With new trends, technological advancements, customer expectations, and competition within the market, the insurance sector’s new era has begun. As the pandemic outbreak continues its spread, it affects both distribution models and consumer behavior worldwide, marking the new growth opportunities for the insurance industry. This is where the retailer comes into the play. Walmart, John Lewis, Amazon, Seven-Eleven – these are only a few examples of retail and e-commerce brands that have identified the insurance sector as one to watch. In these circumstances, retailers have no other choice but to adapt. What gains and opportunities might the retail brands have expanding into insurance? Read the article to find out more!
In these circumstances, retailers have no other choice but to adapt. What gains and opportunities might the retail brands have expanding into insurance? Read the article to find out more!
Increased share in the market
The retail brand’s e-commerce service expansion brings several benefits for business: increased customer loyalty, retention rate, and turnover. The well known UK retailer brand John Lewis is a great example demonstrating the package of gains the brand received by expanding its service line. The opportunity to establish collaborations with British insurance carriers resulted in the knowledge and understanding gained of the buyer persona. From the other side, the PoS convenience and brand promise allowed the retailer to increase its trust among the customers while expanding its wallet share in the market.
Confidence over the product and motivation to spend more
The Retail Product Insurance Study made by PYMNTS and Cover Genius accurately prove the synergy between the insurance and eCommerce purchases. According to the study’s statistical data, almost fifty percent of consumers are ready to make more eCommerce purchases if the insurance coverage were provided at the checkout.
Why is it so? The answer is simple – the opportunity to have insurance options available at the checkout gives consumers peace of mind and security over the product bought. Apart from mentioned above, more than a quarter of consumers in the research stated that if the insurance coverage would be offered at the checkout, they both purchase and spend more money on products. These facts underscore the retailers’ benefit and potential revenue to be gained from providing insurance for the buyers.
Consumers trust in retailers
Unquestionably, for the consumers, paying for insurance is an act of trust. No wonder why consumers are more likely willing to purchase insurance from online merchants. The insurance bought results in confidence gained over the product, knowing that compensation will be received if the ordered device will be broken. This argument is just strengthened by the PYMNTS’ study, revealing that more than sixty percent of the consumers, instead of purchasing insurance by the carrier, prefer to purchase the insurance from online merchants directly among the goods bought.
Beyond a doubt, the popularity of the retailers’ e-commerce service expansion into insurance will grow in the upcoming future. The retail industry exemplifies a vast opportunity and potential for business growth and market share expansion, increasing consumer trust, retention rate, and raising revenues. It is a perfect time to jump for the retailers into the insurance market, and the missed chance today might result in a financial loss for the business tomorrow.