CMO50 2020 #4: Brent Smart

  • Name Brent Smart
  • Title Chief marketing officer
  • Company IAG
  • Commenced role February 2017
  • Reporting Line CEO Australia division
  • Member of the Executive Team Yes
  • Marketing Function 55 staff, 4 direct reports
  • Industry Sector Financial services
  • 2019 ranking 4
  • Related

    Brand Post

    It could be easy for people to dismiss NRMA’s $10 a month fire and theft insurance product, launched at the height of the COVID-19 crisis, as a short-term or offer-led incentive. But for IAG’s Brent Smart, it’s not only been a strong brand and customer vehicle, it’s the first time he as CMO felt able to influence product in a meaningful way.

    He agrees he couldn’t have done it in his first or second year at the ASX-listed insurance giant. “I now have more influence than I had when I started and I understand the business better - I can have a commercial debate with an actuary, which I couldn’t have done when I started,” he says. “It shows how I’ve changed.

    “I used to be the ‘creative’ guy, but this kind of product offer is creative. We sold 70,000 policies in six weeks, which is very hard to do for an established brand. It had great impact.

    “And it shows if you can bring creativity to a business problem, you can find and stimulate growth. That’s where marketers need to flex their muscles to make sure they’re bringing creativity to the whole growth opportunity.”   

    It wasn’t an easy task, however. For a start, there’s the practical and technical challenges of launching such an offer in a big insurance company, that touches so many functions and systems. In addition, the risk environment within the financial services space doesn’t exactly lend itself to making changes too fast for compliance and risk reasons. Then there were the short-term profit considerations.

    But as Smart points out, the crisis left good customers and prospects needing support during a time of crisis. The $10 NRMA offer was about creating a simple, well-priced offer that could be a “safe haven for people to protect them through these times” in order to allow them to become good customers long-term, he says.

    “What’s good is it’s created momentum for further compelling offers. And it means we can bake creativity right into the product, as opposed to a layer over the top,” Smart says.

    Smart’s business clout was increased in February by the decision to move his team into IAG’s Australian business division. The restructure saw Smart elevated to the Australian leadership team reporting director to its CEO. He says it’s brought him much closer to the running of the business and allowed him to develop all sorts of “commercial muscles” as a result.  

    “I don’t think I would have got the increased media spend at the start of COVID, or the third-party offer, if I wasn’t as close to the business as I am now,” Smart says. “I now find myself in meetings I never thought I’d be in, much more about the commercial challenges of the business. I’m able to influence that stuff a lot more.

    “It also shows in the way I talk about creativity internally. At the start, I would have been saying hey, look at these things, check this out. Now I say, here’s the business problem we are solving for. I’m talking the language of the business.”

    Adaptability and purpose

    The ability to act quickly has come to the fore over the past six months in many businesses as COVID transformed market conditions and consumer behaviour and IAG it’s been no different. As the impact of COVID hit in March, the insurance category saw new business volumes fall off a cliff.

    “It didn’t make sense to keep running sales activations, as the demand simply wasn’t there,” Smart says. “But there was a big brand opportunity. People at home meant spiking media audiences. And brands under pressure were pulling back spend and cancelling media, creating a share of voice opportunity.”

    Smart’s team quickly built the case to increase the media budget. In a week an additional $5 million funding was secured, upping April quarter media spend by 65 per cent. This resulted in an 8 per cent increase in reach and 75 per cent increase in digital impressions.

    The work doubled down on NRMA’s existing brand assets, HELP and the Koala, scouring footage from the original koala shoot and including shots of its hero character doing his schoolwork at home. “It was a nod to the reality of home-schooling at the time and it went hand-in-hand with the simple message that our frontline staff were working from home too, continuing to help,” Smart says.

    “We were already ‘pivot fit’ from the bushfires and we turned our COVID response around in just 10 working days. We saw our best tracking scores ever with 91 per cent branding, double the industry benchmark. Despite only running brand activity, by the end of May we saw new business volumes back at pre-COVID levels.”

