Digital transformation has led to a variety of new communication options which enable a better customer experience. While this is a good thing on many levels, the question for insurers becomes which communication options best align with their clients’ needs. To answer that question, you’ll need to understand the preferences of your client base.
A Review of the Options
In 2021, Statista reported that there were close to 300 million smartphone users in the United State alone, meaning we have more communication options available than ever before, right at our fingertips. Here’s a look at several of the top communication channels.
- SMS: SMS, or text messaging, is popular among younger consumers. Gallup found that 68% of 18- to 29-year-olds and 47% of 30- to 49-year-olds reported using text messaging frequently throughout the day. However, among older consumers, text messaging is less popular. Only 26% of 50- to 64-year-olds and 8% of people over age 65 said they used text messaging frequently throughout the day.
- Phone: According to Inc, a study found that nearly 75% of American Millennials and Gen Zers would rather communicate via text than talk. However, HubSpot reports that the phone is still the most used channel for customer service. Furthermore, with the advancement of interactive voice response (IVR) technology, consumers are provided more options to minimize wait times.
- In-App Messaging and Push Notifications: As insurance apps become increasingly popular, in-app messages and push notifications can provide an effective way for insurers to deliver targeted and timely messages. While push notifications can pop up at any time, in-app messages only appear when the consumer is using the app. Push notifications might sound like a better option, but many consumers disable them, so they might not be as effective.
- Live Chat and Chatbots: For consumers who want fast responses without having to make a phone call, chat is an attractive option. There are two types of chat: automated chatbots and live chat that uses human agents. According to HubSpot, a study found that live chat is the preferred communication channel choice among Millennials. However, for common and simple issues, chatbots may be a more viable option.
- Email: Compared to chat and text, email is often viewed as less urgent and therefore slower. Nevertheless, it remains a popular option. NTT Data says that email is the most prevalent form of communication for Generation X.
- Social Media: Around seven in 10 U.S. adults say they use social media, according to Pew Research Center. However, there are many platforms to choose from, and usage varies by generation. Overall, YouTube and Facebook are the most popular, but adults under the age of 30 tend to use Instagram, Snapchat, and TikTok.
- Contact Forms: Online contact forms are another option for consumers who need assistance. According to UX Collective, if a company website provides both a “contact us” email address and a contact form, 67.3% of people prefer the option of emailing over filling out the contact form.
What Do Your Customers Want?
With so many options, you need to weigh a variety of factors before deciding where to invest to best serve your customers. Here are three customer issues to consider:
- Speed: HubSpot Research has found that 33% of customers say that having to wait on hold is what frustrates them most. Options that minimize wait times, like chat and IVR, can appeal to consumers looking for expedited answers.
- Convenience: People often prefer to use something they are familiar with versus learning something new. Older consumers may still consider the phone to be the most convenient option, while younger consumers may find it easier to use text or live chat options.
- Human/Artificial Intelligence (AI) Balance: According to VentureBeat, a survey found that nearly 80% of consumers would rather speak with a virtual agent than wait on hold. For 57% of consumers, speaking with a conversational AI was preferable to waiting on hold for five minutes. Self-service and AI options can be ideal for common issues. However, not being able to reach a human agent easily is also a common complaint, meaning it is essential to find the right balance.
In our previous blog, Allen Rice discussed Innovation for the Sake of the Policyholder, and that subject hits home as it pertains to communication. The digital transformation that the insurance industry is experiencing has the potential to meet the evolving needs of both the insurer and the policyholder. While there is a plethora of technologies available to insurers, it does not mean that the newest innovation will drive a better customer experience for your client base. Now is the time for insurers to provide ease and convenience for the customer on their journey.