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Insurance II
Session 2
Insurance Marketing:
Modern Views on Marketing, Marketing ofInsurance Products, Selling Experience and
Service Experience
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Marketing
Marketing is to know and understand the customer so
well that the product or service fits him and sells
itself.
Marketing should result in a customer who is willing
to buy.
Need to look at the business from the customers
rather than suppliers viewpoint.
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A simple marketing system
Communication
Goods / services
Money
Information
INDUSTRY(a collection
of sellers)
MARKET(a collection
of buyers)
Economists view market as a collection of buyers and sellers. Marketers
view buyers as constituting the market.
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Marketing and Selling
Sales orientation
attempts to increase
sales by informing and
persuading the
customers through
advertising and publicity,
tempting the customer
through promotion
including price reduction
and gift offers, and
personal salesmanship.
Marketing involves designingthe product, determining the
price, deciding how to
distribute, planning the media
and the messages foradvertisement and publicity.
Marketing focuses on the
customer and his behavioral
characteristics in a manner in
which selling did not.
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Marketing vs. Selling
FOCUS Needs and interest of thebuyer
Needs and interests of
seller
ATTITUDE Create pull from buyer Push products to buyer
PRODUCTDEVELOPMENT
Follows marketing activity Precedes sales
PRICE Determines cost Determined by cost
HORIZON LONG TERM (customer isimportant throughout)
SHORT TERM (customer
not important after sales)
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Marketing of Insurance
Marketing of a contingent promise.
Benefits to be realized at a future date
Insurance is like sand while bought, like gold when
it is realized.
Need for buying the product rarely felt.
Prospective buyer has his own special needs:
requires specialized solution through face-to-face
contact (in most cases).
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The Concept of Marketing
Modern Concept
Philosophy ofCaveat Vendor(let the seller beware) Products to match the customer needs (ULIP, Annuity,
Health Plans, Micro-insurance etc.)
Business decisions are market or customer oriented
Continuous evaluation and adjusting the product
characteristics to market needs
Traditional Concept
Philosophy ofCaveat Emptor(let the buyer beware) Goods are produced as per the decision of the Marketing
Manager and are put on the market (Traditional products
like Endowment, Whole-life etc.)
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Marketing of Life InsuranceThree Important Areas
Effective and successful
marketing depends upon
the quality of customers
experience in three areas:
Selling
Service
Relationship
Selling
ServiceRelationship
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The Selling Experience
Personal selling is dominant ininsurance industry
Need to follow a sequence ofsteps in personal selling
Selling an art, not taught somuch as caught
When we sell insurance, we sellourselves
Emphasis upon grooming,personality & communicationstyle
Steps in Personal Selling
Prospecting &Qualifying
Pre-approach Approach
Presentation
Objection Handling
Closing Follow-up
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PROSPECTING
AND
QUALIFYING
PRE-
APPROACHAPPROACH
PRESENTATION
AND
DEMONSTRATION
OVERCOMING
OBJECTIONS
CLOSING
FOLLOWUP
AND
MAINTENANCE
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The Service Experience
Performance of certain services heart of theinsurance contract
Insurer need not be confined to just services only,
but may expand its scope to new areas(Example - Star Customer Support, Star Health Initiative, MaxBupa Health Information, Health Articles etc.)
Main concern Quality of Service Delivery, as
experienced in real time by the customer Everybody swears by quality service reality may be
different
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The Relationship Experience
Where is the relationship ?
Out of sight, out of mind
Merely catchingcustomers or meeting
their service requests: Is it
enough?
A relationship is to be
established
2012-2030:
RenewalsReceived
2031:
Maturity ClaimPaid
2011:Policy issued