Football, in its infancy, had no plays. In the late 1870s, the visiting team would travel to the home team, where both teams would agree upon the set of rules for that game. The home team would supply officials, causing occasional controversy, and the game would be off and running.
There was no quarterback, no set of downs and very few rules regarding possession of the ball.
It wasn’t until Walter Camp, a former Yale player, introduced the concept of a quarterback and a limited time of possession, that “plays” became important. Camp wished to provide more of a strategic element to game play. This resulted in more practice, more play calling and much more interest in the game.
Play calling and playbooks have increasing value and tremendous application for insurers as we rapidly shift from Insurance 1.0 to Digital Insurance 2.0. A playbook is meant to provide strategic direction that fits with current or projected circumstances. When business strategists read the industry, the different market segments and demographic trends, they can apply their plays more effectively to capture market share. Those without playbooks and plays will find themselves scrambling from priority to priority, instead of confidently executing their strategies to earn the win.
Majesco is helping insurers build their unique digital playbooks with our strategic business platform solutions and market research-based, thought-leadership reports. In two of our recent reports, we provided both generational consumer playbooks and generational small-medium business (SMB) playbooks that give insurers valuable insights into digital capabilities enabled by technology’s potential that will energize insurance plays. In my next four blogs, we will draw on both reports to look at both Pregame Analysis and Ideal Offerings that insurers can use to target consumers and SMBs.
Consumer generational playbooks — Pregame analysis
Scouting the opposing team is the basis for creating and applying plays from the playbook to win. You’ll find an excellent scouting report of consumers (broken out by generational demographics) in Majesco’s recent thought-leadership report, The New Insurance Customer — Digging Deeper: New Expectations, Innovations and Competition. At a high level, the report highlights the demographic trends that are pointing to a different future for insurance, which we call Digital Insurance 2.0, recognizing that customer expectations, product needs, engagement and more are vastly different than the last 30-plus years. New experiences and technologies are becoming “the new norm” across all generations but are more intensely and rapidly changing to the next generation of insurance buyers, Gen Z and millennials.
See also: Does Your Structure Fit Your Strategy?
Throughout time, the youngest members of society have traditionally been the early adopters of new technology. Millennials and Gen Z are the early adopters of our current, digital age. Both generations are digital natives. Millennials grew up digital in a world connected by the internet, and Gen Z was “born digital” in a world dominated by mobile. In our Changing Insurance for the Digital Age report, we highlight that the U.S. millennial market alone could exceed $7.2 trillion by 2025 and is the driving force behind increasingly personalized capabilities based on unique customer journeys involving engagement and real-time personalized product delivery. However, nearly 69% of millennials remain either actively disengaged or indifferent with their insurance carriers. Adding to this shift and momentum is the fast-emerging Gen Z market, which is poised to surpass the size of the millennial market.
Simply put, for these digital generations, the traditional products, the business models that support them and the customer experience do not align with their growing market dominance. We found that millennials and Gen Z demand much more in personalized products and experience, putting innovative products and competitors at an advantage.
The scouting report highlights new consumer behaviors and expectations
Driving that point home, Majesco conducted consumer research in 2017 to determine the acceleration in changing digital behaviors across a number of technology and business indicators — the factors that are reshaping insurance. To capture the next generation of buyers, let alone retain current customers, insurers must begin to use playbooks that are aligned to the generational consumer needs and expectations, personalizing insurance, and place their companies firmly into the realm of Digital Insurance 2.0.
We found that all generations share the top three most-performed “new” activities that we used as consumer trend indicators. There are substantial numbers of people who have now:
- Paid for something with a company’s app (e.g. Amazon, Starbucks)
- Paid for transportation through a ride-sharing service like Uber or Lyft
- Used a fitness tracker like Fitbit, Garmin, etc.
- The 2016 Upwork and the Freelancers Union’s annual survey estimated that 55 million people, or 35% of the U.S. workforce, chose freelancing as their means of work. Our survey results confirm that participation in gig economy activities across all generations is similar to the Upwork survey. However, a smaller percentage have “side hustles” via ridesharing or renting their rooms/houses or cars.
- Consumption of ridesharing services is a dominant behavior across all generations. Home/roomsharing services are used about half as much, yet still have a strong and growing appeal.
- Connected device use is seeing tremendous gains. Fitness trackers are the most popular type of connected device across all generations. The nearly 33% of Gen Z and 25% of millennials using connected home devices could also rapidly help intensify these new needs and expectations.
- Use of ApplePay and SamsungPay saw strong year-on-year growth, with more than a third of Gen Z and millennials and a quarter of Gen X now using them regularly. The increased use of digital payment capabilities is raising the bar of expectations across all generations for all types of purchases, including insurance.
- Across all generations, 22% to 38% purchased insurance from a website, with Gen Z and millennials clearly leading the use of this channel. This suggests the increased ease and desire of the younger generation to buy online.
- On-demand insurance was surprisingly strong, with 25% to nearly 30% purchasing it for a specific item or event, such as the kind of insurance that Trov offers. On-demand and subscription-based models are rapidly gaining acceptance in a shorter time, as compared with website purchases, which have been around for nearly 20 years.
- Not surprisingly, Gen Z and millennials lead the older generations in their use of drones and 3D printers (or items produced by one). These are two rapidly growing technologies that present significant risk implications for the insurance industry.
