Numbers Don’t Lie, Marketers Do
If you spend any time in front of the TV nowadays, you are bombarded with marketing designed to get you to take action in some form. Some ads try to sell you something, while some try to sway you to one particular side of an argument or political view. No matter what the issue, statistics and numbers are a powerful way to get a point across. After all, numbers don’t lie.
National insurance marketing is full of “factual” data promising tremendous savings simply by switching your auto carrier. In most cases, the data is probably accurate. The problem with this marketing lies in the intent of the advertisement. It is easy to present this factual data in a number of ways to support whatever side of the argument, political aisle, or transaction the advertiser is on.
Lizards & Cavemen
A certain high profile auto insurance company says that 15 minutes could save you 15%. “15% of what?” you might ask. They want you to think they can save you 15% on the out of pocket cost on your auto insurance. What they really mean is they don’t pay commission to a broker or agent. They would have to charge you 15% more if they were distributed by agents like myself. They don’t know if they can save you money or not. They just want a chance to quote. Like everyone else, they will end up with their proportionate share of the market.Average Savings
Another common number used is average savings. You often hear something like “Those who switched saved an average of ($too good to be true).” Some of these companies even reference customers who switched from a specific competitor. They always make this number sound big, and it often is. The number may even be an accurate representation of savings. The key to this is realizing they are only referencing those who switched. If they didn’t save you money, how often would you switch? Probably never, unless you had a bad experience with your agent, prior company, claims, etc. They may only save money for 10% of the people who call. But, if they just reference those numbers in their ads, they look impressive. So, while the number may be accurate, the depiction of it isn’t. I recently saved a customer of mine approx $1,200 per year on his auto insurance. He was with a very regional company that I had never seen before. I could use this tactic and accurately state that “Those who switched from (his company) saved an average of $1,200 per year”. What you wouldn’t know is that was only one transaction. There is almost no chance I could duplicate that again.What Does it All Mean?
The design of all of this is to pray on the Grass is Always Greener mentality that we all have. They skew these numbers to get you to take action and give them an opportunity. Bottom line is, most of the time, there is very little rate difference from carrier to carrier. It is much more important to have your insurance with a company and agent you can trust and rely on when you need them. You don’t pay your premium to get that piece of paper. Who enjoys reading the policies? You pay your premium to get an insurance company to respond when called upon. You won’t care about that 15% savings if you end up with an uncovered claim. Price should only come into play when all else is equal. Problem is, all else is rarely equal. For added marketing effect, I typed this with a British Accent. -Insurancedude For More from The Insurance Dude – Andy Dillow Catch Andy on Twitter at @Insurancedude Check out all the Albany Insurance Professional Guest Bloggers
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