Digitization is crucial first step in providing amazing digital experience!
Digitization and collection of more data points at every interaction point, your firm has with external entities, is the crucial first step in providing amazing digital experiences and achieving a successful digital transformation.
Lemonade is a socially impactful new age digital insurance company that went public on 2nd July. It’s the company everyone is talking about due to its differentiated business model with behavioral sciences at the center of it. What caught my attention was a pointer to a great post from the Lemonade on how the collection of more data points helps with precision underwriting and in turn provides a great digital experience.
Lemonade collects about 100x more data-points from customers from chatbots, doing away with forms that’s power of an entire digital experience
And that reflects from their customers’ feedback
The more data points you collect from your interactions the more precise you can be. Digitization enables precision targeting which in turn provides opportunities to provide simple, speed, and cost-effective processes and great digital experience.
The constituents for an amazing digital experience:
- The simplicity of onboarding — Hassle-free signup all online and digital, no physical or manual touchpoints, no forms filling, no middlemen
- The power of Speed — 90 seconds to get a quote, 10 mins to complete the process.
- The pull of savings — More than enough to beat incumbent insurers, 40% in some cases 85%.
High resolution data collection is a crucial:
- There is a gap between collection of data and insights from data, there is a threshold on the amount of data and time required for patterns and insights to emerge from collected data points.
- High resolution of data helps develop patterns — at the initial stage of digital transformation, focus on automated collection of diversified and high resolution data points for patterns to emerge.
- Data advantage gap with incumbents can be closed quickly— while incumbents in the analog world have an immediate advantage but by focussing on high resolution data points, that gap can be closed very very quickly.
All digital companies collect data points to do precision targeting
- Precision Recommendations (Amazon, Netflix..)
- Precision Search (Google..)
- Precision Ad targeting (everyone)
- Precision Driver-Rider matching (Uber, Lyft..)
- Precision Driving (Tesla Autopilot, Google Self-driving..)
- Precision Matching (Tender..)
- Precision Hosting (AirBnb..)
- Precision healthcare/Insurance (Precision medicine,
- Precision Marketing (Digital Marketing)
- Precision customer underwriting
and the list goes on…
If two digital companies with similar technical capabilities have the same data advantage how do they compete? What is then the competitive advantage of one company over others? Is it capital, user growth, more incentives, freebies, price war, quality? How to differentiate, how to be unique? Netflix vs Amazon Prime, what is the competitive advantage of one over other when both are collecting as much data as they want?
Please signup here to receive bi-monthly newsletter with all updates directly in your inbox.
Disclaimer: All the opinions expressed are my personal independent thoughts and not to be attributed to my current or previous employers.