F IN A NCI A L SERV ICES
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ARE INSURERS
inancial service providers with a focus on insurance need to rethink loyalty programmes to ensure these programmes meet client expectations and add value to their core products, says Ineke Prinsloo, head of customer insights at Consulta. This is particularly necessary now, due to the decimating impact of the COVID-19 crisis on consumer spending and confidence. While insurance loyalty programmes GLENNEIS KRIEL explores whether or not insurance loyalty have grown tremendously in scope over the programmes are doing enough to ensure customer satisfaction past few years, offering a variety of health, – and how they can do better travel, entertainment, retail, financial, and lifestyle benefits, the South African Customer Satisfaction Index’s evaluation of Momentum Multiply, Discovery Vitality and Sanlam as travel and entertainment in an attempt to save A shifting mind-set Reality found that the money,” Prinsloo says. Consulta’s COVID-19 tracker revealed a increased scope and This necessitates a rethink for insurance considerable shift in consumers’ psyches digital transformation companies on their reward offerings, to fix the with regards to basic needs such as of programmes incongruence between these and evolving health, safety, and income. “We found are not necessarily customer needs. “Insurance loyalty programmes that consumers expect to divert more of leading to greater should rethink the investment by expanding to offer their disposable income to home-cooked consumer satisfaction. access to tangible, basic benefits that consumers’ meals, utilities, and internet connectivity Prinsloo points to the post-COVID income and priorities would have cut and online income generation, while Ineke parity in the rewards in from their household budgets,” says Prinsloo. downscaling on non-essentials such Prinsloo terms of standard and lifestyle benefits, except that Sanlam offered data services (1GB) not included in the other programmes. Clients, however, had to fork out an additional – Ineke Prinsloo 41 per cent to participate in the Sanlam Reality programme over the past two years, with prices increasing from R195 to R257 over this time. Momentum Multiply and Discovery Vitality fees increased by roughly 17 per cent, from R221 to R258 for Momentum and R239 to R280 for Discovery. ld Mutual’s budgeting app, 22seven, classify spending and share insights so users “Our evaluation found that customer was founded in 2012 to help South can see exactly where their money is going,” satisfaction with these schemes is lagging Africans better manage their money. Joseph says. behind those of the other financial services The app, which now has more than As a result, Joseph says 22seven users are categories,” says Prinsloo. “Budget-conscious 350 000 users who more likely to grow their net consumers will scrutinise every expense have securely linked more worth and pay down their against the lens of value for money. than a million accounts, credit card debt than “The lower value-for-money perception is open to the public and non-users. Data accrued of loyalty programmes will therefore fail to totally free of charge. shows 22seven users on mitigate customer dissatisfaction with the In addition, 22seven average save 16 per cent of core product offering, which means that the users are able to earn Old their income in comparison companies’ investments in these programmes, Mutual Rewards for making with 0.1 per cent for the which average around 6 per cent of their sound financial decisions, general population. “People revenue, is not paying off.” with every 10 points earned often think that having a translating into R1. budget is restrictive,” says Jikku Jikku Joseph, managing Joseph. “The truth is that a Joseph director of 22seven, says budget is a plan to spend South Africa does not have more on the things that a strong saving culture: “Most people spend really matter to you and less on the things The industry index score for price to before they save instead of the other way that don’t.” quality trade-off for insurance loyalty around, because our banks typically help us programmes is 70.2 points, which spend our money, not manage it.” is significantly lower than for other People in general also tend to financial services scores except for underestimate the amount of money medical schemes. they spend on non-essentials. “The app Source: South African Customer Satisfaction addresses this by using machine learning to Index 2018/2019
MISSING THE MARK?
“Budget-conscious consumers will scrutinise every expense against the lens of value for money.”
Rewarding good financial choices
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DID YOU KNOW?
22Seven users are able to earn Old Mutual Rewards for making sound financial decisions, with every 10 points earned translating into R1. L O YA LT Y & R E W A R D S
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