Insurers are pretty well-informed that customer experience is the key to running a good business. The problem is that when it comes to asking for investment in customer experience it’s easy for the executive team to turn down because it’s not clear where the return on investment is coming from.
Chief Information Officers understand that there’s a strong case for IT (including specialist insurance software) to handle some of the burden of improving customer experience but they often get stuck when it comes to quantifying the benefits of the investment in new technology. So here’s a quick look at how to break things down to bring the CFO on board.
Get the Data
It might seem silly but all too often the lack of investment in customer experience is explained by a lack of data. It’s a well-known fact that customers that churn often don’t complain before they leave. In fact there are estimates that for every customer complaint an insurer gets, there are another 10-20 unhappy customers out there with the same problem who don’t say a thing; they just take their business elsewhere.
You can begin building your business case by creating data through sampling. Take a decent number of customers and contact them. You’ll need to ask some honest questions and try not to become defensive when you get an honest response.
- “Did you have any problems with our products or service?”
- “Did you tell us about those problems?”
- “Did you tell anyone else about those problems?”
- “If you spoke to us did we resolve the matter to your satisfaction or not?”
- “How do you feel about our products or service now?”
You should then be able to quantify not just how many customers told you they weren’t happy but also the numbers that didn’t.
One thing you should discover is that the customers most likely to renew are those that had an issue and were happy with the way it was resolved. Why? Client loyalty is built on interaction. A successful problem resolution is a positive interaction with the brand.
Thus the data should not only help build the business case for investing in customer experience but also provide some data with which to improve the customer experience too.
A Happy Side Effect of Collecting this Data
If you could show your customers the common pitfalls associated with a product and help them from falling into the trap – wouldn’t they be more loyal? Experience suggests that they are.
Marketing teams may have a conniption fit even considering this but if you were to inform your clients of the three most common problems associated with a product and how to avoid those problems (say via automated e-mail the day they purchase the product) – it’s more likely that not only will you avoid a large number of customer service calls but that your clients will remember the efforts you made to help them. Those efforts tend to turn into customer loyalty. The buzz of happy customers has been shown to increase sales too.