As the benefits business continues to evolve, marketing must change with it. To meet people where they are, many are turning to social media tools and seeing great results for both sales and brand recognition.
The numbers are staggering. Facebook has more than 1 billion registered users, Twitter more than 517 million users and LinkedIn more than 175 million. "This is one of the core principles of social media and why having an online presence is so important," says Ryan Hanley of Albany, N.Y.-based The Murray Group. "Conversations are happening ... so whether we use the tools or not, in order to connect with those people we need to be there."
According to the Pew Research Center, more than 53% of American adults age 65 and older use the Internet. So, while many businesses are concerned about how to market to Gen Y - those 18-28 - Hanley believes age has nothing to do with it. "It does not matter if you are 18, 28, 48, or 68," he says. "I think the idea that only the younger generation uses [social media] is a misnomer," he adds. "I'm 32 and didn't have a Facebook account until I was 27 and realized I could use it for my business."
He recalls finding himself at a local Chamber of Commerce meeting, "like so many young salesmen do." He made his way into circles of conversation. "A year into my job [at The Murray Group], I heard someone say, 'We will connect on LinkedIn,' and that sent a bell off in my head," Hanley recalls. "What the hell is LinkedIn and how are they communicating there? It kind of scared me, there are conversations happening that I am not a part of. That was the core of what got me started."
Facing resistance
Leading a brokerage to establish a social media presence is a daunting task - older generations typically question the ROI, legal issues and lack of understanding of the tools, Hanley says. At the same time, younger generations slowly taking over the business face resistance from their superiors.
It's a challenge Hanley, now director of marketing at the family owned business, has faced first-hand from his father-in-law, Jim Murray, president of the company, which has 15 employees. "They didn't support me at first for all the reasons that everyone who wants to start doing this inside every agency gets pushback," Hanley says. "I saw that coming. I had approached the subject a couple of times."
To overcome that, initially Hanley approached his father-in-law and offered to use social media not as the agency but as Ryan Hanley, the producer who works for The Murray Group, and started RyanHanley.com as an insurance blog. Blogging under the headline of an Albany insurance professional, over time people started to contact him and say, "Hey Ryan, can you write my insurance?" That led to accounts being brought into the business, which set the wheels turning in Murray's head about added business.
"I negotiated for a long time to be able to blog as The Murray Group. There was a natural barrier to people contacting me as Ryan Hanley, producer, versus [the company]," Hanley says. "People had to make that extra connection. I saw that barrier and wanted to get past that by moving blogs to the company's Web presence." The results were impressive - Hanley had 19% year-over-year growth as a producer while on social media, he says.
After Murray agreed to allow the transition, Hanley moved into a full-time role as director of marketing in November 2012. Since then, he says, the company "hasn't lost a beat in revenue. If anything, we've continued to grow and will take on a new producer soon."
Clients also say they are in an "interspace" between the older generation who never had computers and those 20-somethings "who have something attached to them constantly," explains Greg Goss, office manager of Kirk & Teff LLP, a workers' compensation law firm in Kingston, N.Y. and a client of Hanley's.
"I think if you run a business you are looking for someone who seems to understand the wave of the future," Goss says. He has been doing this for more than 20 years and can't remember ever meeting an insurance agent like Hanley who gets social media and has an answer to every question, he says.
Hanley believes an important part of working with his father-in-law is keeping him up to date on what he is up to. "In weekly sales meeting, I say, 'This is what I'm posting and what I'm doing.' So he is very comfortable with the information that goes out and he never feels like he does not understand what is going online," Hanley says. "It's good for the agency in general so someone does not call in and a producer doesn't have a clue."
It's an idea that Murray has not second-guessed. "We set ourselves apart from the competition. It was very exciting," he says. "We started seeing results. ... I would write policies and my clients would say, 'I've seen something on Facebook, who is Ryan? I've never seen this in the industry before. It's nice to know that after we purchase a policy ... we can see what is going on throughout the year.'"
Joseph H. Deacon III also faced initial skepticism from his father while implementing social media at Charleston, W.Va.-based Deacon & Deacon Insurance Agency.
"At first, Dad was skeptical. ... He needed to understand what it was and how it can benefit our firm," Deacon, an employee benefits consultant at the firm, says. "He knows people are using [social media] as a primary method of communication. He lets me handle that aspect of the business, but he's embraced it and he's on LinkedIn and Facebook as well.
"He has friends and former business associates he hasn't talked to in a long time that have found him," Deacon, president of the West Virginia Association of Health Underwriters, adds.
If you don't have time for social media then you are in the wrong business, says Jason D. Cass, owner and an agent at Centralia, Ill.-based JDC Insurance Group. "You are not interested in nurturing relationships and writing new business," he explains. "I can show agents that in the last 35 months I've made over $53,000 in commission income and spent about $7,000. The fact is if you don't have time, you don't have time to write business."
