Case Study

Background

Southern Cross Travel Insurance (SCTI) is a market specialist insuring hundreds of thousands of travellers and has been in operation since 1982.

The travel insurance industry is currently experiencing wholesale change. Historically travel insurance was sold via travel agents at or near the time of booking, but today, the Internet has made it easier for consumers to identify, evaluate, compare and purchase travel insurance without paying commission.

Situation/Challenges

SCTI, the leading provider of travel insurance in New Zealand, entered the Australian market in April 2009 with a purely online business model.

SCTI faced a number of challenges as an entrant to this highly competitive market, with many established brands already vying for a share of the value conscious consumer’s wallet.

“Being the new kid on the block posed a series of challenges for us,” said Craig Morrison, CEO at SCTI. “We faced large competitors with established online strategies and significant market share. This, coupled with our low organic search results as a new market entrant, meant we had to ensure our search marketing strategy delivered significant results in a short time frame.”

SCTI had some clear campaign objectives for the Australian market. These were to:

• Grow market share to 7% by July 2010, and long term to 10% by EOFY 2011
• Increase sales by 33% above the historical benchmark for the period of the campaign 
• Increase SCTI’s share of voice for the term “travel insurance” from 12th to 4th in search engine rankings

Solution

SCTI required a partner to develop an online search strategy that would carve out considerable market share in this price-competitive industry.
SCTI extended its existing New Zealand relationship with Experian Hitwise to launch into the Australian marketplace.

According to Craig, Experian Hitwise’s search marketing solutions met our requirements across the board. Its existing relationship in the New Zealand market was an important indicator of its ability to deliver results.

“Our move into the Australian travel insurance market was a significant risk for us. We needed to analyse historic web search data and purchasing trends for travel insurance; develop a Pay-Per-Click (PPC) strategy; and integrate this with our TVC advertising schedule. “No other Australian search marketing provider could provide this service,” said Craig.

Search strategy becomes the key driver for integrated marketing plans

Experian Hitwise was central to the strategy and drove the other marketing agencies involved in the campaign.

Experian Hitwise analysed three years of historical travel insurance search and purchasing trends online.
Key insights included:

• The new trend for buying travel insurance commences six weeks prior to travel and concludes two weeks before departure
• There are clearly identifiable peaks in online travel insurance purchase which coincide with known holiday periods
• SCTI experienced a 42% decline in online brand search after the previous TVC campaign ended. As a new market entrant with limited brand awareness, an integrated TVC and PPC campaign schedule was recommended to provide an effective push and pull strategy
• To effectively gain market share, ‘weak’ competitors with unsophisticated search strategies were identified and targeted

Execution: Integrated campaign strategy

Experian Hitwise recommended an unusual and contradictory approach to the common views on PPC advertising: increasing the cost per acquisition (CPA) versus SCTI’s previous PPC campaigns.

Experian’s integrated view of the total campaign generated an improved ROI, from increasing the keyword bidding costs, and improved ad position during the seasonal holiday peak, the period supported by the television campaign. The increase in conversion of highly qualified and brand aware customers who searched online during the TVC campaigns warranted an increase in the bid costs.

The success of the strategy required a tightly integrated, yet fluid TVC and PPC campaign, namely:

Television advertising

• Experian Hitwise intelligence was provided to the media buying agency to ensure TVC placement matched seasonal peaks. This data included optimal times of the year, days of the week and recommended trigger keywords and phrases
• Advertising peaks were scheduled to match the state specific school and public holidays
• Four TVC creatives were used. Experian Hitwise intelligence was used to track which creatives were the most effective as reflected in search terms used by consumers during the advertising period

Pay Per Click (PPC)

• To maximize results, the PPC campaign was staggered after the TVC when online traffic and search was at its highest
• Online campaign messaging was developed in collaboration with the TVC agency to ensure consistency of message, maximise click through rates and to ultimately drive highly qualified visits to the SCTI website
• The PPC bidding strategy focused on positions to maximise click through rates and ultimately ROI. Analysis showed that the number one ad position would not necessarily deliver the highest ROI and consequently this position was avoided
• PPC budgets were increased during peak periods
• PPC ad-text, keywords and bidding price were continually modified to improve performance

Further to the agreed execution strategy, the disruption to European air travel from the Icelandic volcano had an immediate impact on the searches for travel insurance online – extending the strength and duration of demand for travel insurance beyond the anticipated pre-holiday period.

Experian Hitwise immediately identified this trend and updated its bidding strategy and budgets to capitalise on this changing behaviour.”

Benefits

The campaign achieved excellent results against its stated goals, notably market share, ROI, sales and profitable customer acquisition during the six week campaign period.

Market Share:

• Grew market share of the online travel insurance market from 5.96% to 9.11%
• This growth of 53% outperformed the campaign and short term objective (7%) by 30%
• The market share performance was so strong it nearly achieved SCTI’s long term objective of 10% by June 2011, six months ahead of schedule

Return on Investment:

• The campaign was delivered within the budget spend and generated a ROI of 200%

Sales:

• Sales for the campaign period grew 43% which was 10% above the campaign objectives

Profitable Customer Acquisition:

• The campaign successfully demonstrated that contrary to popular industry views, increasing the cost per acquisition (CPA) can be commercially beneficial
  CPAs have a ceiling price limit per click to avoid budget blowouts
• The CPA grew within agreed campaign limits and increased sales volume at a faster rate than PPC costs, growing profits
• The CPA was low and below industry benchmarks

Share of Voice:

• SCTI’s share of voice for the term “travel insurance” increased 7 places from 12th to 5th on search engine rankings, demonstrating the power of the campaign in raising awareness and traffic.

“The results this campaign delivered simply speak for themselves,” said Craig. “We’re delighted this campaign won the Interactive Advertising Bureau’s Search Marketing Award for 2010.”

“The Experian Hitwise insights and analysis enabled us to define new buying habits of consumers online and produce an effective integrated TVC and PPC campaign which gave us a market leading edge in a very price-sensitive industry.

“Due to our superior search marketing led, integrated campaign, SCTI is now well placed to continue our longer term objective: to be a leading player in the Australian online travel insurance market.”

The Experian Hitwise approach differed from traditional search marketing agencies by providing consultancy across the whole marketing campaign, rather than just the search component. This, combined with Experian Hitwise’s access to historical web search data and consumer purchasing trends, built a full picture of the market and allowed SCTI to trump its rivals in this highly competitive sector.