Insurance data - is Google the answer?

I've been told I'm blogging a little too much about insurance aggregation. But the main question I still have is "where will a customer's driving data be stored, so that they can have ubiquitous and instant access to it (and preferably at almost zero cost)?"

Yes, the answer most likely is..... Google 

They are probably the only company set up to store this amount of data and make it available online at an almost free cost.

Also, if they now own a price comparison site as well, they may be able to crack the complexity of  mapping of user driving data back to the policies of the relevant insurers(and displaying it in a coherent manner).

BTW: If you think motor insurance is a 'big data headache' - wait until you get into Smart Metering for utilities.

Getting email personalisation wrong

This morning I received an email from the popular discount / voucher service Vouchercloud.

Now I'm sure I would have noticed calling myself 'Louise' when signing up for this service. But a quick check shows that all previous emails they have sent me are addressed to 'Hayden'.

Phew..... For a minute there I got confused. I therefore wonder if anyone else got the same issue.

Perhaps a simple slip, but poor personalisation can't help deliverability or click-through rates.

Who do you trust with your Big Data?

OK, I admit it..... I think Big Data is pretty sexy (But then I find anything remotely sexy if I don't fully understand it and want to. Its why I married a woman far more intelligent than me!). And if you're also a regular reader of this blog, you'll have noticed that I've recently been going on about the use of data in the motor insurer and aggregator market.

For me, the challenge with collecting vast amounts of data on each individual person's activity, such as driving speed and their late night policy breaking trip to the nearest supermarket, isn't about how an insurance company is going to calculate exactly how much extra to charge you for running out after midnight for those cigarettes, nappies, etc. but how you are going to get hold of that data when you decide to change suppliers. Because surely if you find it difficulty to move your own data away from one company who stores your data, they have an advantage over you?

So surely the answer is to not put your data with any one specific insurance company, as they could well have the advantage mentioned above. But to put your data in the hands of an intermediary service.

But again, you have the issue of who you trust to hold this data on your behalf. Perhaps a company with the infrastructure to easily hold your data securely, who can have access to a complex search service to be able to find trends in big data and who understands the online insurance aggregation market?

Which company could provide such a service? I must Google it......

Big data and telematics insurance challenge

In my research on the development of the telematics and the insurance industry  I have realised that my slide and previous post on the maturity of the aggregators needs to change. This is caused by the addition of data..... Big data!

As premiums get more specific to the individual driving behaviour and more data is collected on each policy holder, there are questions that I've got:

1. If I want to have access to all the data about my driving behaviour, can I?
2. How much data is this and how do I get it & store it?
3. How do I provide this data to another potential insurer to be able to compare their premium?
4. How would I then provide it to several insurers at the same time as part of an aggregate service and are they able to produce comparable policies?

So far there doesn't seem to be any easy way of taking one set of telematics driving data and moving it across to another company. Surely this will become of more and more concern to drivers and also to the people that set legal policy & regulations? So if the Data Commissioner's office and even the financial service regulation bodies are not taking an obvious interest, you can be pretty sure they will do soon.

In the end, telematics does not become an issue about creating a comparable policy from insurer to insurer, it is about the bigger issue of how user data is collected, where and who stores it, who has access to it (with and without the insurers permission) and what eventual use this is put to.

Will telematics save us from aggregators?

If you read my earlier postings on telematics (otherwise known as 'black box' or GPS car insurance) and the recent post on the new insurance aggregation service provided by Google, you may have combined these two things. You may have then, like me, asked how motor insurance comparison will work for those who opt for a little electronic box in the boot of their car.

In theory, telematics should give more personalised insurance premiums, as more data is collected and more relevant policies are created for each driver. The technology is used already in Brazil, South Africa and now also Australia, which have all apparently seen reductions in road deaths as a consequence.

