Evaluating the online inquiry response strategy of the...

BACKGROUNDAs consumers increasingly search

for products and services online,

insurance carriers and other B2C

(Business-to-Consumer)

organizations continue to strive to

capture this new breed of

“online” consumer. Velocify

hypothesized that although

insurance companies were

successful at marketing their

products and services, actually

converting these newly interested

consumers into paying customers

has been an area of ongoing

struggle.

In order to evaluate the state of

the industry, Velocify conducted a

secret shopper experiment

targeting 10 specific carriers. To

begin, Velocify researchers visited

each of the targeted insurance

carrier’s websites and submitted

their contact information

expressing their interest in

purchasing insurance. Once a lead

was submitted, each communication attempt from the carrier was carefully logged for evaluation and assigned a grade based on

how it performed in 4 key areas when compared against Velocify’s best practices.

Customer Acquisition 101: Grading Insurance Carriers

EXECUTIVE SUMMARY Velocify commissioned a “secret shopper” experiment to gauge how effectively insurance carriers respond to online inquiries. After

collecting data to measure the consumer response strategies of a sample of 10 carriers, Velocify compared it against established

best practices and then assigned grades based on the performance of 4 Key Performance Indicators (KPI’s). Although the

performance of the sampled carriers varies widely, the results indicate that the consumer follow-up strategies employed by the

average insurance carrier are not reaching their true potential due to lack of swift follow-up and due persistence.

F

CompanySpeed-to-Contact

CallSpeed-to-Contact

Email

Report Card

A

Evaluated By:Industry:

D

D

C

C

C

D

A

B

C

C

C

D

F

D

A-

B-

B-

C+

D

D

D-

Lead Nurturing

BD B-

The grading methodology for this study consists of the average performance of each company in each area and across all inquiries, compared against established Velocify best practices. To learn more, please reference page 5 and 6 of this study.

The 4 benchmarked Key Performance Indicators (KPI’s): Speed-to-Contact Attempt by (1) Phone & (2) Email: The average speed to respond to an inquiry

(3) Lead Nurturing Capabilities: The average number of nurture emails sent

(4) Number of Call Attempts: The average number of contact attempts via telephone

Insurance Velocify

D

A

A

A

A

A

D

F

F

B

C

F

C

C

B

D

F

D

F

A

D

F

C C-D

Number of Contact Attempts (Call)

OverallGrade

Company B(Revenue: $6 Billion)1

Company G(Revenue: $1 Billion)1

Company A(Revenue: $14 Billion)1

Company J(Revenue: $35 Billion)1

Company H(Revenue: $29 Billion)1

Company C(Revenue: $20 Billion)1

Company I(Revenue: $31 Billion)1

Company F(Revenue: $4 Billion)1

Company E(Revenue: $1 Billion)1

Company D(Revenue: $25 Billion)1

1: Annual revenue calculated in US dollars for 2009

Velocify ResearchWWW.VELOCIFY.COM | (888) 856-0534

Copyright © Velocify, Inc. All rights reserved. This material may not be published, reproduced, broadcast, rewritten, or redistributed without expressed written permission.

01

Evaluating the online inquiry response strategy of the average insurance carrier

After one month of collecting and logging

relevant data, Velocify researchers

calculated the average speed-to-contact

attempt, average number of nurture

emails, and average number of contact

attempts made by each of the 10 carriers.

By comparing the findings against the

established best practices (found on page

5 and 6), Velocify was able to evaluate the

The first KPI measured in this study was

speed-to-contact attempt, which

consisted of benchmarking how quickly

each carrier responded to a consumer

both by phone and by email. B2C

organizations that immediately respond

to consumer inquiries enjoy a wide range

of benefits that yield positive results both

in the short and long term. For

example, when a consumer is contacted

moments after they submit a request for

information, they are most likely to be

engaged, interested and receptive. By

speaking with them at this time of

heightened receptiveness, an agent is

more likely to convince the consumer,

and therefore make a sale. Even if the

consumer decides that they do not want

d

ay

s

Best P

ract

ice

Avera

ge

1

2

3

4

5

6

7

Speed-to-Call (Days)

d

ay

s

Best P

ract

ice

Avera

ge

1

2

3

4

5

6

7

Speed-to-Email (Days)

no emails sent

(Company-Wide Average) (Company-Wide Average)

FIGURE A FIGURE B

effectiveness of each carrier’s online

consumer response strategy and

compare it against its competitors.

