Financial Services Struggle to Connect with Customers and Deliver Personal Services

News Facts:

  • Leaders in the Financial Services Insurance sector admit they are behind the curve when it comes to utilising data-rich pools effectively to personalise the customer’s experience
  • Leaders from Prudential UK, LV=, Brightside Insurance and NFU Mutual admit that they need to step away from being product-led and put the customer at the heart of the business
  • Digital entrants and omni-channel options have put a strain in the sector making it fiercely competitive, creating customer churn
  • Leaders agreed that their organisations failed to use customer information from sources as diverse as social media, telematics and online credit services to build customer identity profiles

London, U.K., 20th September 2016 – Amido, a vendor-agnostic technical consultancy specialising in assembling and integrating proven cloud technologies to improve customer data and identity management, has discovered that the Insurance sector in financial services are laggards in the quest to build customer identity profiles that will encourage a more personalised service, generate sales, increase retention rates and ultimately, customer loyalty. The sector has stated that it wants to use data to harness empathy within the customers beyond simple renewals and product purchases.

All of the four insurance companies interviewed agreed that a personalised approach is integral to building loyalty, but to one smaller provider it is everything: ‘You are competing in a market which is dominated by the direct insurance writers, including the household names of Hastings, LV=, Direct Line and Tesco. They have the scale and underwriting capacity to undercut you dramatically, so to compete you have to be very good at serving niche customers with niche products, typically where the direct writers don’t have an appetite,’ said James Fairhurst, Group CIO at Brightside Insurance.

Business technology leaders from insurance also agreed with peers in logistics and retail that the digitalisation of services and disruptive aggregators have added further stress to market competition. Online giants like Amazon and Facebook are having a major impact on their sectors, in particular on the expectations of customers when it comes to the online user experience for technology-driven transactions and how organisations respond to customer needs. An added complication for the insurance sector is the urgency to have a strong multi-channel offering to meet the needs of customers who expect to be able to pick up the phone and get an answer, as well as use digital services.

‘Amazon has cracked customer identity management, it works for you, it is simple and it is very personalised,’ said Richard Warner, CIO with LV= a mutual insurance firm that has grown rapidly in recent years. ‘The bar in customer services is not set by other insurance companies, but by other experiences customers have. People look at organisations and ask ‘is that a good experience?’ based on what they have experienced elsewhere on the web.’

However, Alan Walsh, CEO of Amido, comments: ‘Amazon’s customer identity solution is not where they excel – its purchase recommendation is basic as information on the customer is based on what they previously bought and does not take into account anything else about that individual. A joined up identity strategy reduces spam and personalisation excellence comes when you use insight gained from multiple data sources (social profiles, email marketing, order or browsing history, customer services, transactional history, cookies, online journey etc.) to offer up products and services that customers want, when they want them and in the right channel. You can then apply machine learning to predict future behaviour and pre-empt what customers want before they know they want it. One technology product cannot do all this – it needs a combination – and judging by our research findings, the financial services insurance sector is struggling to gain headway in delivering a more personalised service.’

Andrew Sell, Head of Digital Marketing at Prudential UK adds that although they have sophisticated technologies, they’re still a fair way behind from forming a customer view in the way retail and media are doing. ‘We have a sophisticated Enterprise Data Warehouse that combines data from across our business, but there are still pretty big repositories of data that are not yet joined to this platform.’

Alan Walsh, CEO of Amido comments: ‘Whilst Data Warehouses are an important element of your data storage, they only give you hindsight, insight at best. What machine learning gives you is foresight. It’s having all three working together that really counts.’

The report clearly reveals that organisations see customer identity data and creating a single customer view as a rich resource, but the sector seems unsure about how to achieve this – even though they know that the lines between marketing and IT have blurred. Pooling data together from disparate sources enables customers to feel more secure in their dealings with the brand, their products and their services. Sharing this data across the entire business will help with customer profiling and identity, in turn increasing profit and loss margins as well as improving the overall experience, including the ability to tailor services and products to individual customers.

Richard Warner, CIO of LV=, agrees with James Fairhurst from Brightside Insurance: ‘A lot of our conversations with the customer start with the product, and this will have to change to create an organisation that is more empathetic to the customer. Long term, having an understanding of the customer will lead to having a better interaction with them. We need insight into their wants and needs. As a CIO, how do I have a set of processes that support the customer?’

