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Direct Marketing
      Launch Plan
     Presented to:




June 7, 2012             1
Agenda
 Background and Objectives

 Online Insurance Marketplace
   ‒ Competitive Landscape

 Key Considerations
   ‒ T...
Background
We all agree that:

   Integrating new Direct Response media channels will lead to a successful
    launch of ...
Business Objectives
 Primary Objective:
   ̵   Introduce new media channels to launch 1800 Life Insurance.com to
       d...
Online Insurance Marketplace
          Overview




                               5
Online Life Insurance Marketplace
        Life Insurance Market:
  Annual DRTV and Digital Advertising
                   ...
Competitive Landscape

                                          Established in
                     1985, the company pio...
Competitive Landscape
                       Media Type                     Spend*
                                       ...
Competitive Landscape
                                    AccuQuote:
                                     Direct Response...
Competitive Landscape
                                    Matrix Direct:
                                     Direct Resp...
Key Considerations
     Target Insight




                      11
One target, four distinct personas
       Jared, 37               Diane, 47                  Brian, 31 & Kim, 29    Charle...
Commonalities are Identified
 Charles (52) & Maria (50)                              Jared (37)




Diane (47)
           ...
Cross-channel
Communication is Considered
            Following our prospect throughout their Day
                     Get...
Approach to Market
    Media Strategy




                     15
Optimizing Traditional Marketplaces…
Media Horizons’ long standing relationships with our media partners affords our clien...
…in Tandem with Dynamic Marketplaces
Engines that learn over time where new consumers can be found
algorithmically and val...
Moving Toward an Optimal Media Mix
      Strategy begins with a 2 week Phase I and rolls out over phases
      Goal: Cre...
Recommended 2013 Brand Launch Plan
     Channel                             January    February      March         April  ...
MHI Creative Overview

The Media Horizons design team concepts creative with direct response
   principals in mind, incorp...
Brand Collateral Rate Card
Logo/Brand Identity Development
Strategic Brief:                          5 Hours     $975
Proj...
Digital Rate Card
Flash Banners                                                    Email
Concept, client revisions and ani...
Pilot Approach: Digital
Strategies

   Intelligently target users who are in-market for term insurance


   Leverage dat...
Pilot Approach: Digital (cont.)
Tactics
       Modeling & Targeting:

        ̵   Build lookalike models from existing Hi...
Phase I Approach: SEM
Strategies

   Efficiently and effectively pace campaign spend over the course of the month
    –  ...
Phase I Approach: SEM (cont.)
Testing & Reporting:

   Test segmenting program spend via top-performing geographies and
 ...
Phase I Approach: Broadcast
Competitive Analysis:
   Based on industry competitive research, Select Quote had control of ...
Phase I Approach: Broadcast
Approach to Market:
   Utilize :60 creative length spot for launch (with some testing of a :3...
Approach to Market
Analytics & Attribution Strategy




                                   29
Measurement Tools
 Proprietary HorizonView reporting and analytics system
  ̵   Order attribution
  ̵   Digital tracking
...
Measuring
                  Cross-Channel Convergence

                                                                   ...
Appendix A:
Competitive Landscape




                        32
External Pressures:
                       Insurance Industry
         MetLife               Northwestern                N...
Life Insurance Marketplace
In 2011, life insurance sales reached the highest reported growth margins in
the past 30 years....
Trends in the Life Insurance
               Marketplace
   Shift from term to permanent insurance among insured adults – ...
Customer Adoption
        Recent shift among insured adults from buying term life insurance to
        permanent life insu...
Competitive Landscape
    2010 Top 10 Insurance Companies:                                        2010 Top 10 Insurance Co...
Competitive Landscape
                                       Top 10 Life Insurance Companies
                             ...
Competitive Landscape
Top 10 Insurance Companies Based            Top 10 Insurance Companies Based
 on Broadcast Advertisi...
Competitive Landscape
                                Media Type                       Spend*
                       Broad...
Competitive Landscape
                                Media Type                      Spend*      New York Life:
         ...
Competitive Landscape
                       Media Type                    Spend*
           Broadcast
           Print
  ...
Competitive Landscape
                                                                            ING – Life Insurance:
  ...
Competitive Landscape
                         ING: Digital Flash Creative




Source: Kantar Media

                     ...
Competitive Landscape
                       Media Type                     Spend*     Prudential:
            Broadcast  ...
Competitive Landscape
                       Prudential: Digital Flash Creative




Source: Kantar Media

                ...
Appendix B:
Digital References




                     47
What is a DSP?
       A demand-side platform is a system that allows advertisers to manage
       multiple ad exchange and...
What is a Dynamic CPM?
  On every ad call, the Exchange holds an auction to find the highest paying
  ad to serve. What se...
Real-time Bidding: Example
                 Decision Tree
Data shows that consumers at this publisher and at this time of ...
What is a Universal Smart Tag?
   Acts as a “container” and management tool for all adserved media
    programs


