American and Canadian insurers are facing some big challenges in 2015. Customer experience expectations, their willingness to consider a growing array of new options to buy insurance, and new competitors creeping into the business of insurance are pushing traditional insurers into new digital strategies. It’s no longer a question of digital channels or “other” when it comes to the customer journey; they’re now intertwined. Digital-dependent customers are eyeing new and more digitally savvy market entrants, while demanding more control over the experience and how their personal information is used. This year, digital insurance teams are crafting agendas that satisfy their firm’s hunger for increase market share and revenue balanced with changing demographics, adaptations in response to extreme weather, and regulation that has lagged the changing realities of digital. One thing’s for sure: Insurance eBusiness teams can’t afford to wait around, but they also can’t afford to make the wrong digital decisions.
Just what are the factors propelling North American insurer agendas this year? For starters, it’s about:
Uneven economic growth in North America. The 2008 financial crisis? It’s a distant memory in much of the US, but not for all. By most measures, the US economy is thriving, driven by rising consumer demand for homes, cars, and consumer goods, and, by extension, insurance. And in oil-producing Canada the decline in gasoline prices isn’t good news: Canada is threatened with recession.
On November 20, Google released a report on the findings from a survey it conducted in collaboration with Forrester on online shopping trends in India. The report highlights what’s driving the growth of eCommerce in India, including mobile commerce, female shoppers, and the growing number of people in tier two and tier three cities making purchases online. However, the report also noted some barriers to online retail in India, such as its poor showing regarding customer satisfaction and trust; to make further progress, eCommerce firms must work hard to improve in these areas. The report’s key findings involved:
Mobile shoppers. Mobile is driving the market, especially in tier two and tier three cities in India. Half of the online shoppers in tier three cities are already on mobile, compared with just one-third in tier one cities. The percentage of online buyers making shopping queries from a mobile device has grown from 24% in 2012 to 57% in 2014. Forrester forecasts that mCommerce in India will reach $19 billion by 2019.
Women. Women are far more active buyers than men in tier one cities. They outspend men online by two to one, and one-quarter of women in tier one cities make mobile purchases.
New buyers. More than 70% of people in tier one and tier two cities who do not currently make purchases online are expected to do so in the next 12 months.
New growth areas. Home furnishings, cosmetics, and baby care are the next areas of growth for online retail after the success of online retail in the consumer electronics segment.
This week Google started promoting mobile optimized websites in their search results:
Frankly I'm amazed it's taken Google this long to implement, however for mobile users it's a welcome addition to the search experience that alleviates the pain of clicking on a link only to find a desktop site at the other end. Now the consumer is in control and armed upfront with a Google endorsement of mobile readiness. This strategy is part of an evolution of preemptive warnings for mobile search users. Earlier this year Google started warning mobile users of destinations using Flash or destinations with broken links that would result in a re-direction to the destination homepage.
2015 is upon us: in Forrester’s just-released “Predictions 2015: US B2C And B2B eCommerce Players Will Struggle To Keep Up With Customers” report, we predict a number of key issues will challenge B2C eBusiness & Channel Strategy professionals in the coming year, while a number of new and exciting—but not pressing—topics will circulate. B2C eBusiness & channel strategy professionals ought to know which key issues to watch and which over-hyped trends to ignore.
What Will Happen: Flexible Fulfillment is the new term for omnichannel
Mobile developers change people's lives every single day -- they create innovative experiences, reshape how we spend our time, and give us continual access to Facebook and Twitter (the latter being especially important to the author!). The pace at which these new experiences are delivered continues to amaze, yet continues to speed up. As a recovering enterprise mobile developer myself, I'm always tracking the new tools and technologies that developers are using to maintain this pace and provide new innovation. With that in mind, we've published a report on the mobile development predictions for 2015; the changes that will allow developers to continue to produce amazing innovation at a continually faster rate. We've highlighted 8 in the report, but the ones that are especially exciting to me are:
A year ago, I blogged about the fact that the app economy was blurring the lines and opening up new opportunities, with a lot of new entrants in the mobile space, be it with mobile CRM and analytics, store analytics, dedicated gaming analytics, etc.
Since 2010, more than 40 companies have raised about $500 million in that space! Watch it closely – consolidation will continue, as evidenced recently by Yahoo’s acquisition of Flurry.
While a lot of innovation is happening on the supply-side, too many marketers have not defined the metrics they’ll use to measure the success of their mobile initiatives. Many lack the tools they need to deeply analyze traffic and behaviors to optimize their performance.
