Virtu Systems Chief Product Officer Pavel Poloskov assessed marketplaces with the strongest potential to boost digital sales at the XII RAEX Insurance Market Future Forum on November 14, 2018.
Marketplaces are still among the top ten investment targets and top the rating of best startup niches, according to a recent Venture Barometer study. Pavel reviewed the global leaders’ success factors and identified key caveats for efficient sales via marketplaces.
Successful projects are focused on a single product or service and occupy a niche enjoying a high demand on the part of suppliers and buyers alike. Such projects generate an added value and contribute to an enhanced customer experience through a more convenient service.
Among the key obstacles to launching an insurance service marketplace are low transaction frequency, as customers tend to abandon a marketplace after buying their annual policies, the impossibility of a precise assessment and the difficulty of online customer quality check. Major players are reluctant to engage in price competition, finding it hard to prove the advantages of a more expensive product, as unique products are difficult to compare.
In conclusion, Pavel identified several examples of insurance successfully incorporated in a marketplace, including Trov, Amazon Protect, STARLING BANK, Ariv.al. Trov, a niche collector marketplace, has transitioned from a dedicated social network for collectors to a platform providing short-term coverage for expensive articles. Amazon Protect, which generates added value through white label insurance from Amazon and an extended warranty, successfully deals with a customer’s fear of damage to, or destruction of, their products. STARLING BANK and Ariv.al, as marketplaces for services and fintech projects rather than products as such, offer a tailored insurance coverage for a wide range of situations.
Evidence suggests that a successful marketplace should integrate its products into its customer’s lifestyle, which is enabled by collection and analysis of customer data.
The XII Annual Insurance Market Future Forum was held as part of the Russia Insurance Market project by the RAEX rating agency. Among forum participants were representatives of governmental and regulatory authorities and top managers of Russia’s leading insurers. The forum is an authoritative discussion board for estimating the industry’s strategy, as well as challenges and limitations faced by the Russian insurance market.