as compared to 2009, even while the number of users of social media continued to climb. One of the most logical explanations for this slowdown is that the novelty of social media has worn off for some and those who did not achieve instant success, whatever their motivation, became discouraged and either quit or cut back their participation.
We've said it before but it bears repeating: Content must not preach and push; it must inspire, educate and engage. And one can't expect instant success where social media is concerned.
Nevertheless, insurers and agencies will demand measurable benefits to justify further investment in social media. Those benefits will take many forms. Beyond citing the number of posts and tweets and the increase in traffic to corporate Web sites, our colleagues who are involved with social media will become more adept at pinpointing how the metrics make social media and other communications activities more efficient, e.g., which topics generate the highest traffic and what time of day produces the most posts.
Insurers and agencies will also develop new uses for social media in which their participation can prove valuable. For example, a recent Red Cross survey detailed consumers' increased reliance on social media during emergencies and their expectation that first responders are listening. Consumers will expect the same from their insurer and agency.
Many experts are starting to predict that insurance rates will begin to increase in the coming months. All the more reason to reach out to policyholders through social media so that they understand why rates may go up, even if they have never had a claim. When they get a bill is not the time to explain it.
3. Greater insurer/agent cooperation
As more producers begin posting and tweeting, insurers will work with their producers more closely in creating and sharing content and to guard against inadvertent compliance violations. Many carriers have already developed stronger working relationships with their producers, forcing their competitors to play catch-up.
For instance, there are plenty of examples of independent agents who generate more leads for those companies that participate in social media and reach out to their agents to identify and share best practices, thereby creating a powerful win-win arrangement.
4. Creation of corporate-based communities
Even with the popularity of Facebook and Twitter, the next major trend will be the creation of new networking communities directly on corporate Web sites. By no means will the use of Facebook and other third-party sites shrink—these new "corporate" communities of insurance buyers will be structured to increase the engagement level of their users while they also build links to the public at large.
5. Greater regulatory oversight
State regulators are beginning to monitor insurers' social media activity for compliance violations in marketing, claims and underwriting. This makes it even more critical that companies establish a written plan and guidelines for all social media work, including research. Regulators will begin to look for violations more vigorously, particularly in how companies may be mining social media without careful consideration of insurance law and how in the absence of written guidelines they could unwittingly violate them.
6. Accelerating use of mobile marketing
Some experts believe insurers are years away from widespread adoption of mobile marketing programs. The explosion of use by consumers of the iPhone®, Android™, and other smartphones is driving the rapid expansion of social media usage, and the same trend will push insurers to accelerate their entry into mobile marketing in 2011. Research by the Pew Internet & American Life Project indicates that cell phone users are taking advantage of a wider range of their phones' capabilities. For instance as of May 2010, 38% of users access the Internet using their phone, 23% have accessed a social networking site using their phone, and 11% have purchased a product using their phone.
Tom Wetzel is president of a full-service, insurance-exclusive marketing communications/public affairs firm with a special practice devoted to social media in the insurance industry. He can be reached at firstname.lastname@example.org. He is also on Facebook and Twitter. The company's Web site is www.wetzelandassociates.com.