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Consumers are using the Internet to research and purchase their insurance. This trend provides forward-thinking carriers with tremendous growth opportunities, if they can drive the right consumers to the right offerings.
Digital technologies have changed the way consumers go about shopping for and purchasing insurance products and services. Consider that 43 percent of consumers, who plan to acquire an insurance product in the next 12 months, intend to do it online. In responding to this shift in consumer behavior, traditional carriers will need to address the traditional conflict between the direct digital channel and more traditional agency channels, as well as acquire new digital capabilities and technologies.
Some agent-based carriers have reignited growth across all channels, direct and indirect, by deploying a digital ecosystem that enables relevant consumer interactions at key moments of truth throughout the purchasing process—generating more leads, allocating those leads to the right channels and enhancing close rates within each channel. Traditional carriers can deploy such an ecosystem in a test-and-learn fashion, galvanizing support among rank-and-file agents and employees.
By cultivating a relevant, robust digital ecosystem of skill, technology and infrastructure, a carrier can gain new and enhanced capabilities and customer approaches that lead to high performance.
Inconceivable 10 years ago, the Internet and social media have morphed into a dynamic, booming marketplace of some two billion people. They are generating some 50 million Tweets per day and 34,000 Google searches per second. In the U.S., 71 percent of households are online, and nearly 155 million Internet users will consume some form of user-created content by 2013.
Beyond the sheer volumes, digital technologies have utterly and fundamentally changed the way people interact, buy and consume information. Consider that one in three people would rather talk on Facebook and Twitter than in person. Fifty one percent of consumers search the Internet before making a high-value in-store purchase. More than one in four college students take courses online. One in five new relationships now begins on an online dating site.
The digital revolution is giving consumers more information, more choice and more power. And, the impact has extended to the relationship-dependent business of insurance.
Today, insurers’ relationship with consumers increasingly begins online. Thanks to digital media—the Internet, social networking, blogs, video, smart phones and others—consumers have broad and convenient access to a wealth of information. They are using that access to search for, learn about and get advice on products, services and providers. More Americans now use the Web to engage with insurance companies than use telephones.
In essence, digital channels are becoming the first go-to source in determining which products and services to buy.
Consider that in the $158 billion U.S. auto insurance segment (one of the largest in the industry):
72 percent of consumers use the Internet to learn about auto insurance
67 percent of consumers who shopped ‘within the past 12 months’ received a quote online helping to generate 38.8 million quotes in 2009 in the US alone.
A small but rapidly growing critical mass of U.S. consumers now purchase their auto insurance policies online, driving a record 2.8 million online policies in 2009.
Furthermore, Accenture research shows that 67 percent of consumers who are planning to purchase insurance “in the next 12 months” intend to renew or buy insurance through agents, with 43 percent intending to buy online.
This shift in consumer behavior has transformed the digital channel into the primary ground for influencing costumer choice. Direct carriers who noticed this shift and became digital leaders doubled their market share over the past decade. According to the Independent Insurance Agents & Brokers of America, direct response writers have expanded their share of personal auto to nearly 16 percent with each point of share worth hundreds of millions of premium revenue. In 2009, while others saw their premiums decline, direct writers actually grew premiums by $2.3 billion—on top of $1 billion growth in 2008.
Capitalizing on this opportunity requires a digital ecosystem that helps carriers effectively influence consumer choice in the digital space and resolves the conflict between digital and agent channels, integrating them in a way that enables a consistent and relevant multi-channel shopping and purchasing experience.
Relevance at scale
At the heart of an effective digital ecosystem is the ability to understand a visitor’s intent and profile, and use this information to assemble meaningful, digital experiences that resonate with the visitor, drive engagement and increase conversions.
Once relevance at scale is achieved, the digital ecosystem sustains it over time through a process of continuous optimization. Continuous optimization acknowledges the fact that visitor preferences evolve over time and that yesterday’s optimal digital experiences might not be relevant today.
An effective digital ecosystem integrates upstream into the media cloud (e.g., social, mobile, display, search and so forth) and downstream into the agent and contact center channel.
An effective digital ecosystem is “glocal,” providing global standards with local control. It is delivered through a single, integrated technology platform, which allows for the creation and enforcement of standards and lowers total cost of ownership. At the same time, the ecosystem is local in that it allows local regional managers to use pre-approved creative marketing assets to adjust the visitor experience with the touch of a button in a way that more closely responds to local conditions.
Because an effective digital ecosystem is designed to constantly evolve, it may experience implementation problems occasionally as multiple individuals in the organization make updates and changes to it. Self-diagnostic capabilities enable the ecosystem to constantly scan itself, find issues (such as broken links, faulty tags (e.g., traffic and advertising), malfunctioning forms and others) and generate a prioritized set of corrective actions.
November 25, 2011
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