An Acquisition Journey Redesign Which Increased Conversion and Spend in Home Insurance Online by 30%

How can you design quote journeys effectively? Ask personal questions upfront, pick appropriate defaults and give customers instant feedback about the price change as they go through the process.

In this article you’ll learn: 

  • Which two groups of people choose insurance differently; 
  • How to strike a balance between giving people options vs. simplicity; 
  • How to create the illusion of choice and why it matters; 
  • Why mentions of the “most popular option” won’t get you as far; and
  • Why the middle option doesn’t work in this case.
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Client challenge

How do you strike a balance between choice and simplicity? How many product options should you present so that it doesn’t feel limiting but at the same time doesn’t overwhelm customers? When should the price be introduced in the acquisition journey? And is it a good idea to give customers the option to tailor a product or not? 

Choice Overload

Choice overload is a result of too many choices being available. It can result in decision fatigue, sticking to the default option, or even avoiding making a decision altogether.

These questions would be conundrums even for businesses that carry out the majority of their sales online. But picture a company that historically made 70% of its sales in branches, now facing a massive exodus! 

Yes, the situation at Lloyds Bank insurance division was critical. By 2016, 80% of its customer base had migrated to digital channels which put the department under huge competitive pressure. It had become painfully obvious they needed to reduce their reliance on the retail network, so the strategy was to upsell and convert more of their website traffic. Lloyds were looking for a complete fresh start, not a tweak of the existing journey. The million-dollar question was “How do we design quote journeys to be as effective as possible?”

A team of behavioral experts from Dectech was called in to optimize the online sales journey and offer a redesign of one of the Lloyds products - home insurance. The leader of this change Rich Lewis says they needed to juggle 3 different challenges at the same time. 

Challenge 1: Overcoming the effects of anchoring 

How potential customers would arrive at the page posed a problem. The main sources of traffic were the price comparison websites where customers would get quotes from different providers and, after clicking on a specific offer, would be redirected to Lloyds’ webpage.  

The key challenge was to keep the insurance competitive enough to be at the top of those rankings so customers would actually come to the website, but not so cheap that the company would not make any money from the sales. 

The key challenge was to keep the insurance competitive enough to be at the top, but not so cheap that the company would make any money from sales.

Rich says this meant carefully choosing how basic the basic option should be, and then once they got there, how to make sure there were sufficient opportunities to upsell customers to something more profitable – a Premium option. 

This was a challenge since at this point customers were anchored by the price they had seen in the aggregator, and so the higher sum would be perceived more negatively than it would have been having they not seen a “bargain” price initially. So, explaining the value and increasing the perceived value of the premium option was important.

  • How-to Guide

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Challenge 2: Balancing out simplicity versus complexity

The key was to figure out how to ensure the journey was simple enough that people didn’t drop out and bought the insurance in the end. 

“The challenge is that people say they want flexibility and choice but from a BE perspective people struggle with complexity and choice overload”, Rich says.

The challenge is that people say they want flexibility and choice but from a BE perspective people struggle with complexity and choice overload

The challenge is that people say they want flexibility and choice but from a BE perspective people struggle with complexity and choice overload.

So in this case, it was all about how to make something look flexible enough that the customer feels they’ve got a tailored product that is personal to them, but not so complicated they are overwhelmed with choice options, get stuck, and choose to drop out as a result. 

Challenge 3: Eliminating uncertainty and offering reassurance

Rich points out that even though selling as much as possible was important to the bank, so was making sure customers understood the offer and felt confident and satisfied with their choice. 

He makes the point that people don’t want to spend a lot of time choosing their home insurance; it’s not an engaging product and there aren’t a lot of needs. Since people don’t enjoy buying it, they want to put the minimum amount of effort in.

Lloyds aimed to help customers make more informed product choices, so the bank needed to figure out how to make customers feel more confident about their choice by providing them with the right set of cues and nudges. 

Competition analysis & customer research 

The research part of the project consisted of three steps:

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