Maria Ferrante-Schepis in her Saturday main stage presentation told NAIFA 2014 attendees that businesses must continually be open to change and innovation. Businesses that don’t change aren’t likely to survive. In what Ferrante-Schepis calls a “Napster moment,” named after the music-sharing web site that lost out to the more innovative Apple, businesses that are not open to change are likely to succumb to their competition.
Factors that can leave a business or industry vulnerable to Napster moments include:
All of these factors are at play in the insurance industry today. These are symptoms to the real problem facing the insurance industry: the struggle to maintain relevance to the younger consumer.
Powerful people in the industry tend to see millennials as their children, Ferrante-Schepis said, not their customers. Parents who don’t like what their children are doing try to change them. However, this is an unfortunate attitude to take with customers.
Gen Y has the perception that agents are trying to sell products they don’t need, companies don’t understand Gen y consumers insurance products don’t make me feel protected traditional insurance seem outdated.
The best chance for insurance professionals to avoid a Napster moment is to be open to innovation. To do that they must overcome the fear of failure and embrace opportunities to create successful failures. There are three keys to making failures succeed:
Finally, Ferrante-Schepis encouraged insurance and financial advisors to ask themselves, “What business are you really in?” In answering the question they shouldn’t define their business as a product or service, but rather be open to doing what it takes to ensure their clients lifestyle goals. This is likely to lead to innovative thinking.