   Pro...
Appendix C:
Sample Audience Insight Reports
           (Digital)




                                  52
Attribute Importance
   Geographic location (DMA, region, and state) and connection
    speed are the most important pred...
Audience Analysis:
                High/Low Responders
High-Responder Audience      Low-Responder Audience
• Connection Sp...
Connection Speed
 Wireless is the best performing connection speed.  This
  makes sense: people who connect to the intern...
By DMA
       The campaign is carefully targeted to a small number of major
        market DMAs. Of these, Seattle is by ...
By Region
 Regional performance is  determined by the
  performance of the targeted DMA in that region.
  Consequently Pa...
By State
 As with region, performance of the states is driven by the
  performance of the targeted DMAs.
   180          ...
By Browser Type
 Chrome is the standout, performing much better than the
  other three browsers.
       250              ...
By Operating System
 Windows 7 is the best performing OS.                      Older versions of
  Windows do not perform...
By Hour of Day
 Performance is best from 12 pm – 6 pm, and worst from
      12 am – 9 am. This is typical for a B2C campa...
By Day of Week
 Performance is substantially worse on the weekends.
 140                                                 ...
By Employment Class
       Higher income employment groups generally perform better
        (although the “management” gr...
By Urbanicity Class
   Although this variable is strongly influenced by the model’s
    geo-targeting it reveals an impor...
By Nielsen Social Group
 Nielsen Social Group is a demographic variable
  determined by income and location. The best Soc...
By Nielsen NE
   Nielsen NE is a demographic variable determined by age,
    income, location, and family size. The best ...
Lifestage Group
 Lifestage Group is the final Nielsen variable.
                                              It shows
  ...
Appendix




