Role of MKTG

Subject: Marketing insurance products and services IPGD- CORE SUBJECT
Covered in 33 sessions Based on CII 945 Subject
Examination pattern: case study Three hours are allowed for this paper which carries a total of 160 marks, Part I 1 compulsory question (case study) 80 marks Part II 2 questions selected from 3 (scenarios) 80 marks Pass mark 55% i.e 88 marks
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Chapters and contents

Numbers Subject
Chapter 1 Chapter 2 Chapter 3 Chapter 4 Chapter 5

Role of marketing marketing strategy: planning steps, audit, SWOT Understanding customers: Mix, segmentation Product development and positioning: PLC Information gathering: market research, identifying customers and competitors Branding: establishment, importance, awareness, extension Communication: comm process, message, advt, PR, sales promotion Distribution and service, risk assessment , service delivery
Chapter 6 Chapter 7 Chapter 8
LOGO
Chapter - 1 Introduction to Marketing
Contents
1 2 3 4
Market, Marketing fundamentals Importance of Customer Marketing Definitions
Importance of customer
Matching Process
5 6
Market Types
Role of marketing in insurance industry
What is market
Market has many meanings Market is a physical space with shops where buying and selling takes place Market refers to Demand-Supply situation (How is the Market; The Market is tight; The market is down) It also refers to Demand (e.g., India is a big market for electronic goods; Is there a market for toys? ) The term Market is also used as a verb i.e., to market goods or services
Concept Contd. Markets are old but marketing is new Buyers and sellers used to meet at a place called Market on fixed days and exchange goods of fairly equal value which is called the Barter system. Even today the fixed market place continues in rural areas, called Mandis or Haths.
What is marketing in general

Marketing is about identifying and understanding your customer and giving them what they want. It's not just about advertising and promoting your business. Key to business success is the ability to satisfy current customer needs and for continues success satisfy the future needs as well. Hence here marketing plays a vital role. It goes beyond understanding them. It uses the knowledge gained from interaction and understanding to provided solutions to customers requirements. Though it is used as common term, some say it is a award winning advt, having drink with client, sending greeting cards etc.
Define marketing
There are a range of definitions to the term Shortest def: Meeting needs profitably- ULIP polices The achievement of Corporate goals through meeting and exceeding customer needs better than the competitor Marketing consists of individual and organizational activities that facilitate and expedite satisfying exchange relationships in a dynamic environment through creation, distribution, promotion and pricing of goods, services and ideas
Definitions continuous . Philip Kotler defines it as a social and managerial process by which individuals and groups obtain what they need and want, through creating and exchanging products and value with others Another definition by Kotler ismarketing is not the art of finding clever ways to dispose of what you make. It is art of creating genuine customer value.
Another definition
marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably This definition highlights the customer as being at the heart of marketing. It implies that marketing has a central role to play in business success, since it is concerned wit the creation and retention of customers.
Another definition
Defining markets Quantifying the needs of customer groups within these markets Putting together the value proposition to meet these needs communicating their value proposition to all the people in the orgn responsible for delivering them Playing an appropriate part in delivering the value proposition monitoring the value actually delivered.
Contd.
Marketing helps to: Add value and brings a better match between products and needs Reduces wastages (if product is not needed) Improve effectiveness of communication by better targeting of messages Cuts cost through more effective distribution arrangements Improve better understanding between the organisation and the customer
What is marketed
Goods Organizations Information
Services
Properties
Ideas
Events
Places
Experiences
Persons
Selling Focuses on needs and interests of seller Pushes products to buyer Target is vaguely defined customer Profits through sales volume Product development precedes sales
Marketing Focuses on needs and interests of buyer Creates pull from buyer Target is well defined customer Profits through value satisfaction Product development follows Marketing activity
Contd.
Selling Packaging is done to contain/protect the product Price is determined by costs Selling is subordinate to production Customer is not important after sales Horizon (limit/boundary) is short term Marketing Packaging is done to add value/appeal too Price determines cost Production is marketing central (mktg. oriented) Customer is important throughout Horizon is long term
Contd.
Sales orientation Attempts to increase sales by informing and persuading the customer through advertising and publicity tempting him to buy through price reduction & gift offers and personal salesmanship Marketing orientation Recognizes all the above attempts and adds awareness to use distinct characteristics of Market more effectively in (i) designing the product (ii) determining the price (iii) deciding as to how to distribute (iv) planning the media and messages for advertisement and publicity
Factors which influence marketing