UK insurers are starting to get more interested in telematics and so is Go Compare, one of the UK's leading aggregators. Go Compare initially approached telematics provider Wunelli to work on a 'black box comparison site' to understand more about telematics products. This led to Wunelli spending six months developing Compare the Box's price and product comparison facility.
http://www.comparethebox.com/

So far each insurer is compared using a number of a number of factors, including the location of the car and time driven (some charge extra for late night driving), but also other more detailed information such as acceleration, braking & cornering.

Back in April 2012, Compare the Box was the only telematics insurance aggregation website. But if the history of the web has told us anything, it is that when something unique and successful is developed..... a number of other similar services rush into this space very quickly.

The era of tCommerce

It seems that for the last decade, every successive year was going to be "the year of the mobile"....  up until last year, when it actually was! However, if you asked someone 10 years ago when the "year of the tablet" was going to be, they would probably have shrugged their shoulders or maybe muttered something about having "seen some devices back in the 90's that never really took off", etc.

But the tablet has arrived and now is a major platform for the consumption of online content (although perhaps not for the production of content).

This is exemplified by the recent statistics from the BBC, that showed how Olympic viewing on connected devices peaked in the evenings, when the tablet became the most popular device as people settled down either just with one or together with their TV (in the so-called 'second screen experience').

http://www.bbc.co.uk/blogs/bbcinternet/2012/08/digital_olympics_reach_stream_stats.html

Furthermore.... if you'd suggested to anyone sane, even 3 or so years ago, that ecommerce transactions on a tablet would be a major revenue stream for a lot of businesses, they probably wouldn't have believed you, me included. But as we all know now the tablet, mainly in the form of Apple's iPad device, now makes up a significant proportion of our modern device usage with  a great deal of this activity naturally  online. And online activity for a lot of people means shopping (especially if you're my wife!).

So has the era of tCommerce or tablet commerce arrived?

In my opinion..... most definitely.

Telematics : the future of car insurance?

Telematics in its most general sense is the combination of technology and moving vehicles. However this is most generally used when referring to the tracking of motors via GPS technology and therefore it's application in vehicle insurance.

There are several ways this technology can be used and insurance companies are still looking at different ways to best offer a product to the motor market. Some providers offering a ‘pay-as-you-drive’ model similar to the way you get ‘pay-as-you-go’ tariffs for mobile phones. But others can set up restrictions for drivers, with time and geography both being possible means of restricting customers.

This in theory means they can keep premiums low by agreeing with customers that they will avoid high risk / cost activity (e.g. Away from accident black spots) or only do a specific amount of annual mileage.
Taking this only a tiny step further, this therefore can be a system for rewarding the insured for positive driving.

That little box of electronics in the boot will know everywhere you go, the speed you do it and the time you got there... then it will always report this activity back. Making it a cross between the black box flight recorder, your little brother and a trucker's tachograph.

The impact of Google aggregating insurance

I thought I'd follow up my earlier post, where I mentioned how the entrance of Google into the online UK insurance space was more of an issue for the aggregators than the individual insurers or brokers.
Note: those brands you think are insuring your car are actually fairly likely to be brokers, trying to earn a profit by selling you insurance from a smaller set of insurers.

In 2010 over 50% of all private car insurance was purchased with the use of the Internet, so it is only sensible to assume that has only increased over the last 18 months. It's therefore surprising that many insurance brands in the UK have made the decision not to have a large online marketing presence and take advantage of this traffic and growth. Sure, some companies are targeting organic or paid search online, but the major search terms are now pretty much dominated by the primary aggregators (MoneySupermarket, GoCompare, Compare The Market & Confused)*.

Either through a conscious decision, a lack of securing funds or some other factor, many insurance companies now accept the dominant role of the aggregators and pay them handsomely. In fact some even accept that up to 80% (or possibly more) of their business comes from the big players.

This current situation may not be permanent, but climbing above the big aggregation and comparison sites in either SEO or PPC is something that would take a lot of time, effort, skill and therefore money.

And this is why aggregators have more to lose now than the companies they provide customers to. They have more at stake when the biggest search engine places its own sponsored box just beneath the top two PPC adverts on a search results page. In effect giving itself a free third place listing and thus siting this service above the organic results.