           68
Bibliography
   Kantar Media. Copyright 2012.

   ORC International. Ref. 666107 April 24, 2012

   http://www.limra.co...
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  1. 1. Direct Marketing Launch Plan Presented to: June 7, 2012 1
  2. 2. Agenda  Background and Objectives  Online Insurance Marketplace ‒ Competitive Landscape  Key Considerations ‒ Target Insights  Approach to Market ‒ Media Overview ‒ Creative Overview ‒ Data and Analytics Overview  Next Steps 2
  3. 3. Background We all agree that:  Integrating new Direct Response media channels will lead to a successful launch of 1800 Life Insurance  Key performance metrics (CPQRF and CPARF) have been consistently weakening over the past 24 months  In conjunction with weakening performance, media spend and monthly lead volume has also been in decline 3
  4. 4. Business Objectives  Primary Objective: ̵ Introduce new media channels to launch 1800 Life Insurance.com to drive direct term life insurance sales in US market  Secondary Objective: ̵ Create brand awareness in support of brand/product launch  Learning Objectives: ̵ Identify optimal mix for driving cost-effective sales at scale ̵ Increase overall lead volume ̵ Address Agent Attrition issue 4
  5. 5. Online Insurance Marketplace Overview 5
  6. 6. Online Life Insurance Marketplace Life Insurance Market: Annual DRTV and Digital Advertising  Insurance companies spent over $18 million for DRTV advertising Spend over the 2011 Calendar Year  Insurance companies spent over $10 million for online advertising over the 2011 Calendar Year  Select Quote leads the DRTV category making up approximately 70% of the spend  AccuQuote leads the Digital category making up approximately 95% of the spend Source: Kantar Media 6
  7. 7. Competitive Landscape Established in 1985, the company pioneered the direct marketing of Term Life Insurance. Today Select Quote claims to be America’s #1 Term Life sales agency. Founded in 1995, Since its Matrix Direct offers an excellent inception in 1986, AccuQuote has selection of personalized life established a leading position in the insurance quotes from highly-rated market. AccuQuote sells a variety life insurance companies. of types of life insurance policies, as well as selected annuities. 7
  8. 8. Competitive Landscape Media Type Spend* SelectQuote: Broadcast Radio $4,249,500 $783,400  Direct Response Ads: – Offer: Online $48,800 – Free insurance quote Total Advertising Spend $5,081,700 – CTA: * Spend is calculated from October 2011 – March 2012 – Easy to Understand – Clearly Visible in Ad – Not always a click through, sometimes a phone number  Ads emphasize: – Need to protect family’s future – Different stages of life – Just Married – New Baby – New House – Raise – Lose your job Source: Kantar Media 8
  9. 9. Competitive Landscape AccuQuote:  Direct Response Ads: – Offer: – 70% in savings – Free quote – Prominent CTA: – Short and consistent – Easy to Understand – Clearly Visible in Ad  Ads place a strong emphasis on the need to protect your loved ones in your absence Media Type Spend* Online $5,441,200 Print $325,200 Broadcast $295,700 Total Advertising Spend $6,062,100 * Spend is calculated from October 2011 – March 2012 Source: Kantar Media 9
  10. 10. Competitive Landscape Matrix Direct:  Direct Response Ads: – Offer: – 70% in savings – Free quote – Prominent CTA: – Short – Easy to Understand – Clearly Visible in Ad  Ads place a strong emphasis on the need to protect your family’s future Media Type Spend* Broadcast $1,007,800 Radio $173,300 Online $15,800 Total Advertising Spend $1,196,900 * Spend is calculated from October 2011 – March 2012 Source: Kantar Media 10
  11. 11. Key Considerations Target Insight 11
  12. 12. One target, four distinct personas Jared, 37 Diane, 47 Brian, 31 & Kim, 29 Charles, 52 & Maria, 50  Minneapolis  City Suburb  Colorado Springs, CO  Austin, TX  Married  Independent  Young Couple  Teenage Children  Two young kids  Career Minded  Newborn  Real Estate Equity  Professional  Commuter  Starter home  Second Generation  Wife is homemaker  One Adult Child  Dual incomes  Upscale Dual Income  Sports Family  Multi-generational Home 12
  13. 13. Commonalities are Identified Charles (52) & Maria (50) Jared (37) Diane (47) Brian (31) & Kim (29) 13
  14. 14. Cross-channel Communication is Considered Following our prospect throughout their Day Getting Dressed Media: TV, Radio, Smartphone AM Commute Media: Radio, Billboards, Transit Posters, Newspapers Smartphone, iPad Lunch Media: Email, Web Browsing, Smartphone Mail PM Media: TV, Magazines, Catalogs Home Media: TV, iPad, Smartphone 14
  15. 15. Approach to Market Media Strategy 15
  16. 16. Optimizing Traditional Marketplaces… Media Horizons’ long standing relationships with our media partners affords our clients access to premium content and custom solutions at deeply discounted rates  Up to 75% off published rate cards  Premium media properties purchased at direct response rates  “First look” access to new opportunities  Custom solutions for “360” integration in cross-platform publications  Maximize impressions with minimum investment 16
