In most sectors, companies will concur that there aren’t many options of differentiation that are as sustainable as customer experience is. Customer experience (CX) is the indelible impression any brand creates with customers across touchpoints along the customer journey. Prioritizing for the customer can be good for business. Insurers that prioritized CX generated 2-4 times more new business growth and 30% more profits than firms with inconsistent customer focus over a five-year period, per a McKinsey study. In a Global Financial Services Consumer Study by Accenture, they uncovered that consumers in today’s digital environment still value efficient service, prompt problem resolution, access to polite and knowledgeable staff and value for money. These core tenets of customer engagement trumped add-ons such as loyalty schemes, personalized recommendations or well-marketed brands.
Most incumbent insurers trail on customer satisfaction scores, with average net promoter scores several points below insurtech and digital leaders. Today, below-par service gets greatly amplified by the velocity and virality of social media. What might seem inconsequential such as one badly handled claim or a mistake clicked on a smart phone, can escalate rapidly into a spiraling brand-damaging crisis. Firms across industries have accordingly strengthened focus on providing better CX, vital to distinguish their brands in competitive markets.
As evident through research findings, customers experience friction through the insurance quote to purchase to claims journey. Due to the lower degree of engagement, customers struggle to trust insurers and carriers miss building lasting relationships.
The CX innovation wave is leveraging technology-enabled capabilities to deliver experiences that build trust and eliminate friction to gain customer mindshare. Insurers are focusing beyond traditional transactions and equipping customers with value-added services, digital apps, content, and data to help streamline customer journeys while better managing risk assets. In as much as success in financial services depends upon trust, impactful new experiences are building on that foundation.
Understanding and delivering what customers want can be herculean and several times, the key reason companies fail to match expectations. Identifying drivers of customer delight requires deep customer insights and modelling critical customer journeys, with cross-functional ownership and holistic management. The experience of a large carrier drives home this point. Wanting to redesign their auto claim processes, they set out to reduce call center waiting time. However, their insights revealed that waiting time wasn’t a major customer grievance. Call center routing that ensured a single point of contact mattered much more, especially for severe accidents. This change improved customer satisfaction by 50% and inquiries dropped 80%, improving trustworthiness.
Strong trust doesn’t however guarantee customer loyalty. In the Accenture study, one significant group of consumers called Pioneers, displayed high trust levels on insurers as well as other providers in telecom and big-tech firms. This group was found to change their carrier more frequently than other customer categories, for products and services that offered greater value. The study revealed a strong prevalent demand for “beyond-insurance” offerings that bundle traditional propositions with value-added services that are provided by adjacent players. Around half the study respondents were interested in these new-generation products and services.
Customer expectations are subtly transforming, realigning as a result of frictionless experiences gained in other spheres of digital commerce as well as from ecosystems that provide integrated experiences with minimal interruptions. To meet customer demand for bundled services, insurers need to adapt business models and embed themselves into digital ecosystems offering personalized product and service offerings. They need to rethink marketing strategies to reach targeted customers at the right place and time. While many customers are interested in new bundled offerings, fewer agree to pay for them. Carriers will need to find ways to provide value for money while embedding products and services into frictionless experiences.
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Source: https://dailyfintech.com/2021/04/01/customer-mindshare-will-be-won-by-embedded-frictionless-cx/