Many agents will say they have 700 Facebook 'likes.' But now, how to sell them? "Here's the deal ... you have 700 people who voluntarily clicked a button to show up in your [Facebook] newsfeed, that's like having 700 people stand outside your office," Cass adds. Agents "need to get out there and do it, rather than make excuses. The agent right down the road is making a [lot] of money. They don't want to take the extra time because they don't care about retention."
For those brokers, Cass says, "they see it as a paycheck. And that's fine, because I am going to end up taking their business. We are past, 'Why does this work?' ... If you are still on, 'Why is it needed?' [then] you are so far behind the curve."
Overcoming legal concerns
Hanley believes much of the resistance comes from legal concerns and the true E&O exposure. "We found varying opinions, but as a rule of thumb, if you don't discuss client-specific information, you have little-to-no exposure," he says. "If you write something about flood insurance, someone does not have recourse to come after you unless you are saying, 'John Smith's house, he didn't purchase insurance.' That is just silly. If you are using these as marketing tools, your E&O is almost zero."
Not participating in social media due to legal concerns is just not an option. "The greatest risk in using social media is to do nothing at all," says Sarah Carter, social media and compliance specialist at Belmont, Calif.-based Actiance, an IT company. "The medium has become so pervasive and important in building business. And with appropriate solutions available that allow for governance and the free exchange of dialogue across social networks, there is no reason not to use social media."
However, as it is "the next big thing" of marketing it is easy to make missteps. "There are some basic rules about marketing, as with any [form] of communication, that are still applicable," says Dan Schaeffer, counsel at Neal & McDevitt LLC, a Northfield, Ill.-based intellectual property and marketing law firm. He explains that many concerns from social media are the same as in e-mail - the biggest being disclosure of confidential information.
"For the most part, people are pretty careful about not putting confidential information out there," he says. "... The reality is you want to keep your agents from putting anything confidential out onto social media."
He says he cannot recall any recent legal cases regarding postings on social media, and adds basic social media awareness classes can help overcome potential problems. "The basic rule is just be very careful so that everybody who touches the social media presence of the company knows what is and is not acceptable to put out there," he says. "It is easy to have missteps - there have been some high profile examples of Tweets that went horribly wrong. ... Think about the message you are sending."
A 'vital' tool
In the end, using social media is "absolutely vital," Cass, who co-runs a business with Hanley called The GROW [Generate Revenue Online Workshops] Program, says. "People ask me, 'What is the ROI?' The ROI of your social media presence is that your business will be around in five to seven years," he says. "People who want to take it lightly, are they going to be able survive? ... That's what our generation is expecting."
Cass agrees that it is not a generational thing. "There are 60, 50, 40 year olds and they want to watch a video, they want to listen to a podcast and then decide to engage with you," he says. "That is one of the most important things. No one cares how much you know until they know how much you care. A lot of people want to go out and start telling everyone, 'Let me do your benefits.'"
But it's not about just selling benefits on social media but also showing you are a person outside the office and building a relationship. Cass's Facebook page - which has nearly 5,000 likes - features little information on products he offers but instead focuses on issues in the community and news about his family. Considering that Cass works in a town with a population of around 13,000, the number of Facebook 'likes' is high.
To do that, he showed that he cares and is not just some "insurance dude. ... It is the same thing when you start a business and throw a sign on the door - people don't come running in. They want to know you are committed to the community. It's the same way on social media," he says. "People don't give a shit about insurance. It's boring to them; they want to have a conversation with you.
"No one buys that unless they can trust them," Cass adds. "[Social media is] not a sales tool. It's a relationship enhancing tool. We still provide a service that is face-to-face, but people will not do business with you unless they get to know and like you. My sons will not go to Chamber events. I don't go to Chamber events."
Simply, it increases business and builds a personal brand, says Actiance's Carter. "Compared to conventional marketing tools, such as advertising and direct marketing, social media offers a number of distinct advantages," she explains. "It's free or relatively inexpensive, allows you to interact with clients and prospects in real-time, it's adaptable and offers immediate, direct feedback."
Kirk & Teff's Goss says that when he took over the job and they were looking for a new broker online, Hanley's name "popped up and up and he is all over the place."
Once Goss figured out who the site was associated with, Hanley "seemed to know what the hell he was talking about," Goss recalls. "I went about tracking him down because his [online] presence is 10 times that of all the others put together."
Due to that presence, picking Hanley to manage the insurance for the 15-member plan was an "easy choice," Goss says, but "a really easy choice once you get to talking to him because he knows his [stuff] inside and out."
That's what it is all about. "Social networks do not sell product, do not sell services, they sell brands, they are brand builders," said Richard Honack, lecturer of executive programs at Northwestern University's Kellogg School of Management during a Big "I" Conference Washington in late April.
"Do you have to be there? Yes," he said. "Do you have to be there every minute of every day? No, you have to be there when you have something important to say."
If you don't know how to use the tools and don't pay attention to them the bottom is line you will go out of business, Honack concluded.
