So expensive is said nowadays about improving the customer experience, “delighting” customers and delivering customer service that goes “above and beyond.” For large enterprises, particularly in the insurance industry, this focus on customer experience is quickly becoming a key competitive differentiator.
Disruptors within the e-commerce, retail and hospitality industries have set the standard for new-age customer service. Amazon, Zappos and AirBnB are notable examples. This standard is spilling into other industries. Actually, 89% of companies expect to compete on the basis of customer experience vs. only 36% only 4 years ago, based on Gartner.
But the question remains: Should every company play the role of an Amazon or Zappos with their “whatever it takes” approach to customer service? I argue they shouldn't. And, to be honest, they cannot.
Know what your customer REALLY wants
Insurance, for example, is a low-interest, low-involvement category in that people rarely get looking forward to paying an insurance policy premium or filing claims. Can insurance companies and providers delight policy-holders? Do policy-holders desire to be delighted? I think about this just like a visit to my dentist. My dentist is a great guy, very professional and takes great proper care of my teeth, but I always dread going and am glad when it is over. The reality is, no matter how personable he his, how comfortable the chair is or how new the magazines are, I simply can not be delighted. It's the dentist, in the end.
In the context of insurance, customers focus more on utility than on the extraneous features. It is simply like going to the dentist. Customers would like to get in, take action and obtain out as quickly and as painlessly as possible. This is also true for customer service. Customers just need the basics to run smoothly. They need processing their tell you they are easy, and they wish to move on. Anything else – any extraneous features – comes second.
Despite this attitude, the insurance coverage market is in desperate necessity of innovation. In fact, it is a $1.2 trillion dollar behemoth that's begging for disruption. The proliferation of technology and innovation across other industries, for example retail and banking, means consumers are expecting the same degree of innovation elsewhere – and insurance is in their sights.
How can insurance providers approach innovation without overhauling the client experience and over-complicating things along the way? The answer is easy: concentrate on utility over features.
Utility over features
Insurance companies have to determine what their customers’ most basic demands are and must seek to fulfill them before exploring any transformative technology, additional features or new processes. When exploring new ways technology can improve business, it's easy to get swept up within the sexiness and commitment of innovation – the dreaded technology-for-technology's-sake initiative!
But to work, executives should approach innovation and new technology with a clear strategic and connected directive. Often, we crawl into our own heads and, using the best intentions, solve for any business problem without understanding the effect on customers. A thorough understanding in the customer's perspective is important, as is an understanding of methods to align customer needs using the company's overall direction. Therefore the key is starting off small. Implement a simple process switch to introduce people to a different way to do things and expand after that.
Because while innovation is much needed, we mustn't forget that change is hard. People, and particularly large enterprises, are naturally resistant to change. Inertia, complacency and “that's the way we've always done it” attitudes are easy and-all-too common in the insurance sector.
Insurance customers aren't ready for a revolution, either. Nor do they necessarily want one. Changes in technology mean a new learning curve, and if that curve is simply too steep or otherwise thoughtfully executed with the customer in mind, the satisfaction plummets.
Customer satisfaction is simple
Your goal is to save customers time, save them money or simplify their experience (bonus points if you're able to do all three!). And at the core associated with a great experience is getting towards the root of the customer's problem. Customers aren't always seeking to be “delighted,” but they are looking for the best answer.
So I'm not suggesting an “Amazon-ification” from the insurance industry, but I do believe all companies should be aware of companies that are raising the bar and setting customer experience expectations. Think of it as a different way to manage risk in the marketplace. There's a price tag related to increased levels of customer support. Not all customer segments are created equal, but a far more granular knowledge of cost to serve, customer expectations and profitability are foundational to building the very best customer strategy.
