With this online service, Norwich Union aims to improve its brand image among customers. Differentiation is important in the struggling property and casualty insurance sector – but website initiatives will only go part of the way to securing a loyal customer base. For Home Doctor to bring in real ROI, Norwich must view it as part of a holistic long-term CRM strategy.
Norwich Union plans to launch its interactive ‘Home Doctor’ service.
CGNU’s UK unit, Norwich Union, is set to launch the ‘Home Doctor’ – a new online service aimed at helping its Your House and Home Plus customers to reduce the risks associated with the home. It will take the form of a virtual house, where customers can click on different parts of the house and find advice on how to overcome the particular risks of that area.
The initiative sees Norwich Union trying to reposition itself as an insurer there to support the customer continuously, rather than just there when things go wrong. By providing this continuous home information and guidance service, Norwich Union hopes to build its brand and customer relationships.
Property and casualty (P&C) insurers can no longer rely on price as the main competitive differentiator. The sector is characterized by intense competition and squeezed margins. As a consequence, companies looking to maintain profitability are initiating brand-building efforts.
But as well as being an image building exercise, Home Doctor could have other benefits. By educating customers on how to minimize risk, it could reduce claims. It will also drive traffic to the Norwich Union website – useful, as the Internet is the cheapest marketing channel for insurers.
There are four ways in which such projects can pay off: capturing information from potential new customers, cross-selling, enhanced renewal rates among existing customers, and boosting the company’s brand.
Home Doctor’s customer acquisition potential is limited, as it is aimed at existing customers. But it may help persuade policyholders to renew their home insurance and to extend their portfolio of products held. Realistically, one website will not turn the ‘grudge’ relationship between insurer and insured into a supportive, continuous rapport.
Changing this attitude would require a long-term holistic CRM strategy, in which Home Doctor could play a useful role. However, if it is not supported and maintained after the launch, the site could instead turn into an expensive marketing exercise with little long-term value.
Related research: Datamonitor, 2002: UK Household Insurance 2002