Boston-JohnHancockTower

Boston-John Hancock Tower

Digital Business Principle: 

The Internet of Things (#IoT) has rapidly become the next big thing. For the last 5 years, SocialTech has inexorably advanced from a cool new set of tools, through mainstream, and now into mandatory status. Meanwhile, the persistent question, “What’s next? What’s after Social?” has grown louder and louder. Clearly, circa 2015, the answer is #IoT and its intersection with Social, Mobile/Wearable/Cloud devices, #BigData and Human Dynamics.

 

Short Story: 

In a highly-publicized roll-out in April 2015, John Hancock Financial began giving away a Fitbit to new “Vitality” Life Insurance policyholders in exchange for potential policy premium discounts. In a textbook rollout leveraging the intersecting circles of IoT, Social, Mobile, Analytics, Cloud, (#SMAC) and Human Dynamics, giving away a Fitbit with the policy (which btw skirts the “inducement” regs, right?) provides the needed technology to accomplish several things at once:

  1. foster policyholder motivation
  2. enable accountability
  3. provide transparency
  4. encourage share-ability

I’m guessing (or at least hoping) that other insurers are saying, “Darn! Why didn’t WE think of that!” and following suit.

Netting it out, using the exact same device and corresponding data, customer service, underwriting, and actuary – really, the entire enterprise – is now able to personalize the customer experience (#CEX) with total confidence. Bottomline: real-time data captured ‘auto-magically’ is validating behavior that reduces risk. This is Digital Business or #DigitalBiz.

Potential Impacts:

Ignoring the obvious, and temporary, “first-mover” benefits, the tangential implications across the policyholder/company relationship as well as across Social Networks are astounding. With time to name just a few obvious ones, any others from the community of readers would be most welcome.

  1. Imagine the cascading implications of a Facebook, Twitter, Linkedin, Instagram status update: “I just got a free @Fitbit from @JohnHancockUSA! YAY! #HealthyLiving”

    Fitbit Image

    Fitbit Image via Bloomberg
    Click to see story

  2. An underpinning actuarial principle (and I’m no trained actuary) is this: Healthier policyholders live longer, thereby improving the premium/claim financials. So is this a ‘gimmick’ or a solid business initiative with meaningful ROI?
  3. Real-time policyholder data provides increased interaction opportunities, which in turn improve the customer experience leading to gains in retention, cross-sell, up-sell, and referrals. What are some of the ways John Hancock can interact with Fitbit wearers? “Hey, you did a lot of quality exercise this week. Good work!” “Wow, really! Congrats! 13.1!!!! Good work!” Encouraging stuff. Or the flip side: “Hi Mike. Thanks for keeping the Fitbit on this week. A quick note of encouragement, because as Chinese philosopher Lao Tzu said, ’A journey of a thousand miles begins with a single step.’  You can do this! We’re all pulling for you.”

Further Analysis:

Imagine the pathways that are opened for future opportunities for even greater application of #IoT. This is such a simple implementation. And of course, Allstate and Progressive implemented IoT with their in-car tele-metrics devices. Same thing, except instead of wearing something on your wrist, the policyholder hooks it up to the car. Heck, I’m tempted to switch my insurance from Nationwide, put in two of these devices, one in my car, one in my wife’s, just so we can finally end the circular argument about who is the better DRIVER!!! HA! Of course, it will probably be her!!!

Imagine the cross-selling these IoT devices enable, too. As devices mature and drive through even more data, with permission of course, always with permission, what else might policyholders appreciate you bringing to their attention. Imagine the future email, “We’ve noticed over the last year that you are really getting healthy!! Good work. We would like to suggest a Vitamix to you if you don’t have something similar already. We’ve arranged for a special low price for John Hancock members, as well as a recipe book crowdsourced from other John Hancock Fitbit wearers like you! Just because we appreciate you…” Of course, when they get the Vitamix, guess who they will mention? Guess who’s brand loyalty scores go up? Etc., etc. etc.

What do YOU think?

Can’t stress it enough. Adapt or die! Work hard to understand technology and the implications for your business. Consider sending this post along to others that need encouragement in this area (or write your own). Was this helpful? Please leave a Comment. What to YOU think? What are the challenges? Thanks SO MUCH.

Mike 216 659 4360

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