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Financial Product Opportunities in Today’s Ethnic Markets. Identifying the Best Prospects and Retaining the Best Customers

For financial marketers, Americas ethnic communities present opportunities to win new customers today and a position for future growth. Ethnic Technologies, the global leader in multicultural marketing, research, data enhancements, and analysis used Empirics, a behavioral segmentation solution for financial services marketing, to take a look at the major ethnic groups and two hot marketing topics in today’s financial services marketing:

  • Switching auto insurers
  • Obtaining financial products via direct mail

For the ethnic marketer’s acquisition and cross sell campaigns, Empirics provides the advantage of targeting those households that “look like today’s buyers,” assuring that their offers get positioned competitively within these markets and retain valuable customers.

Top Findings Include:

  • Texas is the most lucrative market for targeting African American auto insurer switchers via direct mail offers. While Texas has 5.9% of African American households, they represent 11.3% of most likely switchers and 17.3% of direct mail buyers. In contrast, Illinois has 6.1% of African American households and only about 4% of most likely switchers and only 4.3% can be addressed via direct mail..
  • California has about 30% of the Hispanic households that are most likely to be shopping their auto policy.
  • California and Texas constitute nearly half of the Asian American auto insurance “switchers.”
  • Nearly 42% of the African American households most likely to obtain financial products via direct mail live in NY, TX, and MD.

Contact Ethnic Technologies for a free report: U.S. Ethnic Groups: Top 10 States for Targeting Financial Offers. candace@ethnictechnologies.com

Auto Insurer Switching
GEICO’s computer-generated gecko is one of today’s most widely-recognized spokes-species. Add campaigns by insurers such as Allstate, Travelers, and Progressive into the mix and you have heightened consumer awareness, creating opportunities for auto insurers to win customers within ethnic communities.

These campaigns may have raised consumer awareness, but how do you identify how many and which households are most likely to switch? The E-Tech enhanced Empirics segmentation for switching auto insurers is based on current switching behaviors in the market. The behavioral segmentation allows marketers to see how not only how big today’s “switcher” market is but also how best to target them.

What We Found

There are nearly 1 million households in the three major ethnic groups that E-Tech enhanced Empirics rated most likely to switch auto insurers. Each of these households represents:

  • The most attractive market to target in acquisition campaigns
  • The insureds most at risk of “moving their business” to a competing insurer

Here are some highlights on auto insurer switching in the major ethnic groups:

African Americans: Texas may rank 5th in the number of African American households but it ranks first in the number of African American households identified by E-Tech enhanced Empirics as having the highest likelihood of switching auto insurers. The Lone Star State also has the highest index (concentration) for auto insurer switching among the top 5 African American states.

Hispanics: California has about 25% of Hispanic households but E-Tech enhanced Empirics determines that the state has about 30% of all Hispanic households that are most likely to be shopping around on their automotive policy. Add Texas to CA’s total and you’ve captured over 50% of the Hispanic households’ auto policies most likely to be in play.

Asian Americans: Empirics determined that California and Texas constitute over 50% of the “switchers” in this ethnic group. Together, they represent about 38% of Asian American households.

  • The most attractive market to target in acquisition campaigns
  • The insureds most at risk of “moving their business” to a competing insurer

Obtaining Financial Products via Direct Mail

Financial marketers are competing for insurance and investment dollars via many different channels: direct mail, online, personal selling. It’s a multichannel world and Empirics provides a behavioral segmentation that identifies the best opportunities for the financial marketer using direct mail. This segmentation is designed to evaluate markets and target prospects based on the criteria of acquiring multiple financial products (other than credit cards) such as life insurance, auto insurance, investments, banking products, and loans.

What We Found

There are nearly 1,400,000 households in the three major ethnic groups that are E-Tech enhanced Empirics-rated most likely to obtain financial products via direct mail promotion. This is a prime market for insurance and investment firms to identify and target the best prospect for their direct mail offers. Here are some highlights:

African Americans: Nearly 42% of the African American households most likely to obtain financial products via direct mail live in NY, TX, and MD. Georgia may have the largest number of African American households, but it is not in the top financial direct mail markets for this ethnic group.

Hispanics: Want your financial direct mail offer to “hit” nearly 70% of the Hispanic households most likely to use direct mail to obtain new financial products and investments? Target households in CA, TX, AZ, and NM. These four states all show high concentrations of Hispanic households who are more likely to use direct mail in managing their financial affairs today.

Asian Americans: E-Tech enhanced Empirics determines that California, New York, and Texas constitute over 60% of today’s highest potential direct mail buyers/investors in this ethnic group. Asian Americans represent an attractive market and there are nearly 1 million households that score above average for financial direct mail use.

Whatever your next financial acquisition or cross sell campaign, E-Tech enhanced Empirics can target it to today’s best market. customers, and prospects.

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