San Francisco-based ESuranceÆ touts itself as a provider of the fastest, simplest way for customers to take care of their auto insurance needs, almost exclusively through its Web site. Visitors can research auto insurance options, receive and compare quotes, purchase policies, and print coverage cards in minutes from their computers.
But like all retail commerce sites, ESurance is faced with the constant challenge of being always available to its potential and existing customers, keeping things simple for them, and managing and storing their data securely. Such a site requires a highly complex, distributed Web infrastructure powered by a tightly-integrated set of applications, both on site and off, with the assistance of many second- and third-party outsourced service providers and other data resources.
Hence the need for data management processes, software, ongoing consulting, and remote access to keep the ESurance Web portal looking, feeling, and working its best. These needs inspired ESurance’s outsourcing engagement with TeaLeaf, a provider of data management and support solutions for the e-commerce industry.
Dealing with usability issues
Because ESurance is essentially “Web only,” it is extremely sensitive to visitor usability issues in light of the late 2006 A.J. Harris Poll “Customer Confidence in Online Transactions – Brands Marred by Poor Online Experience.” Forty percent of online consumers say they would abandon transactions entirely or turn to competitors if they experienced only moderate usability problems, according to the Harris study. Eighty-eight percent of online customers say they also experience problems with online transactions.
TeaLeaf, combining the Harris data with Forrester Research projections, says companies could lose four-and-a-half percent of all online transactions, or $60 billion worth of business through 2010 this way.
Even if ESurance’s potential loss were one one-thousandth of that $60 billion figure ($600,000), preventing such a loss is significant enough to the company to show it the value of outsourcing. “With a site as large and complex as ours, there is a lot of ‘noise,’ and we could easily waste valuable time chasing issues ourselves that turn out to be inconsequential,” says Marj Davies, director of Internet Operations, at ESurance.
Better customer experience produced by outsourced solution
ESurance has always monitored the response time of key pages on its Web site and the operational availability of the site’s support system infrastructure. But it lacked visibility into what customers were actually experiencing with the pages. And Davies knew negative experiences were producing lost policy opportunities, especially during peak visitor times.
“More people are going online, and their expectations are higher,” says TeaLeaf vice president of Marketing and Strategy Geoff Galat. “Even self-service requires service itself,” he adds.
These challenges consumed valuable internal IT resources, producing larger operational margins and ESurance’s need to hire more support staff.
So the company selected Tealeaf to securely gain real-time visibility into the complete customer experience combining its proprietary software with collaboratively building a new database formula for housing and updating competitor rate data that interfaces with ESurance’s. When necessary, Tealeaf hosts some or all of that compiled Web customer information. In addition, it works with ESurance’s IT staff and Web designers to create and improve easy user interfaces.
“The process never ends because today’s great-working Web commerce site is tomorrow’s poor-performing dinosaur,” says Dr. Jakob Nielsen, Founder of the Nielsen Norman Group, which monitors and analyzes Web site usability in all industries.
“With Tealeaf today, we are not only immediately alerted when one of our Web applications or processes fail, but we have an instant understanding of the exact nature of the problem from the customer’s perspective, as well as how many customers are being affected,” says Davies.
ESurance now has complete insight into each customer’s quote and policy-purchase experience. This helped the firm uncover unknown issues, reduce resolution cycles, and quickly fix problems to prevent blocked transactions and inflated customer service costs.
New auto insurees speed through the process
The return on ESurance’s investment in its outsourcing engagement was quick and profound. TeaLeaf delivered 100 percent of its initial services in three months, while requiring only a fraction of the buyer’s resources to administer. In addition to reducing the additional cost of hiring more IT workers, the relationship enables ESurance to protect its revenues, produces lower support costs, and provides the simplest and quickest insurance-buying experience that customers expect.
This engagement helps ESurance recover about six potential lost policy opportunities per day or over 2,000 annually, according to the carrier. It also significantly lowers average problem resolution time from what was up to 24 hours, or longer, to less than 10 minutes in most cases.
“We also avoid additional staff hires through that reduction of resource-to-problem ratio because our staff can support a greater number of Web applications,” says Davies, who also adds that the service reduces the legal costs necessary to successfully dispute fraudulent customer claims.
All this produces an insurance retail site and support structure that continues to accumulate recognition and industry awards for ESurance. “From a Web usability perspective, brevity is essential,” says Neilsen. “Navigation menus must stand on their own, and the site must return data to the user quickly; this instills visitors’ confidence that they have chosen a good product or service they can trust with their money as well as their personal information.”
Watchfire GomezPro Insurance Industry Analyst Tim Carpenter illustrates the need for outsourcing engagements like ESurance and TeaLeaf. “Today, auto insurance carriers, especially direct ones, prioritize Web auto insurance quoting above any other online initiatives,” he says.
“And with all that goes into such an intricate commercial Web site, it could cost millions annually to do this alone,” concludes Nielsen.
Lessons from the Outsourcing Journal:
- Insurers that rely on Web sites to develop new business and manage current customers must instill confidence in these customers through reliable visitor usability and accurate quotes. They also have to create an environment of trust if their Web efforts are to pay for themselves–a very expensive task to do internally.
- Retail Web sites require some of the highest expenditures to develop and maintain, especially in managing data the customer needs with a click of a mouse. Outsourcing to the right provider not only dramatically reduces those costs but also mitigates risk of the data management processes quickly becoming substandard.
- By outsourcing to its data management provider TeaLeaf, ESurance is confident its customers will not go someplace else because ESurance’s site doesn’t give them the information they need in order to buy from the auto insurance carrier. According to a recent Forrester Research study, e-commerce retailers will collectively lose over $60 billion by 2010 when their customers go somewhere else on the Web to make their purchases.