The insurance industry has more than weathered the financial recession—in fact, profits are growing and M&A activity is up. Yet, the industry’s advertising spend doesn’t reflect the industry’s resiliency. 

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Steady Growth and Activity Exceeded Expectations

Despite the inherent in-person nature of mergers and acquisitions in the insurance industry, social distancing and working from home failed to have a strong impact on the number of completed M&As in 2020. 

There were a total of 744 insurance agency mergers and acquisitions last year, which is up about  20% from 2019. And despite low expectations, the second half of the year saw the highest number of transactions in that time period in 5 years—102 in total.

“We think the year ended surprisingly well, given the difficult circumstances the industry found itself in,” said James Lynch, the FCAS, senior vice president, and chief actuary of Triple-I.

Triple-I forecasts continued strength for the industry, predicting a 6.1% increase in net premiums in 2021.

Insurance Becomes More Digital

Globally, digital adoption within the insurance industry increased 20% in 2020. This shift is shown throughout the industry—from negotiating M&As to filing claims. In fact, consumers showed a strong preference for filing claims digitally, and approximately 39% who filed auto and/or property claims in 2020 did so via a mobile app, a website portal, or email. 

The same digitalization has affected how businesses complete M&As. Social distance requirements mean that the initial meetings between buyers and sellers, where they would generally build relationships and rapport, have been forced into virtual spaces.

Relationships are just one part of the process, too. Key points in the process, such as signing documents or reviewing a contract as a team, are now digitized.

MediaRadar Insights

Despite the industry’s growth and heightened activity, the overall ad spend has decreased significantly. Insurance brands in the B2B space spent just $3.1 million in January 2021, which is a 26% decrease YoY.

2020 did see a 20% increase in M&As in the insurance space, and are expected to keep rising through 2021. This may suggest that the decrease in ad spend is a case of reducing ad spend to keep up with existing client demand.

So far, the year’s biggest spenders are consistent with last year’s biggest spenders: Geico, Progressive, Liberty Mutual, State Farm, and Allstate.

As insurance activity surges, we’ll track advertisers to see how businesses market their services. 

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In a survey conducted by Digital Commerce 360, 58% of B2B eCommerce executives have lowered their financial projections this year due to Covid-19. 

With lower financial expectations and an economy that remains unstable, how are executives directing their advertising funds? 

We encourage you to subscribe to our blog for the latest data surrounding the advertising industry. We will provide daily updates as COVID-19 continues to make its mark on the US economy.

6 Verticals Affected by COVID-19

Here we look at how different industries under the B2B umbrella are pivoting in these unprecedented times. Some are surprising (spoiler alert: coffee). Others are not (i.e. webinars). 

Webinars and Digital Marketing 

With the cancellation of trade shows, marketers have had to make a new game plan for generating new leads and building relationships with clients. This was a huge loss for companies that participate in events because 70% of event revenue is made in Q1.

Research from the Center for Exhibition Industry Research found that B2B marketers who attend trade shows allot about 40% of their marketing budget to events, while they only spend 8% on online marketing. 

With this crisis, B2B marketers are now facing the inevitable: they need to pour more into online efforts.

About 65% of B2B marketers will reallocate dollars from live events to online events and webinars this year. We have seen this result in a large spike in the number of companies running paid advertisements for webinars.

Outside of webinar ads, we have seen a spike in digital advertising across B2B as a whole.

Both the number of companies and dollars spent increased 9% month-over-month in March.

In total, over $305M was spent on digital B2B advertising in Q1. This is a 9% year-over-year increase.

Working from Home Software Solutions

As many teams shifted to remote work, home productivity tools (like Slack or Zoom) were up big. In March 2020, spend from these brands were up 63% month-over-month.

IT Companies

These companies know there are challenges in getting workforces to function remotely.

Their response was swift. Ad spend in March was more than 2x the spend in January.

Coffee Brands

Not getting your morning brew in the office any more?

Coffee brands, not normally considered a B2B advertiser, realize this.

Spending in B2B publications from the category was up 4.5x between January and March.

We’ve seen coffee ads on sites like PMMag.com, Engineered Systems, MultiChannel News, Interiors and Sources, and more.

Insurance Companies

As the market becomes more uncertain, insurance companies are increasing their ad spending.

Notable categories up in Q1 2020 year-over-year include:

• Life Insurance: +167%
• Business Insurance: +165%
• Legal Expense Insurance: +135%

MBA Programs

Business school applications go up in times of recession. Many don’t have work and young professionals can use this time to sharpen their skills.

Schools increased their spending in B2B publications. Business school ad spend was up 43% month-over-month in March, and Executive Education programs were up 64% month-over-month.

Interested in learning more? We will go more in depth on how this pandemic has hit B2B companies in our upcoming trend report. Stay tuned for more details.