Banking Review

The Buzz: innovation by customer based design

Customer based design has long been a tenet of true innovation and disruptive growth. Worldwide, the view that innovation is the way to fight back in the recession has gathered significant momentum. Booz & Co has found that so far most companies are resisting the temptation to dip into the research and development coffers as a part of the recession cost-cutting.

It is into this market that IAG has launched a customer-design driven car insurance business. The company, brand, service propositions and product has been the result of an intensive customer design driven process that has taken the best past of 12 months.

While financial markets were changing, the team at IAG continued working towards building an insurer that aimed to delight people who want to buy, claim, manage and review general insurance online. The end result is The Buzz.

In December 2008 IAG launched MyInsuranceIdeas to discuss and learn what customers wanted from insurance. The concept was to build an insurance brand and product offering, together.

“We began with focus groups and then developed the MyInsuranceIdeas forums to continue the direct conversation with customers as we defined our strategy,” CEO of The Buzz, Jacki Johnson told Online Banking Review.

“Co-creating with customers has been an incredible process. We were surprised by the level of knowledge that customers had about the trade off between risk versus price,” Johnson explains. “It’s not simply a matter of price, indeed customers can be concerned when prices seem too cheap; they wonder what coverage they are getting. We were amazed by the ideas and insights we have gathered.”

With each new player or aggregator that enters the personal insurance market, the incumbent players fear a price war. Yet the clear findings of online forums that have driven the creation of The Buzz is that customers are seeking value and reward, and that price is only one factor considered when purchasing insurance.

More than a thousand ideas were generated during the co-creation process. These ideas have formed the basis of four insights that define what customers want from insurance.

Customers want:
1. to know what they are covered for
2. communication in simple language that is easily understood
3. transparency in pricing
4. online transacting and servicing, not just quoting

The internet and social media interaction has changed customer expectations in all industries. One customer drove this point on the servicing propositions of insurers with: “Why can I track a parcel online yet I can’t track my insurance claim online?”

Having customers challenge the status quo of the market identifies the opportunity to innovate. Where many established insurers may be limited by existing legacy systems and internal management protocols, this is irrelevant to customers. The MyInsuranceIdeas forum allowed customers to openly share their expectations of insurers and their online offering.

Customers also clearly indicated a preference for online chat over phoning call centres and click to call technologies. “Customers stated that they want help there and then, online and 24 hours a day. Chat was their preferred method for online interaction,” says Johnson.

Learning from Google and Facebook, both of which have taken a customer-centric approach as a part of their evolution, the online community will be carefully transitioned to the new branded world of The Buzz. The two speech bubbles that form The Buzz logo represents the two-way conversation that has occurred and is required to distinguish it in the market.

As a case study in customer driven design, The Buzz has launched an innovative offering. How customers embrace and engage will be followed by many with great interest.