Running With the Bulls1 Aug, 2014 By: Bridget McCrea Response
Financial services firms continue to leverage multi-channel direct response to keep up in a surging market.
Make no bones about it: J.G. Wentworth is a direct response marketer. “That’s how we describe ourselves — even in our SEC filings,” says Sean O’ Reilly, senior vice president and chief marketing officer for the Radnor, Pa.-based structured settlement payment purchasing firm, whose most recent “877-Cash-Now” campaign was produced by Karlin+Pimsler and features three new television spots that showcase the company’s popular jingle.
“Kash Kahuna” is a takeoff on classic Hawaiian luau. “Guten Tag” features a spin on German beer drinking songs, and “Windows” is a version of an East Village musical performance.
According to O’Reilly, the new campaign also includes a refresh of the J.G. Wentworth 877cashnow.com website and the creation of numerous digital, mobile and social media extensions, as well as a large media spend on national cable networks and broadcast TV. “This new campaign expands on the years of brand investment that have made J.G. Wentworth a household name and the industry leader,” says David Miller, chairman and CEO, JGWPT Holdings Inc. (which also owns Peachtree Financial Solutions), in a company press release.
J.G. Wentworth is one of many financial services firms that are pairing up DRTV’s low-cost and accountability components with digital and mobile opportunities to sign up new customers for its services. In J.G. Wentworth’s case, the company purchases illiquid assets, such as structured settlement payment streams and annuity payment streams, for one lump sum payment to customers. Customers utilize the proceeds to meet life’s changing needs, the most common of which include debt repayment, home purchase, education, auto expenses and medical expenses.
O’Reilly says the company “casts a wide net” in an effort to increase overall awareness for its specific category — both for J.G. Wentworth and Peachtree.
“Both of these brands rely heavily and spend a fair amount of focus on DRTV,” he notes, “with a primary focus of driving qualified leads through the front door.”
Achieving that goal has become more difficult in recent years, namely due to dramatic changes in customer buying cycles and habits. Determining where TV fits into the picture — and exactly what it is “driving” — is equally as challenging. “Right now, there’s a real need to understand the overall attribution model — ultimately to the Web and mobile,” says O’Reilly.
So where TV may spark the consumer’s interest, O’Reilly says recent industry research shows that the potential customer likely does most of her research online. Breaking the cycle down even further, some of that online research will take place on a computer, but the bulk will actually happen on a mobile phone or tablet.
That fragmentation poses special challenges for marketers like J.G. Wentworth. “Understanding the mix between TV and search is a very key part of what we do and what we optimize to,” says O’Reilly. “I think that will only continue to heighten for all marketers as we go forward.”
The Omnichannel Push
With her finger on the pulse of the financial services industry, Cari Gatto, president of New York-based Global Swell Interactive, has worked at American Express and J.P. Morgan Chase — and was most recently a marketing executive at Gerber Life. For the latter, Gatto helped to build out a level of omnichannel functionality that transformed the insurer from a channel-centric focus to one that examined key segments, teased out the value from each, and then took a multi-channel approach to reaching each segment.
While Gatto left that position in January to start her own consulting business, she carries with her a rich vault of knowledge about the intersection of financial services, DRTV, direct mail and digital media.
Like many marketers right now, Gatto is focused on omnichannel and the implications of it for both direct and DRTV marketers. “Omnichannel is really changing the way people think, particularly in terms of data analytics, ROI measurements and campaign effectiveness,” says Gatto, who sees DRTV as a key component for financial services firms looking to leverage the value of omnichannel.
“Credit card companies were some of the pioneers on the direct marketing side because they had to be smart about who they were sending offers to,” says Gatto. “Focused on both the value of the creditworthiness of their target segments, these firms were among the first to use DR as a marketing platform.”
Today, Gatto says most financial services firms continue to use direct mail and — depending on the type of firm in question — DRTV as advertising mainstays. Recipients, however, aren’t responding to such campaigns in the same way that they did 10 years ago.
“They’re not getting something in the mail, filling it out and sending it in,” Gatto points out, “nor are they seeing an ad on TV, calling an 800 number and signing up.”
Instead, they are going online, doing their competitive shopping, and researching their options before making a purchase decision which may happen online, on the phone or through direct mail — regardless of the initial channel of solicitation.
“Customers are using multiple channels as part of their purchasing decisions; it’s not a singular channel anymore,” Gatto says. “For a lot of people, picking up the phone might be the easiest route, but that doesn’t mean they didn’t go online and spend time on a website.”
Where DRTV tends to provide the highest value for financial services firms, according to Gatto, is in its ability to segment an audience and draw valuable data from those segments. Companies must begin with a segmentation strategy and the value of each segment should be quantified.
Based on this data, different marketing activities will be used on a segment-level, says Gatto. “A company should not spend the same amount to acquire a customer worth $500 as a customer worth $5,000,” she notes.
