Use of Social Networking Sites is Catching on for Some Voluntary Players, according to an Eastbridge Report

AVON, CONNECTICUT, USA (November 19, 2009)

Marketing through social networking sites such as Facebook, Twitter, and Linkedln can be a useful resource for businesses—big and small—and a powerful communication tool. Still, the jury is out on how effective these sites are in the insurance industry and the voluntary market, in particular.

Overall, about one-quarter of voluntary players (brokers, carriers, and others) responding to an Eastbridge survey currently use a social networking site, while nearly half are considering one in the near future (with 64 percent of those expecting to do so in the next 12 months). Interestingly, however, the majority who do not currently use a social networking site indicated that they may never do so. “A few carriers have gotten their feet wet into social networking sites,” says Gil Lowerre, president of Eastbridge, “but most aren’t there yet and are not sure that it would be an effective marketing tool for them.”

Carriers and brokers cite lack of time to adequately investigate the use of these sites and lack of funds and/or personnel to operate and monitor the sites as reasons for not using social networking sites today. “Respondents to our survey indicated that they are not sure if the results of having a social networking site are worth the cost and efforts,” says Bonnie Brazzell, vice president.

Most of those using social networking sites do so to promote their name and to attract new brokers and customers. Some also provide information or promote products and/or use the site to communicate with their brokers (70% of the respondents’ sites target current brokers). Only 30 percent of the respondents target employees with their social networking sites. “This is contrary to what those not currently using social networking sites believe,” adds Brazzell. “Those not yet using these sites think that employees are most likely to use the sites.”

In terms of effectiveness, the majority (83 percent) believe that social networking sites do an average job of communicating with their target audience. Just 42 percent, however, said that their sites are effective in marketing the company’s brand and products, with 58 percent rating it “below average” for this category. No respondent ranked the effectiveness of these sites as above average.

The study, Social Networking Websites and Voluntary Companies, is an Eastbridge Frontline Report. Frontline Reports provide timely data on hot or new topics. This report explores the use of social networking sites as a means for marketing and brand promotion in the voluntary market. Copies of the reports are only available to participants and Eastbridge Information Partner companies.

Eastbridge Consulting Group, Inc. is a marketing advisory firm serving insurance and financial services organizations in the United States and Canada.