Scott Gerroir

Over the years Geographical Information Systems (GIS) and other spatial technologies have proven to be valuable assets to organizations and these technologies have enabled researchers to better understand the spatial nature of the consumer. Though GIS have become well established in many large organizations for their ability to delimit trade areas and analyze consumer spending, the insurance industry has traditionally focused the use of these technologies on other tasks, such as, catastrophe and risk management. The paper builds upon the previous works conducted in other fields of business that have used these systems for customer and market analysis. This paper demonstrates how relatively simple spatial analytical techniques, when used with GIS technology, can enhance the explanatory value of current customer analyses. This study examines the current customer base of an Insurance Company in the Greater Toronto Area and with the assistance of spatial technologies conducts three separate types of spatial analyses: (1) market mapping; (2) cluster segmentation; and, (3) customer/broker distribution analysis. The study has shown that currently this Insurance Company concentrates its marketing efforts towards the more affluent areas in the Greater Toronto Area. However, the analysis presented suggests that more attention should be paid towards the outer suburban areas which represent a large and expanding market that this company has failed to capture. Through the use of cluster analysis techniques five customer groups were created to provide a clearer view of the characteristics of this organizations existing business. Through the use of spatial association statistics, it was found that these clusters experience varying levels of spatial autocorrelation in the GTA. The final section of the paper has shown that the geographic location of the brokerages that this company conducts business with has a significant effect on the spatial distribution of the customer base, revealing distinct urban and suburban markets. The spatial analytical exercises employed provide this company with a better understanding of potential of these systems as analytical and decision support tools. The research also provides a base upon which future studies can be undertaken.