For about a decade, JD Power and Associates has been asking consumers to rate their satisfaction with insurance companies on a simple scale of 1-5. This summer, a study of the auto insurance industry found satisfaction, as measured by this simple survey, to be at an all-time high (2012 U.S. Auto Insurance Study).
Logic might suggest that high customer satisfaction should yield high retention and less price sensitivity, but as is often the case, reality is more complex. It turns out that satisfaction is mere table stakes, and retention is a much more difficult job. Other factors, such as choice of channel and bundling or cross-selling, contribute much more directly to loyalty than this simple score from 1-5 indicates.
In general, today’s consumer wants to use convenient channels such as Web and mobile for simple, low value transactions such as making a payment or updating an address. Those channel preferences shift however, as complexity increases and a more high value interaction with a knowledgeable professional is required. There is very often a point at which a personal, face to face interaction is by far the most efficient way to complete a transaction.
Today’s insurance buyers must choose between a direct channel insurer where the customer experience is based on Web and phone interactions, and the traditional agency channel based on relationship and face to face (or at least one to one via phone) interaction. The gap between these two models is wide. Neither model currently spans the array of channel choice and interaction model necessary to provide both convenience and intimacy. Read More »
Have you walked into a retail store lately and seen someone use his or her phone to “scan” a product’s bar code to get immediate access to reviews from consumers who have bought the product? This customer might also (to the chagrin of retail store owners) be looking for cheaper prices offered online or in a physical store around the corner!
This is the new “omnichannel” reality that retailers have to face nowadays—one where virtual and physical channels come together to enable in-store access to web-based customer reviews and price comparisons, while also taking some physical store capabilities to the virtual channel (for example, Remote Deposit Capture in banking). Read More »
My colleagues Jon Stine and Lisa Fretwell with Cisco IBSG recently published research about consumers that are constantly channel hopping in their shopping journey. We all have personal experiences shopping on the web, in the store and on mobile devices.
I recently in the middle of a conversation during lunch, made a reservation on Open Table app, purchased a case for my phone on amazon app and bought a music album on iTunes (Doctor Who Series 6), and pulled up directions to the local home improvement store, all in 10 minutes. Obviously the consumer trend is shopping across multiple channels, and some retailers are succeeding in this new world, and some are not.
I sat down with Brian Kilcourse, managing partner of Retail Systems Research and this was one of the topics we talked about.