Old Mutual iWYZE: Emerging market appealEmerging market (mass market) segments are increasingly important and the battle is being won by smaller, agile players, who offer cost- and technically-leading products and services.
South Africa's emerging market has become a priority segment for many businesses in several industries, and the battle for market share, it seems, is being won by smaller, agile players and those able to interact with - and communicate effectively to - the market.
One of those players, iWYZE valuables insurance, the direct short term offering from Old Mutual, was formed in 2010.
"We're a valuables insurance specialist whose services and approach lends itself well to the emerging market," says Willem Smith, iWYZE Chief Executive.
According to Smith, iWYZE was created as part of Old Mutual's strategy to "exploit group synergies" in this market, where it "had built a strong position".
"iWYZE was formed to create a capability whereby, from an Old Mutual perspective, we have a wider product range and offering to specifically the emerging market in South Africa – and to widen that offering from a financial services perspective. We are targeting that market and it is where growth lies; it is the untapped part of our market. For instance, there are around about nine million cars on the road of which only 2.9 to three million are insured. So there is a huge opportunity."
iWYZE is a collaboration between the Retail Mass division of Old Mutual and Mutual & Federal, a wholly-owned subsidiary of Old Mutual. Its unique approach, coupled with the strength of those brand - especially in the mass market - provides a solid platform for the future, Smith says.
"iWYZE is positioned for broad appeal in the South African market, but specifically targets the emerging market where it is believed a significant opportunity exists."
A very small percentage of those in the mass market have short-term insurance.
"It is definitely a growth market and since our inception things have gone well for us," Smith says. "From a growth perspective, it is above expectation and we have been doing really well.
"We have been able to make a fairly significant impact in the Old Mutual customer base – about a fifth of those clients have not taken any insurance on their valuables before. Roughly, about 50 percent of our client book is existing Old Mutual policy holders.
"The iWYZE product is not solely aimed at that market, but it is our focus. We're more gaining traction on the emerging market."
This segment has been traditionally neglected and approximately 35 percent of South Africans have had no access to formal financial services.
"You can't approach this market in the same way you would the traditional market. The way these segments are accessed or communicated to must differ significantly to the means with which traditional customer segments," says Smith.
The trick is reaching them effectively.
The best way, he says, is online.
"We see the future as going online. We see massive potential, not just in terms of selling and fulfilment capability, but also servicing. From an iWYZE perspective there is a big focus on ensuring our online experience becomes industry leading. We currently have a full procurement capability online and we are one of the very few insurers to have this in South Africa. Many have a quoting capability online. But no one has a straight through processing capability and we do. We rolled that out last year and it is becoming fairly successful. We've seen volumes pick up."
His view is that the market will grow steadily.
"The market in South Africa is still a little bit slow but we have seen a pick-up in the online space," Smith says. "My view is that for the next couple of years you will probably see a steady growth in the online space but not massive volumes. But there is clearly steady growth and we are at a tipping point here. I believe in the next five years, ten certainly, that tipping point will be reached.
If you think about the market we are in, most of your young and emerging market clients have cell phones and are technologically minded and inclined. Our view is that this untapped market is specifically well educated when it comes to technology. The best way to communicate to them is through that, online and social media."
iWYZE's promise is that it is straight and transparent with its clients.
"Coming to us is straight forward," says Smith. "We make it easy for people to come and get valuables insurance.
"In terms of our offering, there are a couple of important things. First, we offer value for money – or at least try to offer value for money. We won't necessarily be the cheapest in the market but we hope we give real decent value. Then it is about being transparent and clear. So the policy is clearly stated. The small print is accessible. We handle claims efficiently and quickly.
"Client focus and experience is also critical. It is a competitive environment as you know. We're up with a host of other players and unless you are on the field you're not in the game. You have to ensure the client has a decent experience when they go through the application, that they understand the policy, that the policy works, and that they're getting value for money. We try and make the application as interactive as possible."
Smith doesn't believe that organising the right insurance should be a five-minute decision, though.
"That's my view," he says. "I also don't believe that insurance that it should be bought without any advice. We have a team of consultants who are accredited under the Financial Advisory & Intermediary Services Act to give advice and they are trained to advise clients on the insurance options that suit them best.
"To stress, we believe our target market wants value for money but also comprehensive coverage. We also realised that clients want the peace of mind that their valuable possessions are protected, but don't want to be burdened with industry jargon and small print. We're making it as easy as possible for people to protect their valuables through the Old Mutual Group, which has a solid track record of securing positive futures for clients for over 168 years."
To learn more visit www.iwyze.co.za.
Copyright is owned by Africa Outlook and/or Outlook Publishing. All rights reserved.