Insurance CIOs Embrace Their Role as Marketers

As more insurers embrace data-driven, digital tactics for appealing to customers, marketing and IT roles are becoming increasingly entwined. Several speakers at Insurance & Technology's Executive Summit, held this week in Rancho Palos Verdes, Calif., discussed how this affects dynamics within executive leadership.

Michael Babikian, president and CEO, Transamerica Brokerage

Babikian was recently promoted to his role from CMO of the distribution arm of life insurance carrier Transamerica. He said that during his time as a CMO, he had spent a lot of time on the issue of marketing/IT alignment with CMO groups. "They are embracing working together from an information perspective," Babikian said.

Insurance organizations "need to evolve to become learning organizations," he continued. "We all know there's a vast amount of information out there. That's one of the things that's causing us from a marketing perspective to change how we take things to the marketplace. If you don't understand statistics and aren't doing marketing based on information, what are you doing?"

Technology-enabled research turns prospective insurance buyers into "prosumers," with up to 57% of the buying decision made before they even contact a company, Babikian added. Better targeting can get information about your insurance company earlier into that research funnel.

"What has changed has how we buy," he said. "You go into a store armed with your smartphone and vast amount of information. What does the sales person offer you? We all know just about as much as the manufacturer as times."

So, it's through learning about the customer's preferences that insurance companies can differentiate, he concluded.

"The percentage of marketing spend that is wasted because of how we're targeting, when we're not basing it on data, is increasing," Babikian warned. "The best prediction of future behavior is past behavior -- and we have a ton of that information already within our organizations."

Rick Roy, CIO, CUNA Mutual

Roy, who caused a stir with his favorable comparison of CUNA Mutual to Victoria's Secret, said that buying in to a new kind of marketing organization was key to the company's success.

"Whether it's your CMO or your head of the direct-to-consumer business, as a CIO, that person has to be one of your strongest working business relationships," he said. "My advice is to learn their language. If you're like me -- I didn't grow up in a direct-to-consumer world -- you have a great learning opportunity."

Michael Fergang, CIO, Grange Insurance

Fergang, a 2012 Elite 8 winner, presented on the role of core systems in improving the customer experience. He said that by working with marketing partners, IT leadership can come up with effective technology solutions to marketing problems.

"So much depends on your capability and your architectural strategy," he said. "If you do your planning and work with your CMO, I think a lot of the core systems could add an abstract layer. Something like knowing who has touched the customer doesn't have to be a core system."

Nathan Golia is senior editor of Insurance & Technology. He joined the publication in 2010 as associate editor and covers all aspects of the nexus between insurance and information technology, including mobility, distribution, core systems, customer interaction, and risk ... View Full Bio