Aug. 17, 2012 at 6:17 AM ET
In the ugly battle of Web users vs. insurance companies, a lot of blood was spilled this week.
We've known for a while that hell hath no fury like an Internet user scorned. But at the intersection of social media, consumer frustration, anxious lawyers and heavy-handed regulations you'll find a particularly tricky corner of the Web. Insurance firms, which have always been a magnet for complaints anyway, lie at precisely this crossroads.
Increased competition has led insurers to employ high-profile marketing gimmicks, like geckos or touchdown dances, in an effort to become household names with friendly reputations. That means it's become necessary for them to establish a social media presence. Progressive's "Flo" character, for instance, has her own Facebook page, with hundreds of thousands of fans. But inviting social dialogue sometimes means inviting trouble, as Flo and her handlers found out the hard way this week.
Progressive encountered a Twitter revolt after the family of a woman killed in a car crash wrote a blog post criticizing the way the firm fought to avoid paying a claim. The post went viral, and the insurance giant then compounded its problems by spitting out automated tweets in response.
Experts who talked about the incident this week said Progressive fell into a trap that often catches large companies as they stumble around the social media world.
"The original response sounded genuine," said Jason Falls, a digital marketing consultant who helped health care firm Humana set up its social media program. "But the fact that they auto-responded the same statement to multiple people showed it was just a copy-and-paste job. More often than not, when that happens, it's not the technology that's to blame. You can blame it on the legal and compliance teams saying, 'You can say this and only this.' It makes you look cold and insensitive."
Both sides have willingly joined the insured-vs-insurers Internet fight. Insurance firms increasingly use the Web as a weapon against fraud, while consumers band together to demand better service, or to appeal denials of coverage. Both can claim victories. There are plenty of stories of insurance investigators who catch disability recipients bragging about completing triathlons on their Facebook pages or tweeting about a great trip to Paris while claiming depression. Meanwhile, earlier this month, a social media firestorm caused Aetna to back down and agree to cover colon cancer treatment costs for an Arizona patient who'd already exceeded his lifetime cap. A flurry of angry tweets really can make a big company reverse course.
'Shame on you'
Fall said he's used to seeing nasty comments pile up on insurance company blogs, Facebook pages and in Twitter feeds.
"It does make me cringe, but I also think it comes with the territory," he said.
It doesn't take long to find cringe-worthy comments on insurance company social media sites. Even days after the initial Progressive firestorm, comments left on Progressive's otherwise happy "Flo the Progressive Girl" Facebook page were dominated by vitriol: "Shame on you," says one. "Has Flo ever wondered why Progressive tries to get killers off the hook?" says another. Many writers called on the actress who plays Flo to quit.
Flo's hardly alone, however. When American Medical News did a survey of health insurance Twitter accounts last year, it found a never-ending stream of complaints:
*"Dear Cigna: How about, for the new year, you do something radical - like processing claims without 500 phone calls from me?"
* "Dear Humana, you've ruined my day. Worse, my wife's day. Way to CYA. I'm paying you to cover mine."
*"@Anthemhealth, so far u didn't send me my ID cards … kept me on hold for 25 mins and ur site isn't lettng me register. Nice service."
Insurance, necessarily, involves rejection. When you are in the business of frequently disappointing people, and making sure your rejections are lawsuit-proof, it's nearly impossible to run a free-spirited social media shop. Rachel Poor, who runs the social media marketing firm Thread Communications, said all heavily regulated industries face the Progressive dilemma.
"I think social media is still a sort of an enigma (to them). They all want to be there, they are told they should be there, but these companies are not used to people talking back to them in such a public forum," she said. "Ultimately, I think it will require insurance agencies to change the way they do business.”
Greg Matthews, a director at social media consultingagency WCG in Austin, said insurance companies often have to go into a Twitter or Facebook fight with one hand tied behind their backs.
"Particularly in health care or financial services, there are privacy-related issues that you just can't discuss," he said. For example, if a patient complains about an uncovered medical procedure, the insurance company can't publicly talk about the patient. "People want you to be transparent and authentic all the time, but you just can't. ... It can be terribly frustrating.”
Falls said companies he works with expect the occasional public flogging after turning on a Twitter account, and they manage to survive by planning ahead.
"The thing I've tried to do with any client opening up its customer service channels -- you have to have a crisis communications plan mixed with a customer service plan," he said. "You have to anticipate what will happen. ... Companies that dive in without a plan of attack for those situations are finding it difficult."
No stiff upper lip?
Automatic and formulaic responses have gotten many companies through old-fashioned media crises, Falls said. For example, journalists are often tolerant of canned answers, he noted -- but they typically don't fly on social media. If a Twitter response doesn't sound like it's written by a real person in response to a real person, the company is likely going to take a hit to its reputation. On the other hand, when million-dollar settlements might be at stake, no insurance company lawyer is going to be comfortable with a social media employee free-lancing responses. So Falls suggests a middle path.
"You have to have a lawyer on staff who can be on call and help your social media team craft communications in crisis situations," he said. "When you have a big publicity problem, you have your legal team working hand-in-hand with PR. Why wouldn't you do the same thing in the social media world?"
In general, he recommends that firms post a detailed, formal response on a website, and instruct their social media writers to tweet or post links to it, while adding personal notes separately.
There are challenges, however: Many lawyers and companies don't have the stiff upper lip needed to ride out a social media crisis.
"Any industry that's heavily regulated will always have a layer of legal and compliance teams that have to be trained, and have to buy in," he said. "It can be done with the right legal team. But if you have a team that constantly says ‘no,’ it'll never work."
Matthews said effective social media must also be fast, and that's often unfamiliar territory for insurance firms.
"It means really changing processes that companies use. Rather than convening the executive committee for two days to make a decision about things, boil it down to the two or three people who can actually make a decision in hours and not days," he said.
It also means knowing who the influencers are in certain topics ahead of time, and planning to engage those people immediately when a crisis hits.
"It's not that hard to know these days who are the folks likely to be influential in this conversation," Matthews said. "You know what the top 10 issues that you might face are, and you know who is likely to be the most influential when those stories break, the people who might take your side or be opposed. ... Ask yourself how do you engage them. What is the content you can bring to bear that articulates your position rather than letting the public run wild. You can never control the conversation, but you can make sure your side is heard."
Finally, and most important, companies have to actually deliver on their promises, perhaps in a way they never have before, Matthews said. If a Twitter user complains and is asked to call customer service by a social media worker, that customer service experience had better be positive, Matthews warns. Otherwise, the angry consumer will have heavy new ammunition for waging a social media war.
"It really helps you find your skeletons in the closet," he said. "You have to have a mindset that you are grateful your customers are telling you what you are doing wrong, and you have the opportunity a chance to fix it. I know a lot of companies, maybe most companies, don’t feel that way, but that’s the only way to be successful in social media.”
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