Due to the established correlation

between contacting a lead and

converting a lead, the objective of the

study was to measure the response

strategy during the pre-contact period

(after an inquiry has been made, and

prior to when any actual contact is

made). It is important to note that the

Velocify researchers posing as

interested consumers at no point

responded to any of the

communications made by the

insurance carriers.

RESULTS

to purchase immediately, B2C carriers

can look forward to the fact that

consumers are more likely to return to

the first organization to contact

them–even if they decide to “price-shop”

or look elsewhere. Since information

about competing organizations is often

just a click away, educating consumers

and providing responsive customer

service allows organizations to forge

strong social and psychological bonds

that can mean the difference between a

sale and a missed opportunity.

Figure A and B above illustrate the

average time it took for each carrier to

respond to consumer inquiries via phone

and via email. Considering that Velocify

best practices dictate that

speed-to-contact is an important driver

of lead conversion and that contacting

a lead within 1 minute results in a

391% improvement in conversion

rates, it is quite startling to observe that

the average response time for both

email and phone calls clocked in at

around 2 days. In an age where instant

gratification is the norm, responding to

a consumer after such a long time

should be considered unacceptable,

regardless of the type of product or

service that is being sold.

Like speed-to-contact, the amount of

contact attempts an organization

makes for each lead and its ability to

CCD

F

FFF

F

F

CDD

A A

D

A A ABB

Velocify recommends responding to inquiries within 1 minute after receipt. (See p. 5 for a detailed overview.)

A B C D E F G H I J

companyA B C D E F G H I J

company

Velocify recommends responding to inquiries within 1 minute after receipt. (See p. 5 for a detailed overview.)

Customer Acquisition 101: Grading Insurance CarriersEvaluating the online inquiry response strategy of the average insurance carrier



02

nurture leads by email contribute

substantially to a successful consumer

response strategy. Velocify best

practices (referenced on page 5 and 6)

indicate that calling leads exactly 6 times

raises the chance of contact to 93% (The

6 Call Standard). By establishing a higher

probability of contact, an organization

can maximize each lead’s value and thus

convert more leads from existing

marketing investment. Also, they can

gain a 350% improvement in lead

conversion rates simply by sending 2-4

nurture emails to each lead. This simple

and affordable way to reach out to

consumers should be considered a

necessary tool for any B2C organization.

The results collected in this study, and

referenced in Figure C above, provide

evidence that many carriers are not up to

par when it comes to ensuring that

enough call attempts are made. In fact,

the average number of phone contact

attempts across all carriers was found to

be fewer than 2 attempts per lead,

indicating that many carriers are

neglecting leads that they are not able to

tota

l a

tte

mp

ts

tota

l e

ma

ils

Best P

ract

ice

Avera

ge

1

2

3

4

5

6

7

Number of Call Attempts Per Lead

Velocify recommends attempting contact via telephone exactly 6 times.(See p. 5 for a detailed overview.)

Best P

ract

ice

Avera

ge

1

2

3

4

5

6

7

Number of Nurture Emails Per Lead

no emails sent

(Company-Wide Average) (Company-Wide Average)

FIGURE C FIGURE D

contact immediately and therefore

missing out on revenue that could have

been gained with a little more

persistence. The majority of carriers

made less than 1 call per lead, with only

two carriers approaching the

recommended 6 Call Standard –

averaging roughly 4 calls per lead.

