How Hancock Is Managing The Multichannel Challenge
How does a company with a career agency system and a bank channel avoid channel conflict?
While I wouldnt say John Hancock hasnt experienced any such conflict, I think weve done well minimizing potential problems. We are at a point where we are identifying and beginning to leverage the opportunities inherent in a strong multichannel distribution system, including banks and agencies.
Ten years ago, Hancock decided we would be wherever consumers were buying financial products. Key goals were first, to emphasize our role as a manufacturer of financial products that customers could rely on to meet their insurance needs and, next, to aggressively expand distribution.
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In 1991, 5,000 insurance agents sold John Hancock products. By 2000, the number had increased to 66,000 across all channels, including agents, banks and broker/dealer firms, with potential for further expansion. We also developed an online portfolio of products for consumers who choose to buy directly.
During this period, Hancock experienced growth in all distribution sales channels. A number of critical success factors enabled us to execute this strategy. Perhaps the most important is that our retail sales operation–including channel management, product development and process development–reports to one individual who oversees all the channels and communicates a common vision.
Channel managers meet regularly to work toward the shared goal of allowing issues and cross-channel opportunities to be explored and capitalized on.
Weve also debunked the myth that new distribution channels hurt agency sales. Weve clearly communicated the benefits that the agency system can expect from the additional brand exposure and increased referrals, as channels try to fit the client to the appropriate level of service.
Part of this process involved recognizing that most consumers select the channels through which they purchase. There is less vying for the same customer than might be expected because todays financially sophisticated consumers decide where and how they want to make purchases and investments.
With a multi-channel distribution strategy, whats important from the agents viewpoint is not so much which channel consumers buy from, but that they trust and buy Hancock. This means they feel they can rely on the company and its products.