(Image credit: Dollar Photo Club.)
Conventional wisdom says that what customers expect from their insurance company is often driven by what they experience in other industries. So it’s important for insurers to continue to draw lessons from other industries as they continue to drive growth. Here are 10 things that other industries are doing that insurers should consider:
- They prepare for the future: companies focus on understanding the trends that will impact their products and services and link those trends to their product development, strategy, business models and customer service to position them for the future. For example, as car ownership shifts to sharing models and hybrid uses of vehicles, and with the advances in the autonomous vehicle, GM announced an investment in Lyft and Volvo announced that it would make keyless access through a mobile app the standard in their vehicles. Keyless access will allow car owners to provide access to their car to anyone.
- They understand their changing role: Companies strive to constantly understand their role in how they contribute to the economy. For most industries it’s evolving. Many companies are using analytics, advanced robotics, automation and artificial intelligence to transform given their changing roles and to make adjustments in their business models to survive.
- They measure success differently: Many don’t wait months to test ROI in new areas, which can mean missed opportunities. They change how they measure results of new technologies and new business models and develop new key performance indicators accordingly. For example, the success of a record launch is no longer just about CD sales, but about streaming and downloads.
- They attract the right talent to the industry: They identify the skills needed to help them compete and recruit the right skills and experience to position the company for the future. This goes beyond hiring millennials to create a social media strategy, it means attracting data scientists and the next generation of employees that are core to their business.
- They stave off commoditization: Retailers are using technology such as virtual and augmented reality to help consumers see things in their homes before they buy. Retail in many cases, has gone through cycles of mass commoditization with low priced clothes and stores designed to get you in and out quickly. However, as the shift to quality over quantity takes place, retailers are reinforcing their value propositions to consumers by being there with the right offer at the right time.
- They reward loyalty: It costs more to attract a new customer than to keep one, so loyalty programs are not just for retailers anymore. Companies are using loyalty to drive growth, by offering break through services, creating brand enthusiasts and influence consumer behavior.
- They think as a brand: Under Amour’s Healthbox could make them the owner of one of the largest health platforms according to Forbes. Tech investments give them influence not only on what their customers wear, but also on their lifestyle choices that are centered on brand interaction. Likewise, Cigna’s partnership with Story Boutique around the theme of “Feel Good” gives shoppers the opportunity to experience Cigna’s brand in a new way.
- They treat physical and digital equally: They understand that physical and digital are no longer separate channels and investments in both drive growth. Amazon’s Books is one example, another is the auto manufacturer who works with one of their most successful car dealers with ambitious plans for growth to him access to their executives, and financial assistance to open new dealerships. They recognize that face-to-face is still one of their best channels for growth, despite the decline in car ownership in the U.S. and the rise of online car comparison sites.
- They use competition to their advantage: They partner with those that are focused on improving points along their value chain and embrace innovation from new entrants and adapt quickly. For example, Gilt.com a member only sales website-spawned dozens of similar sites, many backed by major retailers. Partnering with start-ups and forming innovations labs is just the beginning, there’s also opportunity in partnering with those that are looking to disrupt the industry. Autonomous vehicle manufacturers, connected home vendors and digital-only insurance companies offer opportunities to drive innovation in the industry.
- They derive insights from all types of data: They leverage all types of data to drive insights at the point of decision. Transunion’s Credit Vision Link, according to the company, using “alternative data” now makes it possible for 60 million new consumers to be scored. Retailers use visual merchandising to measure the impact of merchandise placement in stores and insights about demand to improve their inventory. Insurers can leverage new types of data, such as sensor data, images, weather and their enterprise data to drive new insights using advanced analytics.