  17. 17. …in Tandem with Dynamic Marketplaces Engines that learn over time where new consumers can be found algorithmically and value impressions accordingly in a real-time bidding environment http://www.lumapartners.com/resource-center/lumascapes-2/ 17
  18. 18. Moving Toward an Optimal Media Mix  Strategy begins with a 2 week Phase I and rolls out over phases  Goal: Create a cross-platform infrastructure for driving incremental orders at scale Week 1-2 Phase I • Benchmark strategic Stabilize & Optimize and diagnostic +Week 3 measures • Apply Phase I media tactics Test and Learn • Establish a performance baseline to remainder of budget +Week 5 • Apply DR best • Eliminate wasteful inventory • Add/subtract channels, partners, practices and heavy up in top price models DR performing placements Platform • Apply operational • Leverage triggered/rules-based best practices • Roll-out creative best messaging practices (e.g. dynamic • Programs at maximum creative) • Gain visibility into optimal media mix potential and scale • Direct Customer Database CRM initiatives Phase I PHASE II PHASE III PHASE IV 18
  19. 19. Recommended 2013 Brand Launch Plan Channel January February March April May June July - December Paid Search Spend $125,000 $100,000 $90,000 $90,000 $90,000 $90,000 Cost Per Lead $110 $105 $105 $105 $105 $105 Leads 1,136 952 857 857 857 857 Digital Marketing Spend $62,500 $75,000 $105,000 $105,000 $137,515 $172,000 Continually optimize mix to maximize performance Cost Per Lead $95 $95 $85 $85 $85 $85 across all channels. As budget grows, possibly Leads 658 789 1,235 1,235 1,618 2,024 incorporate DR Radio and DR Print DRTV Spend $62,500 $75,000 $90,000 $105,000 $122,500 $140,000 Cost Per Lead $125 $105 $100 $100 $100 $100 Leads 500 714 900 1,050 1,225 1,400 Total Budget Spend: $250,000 $250,000 $300,000 $300,000 $350,000 $400,000 Continue to SCALE SPEND as results improve Total Cost Per Lead: $108.97 $101.79 $100.25 $95.47 $94.60 $93.44 While DECRESING Cost Per Lead Total Leads: 2,294 2,456 2,992 3,142 3,700 4,281 And INCREASING number of Leads Total Spend Paid Search Only: $250,000 $250,000 $250,000 $250,000 $250,000 $250,000 Total Cost Per Lead Paid Search Only: $110 $110 $110 $110 $110 $110 Total Leads Paid Search Only 2,273 2,273 2,273 2,273 2,273 2,273 Difference Spend: $0 $0 $50,000 $50,000 $100,000 $150,000 Difference Cost Per Lead: -$1.03 -$8.21 -$9.75 -$14.53 -$15.40 -$16.56 This is a WINNING Scenario Difference Leads: 22 183 720 870 1,427 2,008 Note: JFM scenario assumes no incremental budget to launch new channels Would need to address natural Agent Attrition issue prior to ramping up spend
  20. 20. MHI Creative Overview The Media Horizons design team concepts creative with direct response principals in mind, incorporating best practices for eliciting response from our clients’ target audiences All new creative development projects include: - Presentation of two concepts - Three rounds of revisions on one selected concept - Proofreading - Coding (digital) - Final file preparation and release to printer/publication (print)  Rates do not include purchase of rights-managed talent, audio, artwork or photography 20
  21. 21. Brand Collateral Rate Card Logo/Brand Identity Development Strategic Brief: 5 Hours $975 Project Management: 20 Hours $2,250 Creative Development: 20 Hours $4,500 Graphics Production/Illustration: 16 Hours $2,000 Grand Total Logo Development: $9,725 DRTV Rate Card Short Form Creative Development (:60 and :30 spots) Creative Brief/Strategy Development: 10 Hours $2,000 Project Management: 40 Hours $4,500 Creative Development: 50 Hours $11,500 Producer (Pre-Production): 5 Hours $575 Grand Total SF Creative Development: $18,575 Short Form Creative Production (:60 and :30 spots) TBD Based on Chosen Creative Concept: $85,000 - $150,000 21
  22. 22. Digital Rate Card Flash Banners Email Concept, client revisions and animated back up GIFS Copywriting, design, client revisions and coding $1,800 per concept (HTML and text) $2,000 per set (300 x 250, 160 x 600, and 728 x 90 units) $175 for each resize thereafter Landing Pages Rich Media Copywriting, design, client revisions and coding. Does not include form functionality Created based on approved flash concept in one size $2,800 per page Starting at $2,500 per concept depending on functionality Functionality menu: Revisions - Product carousel General revisions to copy and/or artwork not requiring - Video layout/format changes - Social sharing (Facebook, Twitter, forward to a friend) - Polling $175 per banner - File download (coupon, PDF) $175 per email - Data capture $175 per landing page - Alerts (text, email price drop alerts) - Calendar reminders Examples include: - Dynamic feeds (store locator, product selector) - Promo code update - Expandable (expands beyond the dimensions of the banner - Price change space upon user interaction) - Call to action change - Overlay (appears to “float” over web page content on a - Product shot update transparent background layer) 22
