A recent Ernst & Young report's finding that analytics are critical to digital success means agents can’t have one without the other—throwing a wrench into agency operations for those who have found adopting a digital strategy to be an enormous undertaking in itself.
Where can independent agencies find the time and money to properly invest in not only the digital activities required to remain relevant, but also the analytics capabilities necessary to find out what really works?
When McClain Insurance Services in Everett, Wash. first started tracking digital performance back in 2005, it involved getting “down to basics”: average premium, source of sale, close ratio and client retention. Later, the agency began tracking more complicated metrics, such as how each client’s path to the agency affects both conversion rates and retention.
“When you start gathering that information, it kind of builds on itself,” explains Claudia McClain, agency principal. “You want to know more. It really motivates you to think, okay, if I want to move this needle, what does it take?”
Now, McClain uses the agency management system to retrieve raw data and run specific reports, in addition to automating lead management and other sequences (see sidebar). If she wants to go deeper, she looks to Microsoft Excel. “I’m not an Excel wizard,” she says. “Agents get intimidated by that, but I just need to have it in a format. If you’re not finding the reports you want in your agency management system, find the data and create your own.”
Do-it-yourself analytics need not be a painful enterprise—McClain says agencies can achieve an effective process even on a tighter budget.
“Agents can invest in a robust website, or they can do the same things on a smaller scale with a decent website and some interns who are willing to enter data,” she explains. “There are different ways and different price tags on each. But from my perspective, the investment in the technology is a one-time investment. It’s big, but once you invest in it and you learn it and you master it, you can keep on making it better and better.”
Bridge the Digital Gap
While many insurance organizations recognize the importance of a solid digital strategy, Ernst & Young found that nearly 70% of survey respondents spend less than 10% of their IT development budget on digital channels.
Of that majority, only 5-10% of respondents plan for budget increases of more than 25% over the next few years—a planning gap that Kaenan Hertz, executive director of financial services and customer practice at Ernst & Young, finds troubling for the industry.
“They say this is critical to their future, but then they’re not funding it,” Hertz says. “That disconnect is going to become painfully evident. The companies that have less of that disconnect are going to succeed and excel.”
That means “we don’t have time” is no longer a viable excuse. Chuck Blondino, who serves as marketing director of the northwest region at Safeco Insurance in Seattle, points out the rapid pace of the industry’s shifting digital focus in recent years, from online quoting five years ago to SEO three years ago to mobile last year.
“Three months from now, it’ll be about something else,” Blondino says. “These things are going to keep coming faster. If you use the excuse ‘I don’t have enough time’—in the future, will we get more? Or will we be bombarded with even more things requiring or competing for our attention?”
“The reality is that the consumer is not going back,” McClain adds. “Consumers are making their choices very clear right now today. Not five years from now; today. That’s based on the fact that the company actually has some of the tools that will make their life easier. And if we don’t, we’re going to get left behind in the dust.”
Jacquelyn Connelly is IA assistant editor.