Rapid-Fire Response

Rapid-Fire Response

Technology Makes Transparency in Marketing and Communications Even More Critical

By Jon Gorman

Marketing can be a crafty art form. It can be used to deceive, convince, sell product or ideas, build awareness, prey on the uniformed, manipulate, tear down, and ridicule. Marketing can also lead to genuine acts and expressions of compassion, groundswell of action, an improved bottom line, and favorable consumer opinion.

Often stories are just stories. They aren’t necessarily based on the truth and some of the best stories are the most fantastic, far-fetched, and least removed from our reality. However, when telling a story about your company, your products, or your brand using marketing and communications tools to your publics, creativity has its place, but one simple question should be asked at every step: Does your story tell the truth?

Savvy marketers often have the ability to convince you of truths that may not genuinely be true … the little white lies. For example, does wine truly taste better from Riedel wine glasses compared to those purchased from Target or Walmart? According to the Riedel website, “Riedel discovered that wine enjoyed from his glasses showed more depth and better balance than when served in other glasses.” We often convince ourselves that wine enjoyed from Riedel stemware tastes better because of the cost – $119 for a single Burgundy Grand Cru wine glass – and Riedel will tell you about their scientific research and tasting challenges. But does it truly transform or enhance the taste of the wine before it reaches our olfactory senses and ultimately our lips and palette? Riedel even offers a Sommeliers water glass at $74 … do the glasses affect the taste of water as well?

There’s also the subtle deceptive practices often exhibited by marketers. When visiting a gas station for a fill up, three octane options are often the choice – 87, 89, and 93. Usually, those octane values are positioned on the pump increasing in value and cost from left to right. However, that’s not always the case, as some stations have been known to position the values from left to right at 89, 87, and 93. How many customers not paying close attention do you think incurred the unwanted higher cost of 89 octane fuel? Was this the deliberate act of a pump designer or engineer or that of a clever marketing professional?

In the insurance industry, marketing messages and tactics are as varied as the products and companies that make up the industry, but there are a few simple truths that are emerging in the environments in which business is operated.

For marketing and communications success, and for your story to be delivered and believed in the current environment, transparency is vital. Seth Godin – author of 10 bestselling marketing books, speaker, blogger, and marketing professional and entrepreneur – says it simply and bluntly: “Any insurance company that spends time and money having their PR people spin and lie and dissemble and defend is wasting money and time. There’s too much transparency for you to get away with this.”

On June 10, 2008, Godin tells a story on his blog about an experience, a marketing and communications touchpoint, he had with his insurer and shared his opinions about their effort. The motivation, in his opinion, was to strike fear in his heart regarding home invasion and carjacking, and utilize that fear to sell him insurance against such threats. “The $110 a year includes coverage for psychiatric care and ‘reward money leading to the apprehension of the perpetrator,’” according to Godin’s post.

“Scaring people (scaring good customers) to make $100 is stupid,” writes Godin. “It hurts your brand. It makes it less likely they’ll open the envelope next time. And most of all, it’s wrong.”

Godin, in his email response to an interview for this story, further points out that the blog posting was read by more than one million people.

Success (or failure) regarding transparency is a two-way street, from the customer or potential customer and from the insurance company.

Rod Brooks, vice president and chief marketing officer, PEMCO Mutual Insurance Company, Seattle, and board of directors’ and executive committee member of the Word of Mouth Marketing Association, says “We are big believers in transparency regardless of the audience.

“We foster trust and create opportunities for meaningful customer dialog when our communications are transparent, authentic, and consistent,” he adds.

As an example, Brooks points to a recent conversation the company had with its policyholders about its decision to apply credit-based insurance scoring as part of its underwriting process, leading to some “organizational heartburn.”

“We took pains to explain the entire process to our policyholders as we felt it was important to share the why and details of the process,” Brooks explains. “Unfortunately, it had a negative consequence – complaints to our state’s insurance commissioner increased, tied specifically to credit scoring.

“We learned many lessons from this endeavor – above all, we realized the importance of refining key messages when the situation calls for it,” Brooks continues. “In this case, we might have received fewer complaints had we coupled our commitment to transparency with more effective outward-facing communications to satisfy the needs of our policyholders.”

Continuing this conversation forward through PEMCO’s clear and consistent communications plan has led to an improvement in the number of customer complaints and concerns, according to Brooks, and suggests a second truth regarding your marketing and communications strategies: be consistent.

Mark Friedlander, director of corporate communications, The Main Street America Group, Jacksonville, Fla., and board of directors’ member of the Insurance Marketing & Communications Association, says consistency is key for The Main Street America Group’s success.

“A key component of The Main Street America Group’s corporate strategy is ‘In the Know’ communications. We strive to communicate consistently with all of our stakeholder groups, whether it’s employees, board members, our network of independent agent-customers, or our policyholders,” says Friedlander. “While there might be slight variances based on the targeted audience, we ensure key messages are delivered consistently to all of our stakeholders.”