It is also clear from the data that the

email nurturing strategy of many of the

carriers is not much better than their call

strategy. In fact, the average number of

emails sent per lead across all the

carriers was benchmarked at just under

1 email, falling well below Velocify’s

recommendation of 2-4 emails per lead.

Only one carrier measured actually fell

within the suggested range; averaging

2.6 emails per lead, while another

company failed to collect email

addresses at the point of inquiry and

therefore did not have the opportunity to

send any nurture emails.

ConclusionThis study provides evidence that the

current consumer response strategies

employed by the average insurance

carrier fail to meet the standard best

practices established by Velocify, and

are therefore negatively impacting

performance. At a granular level,

Velocify found that many carriers are

simply not quick enough when

responding to consumer inquires and

are not persistent enough in both

attempting phone contact, and

nurturing via email. Improving speed,

process, and persistence holds the

potential of dramatically improving

customer acquisition for insurance

carriers and other B2C organizations.

Although it may be true that these

carriers are relatively successful in

their acquisition of new customers, our

research sheds light on how these

carriers, and other B2C organizations

in general, can refine their strategies

and standards to take their consumer

response strategy even further.

D

C

A

DCD

A

D

CD B

A

DDCC

F

CCB

A B C D E F G H I J

companyA B C D E F G H I J

company

Velocify recommends sending between 2-4 nurture emails per lead. (See p. 5 for a detailed overview.)




03

How does your organization stack up?

Velocify graded 10 leading insurance carriers by

evaluating the 4 Key Performance Indicators (KPI’s) of a

successful online consumer inquiry response strategy.

The 4 KPI’s include speed-to-contact attempt (phone and

email), email nurture performance, and number of

telephone contact attempts.

Current consumer inquiry response strategies utilized by

insurance carriers were found to be subpar when stacked

against Velocify best practices.

Fostering a strategy that enforces quick response times,

an appropriate volume of contact attempts, and adequate

lead nurturing, can maximize an organization’s potential

sales and revenue.

Paying particular attention to the sales workflow after a

lead has expressed interest in a product can have

significant impact on a carrier’s bottom line.

Interested in learning more about the research cited in

this study? Visit Velocify.com/whitepapers to access our

entire research collection.

KEY INSIGHTS

Founded in 2004 and headquartered in Los Angeles, Calif., Velocify

develops software as a service (SaaS) solutions for managing sales

leads. Distinguished by its focus on solutions that address the

unique needs of businesses who sell to consumers, Velocify is

recognized as a market and technology leader, managing more than

25 million leads for over 5,000 clients.

With a suite of solutions scaled for small to enterprise organizations,

the company offers the industry’s most comprehensive and

configurable lead management platform.

Velocify enables companies to distribute, track, analyze, and

convert sales leads using a customizable lead management

workflow. Professional services, including training and process

consulting, are also offered to deliver a highly effective solution for

converting sales leads. Businesses look to Velocify for solutions that

allow them to maximize their investment in leads generated online

and from traditional sources, and ultimately increase sales closure

rates for greater revenue.

For more information, visit www.velocify.com.

ABOUT VELOCIFY

Visit Velocify.com/GradeMe for a free, no obligation analysis to see how your organization “stacks up” against Velocify’s proven best practices.




04

Velocify Best Practices: Benchmarks Measured

Speed-to-call and speed-to-email are essential components of any sound inquiry response strategy. In an increasingly competitive Internet age where consumers have access to many different market options, following up quickly is one of the most important factors to successful consumer sales.

Velocify research has shown that speed-to-contact is an important driver of lead conversion: Responding to leads within 1 minute resulted in a 391% improvement in conversion rate.Beyond Qualification: The Impact of Speed on Lead Conversion Rates | April 2010

Sending nuture emails to consumers that have expressed interest but who may not be immediately ready to buy, is a cheap, easy, and effective way to acquire new customers that would otherwise be missed.

