The hybrid customer: relevance, not a flood of stimuli

The hybrid customer isn’t just a response to digitalisation – it’s also what drives it, by challenging firms to reconsider their traditional business models and to continually evolve. What they expect is an excellent customer experience that goes far beyond conventional service. This in turn calls for new standards when it comes to the omnichannel strategy and the deployment of new technologies, says ERGO CDO Mark Klein. 

What was your latest customer experience? Conveniently ordering a product using an app? Receiving face-to-face support in a store? Or a helpful member of customer service staff who quickly and easily answered your question over the phone?

Thanks to digitalisation, we’ve all gotten used to seamless sales and service experiences. Today, we take simplicity for granted, as we know it from our customer journeys on Netflix, Spotify or Amazon. From our initial product search to services – what we’re looking for should never be more than a few clicks away. In this regard, we also want to interact with the provider in a way that best fits our current situation: by email, Messenger, over the phone, or live at their store. In brief: we want maximum flexibility. That makes all of us “hybrid customers". 

The hybrid customer is modern and independent. She or he switches effortlessly between various sales and communication channels to find relevant information and services, anytime and anywhere. They expect interactions with firms to be individualised and consistent. The customer experience must be networked across all channels, each of which offers the same high level of quality. Information on products and sales should be rapidly available, ideally even “in real-time” – and should be consistent, no matter whether in analogue or digital form. After all, in a networked world, customers expect all channels to be harmonised. And for content to work on mobile devices, since today “digital” is virtually synonymous with “mobile first”.

This changed purchase and communication behaviour on the part of customers makes them an essential driver of the digital transformation, also for insurers. In a world in which markets and products are becoming increasingly transparent and the competition is just a click away, every detail counts when it comes to staying in the “relevant set”. Accordingly, firms not only have to meet these demanding customer expectations – they have to exceed them. Doing so requires the consistent application of new technologies and an extensive omnichannel strategy.

The number of online sales is on the rise

But first, insurers need to understand their customers’ preferred channels and how they interact on them. For example, in addition to talking with family, friends or colleagues, most interested parties look for insurance information online: on providers’ websites, independent comparison sites, or social media platforms like Instagram or TikTok. When it comes to long-term or consulting-intensive products, in the classic model this initial phase is followed by individual consulting from a broker or intermediary. Policies, too, are still mostly sold via traditional channels – although the number of online sales is on the rise. According to figures from the German Insurance Association (GDV),19.1 percent of all insurance sales to private customers in 2023 were digital; in 2022 the number was 16.7 percent, in 2021 it was 15.3 percent. The leading categories for online sales were motor, property-casualty, liability, and supplementary insurance/overseas health insurance.

In addition to transparency across the focus channels and their systematic expansion, a successful omnichannel strategy requires a uniform and above all scalable technical infrastructure. This allows firms to reduce complexity, tap synergies, and efficiently employ their resources – e.g. through a Customer Relationship Management (CRM) system, in which all customer information is centrally and securely managed to ensure consistent communication and enable them to make personalised offers. Or to offer customers a user-friendly and intuitive self-service portal, one that ideally isn’t just an information channel but also an interaction channel. A flexible infrastructure is also vital in connection with e.g. websites, lead management, and smooth collaborations between direct sales and agency sales, not to mention all marketing- and sales-relevant automation and analytical applications. And to be able to offer a competitive and uniform product portfolio across all channels. Here, the products need to be straightforward and easy to order. They have to be connectable via interfaces (APIs) and combine short customer registration processes with modern payment methods. This is particularly important for modular products, which are designed to allow multiple, individual combinations of service components.

The right offer at the right time and place

The hybrid customer expects all of these processes to run smoothly in the background during their customer journey. And they demand relevance, not a flood of stimuli. In other words, they want the right offer at the right time and place. To make that happen, all offer processes have to share a consistent orientation.

We at ERGO introduced the hybrid customer as our business model for the German market in 2016. As a central pillar of our digitalisation strategy, it has already demonstrated its quality. For example, during the COVID-19 pandemic, when ERGO was still able to offer its customers the full range of consulting and support, because its brands were consolidated, products and prices were standardised, and the systems running in the background were harmonised. In addition, ERGO gave its sales partners the freedom to tap the potential of the omnichannel approach on their own, e.g. through a range of digital offers and solutions like individual web presences and digital tools for customer dialogues, social media toolkits, and convenient online appointment booking. These were supplemented by digital submission processes, innovative apps, and the freedom to sign documents using electronic signatures and QR codes. And ERGO reviews its own customer journeys at regular intervals. For example, through the ERGO Digital Factory, founded in 2018, which developed prototypes that were open to direct customer feedback. Only in this way can products, processes and services be continually optimised – and new development opportunities be recognised.

To meet the expectations of the hybrid customer, insurers need to focus on and doggedly pursue three aspects: channels, capacities and consistency. This takes identifying and tapping the right marketing and contact channels. It takes the requisite technical capacities to use the entire palette of digital tools and apps. And it takes consistency with regard to communication and offers. Firms who take these points to heart can create pioneering customer experiences that go far beyond conventional service. And stay in the hybrid customer’s “relevant set”.