Social Networking Offers Opportunities, But Can Also Prove Risky For Agencies

Producers and carriers searching for opportunities to develop new clients may find ample opportunities through social networking over the Internet–but there are challenges agencies and companies face as the line between social and business networking blurs, a panel of technology users recently warned.

Demonstrating the strength of the phenomenon, a “secret session” on “Twitter and Social Networking” was held late on the final day of last month's AMS User Group National Conference in Washington, D.C.

To demonstrate the power of Web-based social networking, the session was not listed on the AMS meeting agenda, although hints about it were dropped occasionally throughout the conference. The only way attendees found out about the meeting was either through word of mouth or an online social network such as Facebook or Twitter.

The fact that over 60 people attended the session despite the lack of traditional publicity only underscored the strength of social networking, according to April Feldt, education specialist for AMS Users Group.

The discussion–led by Steve Anderson, an independent agency technology consultant–touched on two main points:

o The benefits of online social networking for generating business and providing information to customers.

o The challenges in controlling the message, as well as potential security issues.

On the benefit side, Nibby Priest, vice president of the Vaughan Insurance Agency in Henderson, Ky., spoke about how important an agency blog was.

In his example, the purpose was to get information out to clients seeking contractors to make repairs after the winter ice storms that hit the region. The electronic networking, he noted, served a dual purpose–distributing information to customers who needed it quickly and easily, and reinforcing the relationship between client and agency.

Reinforcing that relationship, Mr. Anderson noted, also means being smart and honest with your customers. As an example, he cited the response to a question from one of Vaughan Insurance Agency's customers, which the agency honestly answered in its blog–that the ice storms would increase premiums. However, he noted, the agency also pointed out that while increases might not be avoidable, the agency “can help you find more affordable coverage.”

Katie Herbst, senior marketing communications specialist for property-casualty marketing at Ohio-based Westfield Insurance, said the company asked some of its experts to begin writing a blog on topics that agents would be interested in. Once they got started, she said, they found it easy to expand and continue the blog and have come to love writing it.

She also noted how easy it was for the carrier's experts to write the blogs because it is a conversation that is being carried on with agents anyway.

When it comes to writing blogs, Cindy Adams, vice president of information technology for the independent brokerage Holmes Murphy & Associates in Des Moines, Iowa, said that few bloggers start off writing well, but as they become more experienced they expand the blogs and become better at them.

As far as controlling the message, Ms. Herbst said anything negative written about the company by an employee is treated the same way it would be in any publicly published forum.

As the company reviewed the issue of posting items over the Internet, she said, the disciplinary issues they discussed were already in the employee handbook. She added that whatever the rules are that the company develops, they need to promote–not discourage–social networking access over the Web.

A newer form of social networking is Twitter–a quick micro-blog of no more than 140 characters, Mr. Priest explained.

The benefit of Twitter, according to Mr. Anderson, is that people can quickly learn about niche interests, such as the AMS “secret session” demonstrated.

On the security side, Ms. Adams warned that users should avoid putting links into the text of blogs that could lead to questionable sites. She also recommended keeping virus software current–although the first line of defense, she noted, is using common sense.

“The line is blurring between the business and the personal,” Ms. Herbst pointed out, recommending that companies “go slow” when starting social networking outreach programs.

The panelists said agencies and companies need to monitor postings and know what is being said about them, noting that Google and Twitter have feeds that allow users to keep informed about what is being written about their brand online.

“It is worse not to know,” said Ms. Herbst, adding that being aware of any buzz about a company over the Internet should not be confined to social networks.