Chris Gray, Director of Technology at Amido, adds: ‘Combining the expertise, knowledge and resources of Technology and Marketing departments will create a centre of excellence, one that utilises machine learning, data warehousing and customer behaviour information from multiple sources. This all creates that holy- grail, 360 view of the customer’s identity, which is the foundation needed for effective personalisation. The fact is, across all the sectors we spoke with, customer data is mainly owned by the marketing and commercial teams; but true customer identity resides in the data the customer is willing to share – and getting people to share information is a challenge. With Gartner predicting that by 2018, 50 per cent of IT and identity access management programmes will be focused on both enterprise and customer facing infrastructures as the two spheres evolve into one, leaders need to start working towards joining up their information by collaborating their technology solutions.’

Alan Walsh, Amido CEO, concludes: ‘Industries need to understand that identity is different to personalisation. Identity underpins personalisation – unless you have a complete view of the identity of your customer, how can you offer a truly personalised service? Customer identity is a huge part of experience, especially the merging of the digital and physical world as the transition between the two should be seamless. Once you get this right, it presents huge opportunities for all industries and across all channels. But you need to start with your technology first and most organisations already have the software; now you just have to make them talk to each other as digitalisation of the customer’s behaviour is not going away any time soon.’

Customer Experience Event – HOW UTILISING CUSTOMER DATA CAN INCREASE REVENUE GROWTH

Join us at the Soho Hotel on Thursday October 6th 2016 where our customers and report participants will be providing insight into how, by utilising customer data and technology more effectively, they have achieved a more personalised experience and as a result, enabled consistent revenue growth by increasing customer engagement.

Guest speakers include Bob Strudwick (CTO, ASOS), Ian Cohen (Ex- CIO of JLT and now adviser) and Mark Chillingworth (report author, creator of the CIO top 100 and ex-editor of CIO UK). For more information and to request a place please visit https://www.amido.com/landing-page/are-you-making-it-personal-event/

Online resources

Press Contacts

Jazz Gandhi
Sakura Communications
M: +447920032740
Email: jazz@sakuracommunications.co.uk

Harriet Durnford-Smith
Senior Marketing & Communications Manager
M: +447850650135
Email: harriet.dsmith@amido.com

About the Report

Amido commissioned a piece of research into senior IT and marketing decision makers across six vertical markets (retail, media, financial services, utilities, logistics, industry and automotive) to uncover how they are utilising the ever-increasing amounts of customer data to identify their customers and personalise customer experience. The report reveals:

  • Which sectors are leading the way in achieving a single customer view
  • How well senior decision makers think they know their customer
  • How customer data is being used to enhance long-term brand engagement
  • What are IT doing to solve the increasing problem of multiple customer data sources
  • Whether multichannel strategies have created or broken down barriers between IT and marketing

Companies that participated:

Retail – Virgin Holidays, Everest Home Improvement, N Brown, Shell Retail
Financial Services – LV= Direct, NFU Mutual, Prudential UK, Brightside Insurance
Industry and Automotive – Belron, Marston’s, 2 Sister’s Food Group,
Logistics – Metapack, DX
Media – Clifton Media Lab, Haymarket Media Group, LoopMe, Daily Mail group, Global Radio
Utilities – First Utility, Northumbrian Water, Aggregate Industries

About Amido

Amido is an independent technical consultancy that specialises in implementing cloud-first solutions. We help our clients build resilience at scale, flexibility for the future and differentiation of customer experience. And, we do this while minimising business-risk and build-cost.

We specialise in assembling and integrating proven cloud technologies, often building solutions around an existing core while enabling clients to prioritise their investment between commodity services and those that deliver competitive advantage. We design solutions that bridge and augment clients’ existing technology, reducing the operational risk of change.

We work with brands like ASOS, CBRE, Global Radio, London City Airport and Coats to remove friction from their customers’ online and mobile experiences to drive revenue and engagement. From social sign-in to smart content delivery and smooth transactions, we help brands build loyalty through customer recognition by bridging systems in a powerful and unique way, yielding real-time results for brands and their customers. Our passion is finding the right strategic mix of technology to give your company a competitive edge and your customers the best experience possible. For more information, please see https://www.amido.com/

Amido is ranked 12th in The Sunday Times Lloyds SME Export Track 100 league table, the UK’s top 100 SMEs with the fastest-growing international sales.

Amido Ltd is a company registered in England and Wales. Registered number: 7203090.
Registered office: The Leathermarket, 11-13 Weston Street, London, SE1 3ER