  23. 23. Pilot Approach: Digital Strategies  Intelligently target users who are in-market for term insurance  Leverage data from trusted sources to connect ads with primary targets as they surf the internet, creating targeted reach at direct response rates  Identify incremental audience segments that look and behave like original target audience defined by retargeting and/or 3rd party data sources 23
  24. 24. Pilot Approach: Digital (cont.) Tactics  Modeling & Targeting: ̵ Build lookalike models from existing High Value Customers to determine selects for online targeting in display, email and lead-generation:  Race/Ethnicity  Profession  Age  Dwelling Type  Education Level  Credit Forecasting  # of Children in HH  Life stage: New Mortgage, New Parent, Newly Married, Recently Divorces ̵ Utilize abandoner and search retargeting ̵ Intersect users who have demonstrated an interest in specific product categories as measured by user’s online browsing, search activity, and purchase activity (including activity at 1-800-Insurance.com)* ̵ Secure pay for performance media (where available) ̵ Utilize Dynamic creative to customize the conversation for a diverse target set  Buying & Optimization: ̵ Predictive and real-time bidding: algorithmically optimizes audience design, budgets and bid pricing in real-time ̵ Dynamic optimization: Use of conversion, exclusion and retargeting pixels for immediate and on-going campaign optimization based on a deduped order count* *Assumes pixels can be dropped. 30 day view-through / click-through window recommended 24
  25. 25. Phase I Approach: SEM Strategies  Efficiently and effectively pace campaign spend over the course of the month – Refine spend via a day-parting analysis – Determine optimal use of budget  Expand top-performing components while working to improve or eliminate under-performing segments  In addition to Google and Bing, PPC campaign can incorporate Facebook, Yelp and other venues  Maximize Search results through coordination with other marketing efforts (digital and traditional)  Ensure effective mobile campaign component with dedicated account and budget 25
  26. 26. Phase I Approach: SEM (cont.) Testing & Reporting:  Test segmenting program spend via top-performing geographies and markets  Ongoing testing including A/B, ad copy, landing page – Work with web designer to ensure landing pages are optimized for conversion  Consider test campaigns in Spanish, Mandarin or other languages  Content Targeting Test – Placement could include sites catering to new parents, retirement planning, etc.  Reporting: – Get Call Center data to help monitor campaign success – Consider implementation of Google Analytics 26
  27. 27. Phase I Approach: Broadcast Competitive Analysis:  Based on industry competitive research, Select Quote had control of the advertising space for 2011, spending nearly 4 times the amount the next competitor, Matrix Direct. Combined, the category spent more than $18 million in SF DRTV in 2011 for a placement of more than 25,000 spots.  More than 90% of the spend focused on a :60 creative length spot, with the balance split between :30’s and :120’s.  The total category spend for 2011was split across Cable TV, Spot TV and Syndication, with Cable TV accounting for 88% of the total spend.  Full analysis completed, comparing the following categories for each advertiser: ‒ Top 10 stations, based on frequency of air ‒ Local broadcast market selection ‒ Breakdown by daypart (cable & spot) ‒ Total units and airings by daypart 27
  28. 28. Phase I Approach: Broadcast Approach to Market:  Utilize :60 creative length spot for launch (with some testing of a :30 in phase 2 of plan)  Focus majority of spend on Cable TV category, targeting combination of stations and markets with successful competitive usage but also testing into niche “look-alike” stations and markets based on demographic profile of current usage.  Utilize competitive research to also do a deep-dive on creative executions of all competitive ads during creative development process  Phase 1 plan includes initial test flight of weeks 1 and 2, followed by initial optimization in weeks 3 and 4. Full optimization of plan achieved by week 7 28
  29. 29. Approach to Market Analytics & Attribution Strategy 29
  30. 30. Measurement Tools  Proprietary HorizonView reporting and analytics system ̵ Order attribution ̵ Digital tracking ̵ Model development ̵ Lifetime Customer Value analysis (LTV) and CRM ̵ Mail delivery tracking ̵ Call center lead scoring and performance analysis ̵ Call center & financial forecasting 30
  31. 31. Measuring Cross-Channel Convergence  Challenge: channel attribution is necessary but doesn’t work for optimization. “The customer is channel agnostic 1.”  Risk: optimizing out of “contributing” media exposures prior to a conversion can adversely impact sales volume  Solution: evolving attribution methodology to include “assist conversions” or fractional cross-channel attribution Source: Visual adaption of Impact Radius chart, October 2011 http://www.impactradius.com/blog/insight/marketing-challenges-in-2012-3-truly-integrating-online-and-offline-media.html 31
