We’ve all heard about big data—in fact, some days it sometimes seems like I hear about nothing else! But there’s definite substance underlying the hype: big data has the potential to deliver insights that can help insurers fight off tough new competitors and retain their existing customers who are, recent Accenture research has shown, ready to switch providers in numbers in order to get the kind of service they want.
Read more about how to achieve payback in insurance analytics and the changing customer dynamics that are creating a massive “switching economy” of up to $646 billion.
Data is valuable, companies are starting to realize. The obvious source of that value is the use that companies can make of the data derived from their own systems. This is proving to be a huge opportunity because today’s transactional systems, connected supply chains and digital customer service channels, all generate masses of information that, if mined properly, can be turned into valuable insights, particularly for those able to match their client and contract data with customer behavior information coming from their web sites and, increasingly, mobile interactions.
But, of course, humans (and their companies) being what they are, the search is on to find new ways of expanding that value. The first option is for companies to complement internal data with Open Data, readily available from public statistical offices. Such an approach is already helping insurance companies to significantly improve their customer insight and predictive scoring.
An even more interesting option will be for insurers to participate in sharing data with members of the same ecosystem—I will look at this concept in greater depth in a subsequent blog.
Of course, the option that everybody thinks of first is simply to sell one’s data for cash, but this is only really an option for very large companies who already have all their information in a single large database and who can afford the relatively large start-up costs.
I don’t think this is an area that would be of much interest (or profitability) for insurers.
Some of the most notable current data-monetization initiatives are being run by telecoms and network operators. For example, one US operator has started a separate information business using its geolocation data, based on our proprietary Accenture Customer Insights platform. And in Europe, a major grocery chain has created a massive new subsidiary to sell its data on shoppers to consumer packaged goods companies.
In my next blog, I’d like to suggest that the latter example heralds the way in which data monetization is headed.