For any other company this third place Pay-per-click position and top SEO place would cost a fortune to establish and maintain. Save nothing of the improved experience of a comparison service being built into the search journey.

*Sure some are spending significantly on TV (e.g. Direct Line, which is trying all it can to build brand loyalty in the run up to its proposed extraction from the now mainly Government-owned RBS group), but these cases are the exception.

Google enters UK insurance comparison market

The big news in the UK motor insurance market over the last few days has to be the entrance of a new comparison site. Usually this wouldn't be big thing, as there are a number of established players already fighting over each other to grab the remaining market share from the insurance companies they supply with leads.
However in case you're not aware, this isn't just another small startup hoping to grab a small but growing piece of the action. This is one of the biggest Internet companies out there..... Google.

Now, when searching for things such as "cheap car insurance", in addition to a couple of pay-per-click adverts appearing about the search results.... you now also get a box sponsored by Google above the search results that then takes you into a price comparison engine process that compares prices from over 120 insurance companies and brokers.

So whilst this means that insurance companies now have a new and significant entrant into the market that has a considerable influence over the search market (to say the least), I can't help but think that this move by Google is a more significant one for the aggregators.

The church of Apple

I don't know if it is just me, but has anyone else noticed the similarity between the modern Apple stores and churches?

This occurred to me when I was in my local Apple store only last week and then I started to see just how similar the technical Mecca is to a church.

Here's some things I found similar:

• Wooden bench seats arranged like pews in two parallel lines down the middle of the store
• Bright product posters / adverts lit from behind and high up on walls looking like the modern equivalent of stained glass windows
• A guru bar at altar height, with a smiling person stood behind it with the Apple logo around their neck
• A six pointed emblem (the 'Genius bar' logo) looking incredibly like the Star of David

Perhaps this goes some way to explaining the religious-like following that Apple has built up in recent years.

However if you want to full ecclesiastical experience, you should try visiting the London Covent Street branch.

http://www.flickr.com/photos/owen-b/4918511046/

 

Note: Image used is copyright to Kitty Hill

http://www.theage.com.au/technology/technology-news/apple-genius-at-making-customers-feel-good-20120831-254uc.html  

Predicting the digital future

The eCommerce and online marketing industry is one of constant change and if you don't like that.... too bad! Tools, practices & technology are permanently evolving in the online world so much it can feel like you're walking just to stand still.

So to be of any lengthy use in this industry you do need the acceptance of change, coupled with the acceptance that you can not know everything there is or what will be.

Consequently, when asked to pull together a strategy for a client that looks at the longer term digital vision, it can often be hard to come up with anything too specific without drifting off into SciFi territory.

So when asked to predict the future, you end up stating the obvious trends such as:
- Internet (especially data) usage will continue to grow
- mobile use will increase further as smartphones continue to become more prevalent
- device manufacturers will release further versions of their equipment to try and identify (& profit from) different consumer segments

Perhaps predicting the future isn't what it used to be.

Retention optimization

Building an ecommerce site is just the beginning of a long optimization process. It doesn't matter how much thought and effort you put into the initial planning of the user experience & design.....You then have the task of tuning your site to get the most out of it.

All this work is typically focused around the transaction path (also known as the 'booking funnel'). Visitors journeys are scrutinised and optimised in an effort to squeeze the most revenue out of each individual visit.

However, building a site that just takes the money (and let the customer run off) is an incredibly short-term approach to ecommerce that gives no consideration to the longer term customer lifetime value.

So ask yourself:

How are you calculating lifetime customer value?

Where's your email communication plan beyond the latest transaction?

Where's your overall customer segmentation and customer journey planning?

In essence, isn't it time you looked at the ways to retain your customers, rather than just trying to get new ones?

--
Hayden Sutherland
www.idealinterface.co.uk
Digital Strategy - Website Delivery - Online Marketing
+44 (0)780 1341955