Self-Service or Self-Serving?
2012/12/03
Ever since we discovered that the internet could be more than just a document repository or shop-front, we have been investing in smart ways to engage our customers better and improve the user experience. Self-service via a laptop, tablet or mobile device clearly has huge benefits to both the customer who now has access to information at their fingertips and insurers who are able to strip out significant costs from their business through outsourcing process to the customer and redirecting inbound calls. So, when an insurer progresses down the path of implementing ‘self-service’, who benefits most? Are propositions and solutions designed primarily around what the customer wants or are they skewed more towards reducing the insurer’s cost base? I’m sure that there may be people reading this who argue that this is clearly a pointless question as the answer is “Both. It’s a win-win for all”. However, when reflecting on my personal experiences of being part of proposition development teams for both mass-market and HNW propositions, the starting assumption has often been how best to minimise touch for the mass-market via self-service in order to satisfy their needs at a minimum cost to the insurer (measured through call centre volume reduction and staff time), and then how to tailor the HNW propositions with the addition of personal services (such as personal account managers and claims handlers) on the assumption that wealthier customers demand a more personal relationship and are willing to pay for it. In a recent Celent survey into customer preferences for technology use at the point of service (both in the US and the UK), some interesting findings resulted when comparing customer service preference with household income. To make it easier to see, I’ve created the following mini-chart which combines the findings from both US and UK consumers. 
These findings suggest that there may be a correlation between household income and the desire for self-service. The findings also appear to indicate that there is a reducing reliance on ‘human touch’ for wealthier consumers. Simply put, the wealthier an individual is, the more likely that they are to use ‘self-service’ and the less likely they are to seek out ‘human touch’ in the form of additional personal services. Conversely, for complex transactions, the less wealthy an individual is, the more likely they are to seek out either face-to-face or call centre interactions as opposed to ‘self-service’. So, what could this mean for proposition development and assumptions for “self-service”? If insurers are pursuing ‘self-service’ from a perspective of reducing their own costs on the assumption that this is what the consumer wants too, then maybe these insurers are missing a trick? (especially if they are targeting the mass market / less wealthy individuals who either lack the confidence or frequency of contact to maximise adoption). Likewise, if insurers are pursuing HNW individuals through layering on personal services to their proposition, then maybe their design effort could be better invested in improving the user experience or access to on-line tools? Clearly, there is more research that insurers can do to either validate or challenge these initial findings, such as investigating the relationship between wealth and financial confidence, the different types of insurance products (clearly auto insurance is likely to have a different profile to annuities), differing personal experiences of “self-service”, the diffusion process, etc. In the meantime, prior to finalising 2013 plans, maybe there’s just enough time to challenge assumptions around customer expectations for “self-service” and squeeze in any last minute adjustments.
These findings suggest that there may be a correlation between household income and the desire for self-service. The findings also appear to indicate that there is a reducing reliance on ‘human touch’ for wealthier consumers. Simply put, the wealthier an individual is, the more likely that they are to use ‘self-service’ and the less likely they are to seek out ‘human touch’ in the form of additional personal services. Conversely, for complex transactions, the less wealthy an individual is, the more likely they are to seek out either face-to-face or call centre interactions as opposed to ‘self-service’. So, what could this mean for proposition development and assumptions for “self-service”? If insurers are pursuing ‘self-service’ from a perspective of reducing their own costs on the assumption that this is what the consumer wants too, then maybe these insurers are missing a trick? (especially if they are targeting the mass market / less wealthy individuals who either lack the confidence or frequency of contact to maximise adoption). Likewise, if insurers are pursuing HNW individuals through layering on personal services to their proposition, then maybe their design effort could be better invested in improving the user experience or access to on-line tools? Clearly, there is more research that insurers can do to either validate or challenge these initial findings, such as investigating the relationship between wealth and financial confidence, the different types of insurance products (clearly auto insurance is likely to have a different profile to annuities), differing personal experiences of “self-service”, the diffusion process, etc. In the meantime, prior to finalising 2013 plans, maybe there’s just enough time to challenge assumptions around customer expectations for “self-service” and squeeze in any last minute adjustments.