Riding the Whirlwind

Strategic Interactive Marketing for the Insurance Industry

Key Points:

Customer's addresses usually form the basis for adding further profile data.

6.4 Understand Ones Customers

6.4.1 Who are my customers?

• Names and addresses (N&A) (or at least postcodes) form a base from which to add further profiling data.
• Insurers working direct, or those owning the distribution channel (e.g. bancassurers), already have the names and addresses of their customers.
• Those using intermediaries may have basic location information (e.g. postcode) which may be sufficient for the analysis phase. A partnership initiative, with one or two large and forward looking brokers, could well be the way forward.

For a pilot, just a selection of customers may be sufficient. Existing product information and personal profiles might help to select suitable candidates.

- Select a Customer Sub-set for a Pilot -

• Where many N&As are spread across product based systems they may need consolidating. However, whilst software packages and bureaux may help, this task is usually more time consuming than first thought. An alternative, especially for any pilot, is to select customers associated with a particular product type - those who are believed to exhibit the behaviour best related to a particular communications medium. For example:
• Unit Trust customers with large investments and who switch 3 or more times per year might well be up-market. They are likely to have already acquired a PC and possibly be looking to use it to manage their portfolio. An Internet based share price system with on-line dealing could well attract such customers.
• Term assurance customers, aged 25 to 45 living in a town with cable television may wish to explore the benefits of using interactive TV.

Off the shelf and commissioned surveys will uncover their behaviour. These can be mapped onto the Customer Segmentation Model.

• In an increasingly fragmented and individualistic society, behavioural and attitudinal models are directing marketing initiatives. The Customer Behaviour model shown earlier in section 4.5.3 is proposed. This model is concerned with the acquisition activities in respect of financial services. It is shown in outline form on the next page.
• Note: All the other marketing models, including those concerning buyer behaviour, need to play their part.

The result shows where ones customers are currently positioned. Further probing is needed to uncover where they are moving to and what barriers they perceive.

- Mapping Customers -

• A company's own customer base needs mapping against this model. Sampling is a cost effective method and there are various ways of acquiring sample data:
• commissioning surveys and focus group discussions tailored for the client company and addressed to a sub-set of their customers.
• applying general surveys and focus group discussions to the company's customer base through proxy identifiers (postcodes, household make-up, SEG)
• The result will show how ones' customers are positioned. On the outline model (see next page), some possible outcomes have been overlaid. The overlays could be circular, pear shaped, oval, etc. and they are likely to overlap more than one behavioural segment. Together they identify the extent to which the customer base is polarised into leaders, followers, and laggards.

1 to 1 Marketing uses a collaborative approach. This could be achieved by means of a permanent panel.

- Ascertain Likely Movement -

• Probing questions help to discover the likely movement and speed of movement of these segments. These questions also need to uncover the perceived or actual barriers for moving to another segment. One of the axioms of 1-to-1 marketing is that customers collaborate in the development of new products. Ultimately this may involve customers interacting with a product design system, but in the first instance is more likely to be interaction with the marketing department. Groups of customers may be willing to participate in such groups on a longer term basis. Weekends away in a hotel, with both work and relaxation sessions, are a way of saying thank you.

Mapping the Behaviour of Ones Own Customers.

Sampling must also discover the current ownership of technology, who uses it, and any problems or wishes. All mediums need to be included.

• If these questions are answered through sampling techniques, then care must be taken to differentiate between ownership and use. For example a house may have acquired a PC but it is the children who use it for playing games.
• Software suppliers may be able to provide anonymous details on ownership, for example on home accounts packages.
• Information on problems and irritations help to identify the barriers to further use. Wishes will highlight opportunities.

- Ownership of All Mediums -
 

• Any research needs to include all the interactive mediums described earlier.

Planned technologies, including the reasons for the acquisitions, are important.

6.4.4 What technologies are they likely to buy (or not buy) and why?

• Many of these interactive mediums are new, (for instance I-TV and Web-TV) while others have limited but growing take-up (pagers, mobiles). Questions need to ascertain the likely acquisition and use of such mediums:

• perceived benefits such as convenience, cost savings, wealth generation, entertainment value.

• perceived barriers such as cost, difficulties of use, limited value.

There may be opportunities to help customers acquire and learn how to use them. This may well involve partnerships with suppliers.

- Help Customers with New Technology -

• From these answers it may be possible to identify opportunities to support early acquisition and at the same time embrace customers in a pilot:

• free or discounted purchases on the base item, on accessories, or on installation.

• special rental deals.

• free or reduced subscriptions to value added services.

• Arranging these offers in partnerships with complementary organisations may be the best approach. They include suppliers of hardware, communication, base services, value-added services, advertisers, etc..