Much of the focus on transparency and consistency is due to trends in technology, communications, and consumer habits.

Your marketing and communications efforts and tactics are open to immediate and rapid-fire response in a world in which anyone can provide criticism of your company or the words you’re using to describe your company … at any time, and as frequently as desired. For example, using 140 characters or less, a policyholder or consumer can respond to your marketing messages or company actions to an audience of more than 20 million people in the United States every month using Twitter … and that response can elicit an avalanche of additional and related responses. Before dismissing Twitter as a fad, consider how effective the site and community was in painting a world-wide picture of the post-election reaction in Iran.

“Technology has democratized the power of communication,” Brooks explains. “At PEMCO, we’ve found that the concept ‘Voice of Customer’ means organizing operations and communication around customer wants and needs. We’ve found that our customers want a way to communicate with us, and social media is a perfect way to foster meaningful conversations about the company or a particular policy line.

“Now, upset policyholders have the ability to make complaints known to thousands by posting their opinion on an online forum – this has virtually redefined public relations and crisis communications at PEMCO,” says Brooks. “Now when we see a policyholder voicing displeasure, we try to respond to the post within an hour. It shows we listen and acknowledge, and that we take customer concerns to heart. Almost universally we are able to make the individual feel better about their experience, and more importantly, show the broader community that we take customer concerns very seriously.”

It is vital for insurance executives, marketers, and communicators to remain plugged in.

“Companies large and small need to be well aware of the changing media world and have their radar on 24/7,” explains Friedlander. “Just look at recent situations that Dominos Pizza and United Airlines had to deal with where social media outlets played a key role in not only unveiling a significant issue to the world, but also in resolving the situation. In both cases, impact on the organization’s brand reputation weighed heavily on the outcome of the event.”

In addition to immediate feedback, both good and bad, social media sites and applications can offer insurance companies new opportunities to reach out to policyholders, future policyholders, and policymakers.

“Sometimes it seems as if we make this topic of social media seem a lot more complicated than it really is,” says Brooks. “At the end of the day, it’s about conversations. If we’re actively listening, these conversations allow us to learn more about our policyholders and our community. The fact is, these social-media conversations are taking place whether we’re listening or not, so we’re far better off listening and joining the dialogue.

“At the root, we believe our success depends on the opinions of the customers we serve, and social media tools provide access to truthful, real-time feedback on our industry, our company, our products, and our marketing campaign,” Brooks says.

Ignoring new media is a mistake, according to Brooks. “While there’s tremendous value in traditional communication strategies, to a growing majority, not participating in these conversations is an indicator either that the company does not care to invest in real-time feedback or that the company is staid and old-fashioned.”

However, shifting your focus to new media, social media, and online communities should not be at the expense of the old-world media.

While traditional media outlets have upped the potential volume of the consumer/viewer/critic, consumers still know where to turn to for expertise … traditional media reports as opposed to CNN’s iReports, for example. iReport are created by neither reporters nor experts. They are any person who has a home computer, a digital video camera, an Internet connection, and an opinion … usually a very strong opinion.

Friedlander believes traditional media outlets still play a critical role in effectively delivering a company’s message to the marketplace, and that it would be a mistake to bypass the “old” media and strictly focus on the “new” media when implementing public relations strategy.

“The sad truth is that the media – and the general public – views the insurance industry as monolithic,” laments Brooks. “We are in a fiercely competitive market trying to sell a highly regulated/commoditized product in a category with low customer involvement and little opportunity for differentiation. In fact, many have a difficult time distinguishing a mutual from a stock company, or a good corporate citizen from one acting solely in their self interests.

“That means we need to work even more diligently to make sure our key audiences have the opportunity to see the good works we do,” says Brooks. “Then when the public is asked to draw conclusions based on media reports, they have a more balanced picture of who we are, and what we are at our core.”

Godin concurs and offers a suggestion.

“The only way (the only one) that you will find success going forward is to create products, policies, and services that people want to talk about,” says Godin. “That’s the key to your job now. Make stuff that businesses or individuals will so embrace that the word will spread. It can be done with insurance, yes.

“The single easiest way to start on this path is to change the way you interact with customers,” Godin suggests. “Here’s an assignment: buy some shoes from Zappos. Then call with some concerns or questions. Watch what happens. Do the same thing with United Airlines. Which are you more like, Zappos or United?”

Seth Godin’s Blog
GasPedal’s Word of Mouth Marketing Blog
PEMCO blog
PEMCO at Twitter – @PEMCO, @PEMCO_NW
Rod Brooks at Twitter – @NW_Mktg_Guy
Mark Friedlander at Twitter - @markfri09.