While innovation lens can be viewed and applied in varied ways, customer expectations and advancements in technology have piped in 3 useful levers that have a symbiotic relationship with Customer Behavior:
1. Product & Service Personalization
2. Seamless & Hybrid Channels
3. Business & Usage Transformation
These levers when applied to suitable opportunities in most industry verticals can help bring about a more relevant and lasting new market, new product, a better solution or even significant enhancements to today’s experiences.
Let me explain this with an example from the life & pensions industry. And to narrow it down, let’s consider the UK region. Even in developed nations, and with matured products, where we expect a reasonably higher awareness and penetration, we still can enable plenty of opportunities where the above levers can be applied.
Here are some quick stats that lay the basis for the rest of the article. And these are taken from public sources and refer to data as of 2020.
(1) a fifth of the population say they have no form of private or workplace pension
(2) about 8.5 million people over the age of 18 do not have any life insurance in place
(3) only 20% of millennials think they are on track to save enough to retire
(4) 1/5th of UK’s population is over the age of 65
(5) 4 in 5 of those who purchased a pension, or any other long term product have preferred to go with an advisor
So, as we see here, at both ends of the customer spectrum we see opportunities where the levers can be applied to deliver customer needs.
To drive this further, let me segment this market at a high level into three customer categories. This in no means, is completely exhaustive, but it will at least help in understanding the process. For simplicity, I have considered here behavioral facets, but you can appropriately choose the relevant segments in your respective scenarios -
a) Deliberate Deciders : They like to have more control to adjust and select products that are tuned to their specific needs. They would like to compare using various self-services and prefer transparent pricing. They are also okay to share specific data, if they are able to attain a better priced product/service
b) Cautious Choosers : They would like to understand the products and features very well, before engaging on a decision. They would prefer to take time, review and have their questions answered and find the product that is tailored to their specific needs
c) Astute Action takers : They tend to look at more products other than the traditional ones and like to have a complete view of how their potential future expectation is in alignment with their current savings. They also prefer multi channel access along their journey path
Another thread we ought to look at before bringing all these together, is about the customer preferences itself. You can capture this in multiple ways, and one simple way would be to use Google Trends. By selecting appropriate search terms, time period, category, device and location, you will be able to quickly analyze insightful patterns of what customers in that region/sub-region are looking for and which providers have a better presence and recall in these aspects
Here is one such example where we see queries for life insurance come up across the country, but some providers are more prominent only in certain regions, there by leaving white spaces to be addressed
Keeping these points in view, the levers surfaced above can be structured into a 2x2 matrix, utilizing the innovation model shared by late Prof Clayton Christensen. This simple structure is not only useful to plot the ideas but also is lucid enough to explain to any both business and technology teams, to weigh and engage in them
In summary, we begin by understanding the market position and needs, the drivers influencing customer behavior, the customer segments you are looking to address and their preferences. Based on this, we then structure our ideas in a framework that helps to deep dive relevant propositions looking at their priorities and then suitably address untapped opportunities across market types.
I have tried to explain this taking the case of a relatively matured market and a long standing and stable product. But, this can structure can be easily and suitably replicated and utilized in most other cases.