June 19, 2015 by Terri Goveia
They’ve shared adventures with the charming lizard in GEICO commercials. They know State Farm’s “Good Neighbour” tune can seemingly conjure up instant cash savings. And then there’s the set of fun spots from Farmers, with the jingle that sounds like a barbershop quartet improvising a superhero theme: “We are Farmers—bum, badum-bum, bum, bum, bum!”
That familiarity isn’t so magical for Canadian insurers, whose brands have been largely overshadowed by their U.S. counterparts. “Certain brands have cornered the market in terms of awareness,” says Valerie Monet, insurance practice director at J.D. Power & Associates.
That’s about to change, if larger homegrown companies have their way. Recent marketing efforts have ushered a slightly bumbling knight, eager claims representatives and cheerful brokers onto Canadian screens in a bid for stronger branding. It’s too soon to tell whether companies like Intact or independent brokers can gain the same traction as Flo and company have, but they’re making headway in establishing new touch points for insurance shoppers.
Robin Monniere, director of marketing and communications at Belairdirect, says the heightened brand visibility is a specific response to market shifts. Market pressures prior to 2012 had insurers focused on profits, rather than new business. But since then, “things got back to normal. That’s why you see larger investment [in TV advertising] and more competition.”
Then, there’s the “gecko factor.” U.S. promotions have such reach that GEICO—a brand not even sold in Canada—became the most recognized insurance brand among shoppers here, according to a 2012 Globe and Mail report.
That’s representative of a broader trend: J.D. Power’s 2014 Canadian Auto Insurance Study found that aided awareness rates here (consumers select which brands they recognize from a list) range from four percent to 71 percent. In the U.S., those rates are higher, ranging from 15 percent to 73 percent. Monet says the brands with the biggest impact there include State Farm, GEICO and Allstate.
Some provinces like Quebec and British Columbia have had a measure of protection from so-called U.S. spillover. Local French language commercials and marketing dominate in Quebec, notes Monniere, and places with government auto insurance tend to compete more with direct writers than American brands.
But all carriers face another challenge on the customer relationship front: other categories influence what consumers expect from all service providers, says Anna Rajpat, Intact Financial’s vice-president of brand development and customer experience. “We’re not just competing with insurance companies; we’re competing with providers like Amazon or Google who have amplified service differentiation for consumers.”
The current limits of insurer-consumer interaction also make renewed branding necessary. “Insurance companies are starting to recognize that they have to have a more direct relationship,” says Rajpat. Since consumers only reach out when they need a product or have a claim, “we have to find mechanisms to reach them in a more timely and meaningful way.”
To do that, Intact has zeroed in on service and speed. Its ads highlight how fast a customer can get help after an accident or a flood with the company’s 30- minute claims guarantee. “We know that in a claims situation, you’re looking for someone to be empathetic and responsive, but you’re [also] looking to get things started quickly.”
At Belairdirect, the company has made “simplicity” its brand, with the knight spreading the word about how easy it is to get help. In-house studies and focus groups, says Monniere, found “a lack of simplicity in insurance in general was something that was common across all results.” She points out that “now it drives everything that we’re trying to do—everything from our website, how the information is displayed, to the tone we’re using— to make it more accessible.”
Brokers have also taken on TV in a pointed way. The Insurance Brokers Association of British Columbia airs its own Broker Identity Program commercials across the province, adjusting the campaign every two years. The ads—featuring brokers, not actors—highlight the choice, service and expertise brokers bring to the table, with taglines like “We work for you,” says Linda Dolan, owner of Airport Insurance in Port Alberni, B.C., and the association’s second vice-president.
While these messages may help forge the connections insurers want, Monet argues most shoppers are still driven by need: pricing or a last-minute renewal. “If I look at people who went out and got a quote in 2014, 58 percent said they did so because of price. [Only] five percent did so because of an advertisement.” She says circumstances, like a marriage or having a teenage child start driving, also tend to have more influence over their choices.
Some branding efforts face more barriers than others. J.D. Power research has found awareness for brokerages tends to be lower than for direct writers. Rajpat agrees. “It’s more difficult to break through. We don’t have that direct relationship.” But her company does play up the middleman advantage by integrating brokers into their core message. “Our call to action is, ‘Call your broker.’”
Generational preferences are also an issue, especially for online services. “The older population understands the value of the insurance broker,” says Dolan. “We have to make this generation aware. If I buy a pair of pants online and they don’t fit right, I can return them. If I buy insurance online and I tick the wrong box, and I have a claim, I could suffer financial loss and that is huge.”
Insurance isn’t something people—no matter their generation—actually want to buy. That makes the insurers’ task that much more complex, says Monniere. “People don’t look forward to buying insurance… I would be in a much easier spot if I were selling iPods or iPads.”
But there’s some encouragement. Both Intact has seen “strong” results from the branding push. Rajpat says measurements show movement in key recognition areas—consumers are noticing the ads, linking them to Intact and understanding the message. The company also saw a 25 percent increase in unaided consumer awareness. “It’s the highest we’ve seen since we started advertising in 2009.”
Belairdirect’s brand awareness has almost doubled, according to Monniere, and in B.C., some brokers are making unexpected brand connections. At a recent annual general meeting, the event’s sound technician sought Dolan out to assure her that he’d learned a lot from the event, and would seek out a broker. “We have a symbol and it is known, we just have to continue to make sure that it is [recognized].”
Monet says Canadian insurers can learn from their U.S. counterparts; those with the best brand awareness and reach know who their customers are and how to reach them. “If your customer base is largely Gen Y or target audience is Gen Y, you should think about putting your ad spend on Facebook and Twitter and Spotify. They’ve focused on increasing awareness among their target markets.”
How far can awareness go? Both Monniere and Rajpat refer to critical “moments of truth”—one-on-one interactions that really give insurers a chance to differentiate themselves. But those usually come with face-to-face exchanges over a purchase, a renewal or a claim.
Could branding become one of them? It could, says Monniere—although insurers haven’t reached the stage where shoppers brag about the type of insurance they carry, the way they do about their smartphones or gadgets. “We have to be realistic that it might not happen that way. But when you have the chance to establish a oneon-one relationship, that’s a moment of truth. So, you have to reach out to the masses, to those who don’t know you, or who have just considered your brand. You have to reach out and say, ‘hey, join us.’”
Copyright 2014 Rogers Publishing Ltd. This article first appeared in the May 2015 edition of Canadian Insurance Top Broker magazine
This story was originally published by Canadian Insurance Top Broker.