FEAR FACTOR DOES YOUR MARKETING RELY ON SCARE TACTICS? Fear-based marketing is as old as advertising itself. Many companies have succeeded in scaring their customers into opening their wallets. But despite its proven effectiveness, there are limits to fear’s ability to sell. So, when is amping up your customers’ anxiety a good thing, and when will it just make them tune out? Fear inspires us to take action. When we’re worried about our finances, safety, relationships, or social acceptance, we want to eliminate the anxiety as quickly and painlessly as possible. Therefore, companies can effectively convince people to purchase a product by introducing fear and promptly providing a solution. But while fear motivates us, it’s not the only emotion we respond to. Advertisers have long understood the best marketing generates strong feelings among its audience, and research shows emotional triggers are effective selling tools. But should you always target fear when other options are available? Relying on fear can turn off your potential customers. For a start, people don’t like to feel manipulated. We’ve all seen overblown fear-based marketing that suggests catastrophic consequences in a relatively low-stakes scenario. Generally, we roll our eyes and turn away. And at that moment, we lose faith in the company’s willingness to be upfront and honest with us.
You might have expected 2020 to be the most stressful year for business owners, but 2022 has taken the cake. QBE’s 2022 Mid-Sized Company Risk Report showed that executives’ anxieties increased due to the pandemic’s aftershocks. Some of the significant risks these companies were worried about were inflation and worldwide political unrest. Yet, out of all the dangers surveyed among these executives, four set themselves apart and have remained leading stressors for multiple years. Organizational Hazards Organizational concerns have shifted higher up the index as companies are transitioning to remote or hybrid environments. Some organization hazards that were plaguing mid-size companies include talent attraction/ retention and evolving work environments. Within the organizational risk category, mergers and acquisitions (M&A) were the top threat. M&A agreements have been made primarily over video calls, which could have led to the deals becoming less effective than in-person arrangements. Business Interruptions COVID-19 has also made business interruptions a widespread danger. Issues such as loss of critical suppliers or weak supply chains increased the possibility of business interruptions. Additionally, the rising costs of securing these supplies and services are becoming problematic. Cybercrime Concerns In 2020, 62% of executives reported being extremely concerned about digital threats such as cybercrime, which increased to 64% in the following year. In 2022, that number jumped to 73%. In an even more alarming report, the costs of preventing and resolving cybercrimes are estimated to be a whopping $10.5 trillion worldwide annually by 2025. The most prominent cybercrime fears were reported to be data theft/ransomware and corporate espionage. Financial Risks Our unstable economy and inflated costs are becoming a burden on mid-size companies. The most significant financial risks executives face are a potential recession, increased employee benefits costs, fraud, and theft. The fear-inducing survey did shine a light on the importance of risk management. Significant percentage gaps were found between executives who were worried about risks and those who were prepared for them. To prevent living in constant fear, executives should develop solutions and plan for all possible risks they may encounter. It’s always better to be safe than sorry.
Further, too much fear numbs us, and we become complacent. When every commercial on TV or email in your inbox presents a new threat, we no longer feel heightened emotion — and we stop paying attention. Too much fear also gives way to disgust; some things are so awful we don’t want to think about them. Consider those infamous SPCA commercials showing abused and neglected animals. They may inspire some people to give, but most of us change the channel. Meanwhile, other brands like Disney rely on nostalgia, togetherness, and joy and have seen excellent results. Of course, making people feel warm and fuzzy about car insurance or mold remediation is much more challenging. But many companies have succeeded by turning the usual message on its head and focusing on peace of mind instead of fear. While fear-based marketing can work, it’s easy to go overboard. Only use fear in moderation, and don’t forget to close with a message of hope. You want to leave your customers feeling empowered, not helpless or manipulated.
2 • www.INSURICA.com • Specialized Insurance Programs for Specialized Industries.
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