There are two kinds of people in the U.S. No, not Red Staters and Blue Staters...


...but people who are comfortable with responding to and buying from direct response advertising vs. people who are not at all comfortable. Let's call the latter group "people who need people."
You would think that in 2006 the first group would be the majority. After all, look at the continuing phenomenal growth of online sales. Add that to all the merchandise sold through paper catalogs. And all the people who still respond to direct mail and subscribe to magazines.
But now look at the insurance industry, for example. Despite the tons of money that stalwarts like Geico, AIG, Progressive and others have spent over the past decade in direct response advertising, an overwhelming percentage of policyholders - at least 85%, maybe more - still buy coverage from agents.
What accounts for that? There's no real fall off in service when you buy insurance directly. In fact, it may get better. And your policy could cost less because there's no commission involved. The fact is, in this category, people (prospects/policyholders) need people (agents) for reassurance and because the feel that Joe Blow whose office is a few blocks from their home will take better care of them than the GIANT INSURANCE COMPANY in another city.
So what do insurance direct marketers and those in similar situations need to think about? What they need to do to convert people people to direct people. All the logical arguments have appeared in copy. Maybe the approach needs to be much more emotional– or needs to be ludicrous. After all, Geico uses ludicrous humor, but to make a different point. It's worth a try, but my suspicion is that people people will always remain people people.
There's another solution: don't try to direct market to people people. You can start by mailing only to those people who have been direct mail responsive. However, there is no 1:1 correlation between those who respond to catalog, magazine, or fundraising mailings and those who will buy auto insurance direct. For every 10 people who respond to direct mail, there may be only 2-3 willing to consider buying insurance direct.
Here's another situation. Let's say you have a sales force in scores of cities around the country. Your customers are used to dealing with the sales people, but your company makes the decision to eliminate the sales force and go direct. What are you going to tell the customers? What offers might hurt the situation rather than help it? Do you tell these people that they can get along without people? How do you simulate the "schmooze" factor?