Posted on 09 Jul 2012 by Jeff Neilson
This week one of our very own, Jeff Neilson, president of Neilson Marketing Services and ProgramBusiness.com, is contributing to Insurance Unplugged with an article on the mobile explosion and how those in the insurance industry going mobile stand to win big. Jeff updates us on what our industry is already doing in the mobile space.
It’s being predicted that mobile usage will overtake desktop usage by 2014. Think that’s not possible. Take a look at what some of the experts have to say: Back in 2010, Morgan Stanley senior analyst Mary Meeker, dubbed “Queen of the Net”, spoke about mobile and social networking. Meeker stated: “The current cycle is the era of the mobile Internet”, and predicted that within the next five years “more users will connect to the Internet over mobile devices than desktop PCs.” Meeker and her team of analysts expect mobile data traffic to increase by almost 4,000 percent by 2014, for a cumulative annual growth rate of more than 100 percent.
Meeker’s predictions were also underscored in 2010 by comments made by John Herlihy, European Director of Google’s online sales. Herlihy said that Google is mostly oriented towards mobile devices, claiming they’ll become more important than desktop PCs. “In three years time, desktops will be irrelevant. In Japan, most research is done today on smart phones, not PCs,” he said.
Even more recently in a study by Deloitte, “Insurance Tech Trends 2012: Elevate IT for Digital Business,” a key discussion focused on the fact that companies big and small, across virtually every industry, are clamoring to unlock the potential of mobility in their business. The mobile revolution has reached insurers, according to the study, where business leaders are looking for solutions on how they can effectively use mobility. This is not just with their customers but also with their insurance agents and employees. Both groups are pushing carriers to create solutions and extend capabilities to the devices they increasingly depend on for personal use. Initiatives ranging from smartphone applications to wireless device or telematics-based programs have been developed. What’s more, insurers that have piloted programs are now collecting and analyzing the data. This can be a game changer in the way that they offer auto insurance and other related products, the study concludes.
In a white paper, “Executing End-To-End Mobile Services” by Massachusetts-based research company Forrester, mobile is without a doubt increasing in importance as a touch point and channel across all industries. “Mobile services will continue to grow in importance as a conduit to influence consumer interactions with other touch points throughout the lifetime of the customer relationship.” Mobile will play an important role throughout the consumer’s journey, and not only serve as a revenue opportunity but will also be used to serve customer needs throughout the “product ownership cycle.” According to Forrester, “committed customers will be more likely to take advantage of and be open to ongoing dialogue from service providers such as banks, insurance companies, or product manufacturers.” In fact, Ellen Carney, a senior analyst with Forrester, said: "The mobile trend is the most disruptive thing to happen to insurance since e-commerce. Maybe even more so."
In research conducted by Pew, as of February 2012, 46% of the 2,253 adults surveyed said they are now smartphone owners, which represents an 11% growth in the last nine months. Forty-one percent of adults own a device that is not a smartphone. According to Pew, we’re seeing a critical mass affecting different demographics. The numbers are actually significantly higher in certain age groups like young adults: among college graduates, 18-35 year olds and the well off, those who said they used a smartphone was at 60 percent and up (for those ages 65 and up, only 13% of them own smartphones).
And, mobile will begin to get its share of advertising dollars. Right now, 10% of consumers have their attention on their mobile devices, but only 1% of advertising is spent on this medium – reflecting a huge opportunity for growth. While the ad-spend numbers don't quite match the perceived growth, a closer look shows us that we are actually beginning to enter the golden age of mobile and that the advertising spending will follow, according to Richard Ting, senior vice president & executive creative director of mobile & social platforms at R/GA, a full-service digital advertising agency.
Ting says that mobile’s diversity, quality, innovation, experimentation, and cultural influence on society will bring more advertisers to this platform. Advertisers can connect their messages and experiences with their desired audiences due to advancements in mobile ad units, mobile search, mobile apps, mobile websites, and SMS. Furthermore, more than two-thirds of our time on mobile phones is now used for non-communication activities with the average American spending 94 minutes per day utilizing mobile apps vs. 72 minutes of web-based consumption. Mobile is poised to surpass television as the dominant consumer access point for all media. “How we experience life, relationships, entertainment, education, exercise, and work have been completely transformed (for better or worse) because of mobile,” says Ting.
Are there challenges in adding mobile as a new strategy?
Sure there are. First different industries seem to be at different stages when it comes to technology, web sites, and social media marketing. There’s a learning process when undertaking the vision of what you want to create and how you want to use mobile to benefit your clients. The risk is in creating a web of different solutions on different devices, which can end up further confusing the user experience. You need to complement your underlying business strategies to guide mobile development and implementation accordingly. Mobile apps require a new mindset, new application architectures, new methodologies, and approaches to problem solving. And, of course, most importantly, your solutions should focus on usability.
Furthermore, mobility requires resources to create, monitor, manage, and control apps, in addition to strong governance, security protocols, and privacy and compliance policies – particularly important in the insurance industry. Yet even with all these challenges, you can’t wait to go mobile. Business won’t wait. Whether you’re an agency, MGA, wholesaler, or carrier, going mobile has to be a part of your digital strategy. It’s where your clients are and where most will be going.
A look at some of the mobile developments in our industry:
Taser – designed to limit driving distractions by automatically locking a programmed smartphone once the vehicle's engine is switched on, preventing calls and text messages except to 911 and select numbers authorized by parents.
Tag In – an application by Allstate that works on iPhone, Android, and Blackberry phones allows kids to send a simple message and GPS location saying they've arrived safely or are on their way home.
Speedbump – an Android-enabled smartphone application designed to promote car safety by alerting parents if their child drives faster than a certain predetermined speed.
Safety Mobile – created by Safety Insurance lets policyholders report their location and the time of an accident, and provides a screen to let them indicate the point of impact on the vehicle. Users also have the option to upload photos, and they can pull up a copy of their insurance cards.
Safe Driver Program – offered by Apple on the iPhone, allows users to document acceleration, braking, cornering, and speed. If something like a pre-set speed limit is violated, the program automatically sends a text message or email to parents, including information on the vehicle being used, time of the incident, and the actual violation.
An iPad app developed by a leading life and annuity insurer for different users: financial planners, individuals, or benefits manager. For financial planners, they may view an asset library that pulls together all the forms, brochures, and videos for a particular product. Benefit managers only view 401(k) product information and assets. As a result, agents of all types are able to dynamically access information while they’re in the field with customers.
Disaster planning and continuing planning services are available on mobile devices to allow for reporting incidents, facilitating communication between team members and first responders, and providing individual with information on what to do during and after an event.
Electronic proof of insurance – legislation and bills have been passed or are being considered in several states allowing residents to show proof of auto insurance coverage with their smartphone.
Do you have a roadmap in the mobile space? At minimum, are you looking to create a mobile presence? As a wholesaler, MGA/MGU, carrier, and agency, what apps can you develop and/or offer on smartphones to help your customers? Thinking it’s the next big thing but not worth the effort? Think again. The facts bear out that mobile is where you’ll your current customers are, and where you’ll find your new clients.