Cover Story: In the Right Market
AIG Travel Guard simultaneously has succeeded in growing the share of business it attributes to consumer direct sales. “We’ve gone from the consumer part of our business being less than 5 percent of our business to being nearly 20 percent now of our total,” says Mueller.
This development is critical to the company’s bottom line because customer acquisition costs are considerably lower in the direct channel than those incurred when selling travel insurance through retail or wholesale partners.
And, of course, the intelligence AIG Travel Guard derives from its use of analytics and modeling has been applied to every stage of the marketing process. “We make sure our print advertising is placed in publications that really match … this type of customer makeup. Online partners are selected based on the type of visitors that they have that match our customer criteria,” explains Mueller. “The key phrases that we use in our paid search are developed based on the type of customer and the phrases that these people would use. It’s our roadmap … our gospel.”
Berggren summarizes the fundamental change in AIG Travel Guard’s direct marketing: “It was kind of a shotgun approach in years past. Now we’re more of a laser pointer, marketing just toward those people that are likely to respond.”
Having enjoyed such remarkable success, the company is now considering ways to up the ante in its quest to find the “right” prospects, including identifying the most profitable individuals among those who match the AIG Travel Guard customer profile.
“That’s the next evolution of this system …We’ll be able to eventually load in our claims data to find out whether the people on these lists are profitable,” Mueller says. “We’re not there yet, but it’s definitely on the radar.”
Amy Syracuse is a London–based freelancer, who profiled Live Nation in the December 2007 issue. Read the article at www.targetmarketingmag.com/r?s=82651.