Fifty-seven percent of marketers we surveyed do not have defined mobile objectives. For those who do, goals are not necessarily clearly defined, prioritized, and quantified. Only 38% of marketers surveyed use a mobile analytics solution! Most marketers consider mobile as a loyalty channel: a way to improve customer engagement and increase satisfaction. Marketers must define precisely what they expect their customers to do on their mobile websites or mobile apps, and what actions they would like customers to take, before tracking progress. Too many marketers focus on traffic and app downloads rather than usage and time spent. While 30% of marketers surveyed consider increasing brand awareness as a key objective for their mobile initiatives, only 16% have defined it as a key metric to measure their success!
The problems Rick identified in CX ecosystems seem to be the result of ossified organizations, cultures, and business relationships. This means CX leaders must drive new levels of responsiveness and creativity into their ecosystems. And the way you drive these attributes into your ecosystems is to seize on the concept of business agility. My colleague Craig Le Clair outlined 10 dimensions of business agility that provide the market, organizational, and process frameworks necessary to embrace market and operational changes as a matter of routine. This is merely setting the strategy, though; executing it requires a marriage between the business and technology strategies.
Over the past year, we’ve told banks that some of them would become custodians. We’ve told insurers that many of them would be forced to specialise. We’ve told wealth management firms that many would shrink. We’ve done this to show them how digital disruption could savage retail financial services, just as it has done with the music and publishing industries.
But we don’t want to be just the bearers of bad news: We want to help you deal with new players like peer-to-peer lending platforms and even Google entering retail financial services. And to be fair, it’s not all bad news. There are plenty of companies out there using digital innovation to meet their customers’ financial needs in new and better ways. Take for example BBVA which has brought its customers the virtual assistant Lola, video banking, and the crowdfunding platform called Suma. And BBVA hasn’t stopped here. The Bank is currently running the sixth edition of its Open Talent competition for start-ups most likely to affect financial services.
"When will Google launch a bank and what will it look like?" is a question I frequently hear from our banking clients. Google’s activities in digital wallets and payments, as well as its reputation as one of the most disruptive firms in the market, have obviously left many banking executives worried. Unfortunately, they’re asking the wrong question.
I’ll leave aside the issue of whether Google or perhaps Apple or Amazon should be the focus of this increased attention. Each of these players has its unique strengths and growth plans, and some of these correlate more or less closely with financial services. That’s not what makes the question so wrong. As I write in my new report, it’s the assumptions that are faulty here; assumptions that reveal precisely the type of legacy mindset that makes many retail banks so vulnerable to disruption.
Many retail financial firms still haven’t grasped the full potential of digital disruption. They think that new competitors will use their digital might to beat them at their own game, be that through more efficient processes, brilliant algorithms or better user experience. While these three things do matter, what matters most is the purpose which they serve. As I have written elsewhere, digital disruptors like Google are disruptive because they don’t play by the rules. Instead, they use digital technologies to deliver better or entirely new ways of meeting customer needs, often bypassing regulation and re-defining a given industry in the process.
Yesterday HP announced that it will be entering into a “non-equity joint venture” (think big strategic contract of some kind with a lot of details still in flight) to address the large-scale web services providers. Under the agreement, Foxcon will design and manufacture and HP will be the primary sales channel for new servers targeted at hyper scale web service providers. The new servers will be branded HP but will not be part of the current ProLiant line of enterprise servers, and HP will deliver additional services along with hardware sales.
The motivation is simple underneath all the rhetoric. HP has been hard-pressed to make decent margins selling high-volume low-cost and no-frills servers to web service providers, and has been increasingly pressured by low-cost providers. Add to that the issue of customization, which these high-volume customers can easily get from smaller and more agile Asian ODMs and you have a strategic problem. Having worked at HP for four years I can testify to the fact that HP, a company maniacal about quality but encumbered with an effective but rigid set of processes around bringing new products to market, has difficulty rapidly turning around a custom design, and has a cost structure that makes it difficult to profitably compete for deals with margins that are probably in the mid-teens.
Enter the Hon Hai Precision Industry Co, more commonly known as Foxcon. A longtime HP partner and widely acknowledged as one of the most efficient and agile manufacturing companies in the world, Foxcon brings to the table the complementary strengths to match HP – agile design, tightly integrated with its manufacturing capabilities.