Is there enough spice in the experience you design?
According to the ABS, 28% of current Australian residents (about 6.7 million) were born overseas, including myself.
To illustrate this point, in the past I had often found myself to be the ‘token Indian guy’ at an Aussie BBQ. Surprisingly, on a recent NSW Government project, our Director found that he was the ‘token white guy’ in the room.
This means the Australian market is changing, and companies are increasingly conscious that they need to be aware of expats’ behaviours, preferences and cultural lineage to cater to this huge market. The two biggest sources of expats in Australia are China and India, so understanding this market is key.
At CEC, we have had a lot of interesting experiences and conversations with expats and nationals from both countries, so we have developed a set of themes that might be helpful to keep in mind when designing relevant products and services.
Let’s take a look at the insurance market….
What to keep in mind for China
The insurance industry in China is less than 30 years old, and car insurance is a relatively new concept, as car ownership in China only became common 15 years ago.
The majority of insurers in China are long-established, government-backed companies. However, the ratio of payouts to the amount claimed across is lower than western markets, creating a lack of trust in insurance products. Each of these negative experiences is shared multiple times, compounding the belief that insurance companies are untrustworthy.
Insurance in China ranges from very cheap (personal travel insurance) to absurdly high (business contents insurance), but overall prices are lower than in Australia, due to government backing of the main insurers. Chinese consumers also generally prioritise reward over risk, meaning insurance products have a lower perceived value to them.
The Chinese are voracious savers, putting a quarter of their income into savings1. This pool of cash serves not only to provide for their families and retirement but also enables them to mitigate the impact of issues and accidents. Western families relatively save less, meaning unexpected events have a greater impact and insurance is more necessary and valuable.
1 Demographic Patterns Household Saving in China, Notre Dame University, June 2012
What to keep in mind for India
In India, government-backed companies have a higher payout ratio than private and were traditionally preferred, but this is changing with more private insurance providers (including overseas companies) entering the lucrative market.
There is a general belief that the bigger the company, the better it is. Indians are looking for peace of mind that the ‘company should outlive me’ and for that, they are willing to pay a higher premium. However, due to a vast range of income groups in India, the lower income groups still believe cheaper is better and generally have a very limited understanding of insurance jargon, payout ratios etc.
Convenience is a big factor in the Indian mindset. Generally, the insurance agent will visit you at your home or office and get everything sorted. There is very limited effort taken from the consumer other than providing documents and they are used to this high-touch service. Many will often choose a company based on this service. This mindset of convenience to a certain extent still exists in the expat market.
Indians generally congregate in suburbs (except for some, of course) and have a strong sense of community. In this case, word-of-mouth is very strong. Good feedback on one insurance company can cause a ripple effect and result in many new customers. Customers coming through this channel would not do their own research to the same extent and tend to go with what has been recommended.
Insurance is one example but these themes can be translated to other sectors and industries.
Two considerations when designing experiences –
- Think about how you can appeal to this market — Take advertising for example, there is an increasing prevalence of racially ambiguous models. It’s not to avoid looking racist, it’s to appeal to the broadest range of consumers. (Just look at a Kmart catalogue or ad and you will know what I mean.)
- Think about how you can involve this demographic in your research and design — A simple example of doing this is adding it into your recruiting brief for research. Quantitative research, due to large sample sizes has high probability to cater for this in natural distribution however for qualitative research or customer testing this may need to be targeted specifically.