The future of ultra-targeted insurance: Get bigger by thinking smaller
Insurance firms that use data to understand customers can create relevant market positioning to stand out amongst competitors.
People can see hundreds of adverts a day. We’re all flooded with content, so how do you make an insurance product stand out in the noise?
In a world where consumers expect a fast, friction-free brand journey, the insurance industry is experiencing a mindset change — where successful marketing doesn’t center around price alone, and the entire customer experience can be used to support brand loyalty.
The reality is that insurance providers can now grow bigger by thinking smaller — and there are huge opportunities for this in the property and casualty markets. It requires an ultra-focused mentality, though, so forget the one-size-fits-all approach and clunky, time-consuming product offerings for the mass market. Today, making product deployment more relevant and targeted can fast-track you to the top of the Google searches but also allows you to react quickly to new market trends and consumer needs.
To do this, insurance providers need to develop the digital agility of more advanced eCommerce sectors. Perfect the art of using data-driven insights to understand your customer, and you can create relevant content and market positioning that gets you noticed among a crowd of competitors.
Focus like an athlete
Think of it a bit like being an Olympic athlete: You train for your sport, you are focused and know what you have to do to win. When you market a specialist insurance product, having that in-depth understanding of your customer gives you a head start.
The small business insurance market, for example, can be very broad, very competitive. In the U.K., price aggregation is increasingly common and business is gravitating towards trading online. In the U.S., the market remains heavily biased towards local agents, but the pull of the internet is drawing more small businesses towards it.
Businesses in the U.S. looking online for their insurance will find a market dominated by big legacy brands, but it can be off-putting for a small business to be faced with a barrage of generic questioning to ‘get through’ from insurance providers who don’t necessarily understand the nuances of their business. For instance, a beauty therapist doesn’t want to be asked questions about ‘working at height,’ which someone in the construction trade might — it’s not relevant to their business.
A better option is to present each section of the market with an ultra-targeted digital environment. A place where content, risk assessment questions and policy coverages are relevant, and you can become a trusted specialist to that audience. The nature of the small business market makes it very expensive to reach the right small business owners, so by refining the targeting to specific business profiles, marketing can be more effective in terms of response and acquisition cost.
Develop fast reflexes
The pandemic brought into focus the importance of being able to respond rapidly to new trends in specialist insurance markets.
In the U.K., domestic caravan holidays, bike sales and online fitness regimes, for example, all saw a sudden increase in popularity — and insurance products needed to respond quickly to changing needs. When Prime Minister Boris Johnson announced that all gyms would be forced to close in March 2020, virtual workout cover for fitness instructors needed to quickly follow.
A recent Deloitte study highlights the importance of an agile digital channel strategy, which can react to the needs of customers. As you’d expect, there have been rapid changes in consumer behavior during COVID-19, with two-thirds (66%) of consumers saying their appreciation for well-designed technology has increased.
Stay ahead of the trend
Being at the forefront of evolving markets is important and e-scooters are a prime example. In the U.K., they generally remain illegal in public spaces, but with changes in restrictions looming, insurers need to be ready.
Ripe launched its first e-scooter insurance product in the U.K. last year under our Cycleplan brand, which has enabled us to start gathering data to understand the market and customer profile. Even though personally owned e-scooters are only legal on private land currently, we’ve seen a huge growth in interest, with more than 30,000 quotes to date and year-on-year policy sales increasing by 1,592%.
Content has played an important role in this, with the “Best electric scooters on the market in 2021″ blog now our second most-read article, with over 29,000 page views.
Test the science
The important thing when marketing an ultra-targeted product is to get deep under the skin of the particular segment of the market and understand what the customers want, so you can talk their language. Access to data and knowledge of channels where you can target and engage with the appropriate customer profile is crucial, as is the ability to customize the website, product and customer journey to appear as niche as possible.
It’s important to get detailed customer experience insight. If you rely on verbal feedback alone, it can be difficult to get a precise view of what customers did and didn’t like about the journey. Going a step further and using neuroscience and biometric tests to gather an additional level of data helps you see where the exact pinch points are to improve the customer journey.
Plan your route to the future
As the pace of our sector continues to get faster and consumer expectations rise, we need to keep up. When we look to the future, tailored insurance cover and pricing will become expected by consumers. They don’t want an expensive package that doesn’t meet their needs; they want cover for exactly their requirements, which can take into account specific risk factors.
Sometimes thinking smaller is the best way to grow bigger. The challenge is having the tech capabilities, data analysis and creative skills in place to quickly deliver compelling insurance propositions for your ultra-targeted audiences.
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