Hit auto insurance marketing KPIs – without breaking the bank 

Marketers feel the pressure to deliver on KPIs. They’re continuously tasked with bringing in new customers in order to achieve profitable growth. Unfortunately, auto insurers may view their marketers and advertisers as big spenders. To be fair, it’s hard not to see it that way when carriers invest in ads during The Big Game, which currently cost about $7 million for a 30-second spot.

Furthermore, the industry has faced headwinds over the past few years. With continuing shifts in consumer insurance trends and driving patterns, it’s clear that auto insurance marketers need to rethink their approach to meeting KPIs. Here’s why.

3 problems with auto insurance marketing KPIs

#1 Marketing KPIs may not align with carrier strategies

When the COVID-19 pandemic disrupted our day-to-day lives, auto insurers had to adjust across their businesses. These shifts included fine-tuning their marketing approach. As miles driven shrank, so did advertising budgets. Moreover, when drivers took to the roads again, they did so at even higher speeds. This change in driving behavior caused more accidents and claims in the process. The focus of marketers went from longer-term metrics like lifetime value (LTV) and cost of acquisition (CAC) to short-term tactics like reducing policy growth or stopping advertising entirely in order to remain profitable.

Rather than overcompensating for these market factors, it may be time to blend the two metrics (maybe the LTV-to-CAC ratio) and utilize driving data as a proxy for profitability to optimize for long-term success. This puts insurers in a position to hit their marketing KPIs consistently and sustainably.

#2 Typical auto insurance marketing KPIs overemphasize quantity over quality 

While focusing on short-term metrics like cost per acquisition has become the norm, this can lead to prioritizing the quantity of leads over the quality of leads.

Today, the industry is once again in growth mode. However, some insurers are still emphasizing sheer numbers rather than targeting their best customers. So, shouldn’t carriers focus on customers who will help them reach their long-term goals and provide the highest lifetime value?

#3 Auto insurance marketers must limit wasted spend

Another key issue with neglecting quality is that, on average, carriers don’t close more than 10 to 20% of the consumer traffic that lands on their website through marketing campaigns. That means 80-90% of their marketing spend is ineffective. With more advanced targeting strategies available, insurers can minimize this waste and ensure their marketing budget is spent more efficiently – ultimately improving their chances of hitting KPIs.

Turn big spend into big revenue

If you want to hit your auto insurance KPIs without overspending, one solution could be to rethink your acquisition process. Instead of outright rejecting the customers you can’t insure, you can connect them with carriers who may be able to offer them coverage. By monetizing this process, you can transform that seemingly wasted spend into a revenue-generating opportunity.

Auto insurance marketers may sometimes be big spenders – but they can also be strong drivers of ROI.