Welcome to the first part of a series called Chart of the Week. In this series, I’ll post a short video that looks closely at a figure or chart from a piece of Accenture research. My team and I have selected some fascinating—and hopefully, useful—charts. I’m looking forward to discussing the charts over the coming weeks.

Do you know your customers?

 

It sounds like a silly question: Do you know your customers? And if so, how well? Do you know what they want from you in terms of information and engagement?

If you answered yes, then you probably have an effective customer segmentation strategy.

Figure 1 divides customers into four segments, based on the importance of information and the importance of relationships. Click on Figure 1 to open a larger image in a new window.The lower left quadrant represents an entry-level buyer who needs little information and doesn’t value contact with an agent.

  • The upper left quadrant represents a buyer who needs more information, but still doesn’t value contact with an agent. Perhaps this buyer has an existing policy and wants to add or change coverage on that policy.
  • The lower right quadrant represents a wide spectrum of buyers who prefer to rely on agents for advice. Accenture research shows that this segment includes initial buyers, existing customers wanting to add coverage and long-time customers who want to upgrade their policies.
  • The upper right quadrant represents buyers with the most intensive needs: those who demand lots of information and prefer to have a strong relationship with a financial planner—not just an insurance agent. These customers want a relationship with you, value your advice and are very loyal.

You can see that these four customer segments have varying needs and expectations, and that carriers need to approach each segment in different ways. In other words, one size doesn’t fit all.

Attract and retain customers for life

Developing and implementing a solid customer segmentation strategy is an important way for carriers to improve the quality of their customer experience. Even more important, by understanding your customer segments, you can build enduring relationships to move your customers to higher-value products over time.

For more information, download Attracting and Retaining Customers for Life.

Join me next week as I talk about where people are buying insurance.

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