Habitual buys happen out of inertia or brand loyalty. What characterizes habitual buys is the lack of cognitive effort, meaning the consumption is a ‘thoughtless’ one. The reason as to why this happens is ‘cos consumers are buying repeatedly a brand that has delivered on value.
A week ago, I renewed my car insurance and two wheeler insurance. Until now the act was one that I repeated without much thought. I mean I just went back to my insurer and got the insurance renewed. However this year was different. I give the marketer credit for making me think about something that I was habituated to. How do that happen? I mean, why did I start thinking about renewing my car and two wheeler insurance, something I never did in the past? Here’s why. The marketer interrupted my habituated repeat buy with a proposition of ‘better value’. The marketer stepped in and said, ‘Wait a minute. You can get more than what you are currently getting from the service provider. So take a moment, do some thinking and evaluating and pick an insurance provider.’
I did just that.
First, I went to a web based insurance aggregator. I checked what was on offer from the various insurance service providers. Now here’s what you need to watch out for. Though the premiums you pay remain the same across insurance providers, the difference is in the added value you can get. The question you gotta ask is, who’s giving me more? Who’s adding value to me by giving me a bundle of insurance services? So for example, will be you getting free roadside assistance should your vehicle breakdown? What about a toll free number you can call when you want help? You will see that insurance providers have differing portfolios of services to offer, and so that’s where you have to do the evaluation. Of course, at its core an insurance is really about getting a claim serviced quickly. Who does that and who’s got the best record in responding to claims is the core value you should be looking for. There's another option that I am actively considering for insurance renewals in the future, and that is a long term two wheeler insurance policy. Insuring for the long term has advantages including convenience offered in renewal, elimination of risk related to non-renewal, discounts offered, and the freezing of premium rates.
Insurance buying a great example of how a habituated buy can be turned into one that the consumer puts thought into. The lesson here is to always ensure the consumer is presented with a chance at better value before he/she makes a habituated buy. The prospect of better value forces a rethink by the consumer. That’s how it happened to me. I did a rethink on the value I was getting renewing my car and two wheeler insurance.
Then, I switched.