Acquiring new customers with an attractive offering
With many consumers expecting from their provider, how do businesses within tough industries like the finance sector attract new consumers and keep them loyal?
M&S for business decided to carry out some Insight research with the aim of discovering what makes a successful customer acquisition and retention strategy. This is one of the benefits we found from implementing reward schemes:
Benefit 1 – Acquiring new customers with an attractive offering
The increasingly competitive nature of the industry has resulted in a greater need for insurance companies to provide something unique for their customers. It’s clear that price in the current economy is an important factor with 95% of our consumer survey participants stating that the cost of the policy is one of the aspects considered when choosing insurance providers.
Despite the high number of respondents stating price as such an important factor, only 55% deemed the lowest price is the most important element of choosing insurance. It seems that consumers believe that if companies cannot provide a competitive price, they must ensure their policies and products are value for money and offer something extra. Other influential factors in the survey were the inclusion of a personalised or unique service for the customer, how highly ranked the provider was as well as whether the provider offered a loyalty or reward scheme.
Most companies we spoke to chose to offer reward schemes with the primary purpose of attaining new customers. Daniel Tamarjan, Online Marketing Manager of Freedom Heath Insurance – who use rewards such as shopping vouchers and cash discounts – stated that it is vital that companies choose the right scheme for the intended target audience to encourage customer loyalty as reward schemes as not automatically successful.
Furthermore, not only can reward schemes be used as part of package offered by a company, they can also encourage positive behaviour from the customer. One part of the reward scheme that Vitality Health and Life Insurance provide is to allow customers to build up ‘active points’ by exercising. These points can then be exchanged for perks, such as cinema tickets or a free cup of coffee. Another bonus of this type of scheme at Vitality is that it encourages customers to live a healthy lifestyle, therefore, decreasing the amount of claims made.
Reward schemes work as part of the wider offering to customers. Most people have price on their mind when shopping for insurance, but when they are offered a better service or added benefits their decision can be influenced. It is important to consider the type of reward scheme in order to attract high quality customers and reach the relevant audience. One way to offer an attractive offering is with M&S for business’ service of ‘Insurance Replacement’ which allows insurance companies to offer M&S gift cards to claimants.
For more information on Insurance Replacement, please feel free to get in touch with us.