Velocify research shows that leads that receive email nurturing have a 3.5 times higher chance of converting than those that receive none. Additionally, leads that receive 2-4 emails convert 42% better than those that receive less than 2.Velocify Analysis | February 2010

Speed-to-Contact – Best Practices

Lead Nurturing – Best Practices

*Although Velocify emphasizes that a good lead nurturing strategy should last longer than 30 days, the study measured email nurturing within a 30 day window because we believe the time frame is a strong indicator of a carriers overall lead nurturing strategy.

0:00+0% +200% +300% +400%

0:30

m

inu

tes

improvement in lead conversion rate

leads called in under 1 minute +391%

14%20%

8%

con

ver

sion

rat

e (%

)

conversion rate vs. nurture emails sent

< 2 emails 2 - 4 emails 5 > emails0%

10%

20%

Data

Data

Strategy

Strategy

(continued)

Don’t wait to attempt contact with a lead who expresses interest. Reaching out to them immediately (within the �rst minute) allows your organization the best chance of converting them into a customer. Even if your staff is not able to keep up with the high volume of leads on a particular day, an instant automated email acknowledging that someone will reach out to them soon can mean the difference between a conversion and a lost opportunity.

Fact: Only 4 out of 10 carriers studied had automated instant email capabilities.

A+

Fact: The carriers measured in this study sent an average of only 1 email per lead.

If your company does not automatically respond to every lead via email upon receipt of a lead, your company is certainly missing out on signi�cant new revenue. Nurturing your clients between 2-4 times via email is an important component of a successful consumer response strategy.




05

Velocify Best Practices: Benchmarks Measured

Getting Leads From Your Web Properties? Here’s an Online Approach That Works.

To an online consumer, your website is the face of your company and it is important to keep it simple, attractive, and useful. Your website should be designed to move a consumer through a simple 3 step process (outlined below).

Attract Educate Capture(1) Attract: Getting a consumer to your website is one thing, but keeping

them there is another. Create a website that is aesthetically pleasing, but not overwhelming.

(2) Educate: Provide your consumer with education about your products and reasons why they should do business with you. Don’t make consumers work for information; empower them with easily digestible facts and tools.

(3) Capture: Now that you have a lead’s attention, provide a simple contact form that allows a consumer to disclose as much information as they are willing to disclose. Don’t limit how much information you can collect, the more information a lead provides, the greater the chance of contact.

Opps, Arie. “Focus on ‘User Experience Optimization’.” Entrepreneur 05 Feb. 2010: Web. 12 Oct. 2010.

Fact: 2 out of 10 companies measured in this study failed to collect basic contact information from a consumer when making an inquiry online (phone number or email address).

Online Consumer Engagement – Best Practices

Maximize the value of each lead by attempting contact 6 times. Giving up too soon or spending too much time on ultimately unproductive leads can signi�cantly undercut an organization’s new client acquisition potential. Velocify research found that making 2 calls versus just 1, increased the chances of contactinga lead by 87%, and that calling 6 times (The 6 Call Standard) resulted in nearly the maximum possible contact rate, with minimum opportunity costs.Six Calls Equals Success: The surprising Impact of Call Frequency on Lead Conversion | November 2009

Call Frequency – Best Practices

20%

40%

60%

80%

100%

1 2 3 4 5 6

6th call attempt93% chance

1st call attempt39% chance

0-5 mins

30 mins-2 hrs

2.5-4 hrs day 3 day 4 day 11-12

2nd call attempt72% chance

contact attempts (calls)

con

tact

pro

bab

ilit

y

(cu

mu

lati

ve)

Data

It should be every organization’s priority to attempt to contact each lead via telephone 6 times. By following this 6-call approach, your organization is maximizing the value of each lead while minimizing wasted effort.

Fact: The average carrier attempted only 1.7 calls and sent only 0.9 emails per lead.

Strategy




06

WPVY1011

Evaluating the online inquiry response strategy of the...

Documents

Transcript of Evaluating the online inquiry response strategy of the...