Insurers need a customer experience management strategy

OVUM VIEW

Ovum publishes report on creating an insurance customer experience management strategy

The marketplace is moving quickly through an inflection point in the way that commerce is conducted. It is entering an environment in which consumers are gaining more power in the business transaction, corporate messaging must be closely tailored to each individual customer, and customers increasingly expect to be treated as individuals. Ovum’s recently published report Creating an Insurance Customer Experience Management Strategy discusses what insurance customer experience means, the customer experience management (CEM) process, and the major components and associated capabilities required in an insurance CEM solution to enable insurers to provide high-quality customer experience. The report provides detailed profiles of six technology vendors offering products or services supporting different aspects of an insurance CEM solution: Hearsay Social, Interactive Intelligence, Microsoft, NexJ Systems, Salesforce, and SAP.

Customer experience is becoming the new basis of competition

The crux of adapting to a customer-centric marketplace is providing excellent customer experience. This raises the obvious question: what is customer experience? We define the customer experience (regardless of the industry), as the sum of exposure that a customer has to three domains:

  • external “surrounding” contact with others about a company or product
  • a company‚Äôs marketing, sales, and support infrastructure
  • the usage of a product or service itself.

Our definition incorporates a broader perspective than most enterprises work with, especially the service part of the business. We believe that the essential component of the customer experience (and much of the value of it) is derived from seeing it as closely as possible from the customer’s point of view, regardless of whether the customer is a consumer or a business.

Insurers need to understand the CEM process

Insurers must understand the CEM process before being able to create (or use) a CEM solution. CEM is the process of:

  • tracking a customer’s path across the customer experience lifecycle
  • integrating data from all interaction channels across the customer experience lifecycle
  • integrating customer-specific data collected from external sources with customer-specific data from the insurer’s functional departments (e.g. underwriting, marketing, claims, billing, sales and distribution, and legal)
  • improving the quality of revenues and profit derived from customers
  • optimizing business processes to become customer-centric.

An insurance CEM solution encompasses three interdependent sets of components

Insurers need to build or acquire the three interdependent sets of technology components required in an insurance CEM solution:

  • tactical components: the capabilities needed to create, deploy, track, and manage the experiences of each individual insurance customer
  • control components: the capabilities needed to manage the security and auditability of each customer interaction
  • design, use, and maintenance components: the capabilities needed to design a CEM strategy that aligns with the business systems used to keep the insurance company running; use the components of the CEM strategy; and maintain all of the components of the CEM strategy.

Our report discusses in detail the specific capabilities of each of these sets of components, while the associated set of vendor tables details the products and services in the three component areas offered by each of six technology vendors: Hearsay Social, Interactive Intelligence, Microsoft, NexJ Systems, Salesforce, and SAP.

APPENDIX

Author

Barry Rabkin, Principal Analyst, Insurance Technology

barry.rabkin@ovum.com

Further reading

Defining the Insurance Customer Experience, IT004-000360 (February 2013)

Creating an Insurance Customer Experience Management Strategy, IT004-000354 (February 2013)

2013 Trends to Watch: Customer Relationship Management, EI015-000005 (October 2012)

The Future of Customer Service in a Mobile World: Smart, Connected Interactions, TE001-000543 (July 2012)

Redefining the Customer Experience, TE007-000614 (June 2012)

Preparing for the Social, Self-directed Insurance Customer, IT004-000304 (April 2012)

Disclaimer

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No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior permission of the publisher, Ovum (an Informa business).

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