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Why Thai insurers need a deeper customer understanding in the ‘Digital Era’.
BANGKOK — Thirty five million Thai people are frequent users of the internet for social purposes, as well as, for the purchase of products and services – 182 billion THB (5.2 billion USD) was spent on retail ecommerce alone in Thailand, in 2013*. When looking specifically at the insurance industry in Thailand, non-life on-line insurance sales grew 136% (premium of new business sold) between 2013 and 2014**. "It is crucial for insurers to focus on digital channel development and optimization, and equally important to "change the thinking" to become successful in the digital era," explained Ms. Kelly Yong, CEO of Aegon Direct & Affinity Marketing Services Thailand or 'ADAMS', one of Asia Pacific's leading independent direct marketing and consultancy service providers, specializing in insurance distribution. "In order to become successful in digital channels, the insurance business in Thailand should focus on understanding the customers. There are opportunities for insurers to differentiate by introducing an analytics driven approach to developing digital service platforms and multi-channel strategies. When you understand what the customers need, you can truly provide the right product, at the right time, to the right customers."
The recommendations from ADAMS to Insurance companies when it comes to digital, include;
1. Start with understanding the customer and design the customer journey according to how customers choose to interact and transact across channels.
Consumer research, conducted by ADAMS in 2013, has shown that the younger Thai generation, including mature singles (aged 30+) and young families (aged 25-34) have a high interest in buying insurance products on-line or over the phone, especially for Auto insurance and Personal Accident products. Those consumers will source information from peers, 'word-of-mouth,' TV and on-line. However, the factors that have the most impact as to their consideration to purchase are; high credibility and trustworthiness of the insurance company; if there is a follow-up service offering; a simple sales application process; and providing help whilst transacting on-line.
2. Insurers should focus on customer experience rather than just sales, to drive a better outcome overall. A great customer experience will build trust and also create 'word-of-mouth' recommendations. In order to deliver a good customer experience, Insurers need to;
i. Create a user-friendly digital channel, with simple navigation and clear language;ii. Provide an on-line transaction service, enabling an immediate purchase;iii. Provide the offer of 'human' assistance to customers to support throughout their on-line journey;iv. Design products which are easy to understand, as the customers are often making the decision to purchase unassisted.3. When creating a digital strategy, be aware that even though digital plays an increasingly important role in insurance, especially around education, traditional channels such as Face-to-Face and over the phone are still important for customer engagement when discussing financial protection.Dr. Hongjuan Liu, ADAMS' Regional Director, Customer Analytics & Behavioral Insights, shared one example of how Aegon Life Insurance Co. Ltd. (Aegon Life), an Aegon Joint Venture, implemented a successful digital strategy in India. Aegon Life was the first insurer in that country to distribute Life insurance on-line, and they believe in creating a simplified buying process. Rather than operating the on-line sales channel on its own, Aegon Life also established a tele-assist operation to help guide consumers through the on-line journey, providing multiple touch-points for contact, such as web chat and inbound/outbound telephone services.
This approach was driven by the consumer needs of 'chatting' with a real person, as life insurance is still considered complex and not as easy to understand. With such a focus on customer understanding and customer experience, Aegon Life won the "eBusiness Leader" at the India Insurance Awards for three consecutive years (2013 - 15).Ms. Yong concluded that "Just like in any other developing country, be close to the ground, adopt a "test and learn" environment, always have a creative appetite in order to be successful in the digital era as customer behavior changes along with new technologies. This is our philosophy and we are excited to work with our business partners here to innovate in digital insurance distribution."
*www.bot.or.th and www.nso.go.th**www.oic.or.th
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