Referrals are the lifeblood of many a producer; without them, a life insurance or financial services practice will suffer or atrophy altogether. But as consumers, most especially young millennials, conduct more personal business online, advisors are having a harder time making contact with prospects through conventional methods like word-of-mouth marketing.
Enter KnownCircle.com. Tailored to insurance professionals, the social networking site is designed to let consumers easily find trusted service providers while enabling producers to quickly build a referral-based practice.
To learn more about the web portal, LifeHealthPro Senior Editor Warren S. Hersch recently interviewed Vinay Murthy, vice president-business development of SocialTwist, KnownCircle’s parent company. The following are excerpts.
Hersch: Tell me about SocialTwist. What’s the company’s focus and what prompted the company’s development of KnownCircle.com?
Murthy: Since 2008, more than 50 of the world’s largest brands including Kimberly Clark, Sara Lee, Procter & Gamble, ConAgra Foods, Jamba Juice, Barnes & Noble, and others have worked with SocialTwist to integrate into their marketing efforts low-cost social referral programs: initiatives that spread the word about their brands via prospective customers’ friends and family members.
According to a recent study by Boston Consulting Group, consumers rely on word-of-mouth more than they do paid media advertising: The results of the BCG survey of more than 32,000 consumers in Europe and the U.S. show that 66 percent of the respondents consult friends and family before purchasing — two to ten times more often than they consult paid media advertising.
Big companies understand the power of social referral marketing and are making the most of the technology. That’s generally not the case, however, among small businesses, which don’t know how to use social media to scale up their outreach to potential customers. KnownCircle aims to extend this capability — to help consumers discover professional service providers endorsed by the people they trust.
Currently available to insurance professionals, the site boasts more than 200,000 agency and broker profiles. Over the next few months the platform will expand to include additional professional service providers, including tax preparers, real estate agents, attorneys and others. Hersch: Other social networking sites offer the ability to endorse a provider’s products or services. What distinguishes KnownCircle.com from these other portals?
Murthy: Our mission is to help consumers and service providers find each other at the time of their need and through their trusted connections. It’s these two components that distinguish us.
Of course, agents and brokers may have a presence on other popular social networks, such as LinkedIn and Facebook; as well as on ratings and review sites like AngiesList.com and HomeAdvisor.com.
The challenge for professionals with a presence on, say, Facebook is to connect with their customers and prospects. The value of a “like” is diluted; unless you have a common connection to a service provider, there’s little chance that friends will see your referral.
Likewise, I can’t just go onto LinkedIn to find out, say, which tax preparer a particular friend uses. You may know that your agent or broker is connected to LinkedIn, but it’s very difficult for me, a friend, to find that out.
As a result, people resort to more time-consuming and cumbersome methods: calling or emailing friends and family or carrying out research to locate trusted professionals. The ideal experience is to search for services you’re interested in, and then quickly find providers who are also well known to your friends or family.
From a provider’s point of view, securing an endorsement from customers can be difficult when they have to chase down clients for testimonials. It would be much better to simply secure a one-click endorsement from clients they serve, then leverage their social connections to drive new business. Hersch: Walk me through the site’s functioning. What happens at each step?
Murthy: You email clients to join your known circle, and they accept your invitation with a single click. Thereafter, you can nudge them through the portal to send you referrals, either via email or by endorsing your business on all social media channels.
When that happens, assuming friends of a client are in the market for your services, they simply click on a link that you’ve posted.
Friends may be directed to the profile page of the agent where they can transact business. This is what we call Discovery Wire Referrals. Clients give a referral to your agent, and friends thereby discover the referral. You can also discover an agent via Discovery Wire Search.
Assuming friends come to KnownCircle.com looking for known insurance agents in a particular city, they’ll first see a list of agents there. They then can log into, say, Facebook and see highlighted those agents or brokers who are endorsed by their friends. Thereafter, they can learn more details about the producer and request a quote. The agent will see that he or she and the friend are linked to a particular client — a trusted connection.
Hersch: What other functionality does the site provide?
Murthy: The site’s analytics dashboard can show agents and brokers statistics on people in their KnownCircle, referrals they’ve received in the 30 days, quote requests and leads they’ve closed on.
Incoming leads, generated through a cloud-based server, can be entered into a customer relationship management system for processing. Longer term, we expect to connect the site directly to carriers’ existing CRM software, making lead processing a seamless experience for their agents and brokers.
Hersch: Which carriers’ agents and brokers are accessible through the site?
Murthy: Of the nation’s 300-plus carriers, we now list the top 10 P&C insurers, including multiline companies like State Farm and Allstate. We expect to be adding more auto, home and, not least, life insurers.
We’re also integrating KnownCircle with third-party social networks. The site now interfaces with services of all major e-mail providers, including Google, Microsoft, Yahoo and AOL. So users can easily add contacts to the site from an e-mail database. They can also customize and preview agent recommendations before sending them out. Hersch: What’s your revenue model? How will you make money on the site?
Murthy: Users will receive the service for free. Our plan is to collect a lot of data from the professionals’ referral networks and provide a value-added package that insurance carriers will pay for to facilitate sales and marketing objectives.
Carriers might also use the service as white label solution: that is, offer a dedicated social referral network to their agents. So instead of people coming to KnownCircle.com, they might go to StateFarm.com or AllState.com to avail themselves of agents affiliated exclusively with these carriers.
That being said, we don’t expect to be deriving revenue from the get-go. We’re building up the network from both a provider and consumer standpoint. Once the network reaches a certain critical mass, we’ll be in a better position to offer value-added services. Hersch: How large is the KnownCircle team? What was needed to bring the web portal to fruition?
Murthy: The site has been in the works for several years. The SocialTwist team that developed it consists of about 40 people, of which 15 are dedicated specifically to building the service, including IT, sales and marketing professionals. It’s a big undertaking on the back end.
The site is entirely the initiative of the parent company. SocialTwist leverages an incubation model: The company develops product ideas and business units to realize them. Once the business reaches a certain size, SocialTwist will spin it off as a separate company.
Hersch: Many insurance and financial service professionals remain wedded to traditional word-of-mouth marketing techniques to secure referrals. How much of an impact do you believe KnownCircle will have on the market?
Murthy: What we’re doing is layering technology on top of producers’ referral-generating practices. By automating and scaling up the process, we amplify the power of client recommendations.
Also, though conventional word-of-mouth marketing has worked very well in the past, it’s become increasingly difficult for professionals to connect with young prospects — millennials — in this way. Many of them question the need for an agent and for interfacing with one in person when they already handle so much of their communications online.
In this new world, producers will have to transact more business through online social networking connections. So we expect our site will fulfill a significantly growing need.