    The more collaborative approach towards product development was also demonstrated in May with the launch of NRMA’s $10 a month offering.

    “Listening closely to customer feedback from NPS surveys, social media and our call centres, we saw a growing number of profitable and good- risk customers being forced to downgrade or cancel their insurance,” Smart explains. “So we designed the perfect offer for these times – one that not only retained these customers but attracted similarly good customers from our competitors. All while reinforcing the brand positioning of HELP.

    “It required a new way of working; collaborating cross-functionally at speed, whilst working remotely.”

    Marketing partnered with the product and pricing team to model different offer options, landing on and building the business case for Third Party Fire and Theft cover for $10 a month. Flat rate pricing was new for our category, which usually priced on individual risk. New digital initiatives and creative assets swiftly followed including an acquisition-driving retail campaign that leveraged NRMA’s brand attributes of empathy and help.

    “I’m proud to say marketing led a cross-functional project team working from home that delivered the new product in just six weeks and delivered even more impressive business results,” Smart says.

    Innovative marketing

    One program of work Smart’s team engaged in before the crisis and the bushfires that’s continued to deliver was aimed at improving home insurance take-up.

    “It was increasingly seen as a grudge purchase. Since 2016, the number of households in Australia grew by 5 per cent, while the number of uninsured homes grew by 32 per cent. We were losing market share and coming off two negative quarters of sales. We needed to turn it around, fast.”

    While short-term sales tactics were tempting, Smarts says IAG knew it wouldn’t address the bigger perception issues. Ethnographic research across IAG’s most loyal customers also showed ‘home’ as a symbol of emotional security and nothing would make them feel more vulnerable than if it was under threat.

    “We needed a way to connect that feeling to every Australian,” Smart says.

    The koala campaign was born. Smart points out the homes of our national icon were under threat and gaining serious traction in the media. A home insurance campaign featuring koalas was a lateral idea that defied all category conventions, he says. Smart says he undertook extensive stakeholder management to build the trust within the business to take this creative leap.

    The campaign debut in August 2019 telling the emotional story of a boy rescuing a koala, backed by a pledge to plant a tree for every home policy sold. The campaign was fully integrated across paid, owned and earned channels. IAG also created the world’s first Koala Chatbot and its star, Arlo the Koala, ended up on the front page.

    Smart says the work struck a chord immediately, with double-digital increases throughout the entire funnel leading to a 20 per cent increase in quote volumes.

    “Then the bushfires hit and our role in protecting Australian homes took on even greater meaning,” Smart says. “It was a critical moment to re-evaluate our narrative; to demonstrate cultural relevance and market leadership.”

    In five days, the campaign had pivoted to suit and extended via a new partnership with the Port Macquarie Koala Hospital. Smart says this made the campaign even more impactful, with cut-through and branding scores rising. Sales increased in the fourth quarter by 22 per cent, delivering IAG’s most successful home insurance quarter ever, and market share increased by 2.1 points.

    Business smarts

    Another way Smart has strived to realise NRMA’s purpose of making the world a safer place is through proactive measures to educate customers how to better protect their homes and environment.

    “As we emerged from the ashes of the bushfires, NRMA was committing $1.5 billion to rebuild homes across the state. But that’s the basic promise of our product,” Smart comments. “If we really want to live our purpose to ‘make your world a safer place’, we needed to do more to prevent future climate disasters.”

    In February 2020, Smart took the lead on the ‘Rebuild and Resilience’ project to develop IAG’s strategic response to the bushfires and longer-term climate strategy. The key was to move to new proactive prevention, a cultural change opportunity for the business, he says.

    “It also had the potential to generate immense staff pride, which I believe is one of the most important things a CMO can do to positively impact customer experience.”   

    The first cab off the rank is ‘First Saturday’, a platform created in partnership with the Royal Fire Service and State Emergency Services encouraging everyone to complete a home safety task on the first Saturday of every month. The calendar of monthly tasks covers cleaning gutters to buying a fire blanket and is based off claims data and seasonal risks.

