6 Tips for Avoiding a Social Media Debacle

Progressive's "robotweet" debacle put a spotlight on social media's importance within the insurance industry and the risk companies take if they do not implement a sound social media strategy.

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Insurance executives in IT and marketing know that social media is a double-edge sword. It is a fantastic way to build customer engagement, communicate in a timely manner and to enhance the brand, but it also can enable miscommunications, complaints and a poor image. The blowback against Progressive Insurance when a series of cold-hearted-sounding “robotweets” it issued regarding its responsibilities toward a deceased policyholder angered the customer’s brother – and his followers in the blogosphere – shows how easily social media prowess can turn into clumsiness. Here are six recommendations for how insurers can avoid social media missteps and what they need to do to optimize the service, engagement and branding potential of this channel.

1. Engage, Don’t Broadcast

There is a difference between using social tools to broadcast a message versus to engage with customers / prospects. The Progressive situation is another example of old media habits being used with new social technology. The mass media model is a company using a large megaphone (advertising budget) to shout their message out to anyone within earshot / eyesight of the TV, radio, computer or print. If there is any response, individual voices are not heard as they are not loud enough. Companies can choose to use social as a broadcast engine (robotweets). However, they must be prepared for the response to an unwelcome message -- a thousand, ten thousand, or a million individual voices drowning out the megaphone on social platforms in a very visible, transparent (and loud) way.

Social media is best used as an engagement tool – not a better way to broadcast, but a better way to engage with people for their benefit – add to their interests, meet their needs, serve their purpose. For companies/individuals using social media as a broadcast tool, they need to be prepared for unintended consequences.

— Mike Fitzgerald, Senior Analyst, Celent

Source: Celent

Katherine Burger is Editorial Director of Bank Systems & Technology and Insurance & Technology, members of UBM TechWeb's InformationWeek Financial Services. She assumed leadership of Bank Systems & Technology in 2003 and of Insurance & Technology in 1991. In addition to ... View Full Bio

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