Some see it as a blessing, others as a curse. But either way one thing is certain – email is here to stay. Indeed, so pervasive has the technology become that, according to figures from Gartner, the average office worker spends 49 minutes ploughing through email messages each day.
Not only that, says Gartner, but things are likely to get worse before they get better. A quarter of office staff already spend over an hour each day dealing with emails, and the amount of time devoted to the task is on the rise.
Statistics from the London Internet Exchange reveal that 360,000 email messages are bounced across UK networks every second, underlining the fact that Britons are one of the most intensive users of PCs in Europe.
But where do insurers stand in this frantic world of cyber communications? The short answer is: in an almighty spin.
It doesn't help matters that the sector has been in turmoil anyway for the past decade or so, hit by mergers and amalgamations, regulatory clampdowns on selling and the new threats posed by banks and building societies muscling in as policy providers.
However, it is technology that has arguably had the biggest impact. Take, for example, Direct Line's pioneering use of call centres – making it, almost overnight, one of the most potent insurance forces in the land.
Nowadays, phone-based customer relationship management (CRM) is commonplace in the sector. However, there is a new techno kid on the block that insurers ignore at their peril. Put simply, the phenomenal growth of email means that the sector has to find new ways of managing the medium if it is not to lose customers.
While all the leading insurers tend to boast websites, many still remain little more than online brochures. Second-generation sites might allow primitive transactions, but few sites are fully interactive – allowing call-centre agents, for example, to engage in instant dialogue with e-customers in much the same way they might with those who make enquiries by phone, using pop-up information screens linked to the caller's postcode or telephone number.
Yet it can be done. The secret is in automating responses to emails, managing the traffic volumes more effectively and integrating electronic messaging with existing CRM systems and IT infrastructures.
Die-hards within the insurance industry might contest whether yet another technological layer is desirable or necessary. What cannot be denied, though, is that the web has delivered a new sales channel and that, compared to other mechanisms, is significantly cheaper.
In fact, executives at Egg – the online arm of the Pru – maintain that web-generated business costs ten times less than any other medium.
If it is accepted, then, that the web adds a valuable new channel at a lower cost than other methods, it follows that handling customer emails, the main by-product, has to be given serious attention. But before automating email responses, it is vital to be clear about the type of customer you're dealing with.
Generally speaking they can be divided into three groups: buyers, searchers and shoppers.
The first are the more sophisticated web surfers who know exactly which sites to scan and use them to compare prices. They need little assistance. Searchers, by contrast, have a vague idea of what they want but use the website to refine their needs – often followed by some sort of interaction with a call-centre agent. Finally come the e-shoppers, people who know they need insurance, for example, but haven't a clue beyond that. This category usually needs intensive follow-up help so that policies, say, can be tailored to their individual backgrounds and lifestyle.
Firepond's studies within the insurance sector show that three-quarters of e-customers are more likely to purchase a product if they get a response to their initial email inquiry within an hour. In the world of cyber communications speed is vital – especially when rival firms are just a click away.
Once the categories of customer have been identified, the task of automating email replies can begin. By integrating the electronic messaging system with a company's core database or CRM platform, responses can be given a highly personal flavour, along the lines of: “Dear Peter, as a customer of 15 years standing with Insurance International, we can offer you a substantial discount on your premium.”
Software templates can do much of this automatically, with the recipient usually having little idea that the reply is computer-generated.
At the Nationwide Building Society, which has just a single email address for all web-generated inquiries, more than half of all customer emails are already dealt with in this way.
This also takes a huge workload off the shoulders of agents, freeing them to get on with helping customers who do need the more personal touch. It is a point not to be underestimated, especially as insurers – in a bid to slash margins still further – are constantly looking at new ways to make call centres and their operatives function more efficiently, with touch-tone phones and interactive voice response (IVR) just a few of the other weapons in their armoury.
What it all boils down to, though, is providing customers with a seamless service, no matter how they have contacted the organisation.
Direct Line transformed the industry by adopting call-centre technology and cutting out brokers. Automated email and message handling simply takes the technological revolution a step further. Early adopters will flourish, the rest will be taking a risk – a paradox for the risk business, if ever there was one.