Other parts of this series:
- Insurers need to respond quickly to win and retain customers in a market hugely disrupted by Google and Co.
- Insurers are equipped to meet rising consumer demands, but their advantage could be eroded
- Insurers can learn from Google and Co how to disrupt and dominate a target market
- Insurers must become constantly relevant to their customers or they will lose revenue opportunities
- Digital enablers help insurers nurture innovation and develop products to fuel revenue growth
- Insurers should align their market roles with key digital enablers to drive up revenues and curb costs
Insurers eager to thrive in the new customer-driven era should take a close look at how Google and other digital giants operate. These online innovators are all very good adopting specific roles that enable them to disrupt and dominate their target markets. Carriers need to select the roles that best suit their digital business objectives.
Insurers are increasingly having to fend off competition from Google, Apple, Facebook, Amazon and Alibaba (GAFAA) and other digital specialists. Furthermore, they’re conducting business in a market that is being hugely disrupted by these companies. In the new consumer-to-business (C2B) era digitally-empowered consumers are dictating how companies should serve them. And, as you can see from the illustration below, few companies can satisfy them as well as the GAFAAs.
Carriers searching for role models to help them succeed in the C2B era should take a close look at how the GAFAAs operate. One of the GAFAAs’ most distinctive features is the way they adopt different roles within a variety of markets. They’re able to identify the most effective mode of doing business in a particular sector. This becomes the platform from which they strive to disrupt and dominate their target market. Think of Google’s entry into the digital advertising business, or Apple’s introduction of smart digital devices, or Amazon’s thrust into online retailing.
Insurers looking to devise an effective C2B strategy should adopt a similar approach. They need to be clear about the roles they’re going to perform. Here are some of the leading options:
Relationship player: The insurer owns and enhances its relations with customers by delivering products and services across a variety of digital ecosystems. These ecosystems incorporate links with several partners. They could include other carriers, suppliers from different industries, fintech specialists and even some of the GAFAAs.
Platform provider: The carrier builds and supports an open digital platform that enables financial services firms, and other content providers, to interact with potential customers.
Financial services utility: The traditional role that most insurers currently perform. The carrier develops, packages and provides insurance solutions and associated financial services.
Innovation playmaker: The insurer forges close ties with fintech firms, using incubators, accelerators, technology hubs and venture funds, and expands into new businesses across digital ecosystems.
Secure digital enabler: The carrier builds and operates a secure technology platform that offers consumers easy access to digital commerce. This could be extended to include specialist security services such as verifying digital identification, safeguarding the privacy of customers’ data, and ensuring compliance with data privacy regulations.
Some of these roles seem far removed from the traditional insurance business. But the GAFAAs all climbed to the top of their markets by identifying how to do something different. And then did it better than anybody else. Insurers need to adopt the same attitude if they want to succeed in the fast-moving C2B environment.
In my next blog, I’ll discuss how insurers can ensure they remain relevant to increasingly fickle customers.
Until then, take some time to read some of these links. I think you’ll find them interesting.