Presented during the High Performance Marketing Conference 2012, organized by Accenture on February 9th 2012. This presentation given by Aviva discusses the challenges organizations are facing due to the continued macro economic uncertainty and changing consumer behavior.

1. High Performance Marketing
Conference 2012
Aviva UK Life & Pensions
?
Copyright © 2010 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

2. Aviva UK Life & Pensions
Existing Customer Management:
Poor data, no analytics, no chance?
Copyright © 2010 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

3. Contents
• Background & Context
• Existing Customer Management
• From Tactical to Strategic
• Benefits & Reflections
3

4. Background & context
4

5. About Aviva
A significant global business:
- 6th largest insurer globally
- 44m customers
- 12 focus markets
- 36,000 employees
- 300bn+ funds under mgt
A clear strategy:
- Geographic focus
- Exploit composite advantage
- Build on core capabilities
© 2011 Accenture. All rights reserved. 5

6. Aviva UK – a 300 year pedigree
• Life, pensions, savings and retirement
UK Life • 12% market share
• 6.5m customers mostly through IFA and
Bancassurance
• House, car, pet, business insurance
UK GI
• Direct and broker distribution
• 6m customers
• Private medical insurance and group
UK Health risk
• Direct and intermediated business
• #3 in market
© 2011 Accenture. All rights reserved. 6

7. Aviva UK Life – the problem and the opportunity
Problem
 More customers leaving than arriving
Existing Customer
 £XXXm commission bill Management:
 Creaking legacy infrastructure “We’ll invest in
analytics-led customer
 Overwhelmingly intermediated marketing to drive more
value from our existing
base”
Opportunity
 6.5m customers
 Regulatory dynamics
 Compelling customer brand
© 2011 Accenture. All rights reserved. 7

8. Existing Customer Management
8

9. Starting from a low base
Old approach constrained by: New brand position focused Existing Customer Management
on understanding the team created
individual customer and
being relevant
• Poor view of customer
• Increase up/ cross sell,
data
retention, rollover
• No analytics tools campaigns with
analytics
• No analytical skills
• Identify additional
• Campaign selections
opportunities
by intuition /
experience • Build Aviva internal
sustainability
• Little visibility of new
opportunities • Define the roadmap
and investment case
• DM campaigns with
long lead times • Pilot value from
customer analytics
• Belief DQ = bad

10. Key project phases and evolution of capability
Proof of value / pilot Value exploitation Analytics managed service
Feb’10 Aug.’10 Feb’ 11 Jul’ 11 March 2012
•Data Check
•Exploratory Analytics
•Test Campaigns
•Process Changes
•Build Awareness •Increase Campaign
Volumes
•Test Multiple Channels
/ Mechanics
•Broaden Use
UK •Inform Customer Retention
Strategy
•Inform IFA Analytics
Proposition
Italy •Campaign Prioritisation
India •Pure Off-shore Model
•Transition To In-House (plan)
© 2011 Accenture. All rights reserved. 10

11. Did we have poor data?
We developed a new “single-view-of-the- customer”
Life Insurance Data Model Structure
Policy Value Segment Complaints
Demographics
Claims Payments
DWH DWH Campaigns
Accenture’s Life Insurance
Customer Analytic Record (CAR):
• Facilitates rapid descriptive and
propensity model development
• Identified overall data quality and
identify key data gaps.
11
© 2011 Accenture. All rights reserved.

12. If you really want to know what it looked like…

13. Descriptive Modelling: shining a light to identify value
Multiple Layers Of Analysis ….
2ND POLICY
1ST POLICY Annuities
Group
Pension
• X.X million Life policyProtection records in our CIC database
Investments
Individual
Pension
Equity
Release
holder Unknow Grand Total
Life
31% are joint 59%
Annuities 0% 31% 2% 3% 4% 0% 88,528
GPP policies
Investments
8%
5%
49%
1%
• X.X million are currently active
3%
66%
21%
9%
0%
0%
19%
18%
0%
0%
48,815
442,480
IPP 18% 7% 11% 40% 0% 24% 0% 331,664
Equity Release
Protection
3%
2%
0%
3%
• Average Life product holding is 1.06 products.
19%
8%
0%
9%
64%
1%
13%
77%
0%
0%
9,382
407,887
Uknown Life 8% 2% 50% 9% 1% 21% 10% 4,953
XXm no longer active X.Xm active Life1
Grand Total 11% 5% • Average 17% policy holding is 1.2 policies.
29% Life 1% 36% 0% 1,333,709
Life1 Customers Customers
Product PH with Single PH with Single PH with PH with Total Policy
Holdings Policy (#) Policy (%) multiple multiple Holders (PH)
policies within policies within (#)
same product same product
X.Xm customers X.Xmil X.Xm customers holding holding (%)
with at least one customers with with at least one Protection
Protection policy at least one IPP Investment
policy, 0.5m for policy Investments
GPP, 0.6m for IPP
Annuities, 0.1m
for Equity GPP
Release Annuities
Equity Release
X.Xm Active Life1 X.Xm Active Joint
Policies Life1 Policies
X.X.m Policyholders are between
35 and 49 and represent future
growth opportunity
90 Campaign Ideas Generated
© 2011 Accenture. All rights reserved. 13