    First Saturday, which launched in August, is the first of many initiatives planned under the multi-year Rebuild and Resilience Strategy. “It’s much bigger than a marketing venture, it’s a plan to unite company-wide climate and prevention efforts including public education, stakeholder and government engagement, community partnerships and open-sourcing our data,” Smart says.

    Such work during both the bushfires and now the COVID-19 crisis just adds to Smart’s belief in the power of brand purpose and IAG’s commitment to it.

    “What I have always liked about IAG is how clear our purpose is - it’s one my mum and the frontline staff can understand, and it’s linked to our business and what we do,” he says. “What’s interesting is where you find yourself in situations when you need to act purposely, if you want to make a difference, purpose gives you clarity on what the right thing to do is.

    “That is what has happened with us. Because we at IAG believe in that purpose and take it seriously, when things happen like the bushfires, our first reaction is what can we do to help people be safer. We have been out there talking about saving koalas, we better go and save them.

    “If you are going to be purpose-led, not purpose-said, you have to walk it when those moments present themselves.”  

    Customer-led thinking

    On the B2B front, meanwhile, Smart’s team has also spent the past year working to improve CGU’s resonance as a commercial insurance brand. Sold mainly through brokers, CGU marketing in typical fashion through newsletters, trade press, conferences.

    “If we could bring the same brand strategy and content capabilities that we applied to our consumer brands to the B2B space it would transform the level of engagement for brokers,” Smart says.

    Work started with an insight into the broker’s ultimate end-customer, small business owners. Each year, over 400,000 Australian Business Numbers (ABNs) are cancelled. The question IAG marketers sought to answer was: What if we could become the champion of small business ambition, bringing one of those cancelled ABNs back to life and actually starting the business?

    ABN Rescue was born, and the craziest idea the team could find was adopted - Domuts, donuts for dogs. “By documenting and telling the Domuts business story, we created a content program that celebrated the ambition it took to start and run a small business,” Smart says.

    IAG created 30 pieces of original content and generated a further 29 pieces of earned media coverage reaching 9 million people. The brand secured more traction in social than CGU had ever seen, with social share of voice peaking by 322 per cent, while content generated 11,977 social actions.

    “Suddenly CGU stood out, brokers were highly engaged and we drove an impressive double-digit uplift in sales volumes,” Smart says.

    The engagement-led approach for CGU continued during COVID with the ‘Business As Unusual’ content series, with webinars from high-profile speakers including John Howard and Mark Bouris.

    Data-driven approach

    IAG’s scale, complexity and legacy technology make transforming to personalised marketing a huge task. Smart says while data and technology are crucial, huge effort has to be made around people and process.

    “Our ambition is to move from traditional product-driven targeting, to contextually relevant omni-channel personalisation, with hundreds of dynamic behavioural segments based on transactional, engagement and predictive data,” he says. “It sounds like a bunch of jargon, but it means more engaged customers, leading to better conversion, retention and profitability.

    “The key to gaining organisational buy-in has been a mindset shift with data-driven experimentation at the heart.”

    To do this, Smart says his team has designed experimentation methodologies with technology, process and insights intertwined, and active collaboration across digital, analytics and service design teams. The first major experiment was on ‘Unconverted Quotes’, building new capability to send follow up emails to customers who had quoted but not purchased.

    The experiment saw a 3.6 per cent increase in conversion. “This gave the business the confidence to invest in further capability uplift, so we could transform the initial experiment into a scaled solution,” Smart says.

    The scaled solution sees the Unconverted Quotes program tap into 13 trigger points within the quote flow, with identified customer segments are used personalised by audience type, value and purchase intent. A range of signals, propensity models and triggers combine to deliver contextually relevant content through multiple channels.

    “We can also respond much faster to customer needs, with communications and messaging delivery times rapidly shortened internally. This is no mean feat for our company, but we have the ambition to do it faster and better,” Smart says.

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