The proven ROI for business text messaging in insurance | Insurance Business America
Consumers today expect to be able to engage with insurance organizations whenever, wherever, and however they want. Gone are the days when insurers could get away with contacting customers once a year by sending a policy renewal notice in the post. In today’s technology-forward society, customers expect personalized and conversational insurance experiences, supported by end-to-end digital tools tailored to their unique needs.
According to LivePerson’s ‘2020 Survey of Consumer Preferences Around Insurance,’ 71% of consumers would trust an insurance company more if it provided a personalized service. One way for insurance firms (agencies and carriers) to meet that demand is through two-way business text messaging. This was loud and clear in LivePerson’s research, which found that 70% of consumers want the ability to securely text or message with their insurance company, and 70% would trust an insurance company more if associates are readily available via messaging to give advice, answer questions, and help with purchases.
Find out more: Learn all about StatFlo’s text messaging platform
Statflo, a business text messaging platform, helps insurance companies foster one-to-one relationships with customers through personalized and proactive customer outreach. Businesses can leverage Statflo’s compliant text messaging platform to shorten their sales cycles, effectively cross-sell/up-sell customers, and engage their customer base.
“There are lots of use-cases for business text messaging in insurance,” said Scott McArthur (pictured), chief revenue officer at Statflo. “It can be used for interacting with customers, informing them about policy updates, and letting them know about new products. It could also be used to kick-start the claims process, for sending through documentation for clients to sign (supporting the sales process of a new insurance plan), and for sending information and content about the product or service they just signed up for.
“A study by Collinson found that 63% of consumers are open to further communication from their insurer. And three quarters of customers are interested in receiving details about target products or benefits based on their usage and behavior. A consumer might have their home insurance with one insurer and their auto insurance with another – that’s a great opportunity to cross-sell/up-sell that customer to let them know about other products that are available within your organization, and that can be done with a personalized approach via text messaging.”
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More than 90% of people read a text message within the first three minutes of receiving it, according to MobileSQUARED, a mobile research firm. That is a huge open/read rate compared to email and phone calls, where the read/answer rate is more like 20-30%.
“With business text messaging, insurance companies can drive that captive audience, while also improving engagement rates and retention rates of customers,” McArthur commented. “At Statflo, we’ve conducted research into the retention rates of some of our biggest customers. Our customers found that they had a 15% improvement in client retention as a result of interacting via one-to-one text messaging, versus phone calls, email, or mass automated texts.
“We also carried out a study that looked into conversion rates on cross-selling/up-selling products via text messaging, and we found that one-to-one texting produced conversion rates of four to five times better than standard, legacy outreach solutions. Business text messaging has an amazing business case in terms of the key performance indicators (KPIs) and the return on investment (ROI), and perhaps most importantly, it’s what customers want and how they expect to be interacting with their businesses of choice.”
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While the use-cases of business text messaging are wide-ranging and the success ratios are relatively high compared to more traditional communication methods, some companies still have concerns. The most common query that McArthur fields from potential clients is: ‘Are we actually allowed to do this? Do we need to get opt in for text messaging?’ McArthur explained that under the Telephone Consumer Protection Act (TCPA), companies that have an existing business relationship with a customer do not have to get express opt in to interact through text messaging; they simply need to give them the option to opt out.
Other companies have expressed uncertainty about the ROI of text messaging platforms and whether their teams will actually use text messaging, but again, Statflo’s studies have shown high frontline engagement and a proven ROI because texting, in McArthur’s words, “is such an easy way to engage with clients.”
“There’s a high level of awareness among insurance organizations that they need to engage in digital transformation and shift how they interact with clients in order to provide the best possible customer experience,” McArthur added. “Insurance companies should strive to provide better personalized and proactive customer interactions because there’s a lot of other products and services they could be selling. By having consistent one-to-one communication with customers, insurance companies will increase their retention rates and they won’t have to pay as much on cost of acquisition. There’s a huge financial impact to having better interactions with customers – and business text messaging can play a key role in that.”
Find out more about Statflo’s business text messaging proposition here.