Millennials are still making their way into the workforce and their influence has changed how we communicate and even how businesses are run. But before we get too complacent about how we’ve embraced a new way of doing things, it’s worth remembering that the Generation Z cohort is snapping at the heels of Millennials. In less than ten years, around 20-30% of the workforce will be Gen Z and we can be sure that their expectations for digitalised, personalised services will be unprecedented.
As digital natives whose formative years will have been spent in front of smartphones and tablets, anything that is not available as an app, or as part of the digital ecosystem, will be unacceptable. Indeed, traditional processes, such as those still used widely in the insurance industry, will be to Gen Z consumers as fax machines are to Millennials, baffling and unnecessary.
Reaching this group requires an omnichannel approach. Gen Z are experts at social commerce, determining the best deals through expert research across multiple different touchpoints. They factor not just value, but convenience and sustainability into their buying decisions. They are also less likely to hold onto ‘things’ long term if they can make money out of recycling and reselling, and this is important for insurers planning their marketing strategies.
Products and services that suit their lifestyles at a specific time, but which can be changed quickly and easily will appeal, and the ability to quickly receive a quote or submit a claim is essential. This means altering the traditional insurance approach and instead insurers should be thinking about how their products provide reassurance in line with customers’ lifestyles. They could team up with well known brands to offer complementary services, eg. health and wellness tips and a medical appointment tracker available on the same app that manages their insurance policy.
Gen Z consumers are accustomed to services that are personalised and honed to suit their likes and dislikes, their habits and their buying behaviours. This is the direction of travel for insurance and means developing flexible products that can just as easily be used to insure a bicycle for one day as they are to insure the contents of a rental apartment for a year.
The overall message to insurers is that it’s time for a rethink beyond internal digital transformation efforts. Customer bases are changing quickly and irrevocably and start-up fintechs have tapped into these new sources of growth. Where once insurance companies enjoyed a degree of loyalty handed down from generation to generation, today’s young, discerning consumers are making their decisions based on what they see in Facebook, Instagram or through the myriad social channels they occupy. To keep up insurers need to be occupying the same space, but to win, the products and services they offer must be flexible and accessible too.