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Shaping Expectations for Customer Experience

Many of us regularly hear the premise that customers’ experiences in any product category shape their expectations for interactions with all other types of companies.

Think back to the last time you visited a website that offered little to no information. Pretty frustrating experience, right? Now think back to the last time, or anytime, you searched for something on Apple’s website. How did that experience compare? Judging by its reputation, Apple’s website most likely offered a considerably more satisfying experience than that of the one that left you frantically trying to close the window before you lost your cool. Even if a company is not a tech giant, visitors to its website are likely to expect a comparable experience to what they get with Apple.

While looking to understand more about these changing expectations and their potential implications for financial services companies, I learned there actually is a term, coined by Accenture, for these expectations. “Liquid expectations” represent the idea that customer experiences seep or filter from one industry to totally different industries.

Accenture suggests that this drastically changes the competitive landscape. They contend that companies’ direct competitors, those that offer similar products and services, are only one consideration when formulating competitive strategy. In addition, today’s companies need to attend to experiential competitors (those offering experiences that effectively replace theirs) and perceptual competitors (those providing experiences that shape expectations for all product categories).

The model of customer experience, developed by LIMRA to address nuances of managing customers’ experiences associated with life insurance, identifies expectations as an important driver of experiences. In the current environment, consumer expectations have changed in myriad ways. For example, people expect to be able to transact business quickly, when they want (24/7 access), how they want (omnichannel), in a personalized and transparent manner. For financial services companies, this “raising of the bar” certainly has created some considerable challenges.


What Pizza Has in Common With Life Insurance

Consumers’ expectations for transparency provide an interesting example of how liquid expectations are touching our industry. The question: What might a pizza company (Domino’s) and a life carrier have in common? In recent years, Domino’s has reinvented itself — transitioning from the target of bad-food jokes (with a stock price of less than $9 per share in 2010) to the second-largest pizza chain in the world (with a current share price of more than $200).

 One key component of this success is staying closely in tune with customers. One franchisee, in response to realizing a significant percentage of customers were calling his shop to confirm the status of their online order, developed the Domino’s Tracker. With the tracker, customers can log into an app and follow the status of their pizza at every step (order placed, prepped, baked, boxed and delivered). Needless to say, the pizza tracker has been hugely popular — largely because it makes the process of ordering pizza more transparent by taking out the mystery.

What does any of this have to do with a life insurance policy? Executives at Protective Life actually drew an analogy between the process of making a pizza and the process of issuing a life policy. It’s no secret that a perpetual challenge for the life industry is keeping applicants informed of their status.

As a result of this thinking and an interest in optimizing the customer experience, the company introduced the Protective Application Tracker, which, much like the pizza tracker, takes the guesswork out of where the customer’s application is in the process.

I have no doubt that customer expectations will continue to evolve and continue to raise the bar for all companies. As insurance carriers strive to provide contemporary and positive experiences, they must remember to monitor those perceptual competitors across all industries. They are likely to play a major role in shaping the future for all of us.


Todd A. Silverhart, Ph.D., is corporate vice president and director, insurance research, LIMRA. Todd may be contacted at [email protected]

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