14. Campaign targeting through analytics
Propensity Model Top 2
Deciles of Customers –
203K
Active policy holders
– 144K
Age Profiling Cut
(30 -60 yrs)– 108K
Has Phone–
74 K
Increased targeting by After
applying filters based on Supp. 28K
insights from profiling of
responders
14

15. Campaign results - significant uplift over BAU selection
CAMPAIGNS LIFT OVER RANDOM
ANNUITY CROSS_SELL 2.59
PROTECT CROSS_SELL 1.57
EQUITY RELEASE CROSS_SELL 1.36
MOTOR TO LIFE 1.5
HOME TO LIFE 3.8
IPP RESTART 0.9 (negative performance)
Annuity Pensions base 7.1
Annuity Non Pensions base 3.6
15

16. From tactical to strategic
16

17. Strategic Analysis: IFA (Financial advisor Base)
1
PROJECT APPROACH PARTNER WITH IFA TO CROSS- SELL HIGH
Track IFA VALUE PRODUCTS
Performance
PARTNER WITH IFA TO CROSS- SELL
STRATEGIC PRODUCT LINES IFA IS NOT
OPERATING IN
4 2
Data driven RE-TIERING
Execute
insights
agreed
3 delivered to BRING IN-HOUSE DM OPERATION /
actions IFA’s RESPONSIBILITY FOR NON-STRATEGIC IFA’s
Plan and prioritise
actions on IFA Base
© 2011 Accenture. All rights reserved. 17

18. Strategic Analysis - churn segmentation
• Cluster analysis of inactive accounts to identify the
types of customer attitudes and behaviour toward
Joint holders : 10%
churn. Active products and joint policy
• Overlaid sample of bond surrender customer feedback holder group
to validate
Loyal customers : 17%
Middle age group, matured policies,
high tenure group, pension and
annuity base, mostly IFA customers
Protection seekers : 19%
Young customers, protection
focused group
Golden geese: 19%
Older customer, high value and
high ticket policy holder with bond
surrender
Movers & Changers: 35%
Older customer, voluntary inactive
group, low value, joint
policyholders, pension customers
© 2011 Accenture. All rights reserved. 18

19. Benefits & Reflections
19

20. Benefits delivered
1. Incremental sales • Uplift of 2.84 in sales conversion achieved against
conversion & revenues BAU customer selections.
• £XXmillion incremental value delivered through ECM
campaigns 2011
•200k customers added to multiple Life policy holders
in 18 months: 23% vs 20.5% (adding in GI policies
34% vs 26%)
• 25+ insight driven campaign waves executed
2. Campaign Management
& Process • First cross BU campaign by customer management team
• Campaign timelines reduced by 50%
• 100% increase in marketable base by challenging
existing suppressions and data management routines
3. Analytics & Strategy • Proved tactical and strategic value of analytics
• Insight generation and dissemination has led to
snowball of new insight requests
© 2011 Accenture. All rights reserved.
• 20

21. Reflections from Aviva
• We developed analytics too early – the marketing infrastructure wasn’t ready
• The business wasn’t bought in enough – limiting the effectiveness of some campaigns
• We can use analytics as a tradeable currency – why aren’t we doing more?
• Is there more we can use CIC for... Predictive underwriting...?
• We still haven’t developed processes to deploy the analytics in anger – but we are near
• The value added from Accenture was outstanding – far more that their remit……..
21

22. Aviva’s Accenture Legacy
• We have proven the case for analytics in UK Life
• We have reduced campaign speed to market substantially
• We have a usable single customer view… after 6 years of trying
• We have sold the benefits of analytics to the wider UK region
But essentially……
• We have a platform for significant value growth over three years
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23. Questions?
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