Every day you come across hundreds of advertisements from insurance brands. Several of them are a bit scary and several are very funny. However, there is always an abundance of insurance advertisements on every medium including television, newspapers, and magazines. Insurance companies use all sorts of methods, styles, and tools to advertise and promote their large range of insurance products. However, gaining the consumers’ attention is still difficult and most of us watch those insurance ads with very little interest.
Ever wondered why these insurance companies advertise so much? Could they not manage to advertise less and sell more as many other companies in other categories do? Why do they bother their audience with all types of advertisements including videos, images, and content? The truth is that however annoying or amusing it is for you, the insurance companies still need to advertise and therefore they advertise a lot.
Insurance products are unsought goods
Insurance is not a convenience product that consumers buy regularly. It is something that they do not seek or seek very less. It is something that they are aware of but do not have much knowledge about. Everybody knows of life insurance but seeks it only when he feels it is really crucial to have one. So, the truth is that unsought goods do not sell like convenience goods. You do not seek insurance the way you seek milk, cola, salt or biscuit. It is why there is a lot of advertising and personal selling as well as other types of marketing efforts that are required for the sales of insurance plans. Since insurance is classified as unsought goods, finding customers is very difficult even if retention is easier. If nothing goes wrong, the customer would not check back or want to switch providers in the case of insurance. However, finding the buyer is the most challenging part since selling something people do not seek is a tricky thing to do. The chances of your hearing a no are always higher and you need to adopt smart personal selling techniques to find buyers.
Level of engagement is low:
An insurance product will not interest you like a magazine, a music system or a burger does. It means that the advertisements laid by the insurance companies do not convert at the same rate as the other products. The level of customer engagement in case of insurance advertising is much lower which is why the insurers put so much effort into personal selling and branding also.
The most important concern of the advertiser in the insurance industry is to grow product or brand awareness. They know that not many people would be automatically interested in their brand or product. It is why they need to promote the features of their products, its benefits and gain publicity to interest the prospective buyers. It is not just about little interest but you can also see instances of negative interest among consumers related to insurance whether it is car insurance, health insurance or life insurance. Even if there is an existing low level of awareness regarding a product, generating interest is the biggest challenge before the insurance advertiser. That’s why these companies focus on aggressive advertising. Insurance advertisers also use a multichannel marketing strategy to drive customer engagement higher.
Low Awareness and Interest among the Leading Consumer Segment
The price distribution of insurance products varies which means not all insurance products in the market are available at the same price. However, a consumer would not normally compare the process of these products unless a need somehow erupts. Now consider the largest consumer segment of insurance products which is the millennials but insurance does not figure as highly important on their list. They are unlike the baby boomers and they seek fun and exciting products, not something as boring as insurance. They are attracted by Netflix, iPhone, and Facebook but insurance neither is and nor will it ever be even close to the top in their list of most sought after products and services. They talk about Facebook, Coca Cola, and Nike but they never talk about the leading insurance firms or how their products are cool. This is also a reason behind the low engagement level. Now that the level of interest in the leading customer segment is so low, how will the marketing messages stick to the consumers’ minds? People will not like to remember the slogan of an insurance brand. This is the reason that insurance advertisers use various kinds of ads and keep updating them regularly.
The types of ads used by insurance advertisers range from scary to funny. The level of competition in the insurance industry is also high and as a result, brands advertise aggressively in order to stay competitive. Not just because they do not want to lose prospective buyers to their competitors but also because they want to remain on the top of the mind of their audience. Since igniting interest and engaging the audience is a bit difficult, there is no other option before them but to advertise aggressively. However, aggressive advertising does not mean that they are wasting their dollars but it has been found through research that the insurance providers that spend a large part of their revenue on advertising, also experience growth in their sales and revenue. It was also found that technology and marketing automation could grow sales for insurance providers.
- What are brand variants and what are their benefits
- Scope Creep in Project Management and how to prevent it
- Toyota VRIO Analysis
- What are the five phases in project management?
- Business Segments of Comcast Corporation
- What is Collaborative Leadership and How to Become a Collaborative Leader