The competitive nature of the insurance industry has made customer retention a significant challenge for insurance companies. Customers can switch to a new policy at the tap of a button, with everything being online and digital marketing tools revolutionizing the industry.
To ensure customer retention, insurance companies need to adopt affordable marketing strategies with a client-first approach with enough potency to retain customers for long periods and increase revenue. In this article, we'll understand what customer retention means for the insurance industry and how customers can be kept affordably.
What is customer retention?
For the insurance industry, customer retention is more about retaining customers through renewals and reducing the number of customers who tend to shop around as they near the time of renewal. Briefly, customer retention intends to acquire more potential customers than those who leave.
A survey by IBM stated that acquiring newer customers costs insurance companies 7 to 9 times more than retaining the existing ones. This is expected to increase from 15.8% in 2018 to 17.9% in 2022. Therefore, insurers must leverage powerful marketing automation tools to strategically manage customer retention and drive revenue growth.
Now that we know the basic concept of customer retention in insurance industries, we’ll discuss some practical strategies that insurance companies can implement to retain customers on a profitable long-term scale:
Effective customer retention strategies
The rising need for retaining existing customers through pristine client-agent relationships, newer policies, and marketing strategies has enabled the insurance market to evolve and become lucrative. The companies implementing better strategies are staying ahead of the curve, while the others are falling behind in revenue and retention.
Here are some effective customer retention strategies that insurers can look into:
1-Adding value to the product during the policy period
The event when insurance needs to be claimed is such a turn point that it’s not desirable by the insurer or the policyholder. However, until this point, or in the fortunate turn of events where this point does not arrive, insurers much ensure a consistent relationship with their clients throughout the tenure of the policy period. They can do so by providing additional support through renewal reminders, regular updates through automation, or complementary maintenance services (depending on the nature of the insurance). Insurers can also consider adding coverages based on the customer's needs as a more personalized way of catering to customers. These techniques will help retain your customers and interest them in better policies during renewals.
2-Using state-of-the-art tools to ease processes
From procedural functions to deducting premiums from automated payment plans, everything should be eased out for the policyholders by insurers with the help of advanced software and tools so that customers don't shop around owing to inconvenience. Insurers can implement weekly email campaigns to engage customers and create an omnipresence through various channels. This lets your customers stay updated with the latest policies and how they can benefit from them, leading to longer retention.
3-Explicit predictive analysis to retain customers
Insurance companies can segment their clients and offer more personalized services. An analysis of customer behavior, renewals, and the nature of renewals can help predict your revenue growth and retention probabilities. This strategy allows insurers to retain customers and focus on offering better services to them instead of looking for newer customers. By leveraging these insights, insurers can drive massive revenue as customers will likely get personalized services that help them stay with the insurance company.
The only way insurers can stay ahead of the curve in this age of tech-savvy clients constantly looking for better is by creating a presence and providing offers that customers cannot put down. With the help of no-code tools and the wealth of customer data that insurers have, they can implement targeted marketing skills and drive improved customer retention. From email marketing setups and social media campaigns to marketing automation tools, insurers have many options to bring their A-game into the thriving competitive landscape and strategically retain more customers.
5-Powerful email campaigns
One of the most proven ways insurance companies can retain customers and grow as a company is through powerful email campaigns that have the potential to keep customers engaged with the brand and reduce their chances of looking around. Email marketing campaigns target the psychological marketing impulse of customers, keeping them hooked to one brand and driving massive revenue and results for businesses. Insurers can drive revenue and foster customer loyalty in the insurance industry through Marketing Automation Tools, which have automated mailing processes and several features to retain existing customers.
What are Marketing Automation Tools?
Marketing automation tools have become effective digital marketing tools in the current market, bringing profits from all sectors. The key to retaining customers lies in reaching out to them professionally, with a hint of personalization. This element of personalization helps customers stay true to one brand instead of shopping around because it feels personal. Marketing automation software simplifies the email processes in an organization through automation.
An effective marketing automation tool like Asteya’s marketing automation tool enables you to reach out to your existing customers based on your business targets and achieve your business prospects most affordably. Marketing automation tools have the following features which help insurers optimize their marketing efforts:
- Increased lead generation
- Nurturing leads
- Customer retention
- Maintaining client-agent relationships through scheduled automated emails
With the help of effective marketing automation tools, you can target potential and existing customers the way you want. You can create automated marketing campaigns with pre-existing templates, from personalized and welcome emails to promotional emails. And all of these can be done from one software, reducing the scope of human error as the email campaigns can be scheduled and sent to customers according to the customizations made.
Let's look at the benefits of Asteya’s marketing automation tool in the insurance industry:
Through automated email campaigns, insurers can ensure the right message will be delivered to the right set of customers, meeting the business's target.
- Improving the overall customer experience through regularly personalized emails.
- Reduced scope for human errors.
- Nurturing renewals and sale cycles.
- Time saving for insurers due to its automated functions. They can feed the customer database into the software, and the tool will execute multiple email campaigns automatically.
With 74% of marketers claiming that the most significant benefit of automation is that it saves them a great deal of time, automation has resulted in 80% of ROI, 46% growth in revenue, and an increase in leads by 26%.
With no requirement of great capital or increasing timely investment, marketing automation tools help customer retention most affordably. Some of the ways marketing automation tools can be used to the advantage of the insurers to ensure retention are:
A great way to create a lasting impression is through an impactful welcome email sent to customers who go on board with your company. With powerful CTAs and attractive templates, welcome emails can help you acquire customer loyalty.
Reminding customers about their renewal dates and the benefits of their policies during the active policy period not only helps customers remember their renewal dates but also presents an opportunity for insurers to promote newer policies and services.
Birthday or anniversary
Personalized emails in business go a long way! Wishing your customers or providing them with special offers on their birthdays or anniversaries is a highly effective marketing skill to keep your customers happy and accurate to your brand.
You can grow customer retention with weekly emails sent to your customers, speaking about policy updates or newer offers to keep them aware of the updates and build a compelling presence. Email campaigns can also be scheduled for interested customers who do not currently have a policy with you but have come across your website and requested a quote.
Feedback emails are a great feature of marketing automation tools as they help you learn about your policies and how customers perceive them. This allows you to make necessary improvements to existing policies and largely retain customers. This makes the customers feel heard and important, contributing to greater customer satisfaction.
Newsletters are sent to customers on new updates or blogs on the company website to drive more website traffic. Marketing automation tools can send customers newsletters and keep them engaged. You can send newsletters weekly, monthly, or quarterly, maintaining a rapport with your customers.
Start retaining your customers today!
Insurance companies' primary focus is customer retention, as they know the lucrative nature of the industry and the growing competition. Therefore, to drive sales and retain existing customers, insurers must adopt effective strategies that cater to customer needs and give insurers a competitive edge in the market.
With marketing automation tools contributing to higher open rates of about 86%, an increase in click-through rates by 196%, and 320% more revenue compared to traditional email models, they have become an important marketing tool, along with other no-code tools and date intelligence software in place. If you are preparing for success in the lucrative insurance market in the next few decades, stay ahead of your competitors with proven marketing strategies to help you retain your existing customers and draw in newer ones.