  32. 32. Appendix A: Competitive Landscape 32
  33. 33. External Pressures: Insurance Industry MetLife Northwestern New York Life ING Prudential Source: Kantar Media 33
  34. 34. Life Insurance Marketplace In 2011, life insurance sales reached the highest reported growth margins in the past 30 years. Other Notable Trends: Mean Life Insurance Coverage*  2008 financial crisis caused a large $180,000 decline in life insurance sales $160,000  In 2010, insured individuals owned $140,000 on average $154,000 of total life $120,000 insurance coverage. $100,000 Any**  In 2010, the average amount of $80,000 Individual*** individual insurance coverage $60,000 Group decreased by two times that of group coverage – $12,0000 vs. $6,0000 $40,000 $20,000 $- 1992 1998 2004 2010 * Coverage is in 2010 dollars. ** “Any” includes individual, group and service members’ coverage (SGLI/VGLI) *** Includes life insurance sold face-to-face and through direct means. Sources: PR Web & ORC International 34
  35. 35. Trends in the Life Insurance Marketplace  Shift from term to permanent insurance among insured adults – when a period of a term policy ends people are less likely to extend/renew the coverage – Single men and women, husbands and wives are more likely to rely on permanent insurance as their only individual life insurance – Almost 2 in 3 insured adults have some permanent insurance as part of their individual life portfolios  Adults carry enough insurance to replace their personal incomes for an average of 3.6 years – High-income adults carry the most life insurance in terms of the lengths of time they can replace their personal incomes – Men with personal incomes of over $100,000 can replace their incomes for the longest time – Middle-income women with personal incomes of $50,000 to $99,999 carry the smallest amounts of life insurance in relation to their personal incomes  In 2010, only 1 in 10 insured adults owned both permanent and term insurance 35
  36. 36. Customer Adoption Recent shift among insured adults from buying term life insurance to permanent life insurance; however term still represents 65% of coverage Types of Individual Life Insurance (Insureds) Single* Total Adults Men Women Husbands Wives Single* Men Women 2004 2010 2004 2010 2004 2010 2004 2010 2004 2010 2004 2010 2004 2010 Permanent Only 44% 53% 42% 52% 45% 54% 41% 49% 45% 52% 46% 68% 42% 70% Term Only 37% 37% 37% 36% 37% 37% 35% 38% 37% 39% 40% 23% 41% 25% Both 19% 10% 21% 12% 18% 9% 24% 13% 18% 9% 14% 9% 17% 5% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Any Permanent 63% 64% 63% 64% 63% 63% 65% 62% 63% 62% 60% 77% 59% 75% Any Term 56% 47% 58% 48% 55% 46% 59% 51% 55% 48% 54% 32% 58% 30% Other Notable Trends:  Term life insurance sales trending down  Majority of term insurance purchased by 25 – 44 year olds  Low rates for younger people, much higher rates for  Sales have increased in the 55+ age group older people Source: ORC International & LIMRA Research 36
  37. 37. Competitive Landscape 2010 Top 10 Insurance Companies: 2010 Top 10 Insurance Companies: Term Life Issued ($ 000s) Term Life in Force ($ 000s) 2010 Rank Company/Group Term Life Issued 2010 Rank Company/Group Term Life In Force 1 ING USA Life Group $87,007,767 1 RGA Group $1,522,897,986 2 Northwestern Mutual Group $86,438,585 2 Aegon USA Group $1,385,368,401 3 Metropolitan Life & Affiliated Cos $81,526,493 3 Swiss Reins Group $1,354,102,348 4 State Farm Life Group $65,878,257 4 Prudential of America Group $966,331,508 5 Primerica Group $64,995,079 5 Metropolitan Life & Affiliated Cos $931,059,999 6 NY Life Group $55,807,875 6 ING USA Life Group $886,667,849 7 Prudential of America Group $53,336,104 7 Munich Amer Reassurance Co $737,169,920 8 Aegon USA Group $50,878,605 8 Northwestern Mutual Group $714,869,453 9 SunAmerica Financial Group $40,852,125 9 Genworth Finl Group $708,049,456 10 Legal & Gen America Group $39,543,526 10 SunAmerica Financial Group $657,839,965 Source: ORC Inernational 37
  38. 38. Competitive Landscape Top 10 Life Insurance Companies Based on Overall Advertising Spend Company Total Advertising Spend* Metlife Inc. $75,993,600 New York Life $62,224,700 Northwestern Mutual $54,318,700 AARP $47,465,000 Mutual of Omaha $14,543,500 State Farm Mutual $13,386,500 Prudential Financial Inc. $10,337,200 Nestle SA (Gerber) $9,429,000 Allstate $9,247,600 Massachusetts Mutual $6,815,500 * Advertising Spend time period: March 2010 to March 2012 Source: Kantar Media 38
