As an auto insurance marketer, what you don’t know about your customers box hurt you.
Traditional targeting methods often fail to provide an in-depth understanding of prospects, making it easier to mistakenly target high-risk drivers. These engines typically have a low lifetime value, which increases customer churn, which can negatively impact profitability over time.
With telematics data, you can get out of that targeting rut. Learn how to gain a true understanding of your leads to target, engage and convert quality leads, increasing marketing ROI and profitability.
How does the buying cycle doom insurance marketers?
Online advertising is extremely competitive for auto insurance marketers because it targets a limited pool of prospects. Consumers do not change insurance often. If they have a good driving record and a good rate, why would they change?
Meanwhile, consumers buying new coverage are typically drivers whose rates have gone up because they’ve had an accident or suffered some other form of loss. Data shows that these high-risk drivers click on car insurance ads up to 3 times more often than low-risk drivers. These risky drivers aren’t the ones car insurers want in their business portfolio – but they can still inadvertently target them. Why?
Traditional data targeting can lead to negative ROI
When auto insurers use traditional targeting tactics, they don’t have a full understanding of the consumers they are reaching. They optimize their campaigns for conversion and increase their budget to reach high-converting segments. Marketers end up doubling down on the highest risk factors based on the signals they see in their campaign metrics.
Some might say, “That’s OK; our pricing team will fix the issue when the user completes their quote. This would be true if the company had access to telematics data as part of the quote feed. But if not, carriers will continue to convert and undervalue riskier drivers using traditional pricing systems.
But it doesn’t have to be that way for your business. Your best customers are out there, you just need the right data and targeting strategies to identify and acquire them.
Identify your ideal customers with telematics data and audience targeting
Using programmatic marketing techniques such as audience targeting, auto insurance marketers can target segments of drivers grouped by risk in their advertising campaigns across the digital ecosystem.
And by using telematics data in their programmatic marketing, carriers can either target only the most profitable customers, or simply modify their bidding strategy to raise the bids for the best customers and lower the bids for the riskiest customers.
Additionally, with a deep understanding of their ideal customers, carriers can customize ad creative to engage different types of drivers at different stages of the purchase journey. Once personalized messaging is developed, operators can run ads through their own demand-side platform in marketing campaigns across all digital channels.
Smart auto insurance marketers increase their ROI by augmenting their traditional data targeting strategies with telematics data and using audience targeting to reach the best prospects for their business.
Fred Dimesa is Head of Advertising and Aggregate Data Products Segment at Arity. He can be contacted at [email protected].
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