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Over the past couple of postings, I’ve been taking a look at this year’s Fjord Trends and asking what they mean for LP&I providers. The key message that keeps coming through is the whole idea of relevance. To differentiate themselves in a crowded marketplace, providers have to create relevant products and services. And increasingly, these products and services have to provide value not just for consumers but for wider society too. 

In this third and final blog in the series, I want to focus on the last three trends and find out what they mean for the LP&I industry. Fjord’s Inclusivity Paradox is right on target.  

Here the message is all about personalisation. In trying to be more targeted, relevant and inclusive in their product offerings, LP&I providers risk inadvertently excluding or even alienating some customers and financial advisers. What about the voices that haven’t been picked up by data or that don’t fit the traditional groupings? 

The solution: focus offerings on mindsets and contexts instead of on traditional demographic measures. This could involve segmenting customers based on how they use digital technologies, a factor that in today’s era of “post-demographic consumerism” arguably says more about someone than their age, gender and education. It also cuts right across the mosaic of traditional demographic groups. Meanwhile, to achieve relevance in context, providers should build offerings and messaging around different customer life phases or key life events.  

Doing this effectively may demand investment in R&D in order to understand this new, dynamic and – most importantly – digital customer deeply enough to provide products that offer enhanced value and relevance. But all the tools that providers need to segment the marketplace are available. And there’s certainly no shortage of data. 

In the next trend, Space Odyssey, we explore how, as digital and physical become increasingly intertwined, businesses need to design spaces, products and services to provide customers with a flexible and personalised experience, regardless of channel. 

For LP&I providers, this means first and foremost building out a digital offering, akin to what retailers have done with e-commerce. This could be a digital experience where a customer need never ‘physically’ speak to a provider. It could be a self-service web portal, or it could be an app.  

Secondly – and this is just as important – LP&I providers must integrate their digital offerings with their physical distribution channels. Preferences registered and actions taken by customers in the digital space should be visible to advisors in the face-to-face channel, and vice versa, ensuring that recommendations and offers are always as relevant as they can be. 

Looked at in an LP&I context, the final trend, Synthetic Realities, presents us with an unforgiving market of consumers no longer prepared to take anything at face value. 

The digital age has always been about the effortless replication of information – text, images, music – and the same increasingly applies to brands, products and services. The outcome? Customers have a hard time telling what – if anything – sits behind a brand. Apathy is rife and authenticity has become the new Holy Grail of brand marketeers. 

With customers increasingly deaf to time-honoured life and savings narratives, providers need to craft strong, fresh brand stories to get their attention. LP&I products remain misunderstood and even feared by many end consumers, so effective storytelling will also grow the overall market. Take Vitality for instance, which has merged insurance with wellness to create a compelling new mission statement around protecting people’s health. 

Opportunities abound for LP&I providers to become more than just ‘same-old, same-old’ LP&I providers. There remains a huge gap in provisioning for the link between mental wellbeing and financial wellbeing, for example. And, just as Vitality has made insurance an adjunct of fitness, traditional providers can build savings into things customers are already familiar with, already do and already enjoy – helping to solve the ongoing UK savings crisis. 

So, there we have it. By delivering relevant offerings via relevant channels, buoyed with a sense of brand mission, LP&I players can establish those all-important customer connections amid the digital cacophony. 

That’s it for this mini-series. I hope you’ve found these blogs interesting and stimulating. I’d love to hear your views. Please leave a comment or email me. Thanks for reading.