  39. 39. Competitive Landscape Top 10 Insurance Companies Based Top 10 Insurance Companies Based on Broadcast Advertising Spend on Online Advertising Spend Company Term Life Issued Company Term Life Issued MetLife $65,350,300 MetLife $8,174,000 AARP $43,818,600 AARP $3,402,800 Northwestern Mutual $38,085,500 Prudential $2,147,500 New York Life $17,105,100 Nestle SA (Gerber) $1,691,300 State Farm $12,882,800 Allstate $976,800 Lincoln Heritage $7,914,200 HSBC $845,300 Nestle SA (Gerber) $6,289,200 Mass Mutual $370,700 Allstate $3,589,500 USAA $365,400 Prudential $2,323,200 New York Life $323,100 Aviva $1,267,700 Aviva $295,400
  40. 40. Competitive Landscape Media Type Spend* Broadcast $65,350,300 Online $8,174,000 MetLife: Print Radio $930,600 $143,300  Direct Response Ads: – Offer Total Advertising Spend $74,598,200 – Rates as low as $14/month * Spend is calculated from March 2010 – March 2012  Ads emphasize: – Protecting family Source: Kantar Media 40
  41. 41. Competitive Landscape Media Type Spend* New York Life: Print Broadcast $41,618,100 $17,105,100  Direct Response Ads: – No offer Radio $3,162,100 – Passive CTA: Online $336,100 – “Learn how” Total Advertising Spend $62,221,400 – “Click here for more information” * Spend is calculated from March 2010 – March 2012  Ads emphasize: – Low cost – Industry reputation – Securing your future Source: Kantar Media 41
  42. 42. Competitive Landscape Media Type Spend* Broadcast Print $38,085,600 $16,196,600 Northwestern Mutual: Online $33,500  Brand Awareness Ads: Radio $3,600 – Click through but no clear CTA Total Advertising Spend $  Ads emphasize: * Spend is calculated from March 2010 – March 2012 – Building a foundation for the future Source: Kantar Media 42
  43. 43. Competitive Landscape ING – Life Insurance:  Direct Response Ads: Media Type Spend* – No offer Digital 36,700 – CTA: * Spend is calculated from March 2010 – March 2012 – Easy to Understand – Clearly Visible in Ad – Passive  Ads emphasize: – Need to protect family’s future  Flash ads speak to protecting yourself at different stages of life (See next slide) – Marriage – Education Costs – Family Source: Kantar Media 43
  44. 44. Competitive Landscape ING: Digital Flash Creative Source: Kantar Media 44
  45. 45. Competitive Landscape Media Type Spend* Prudential: Broadcast $2,323,200  Direct Response Ads: Print $2,253,100 – Offer: Online $2,147,500 – Free insurance quote Total Advertising Spend $6,723,800 – CTA: * Spend is calculated from March 2010 – March 2012 – Easy to Understand – Clearly Visible in Ad  Ads emphasize: – Need to protect family’s future  Flash ads speak to protecting yourself at different stages of life (See next slide) – New House – Education Costs – Family Source: Kantar Media 45
  46. 46. Competitive Landscape Prudential: Digital Flash Creative Source: Kantar Media 46
  47. 47. Appendix B: Digital References 47
  48. 48. What is a DSP? A demand-side platform is a system that allows advertisers to manage multiple ad exchange and data management accounts through one interface. By utilizing a DSP, marketers can access and manage bids for banners via a DSP’s “seat*” on an exchange, as well as the pricing for the data that they are layering on to target their audiences. Additionally, much like Paid Search, using a DSP allows marketers to optimize based on set Key Performance Indicators. Source: http://en.wikipedia.org/wiki/Demand-side_platform *While Valueclick is not a DSP, they have their own exchange seats and competing optimization technology 48
  49. 49. What is a Dynamic CPM? On every ad call, the Exchange holds an auction to find the highest paying ad to serve. What sets this auction apart is the dynamic pricing option for advertisers. Dynamic pricing ensures that the price an advertiser pays for an impression is tied directly to the value of the impression to that advertiser. The DSP’s ad server predicts the probability of a user’s response to a particular ad, calculates a bid price tied to the value, and determines whether the creative passes the test of ROI. Source: http://www.adgile.com/dynamic-cpm-pricing/ 49
  50. 50. Real-time Bidding: Example Decision Tree Data shows that consumers at this publisher and at this time of day are 3x more likely to engage with the brand Engine learns over time where new consumers can be found algorithmically 50
  51. 51. What is a Universal Smart Tag?  Acts as a “container” and management tool for all adserved media programs  Provides real-time pixel “fire” based on deduped order count within a pre- defined “look back” window  Delivers cross-program path to conversion, exposure to conversion and time lag to conversion insight  Enables “enterprise level” reporting  Reduces page load time 51
  52. 52. Appendix C: Sample Audience Insight Reports (Digital) 52
  53. 53. Attribute Importance  Geographic location (DMA, region, and state) and connection speed are the most important predictors of campaign success. Nielsen NE (demographic variable) and browser are also significant. Connection Speed DMA Region State Nielsen NE Browser 0 0.2 0.4 0.6 0.8 1 1.2 53