Marketers in the financial services industry are particularly interested in audience segmentation, says Gatto, because unlike a piece of exercise equipment or a skincare product, financial services usually involves an ongoing commitment and often there is a level of risk associated with acquiring a new customer. “Whether it’s a checking account, savings account, credit card or insurance, we’re talking about long-term revenue streams,” says Gatto. “In most cases, consumers make a decision around opening a bank account or taking out insurance coverage — and then stick with it for several years.”
According to O’Reilly, J.G. Wentworth spends a “fair amount of time” understanding the vast amounts of data it collects and then looking at different ways to leverage it. In some cases that means looking at daily call volumes, and in other instances it requires a review of online searches that took place throughout the day. “Ultimately, we’re looking at the interplay among different channels,” says O’Reilly, “and how that drives qualified leads and overall business performance.”
Taking the data discussion a step further, O’Reilly says the real challenge for financial services marketers lies in mixing the art and science of the data itself. “There’s so much out there in the big data landscape right now, but how do we make sense of it and how do we know that we’re measuring the right things?” asks O’Reilly, who points to interest rate fluctuations, consumer confidence and overall buying rates of different media properties as just three of the key data points that J.G. Wentworth watches closely.
“Marketing is a very fluid environment right now,” says O’Reilly, “and one where financial services firms, in particular, have to not only understand the analytics but also the emotional component.”
Media Consumption Patterns
Headquartered in Carmel, Ind., CNO Financial Group is another long-time user of DRTV. With the Bankers Life, Washington National and Colonial Penn brands under its corporate umbrella, CNO Financial Group provides insurance solutions to middle-income working Americans and retirees. According to Chris Campbell, senior vice president of marketing and communications, Bankers Life and Colonial Penn both use direct response, direct mail and digital media extensively to reach their respective audiences.
Campbell says he has an entire team devoted to generating leads for more than 5,000 Bankers Life agents, for example, and an ongoing initiative to re-market DRTV leads with sister company Colonial Penn (whose customers use mail, Web and phone to purchase term and whole life insurance). “That’s the more traditional direct response model,” says Campbell, “where tele-agents are processing sales over the phone.”
Focused on leads generated via DRTV, those agents also handle extensive re-targeting through direct mail programs and upscale upsell campaigns, according to Campbell, who uses different approaches to DR and digital marketing, “depending on which company we’re representing and the market that we serve.”
Within those respective markets, Campbell says he’s picking up on some key trends that are impacting CNO Financial Group’s advertising initiatives. For one, he says media consumption patterns are shifting based on market demographics.
Primarily focused on middle-income Americans, the marketer more closely monitors those patterns. “It used to be something we looked at every few years,” says Campbell, noting that the company has picked up on recent drops in direct mail and broadcast TV consumption. “Now we’re reviewing the media mix every few months to determine what people are using.”
CNO Financial Group is also spending more time on digital marketing these days — an effort that’s greatly sped up the company’s sales process. “It’s exciting because faster is better,” Campbell contends. “Thanks to the Internet, we’re getting the leads and phone numbers within seconds of consumers typing their information in and are able to call them back within minutes. This is a far cry from the days when we sent out letters and waited for consumers to fill out forms and send them back to us.”
That lightning fast speed also allows CNO Financial Group to switch up its ad campaigns on the fly — particularly in the digital realm, where campaigns can be tested and/or altered within minutes versus days or weeks. “This has been very helpful for us because we’re mixing direct sales with an agent force in a world where consumers are becoming more and more omnichannel,” Campbell adds.
By now, he notes, most marketers know that not every consumer is going to watch TV, open mail or surf the Web the same way. “Everyone has different preferences, so we’re expending a lot of energy juggling the interplays across all these different channels,” Campbell says, “and making sure that we’re tracking that same consumer as he switches between responding to television, interacting on the Internet, or having an agent in his home.”
Campbell also has his eye on data analytics and says he’s hiring more data scientists to help dissect and make good use of the information generated by CNO Financial Group on a daily basis. “With digital, the volume of data we’re getting and how quickly we have to process it is straining the organization,” he explains, “so I have a couple of data scientists on board and we’re looking to bring on more just to manage the volume of information.”
Addressable Advertising Ahead
As he looks at the work his firm is currently handling for financial services firms like J.G. Wentworth and the new innovations that are coming down the pike, Mal Karlin pinpoints addressable TV as one trend that marketers should keep an eye on. According to a recent AdAge story, “The CMO’s Guide to Addressable TV Advertising,” the concept finds marketers pinpointing their target audiences and creating a household profile using data such as income, ethnicity, children in the household, and car leases set to expire. They then work with cable operators to determine the number of addressable-enabled households that fit their target and serve commercials to just those homes.
“Addressable advertising is going to be very big, very soon,” says Karlin, president and chief creative officer for the New York-based Karlin+Pimsler. “Within the next year or so, marketers will be able to target their exact customers via their cable boxes or satellite dishes — right to their TVs.”
Someone who is viewing a show in one home, for example, will get a different advertising lineup than the neighbor next door who is watching the same show. “That’s a pretty exciting development,” says Karlin, “and one that presents a lot of potential for the financial services marketer.” ■