There’s a joke in the English town of Norwich that everyone either works in a church, in a pub, or in the insurance industry.
Luckily for the customers of IAG, Julie Batch’s family worked in insurance, and instilled in her a set of values she has carried through to her current role as chief customer officer.
“My family really believed in the social value that insurance provided, and they acutely felt the pain that customers went through when something terrible happened,” Batch says. “And so I had a really strong sense of purpose.”
While Batch’s entire career has been in insurance, much of that was in fields such as re-insurance and risk management. Three years ago, however, she began to notice the emergence of a new field of activity around customers.
“I had spent a lot of time understanding the system that was IAG and how it works end-to-end, and I had a deep passion for the work we were doing around our purpose of making our customer’s world safer,” Batch says. “I thought I could take these skills and make a far more impactful difference to the people that matter most in our organisation, which are our customers.
“One of the first things we did was ask: How do we take an organisation that has been really product focused, and change that to a customer-in approach? That led us to ask: How do we understand our customers better?”
To do this, IAG created a new team – a difficult task when working in a field that was only just coming to be defined.
“My team is unusual in that the capabilities that are assembled within the chief customer office were quite dispersed across the organisation,” Batch continues. “We took an early view that to be effective, we needed to combine the abilities to understand our customers through data, leverage the insights with analytics, test whether those insights were relevant through a customer team, and engage with the customers to check the qualitative view.
“And we felt we needed to bring innovation to the table, to take those insights and continually test and innovate and build new experiences, businesses and capabilities and take them to the customer through great marketing and reimagined digital interactions.”
Batch’s first task was to start combining the many separate data sets within IAG to create a more integrated customer view. Using open source technology, Batch and her team began building a flexible and extensible data platform, and applied analytics capabilities to create a comprehensive customer segmentation model, including connections to third-party data sources to create better insights into customers based on their behaviour.
One of the biggest changes is to how IAG segments its customers, with the segmentation model now being implemented across the organisation to deliver more growth pathways.
“If you continue down the pathway of a segmentation model that tells you about someone’s age or someone’s price, you are going to continue to respond to that customer in the same way,” Batch says. “But if you reflect that they are groups of people where it doesn’t matter how old they are or what their affluence is, but they have certain desires and certain needs, and you start to segment around that, that really helps.
“What our segmentation model has done is not just tell us who holds which product and therefore what is the best opportunity to sell them another one, it tells us what new products those customer might want, and it tells us what price to sell them at, and it tell us what adjacencies they are most likely to want to embrace. That takes us well beyond the pathways of cross-sell and upsell it; it is a really deep, rich model that opens tonnes of opportunities for us.
“We have spent a lot of time across our organisation choosing how they can create growth, and not only in product, but in the number of customers that we service.”
One of the keys to that success has been Ambiata, a data analytics and AI consulting and technology firm IAG acquired in 2015.
“We acquired them early on knowing that we needed to extend our analytical capabilities and beyond being great at actuarial science,” Batch says. “With those capabilities, we have now looked at all of our models and the way we apply them, and we have really built leading contemporary techniques into those models that are embracing machine learning and helping us bring a lot more automation, prediction and accuracy into the models.”
By taking an early lead on machine learning, IAG has begun to reap significant dividends in terms of the value those techniques are creating within the company.
“We have done a lot of work around our employee focus, so the customer centricity in our organisation has lifted considerably,” Batch says. “So much so, that if you look at a lot of our Net Promoter Score results, we have the highest results in financial services.
“We’ve been putting the foundations in to change the experience. The next 12 months is where that is going to be felt by our customers.”