  54. 54. Audience Analysis: High/Low Responders High-Responder Audience Low-Responder Audience • Connection Speed • Connection Speed - Wireless - DSL • DMA • DMA - Seattle - Honolulu • Region • Region - Pacific Northwest - Pacific • State • State -Washington -Hawaii • Nielsen NE • Nielsen NE - Brite Lites, L’il City - Upward Bound • Browser • Browser - Chrome - Internet Explorer 54
  55. 55. Connection Speed  Wireless is the best performing connection speed. This makes sense: people who connect to the internet on a wireless service as most likely to be eligible and interested in the advertiser’s service. 800 45% 700 40% 35% 600 30% 500 25% 400 20% 300 15% 200 10% 100 5% - 0% Cable Broadband DSL Wireless Mobile T1 Other Index % of Imps 55
  56. 56. By DMA  The campaign is carefully targeted to a small number of major market DMAs. Of these, Seattle is by far the best performing. Honolulu, Raleigh, and Baltimore under-index. 180 40% 160 35% 140 30% 120 25% 100 20% Index 80 15% % of Imps 60 10% 40 20 5% 0 0% Houston, TX Baltimore, MD Seattle-Tacoma, Raleigh et al, NC Honolulu, HI WA DMAs with at least 1% of Imps 56
  57. 57. By Region  Regional performance is determined by the performance of the targeted DMA in that region. Consequently Pacific Northwest (Seattle) is the best performing region and Pacific (Hawaii) is the worst. 180 40% 160 35% 140 30% 120 25% 100 20% 80 15% 60 10% 40 20 5% - 0% South Central Mid Atlantic Pacific Northwest Southeast Pacific Index % of Imps 57
  58. 58. By State  As with region, performance of the states is driven by the performance of the targeted DMAs. 180 40% 160 35% 140 30% 120 25% 100 20% 80 15% 60 10% 40 20 5% 0 0% Texas Maryland Washington North Carolina Hawaii Index % of Imps 58
  59. 59. By Browser Type  Chrome is the standout, performing much better than the other three browsers. 250 60% 50% 200 40% 150 30% 100 20% 50 10% - 0% IE Firefox Safari Chrome Other Index % of Imps 59
  60. 60. By Operating System  Windows 7 is the best performing OS. Older versions of Windows do not perform well. 160 45% 140 40% 35% 120 30% 100 25% 80 Index 20% % of Imps 60 15% 40 10% 20 5% 0 0% Windows XP Windows Vista Windows 7 Macintosh Other 60
  61. 61. By Hour of Day  Performance is best from 12 pm – 6 pm, and worst from 12 am – 9 am. This is typical for a B2C campaign. 160 18% 140 16% 14% 120 12% 100 10% 80 8% 60 6% 40 4% 20 2% 0 0% 12-2:59 am 3-3:59 am 6-8:59 am 9-11:59 am 12-2:59 pm 3-5:59 pm 6-8:59 pm 9-11:59 pm Index % of Imps 61
  62. 62. By Day of Week  Performance is substantially worse on the weekends. 140 15.20% 15.00% 120 14.80% 100 14.60% 14.40% 80 14.20% 14.00% 60 13.80% 40 13.60% 13.40% 20 13.20% - 13.00% Sun Mon Tue Wed Thu Fri Sat Index % of Imps 62
  63. 63. By Employment Class  Higher income employment groups generally perform better (although the “management” group under-indexes). 160 35% 140 30% 120 25% 100 20% 80 15% 60 10% 40 20 5% - 0% Management Professional White Collar, Mix WC, Service, Mix BC, Service, Mix Mostly Retired Index % of Imps 63
  64. 64. By Urbanicity Class  Although this variable is strongly influenced by the model’s geo-targeting it reveals an important fact: town/rural users do not perform. 140 40% 120 35% 30% 100 25% 80 20% Index 60 % of Imps 15% 40 10% 20 5% - 0% Suburban Second City Urban Town/Rural Town Rural 64
  65. 65. By Nielsen Social Group  Nielsen Social Group is a demographic variable determined by income and location. The best Social Groups are “Urban Uptown” and “Inner Suburbs” 200 16% 180 14% 160 12% 140 120 10% 100 8% 80 6% 60 4% 40 20 2% - 0% Index % of Imps 65
  66. 66. By Nielsen NE  Nielsen NE is a demographic variable determined by age, income, location, and family size. The best performing groups are younger and wealthier, with families. 250 6% 5% 200 4% 150 3% 100 2% Index % of Imps 50 1% 0 0% 66
  67. 67. Lifestage Group  Lifestage Group is the final Nielsen variable. It shows Clearwire succeeding in young to middle aged groups. 140 18.00% 16.00% 120 14.00% 100 12.00% 80 10.00% 60 8.00% 6.00% 40 4.00% 20 2.00% 0 0.00% Index % of Imps 67
  68. 68. Appendix 68
  69. 69. Bibliography  Kantar Media. Copyright 2012.  ORC International. Ref. 666107 April 24, 2012  http://www.limra.com/newscenter/newsarchive/archivedetails.aspx?prid=229  Person-Level Trends in U.S. Life Ownership http://media.hbwinc.com/pdf/Person_Level_Trends_in_U.S._Life_Insurance_Ownership_2011.pdf  Person-Level Trends in U.S. Life Ownership http://media.hbwinc.com/pdf/Person_Level_Trends_in_U.S._Life_Insurance_Ownership_2011.pdf  “Term Sales Seen Rebounding-Again,” National Underwriter Life/Health, July 9, 2002  http://daniel-workman.suite101.com/average-term-life-premium-rates-for-men-and-women-age- 18-to-24-a343081  http://www.insweb.com/life-insurance/life-stages-life-insurance.html  Northwestern Mutual Life Insurance Co. report based on research conducted by Mathew Greenwald & Associates, November 2010  “Intelliquote, and the Life Insurance Industry as a Whole, Experience Records Growth in 2011; a Trend that is Expected to Continue,” http://www.prweb.com/releases/intelliquote/life-insurance-sales/prweb9523564.htm 69
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