Segmentation - Merkle

SegmentationCustomer Strategy DoneRight

Welcome: Customer Strategy BreakoutSanjay MehraVice President of Analytics and Customer ManagementDirect BusinessMetLifeLeah van ZelmPrincipal ConsultantManagement Consulting GroupMerkle2

Objective• Demonstrate elements of cCRM Customer Strategy from the general session– MetLife’s segmentation solution– Translation of the segmentation solution into strategy• Share examples of segment strategy driving marketing, sales, service3

BackgroundMetLife developed a new direct-to-consumer life insurance channel to address theunderserved Middle Market.Agents / Brokers Underserved Market Direct BusinessMetLife traditionally soldlife insurance via agentsand brokers, who tend tofocus on a more affluentaudienceThe company recognizedan underserved middlemarket, broadly definedas 25-45 years old and$150K income or lessMetLife developed a newchannel – direct toconsumer – to serve themiddle market* Online ** Call Center *4

Challenges with Original Targeting StrategyThe Middle Market consisted of individuals 25 -45 years old with a household incomeunder $100k, but MetLife needed more insights than what was available at launch.Go-to-Market SegmentsChallenges• Not rich enough to inform customer engagement• Not actionable enough to drive execution – e.g., notdemographically distinct• Too many segments to actively manage• Individuals outside of the “Middle Market” werebecoming customers, but weren’t assigned a segment5

What Segmentation Solution Did MetLife Need?MetLife engaged Merkle to develop Enterprise segmentation – it had to be strategicAND tactical in nature.StrategySegment PrioritizationCustomer EngagementValue PropositionMedia Budget AllocationProduct PlanningBrand StrategyCompetitive StrategyTacticsTactical TargetingCustomized TreatmentMessaging & CreativeMedia Offline BuyingOffer PresentationTactical TargetingPositioningSolution• Richness: attitudes,needs, behaviors, brandrelationships, mediausage• Attributable at theindividual level• Universal view ofinsurance market• Monetary view of value6

The SolutionAfter extensive requirements gathering, we used a combination of primary research,advanced analytics, and strategy development to deliver the solution.ApproachValue AnalysisPrimaryResearchClustering &MappingCustomerStrategyBuild valueanalysis based onpolicy revenue,acquisition cost,survival model+Develop predictedvalue model toassign toprospectsDeeplyunderstandattitudes tied tolife insurance+Needs,purchasingbehavior, brandrelationships,brand imagery,psychographicsCluster onmotivations+Link surveyresponse tonational file anddevelop segmentassignment model+Robust profilingOverall portfoliostrategy+Segment specificstrategies7

The SegmentsThe resulting five segments proved attitudinally differentiated and demographicallydistinct.YoungAchieversConcernedMomsFinanciallyMatureHoHumSoloContentDemographicsYoungerYoung, Middle AgeMatureMiddle AgeMatureSkews maleMostly femaleSkews maleMostly femaleMale and FemaleAttitudesEarly adopters,technicalDriven, Risk takerPrice sensitiveUse social media,but not otherwisetechnicalDon’t know whereto beginPrice sensitiveRecognize value ofinsuranceConfident aboutfinancial mattersLeast pricesensitiveLate adoptersRisk averseNot primarydecision makersand not thinkingabout LIUse social mediaMistrustful offinancial inst.Least interest in LI8

Young Achievers Strategy and JourneySegment StrategyObjective: Fill the funnelPositioning: Like your parents before youPrograms: Heavy digital focusSegment Specific ExperienceBetterFasterCheaper10

Implementing Segment Strategy2013 RoadmapSegment Q1 Q2 Q3 Q4 2014General • Workshop • LTV update• Case mgmtexperience• Quote toolenhancements• Seg Website• MMO by segment• Non Buyerprogram• Segmentperformanceevaluation• Processimprovement• eDeliveryYoungAchiever• Call Cnt Trng• DRTV spot• Ratings andReviews• Display• Landing page• Prod Roadmap• Online AppRedesignConcerned Mom• Call Cnt Trng• DRTV spot• Display• Landing page• Prod Roadmap• Onboarding• Call routing test• Online AppRedesign11

