Big tech companies with relevant consumer data have been eyeing the insurance industry for the past few years and looking at how they can use their insights into customer behavior to reinvent the sector and undercut carriers on prices. Understandably, incumbent carrier leaders are concerned about the threat of disruption via commoditization.
But here’s a thought: What if commoditization has run its course? A simple way to trace the rise of commoditization is to observe the trajectory of Walmart from regional to national to global retail player. When products or services from rival sellers are distinguished only by their price, they’ve been commoditized. Countless retailers learned this lesson the hard way from Walmart’s dominating presence.
Executive SummaryAs some carriers worry about the threat of disruption to their industry due to big tech, Tara Kelly, founder, president and CEO of SPLICE Software, writes that carriers should focus on aligning their business strategy with consumer values. She says this means collecting more data, staying agile and efficient, and maintaining a clear vision to serve customers who are increasingly seeking value both in terms of price and ethics.