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End Affinity Group Cannibalization, AmWINS Group Benefits’ Fleet urges
July 30, 2007 – Warwick, RI and Stowe, VT – At a time
when association membership is on the decline, Samuel Fleet, CEO,
AmWINS Group Benefits, today warned practitioners of affinity group
marketing to drastically modify their strategy or face extinction.
“We have been and continue to cannibalize each other,” Fleet said on July 27, at the Professional Insurance Marketing Association’s (PIMA) 2007 Summer Conference in Stowe, Vermont. He suggested that attendees instead create opportunities by developing niche products and apply their core expertise to new markets.
“Wake up and smell the coffee: Ozzie and Harriett-era insurance marketing is a dead-end when the prospects we target today gather in Google Groups or on MySpace pages,” Fleet added.
Fleet’s “state-of-the-state,” of traditional association programs (professional societies and trade associations) describes declining membership, demographic changes, commoditization of core products, and a mature market. Plus, increased competition from dot-com insurance sites and carrier direct selling puts added pressure on TPA business.
Fleet suggests that the argument to declining association membership can be countered by the fact that they have only changed in nature, style, and substance. There are people joining groups and participating in a different way than in the past. These changes are coming from the younger generations and immigrant populations, which do not see a welcome mat from traditional American associations, so they form their own affinity groups.
Fleet said to the PIMA conference that in order to create sustainable growth opportunities, TPAs and carriers must look to these other affinity groups, develop new products and redesigned marketing initiatives. He also suggests carriers practice group underwriting, take risks on new ideas and offer flexibility in delivery.
Some of the market opportunities include banks and credit unions, employers, even online communities, such as Yahoo! or Facebook groups. Fleet said, “it’s up to us to reinvent the affinity group wheel and create marketing opportunities as the nature of affinity groups have changed. We need to market to more diverse niches, such as cultural groups and community associations, and we should be targeting dog lovers and wine collectors.”
“There is little or no appreciation for the fact that taking over a block of mature business provides for short term gain, but that strategy sacrifices long term success. As industry leaders it should be our mission to create real sustainable growth opportunities,” Fleet added.
AmWINS Group Benefits, formerly known as NEBCO, has developed numerous new market opportunities since its inception in 1994. For example, it pivoted on 1996 FASB requirements by looking at retirees as an affinity group, developed an employer PDP in response to the Medicare-D prescription drug law and developed a new limited medical policy called HealthWINS® to target underinsured and uninsured workers. AmWINS Group Benefits has experienced six straight years of organic growth of 43%.
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“We have been and continue to cannibalize each other,” Fleet said on July 27, at the Professional Insurance Marketing Association’s (PIMA) 2007 Summer Conference in Stowe, Vermont. He suggested that attendees instead create opportunities by developing niche products and apply their core expertise to new markets.
“Wake up and smell the coffee: Ozzie and Harriett-era insurance marketing is a dead-end when the prospects we target today gather in Google Groups or on MySpace pages,” Fleet added.
Fleet’s “state-of-the-state,” of traditional association programs (professional societies and trade associations) describes declining membership, demographic changes, commoditization of core products, and a mature market. Plus, increased competition from dot-com insurance sites and carrier direct selling puts added pressure on TPA business.
Fleet suggests that the argument to declining association membership can be countered by the fact that they have only changed in nature, style, and substance. There are people joining groups and participating in a different way than in the past. These changes are coming from the younger generations and immigrant populations, which do not see a welcome mat from traditional American associations, so they form their own affinity groups.
Fleet said to the PIMA conference that in order to create sustainable growth opportunities, TPAs and carriers must look to these other affinity groups, develop new products and redesigned marketing initiatives. He also suggests carriers practice group underwriting, take risks on new ideas and offer flexibility in delivery.
Some of the market opportunities include banks and credit unions, employers, even online communities, such as Yahoo! or Facebook groups. Fleet said, “it’s up to us to reinvent the affinity group wheel and create marketing opportunities as the nature of affinity groups have changed. We need to market to more diverse niches, such as cultural groups and community associations, and we should be targeting dog lovers and wine collectors.”
“There is little or no appreciation for the fact that taking over a block of mature business provides for short term gain, but that strategy sacrifices long term success. As industry leaders it should be our mission to create real sustainable growth opportunities,” Fleet added.
AmWINS Group Benefits, formerly known as NEBCO, has developed numerous new market opportunities since its inception in 1994. For example, it pivoted on 1996 FASB requirements by looking at retirees as an affinity group, developed an employer PDP in response to the Medicare-D prescription drug law and developed a new limited medical policy called HealthWINS® to target underinsured and uninsured workers. AmWINS Group Benefits has experienced six straight years of organic growth of 43%.
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