Example: Concerned Mom’s landing pageThis Concerned Mom’s specific landing page will be used in conjunction with a displaycampaign targeting this segment.Relevant tipsFamily focusSimplicityAffordability12

Anonymous Digital TargetingProspectingPurchasePixelModelingAnonymousBrowsingVisitor Becomesa LeadBack EndMatching / IdentifyMost AttractiveLeadsAnonymoususer with similarcharacteristicsis served an ad13

Example: CSR TrainingAwareness of segmentsHow to engage them14

Example: DRTV spot “Real People”Concerned MomYoung Achiever15

Example: Media Planning• Integrated segments into agency’smedia planning tool• Did this by assigning MRIresponders to segments• Agency changed network andprograms purchased• Led to CPL being cut in ½16

Product ResearchSegment Motivations• Link existing motivations,beliefs, and decisionmaps to product featuresthrough “laddering”• Identify resonantcommunicationapproaches to promote itonce readyProduct Features & BenefitsProduct Roadmap• Unlike more traditionalresearch techniques, theladdering approachallows organic ideationand provides a richframework in which todevelop productelements and positioning.• Focus on target segments17

OutcomeStrategic and Tactical TargetingStrategySegment PrioritizationCustomer EngagementValue PropositionMedia Budget AllocationProduct PlanningBrand StrategyCompetitive StrategyTacticsTactical TargetingCustomized TreatmentMessaging & CreativeMedia Offline BuyingOffer PresentationTactical TargetingPositioningSolution• Invest primarily in twosegments• Anonymous digitaltargeting• EM/DM by segment18

OutcomePersonalizationStrategySegment PrioritizationCustomer EngagementValue PropositionMedia Budget AllocationProduct PlanningBrand StrategyCompetitive StrategyTacticsTactical TargetingCustomized TreatmentMessaging & CreativeMedia Offline BuyingOffer PresentationTactical TargetingPositioningSolution• Segment engagementstrategies• Website personalization• Call center personalizationand “scripting”• Online tools19

OutcomeMessaging and CreativeStrategySegment PrioritizationCustomer EngagementValue PropositionMedia Budget AllocationProduct PlanningBrand StrategyCompetitive StrategyTacticsTactical TargetingCustomized TreatmentMessaging & CreativeMedia Offline BuyingOffer PresentationTactical TargetingPositioningSolution• DRTV spots• Digital creative, customlanding pages• Social campaign20

OutcomeMedia Budgeting, Planning, BuyingStrategyTacticsSolutionSegment PrioritizationCustomer EngagementValue PropositionMedia Budget AllocationProduct PlanningBrand StrategyCompetitive StrategyTactical TargetingCustomized TreatmentMessaging & CreativeMedia Offline BuyingOffer PresentationTactical TargetingPositioning• Media mix optimization bysegment• Segments integrated intomedia planning tool• DRTV buys21

OutcomeOffer StrategyStrategySegment PrioritizationCustomer EngagementValue PropositionMedia Budget AllocationProduct PlanningBrand StrategyCompetitive StrategyTacticsTactical TargetingCustomized TreatmentMessaging & CreativeMedia Offline BuyingOffer PresentationTactical TargetingPositioningSolution• Product development• Product positioning• Bundling considerations• Next best offer22

OutcomePositioningStrategySegment PrioritizationCustomer EngagementValue PropositionMedia Budget AllocationProduct PlanningBrand StrategyCompetitive StrategyTacticsTactical TargetingCustomized TreatmentMessaging & CreativeMedia Offline BuyingOffer PresentationTactical TargetingPositioningSolution• Segment attitudes drivepositioning• Brand measurement bysegment23

Thank You!Q & ASanjay Mehra –smehra1@metlife.comVice President of Analytics and Customer ManagementDirect BusinessMetLifeLeah van Zelm – lvanzelm@merkleinc.comPrincipal ConsultantManagement Consulting GroupMerkle24