Developments of marketing has followed the developments of trade
Amount of competition
Customers ability to pay ability to pay
Marketing
Target sales volume
Price of Competitors products
Who is a customer
A customer is the recipient of a good, service, product, or idea, obtained from a seller, vendor, or supplier for a monetary or other valuable consideration.
A customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption in our work - he is the purpose of it. We are not doing him a favour by serving him. He is doing us a favour by giving us the opportunity to serve him
Wikipedia
Mahatma Gandhi
Peter drucker
The purpose of business is to create customer There is no business with out a customer
How important a customer is

Customers are the most important people for any organisation. They are the resource upon which the success of the business depends. When thinking about the importance of customers it is useful to remember the following points: 1. Repeat purchase is the backbone of selling. It helps to provide
revenue and certainty for the business. 2. Organisations are dependent upon their customers. If they do not develop customer loyalty and satisfaction, they could lose their customers.
Loyalty is developed through trust and by consistently delivering a memorable experience. Loyal customers provide repeat business andequally important referrals of new customers. Word-of-mouth advertising may be one of the oldest and most effective methods of developing new customers.
How important a customer is

3. Without customers the organisation would not exist. 4. The purpose of the organisation is to fulfill the needs of the customers. Needs may differ from customer to customer. Anticipating a
customer's needs is an important part of most retail and wholesale businesses, especially in a more challenging retail environment
5. The customer makes it possible to achieve business aims. Maximising profits Top position Market share Etc
Changed marketing
Markets become sophisticated, the seller of the product was no longer necessarily producer of the product. Agents and other intermediaries began being used to represent both sides of transaction. Improved communications- contract of sale is negotiated at a distance without the parties ever meeting. Mid twentieth century, producers and sellers in market given greater attention to customers than ever before. Concept of selling shifted towards serving the customer through use of help desks, calls centers and CS programmes, including companies asking the customers feedback about the products, basing on which they are redesigning the products. In the process, technology has allowed for more data collection
The matching process

With these developments, marketing is about the
matching the abilities of the needs of its customers. Marketing is about identifying what customers want; which of those wants the business is good at delivering. The matching process takes place in the marketing environment in which the business operates. This environment is dynamic and not necessarily controlled by the business. The challenge for businesses is to identify customer wants in this dynamic environment.
Marketing environment
Market types
(for application of marketing)
Production based Product based Reluctant

Customer first
Society first
Production based market :Seller emphasizes on effective production and distribution. The approach works best when demand is greater than the supply and goods and services are relatively easy to sell. There is no need to concentrate on marketing them Product based market: This is a market where goods and services sell themselves, usually because of inherent quality and performance characteristics. All the consumers are generally well informed and know about the product. Sales promotion and marketing are not necessary. For e.g., specialist computer software, gold bullion and other precious metals
Reluctant market: This type of market is one in which consumers will not buy sufficient goods and services unless persuaded to do so by advertising and sales promotion. The inherent quality and performance of the goods is insufficient in itself to generate sales. Marketing is essential in this market, especially when supply of goods and services is more than the demand
Hyundai cars, surf excel, ULIP policies
Customer first market: This type of market shifts attention away from the seller and the producer to the consumer. This approach involves determination of consumer needs and values and design and supply goods and services to satisfy them. The consumer is the most powerful party in the transaction. The role of marketing in these conditions is to ensure that products match consumers specifications and there is much reliance on market research and communication. Clothing, restaurant Society first market: This is a newly developing market type. It takes the consumer first market approach a step further. The needs of the consumer are satisfied in such a way as to enhance the well-being of the consumer and society as a whole. Goods should be socially acceptable, organic, non-harmful or non-polluting. The world should be made a better place to live in. Greenz, paper bags
Marketing a service
With an intangible product serving the customer is difficult task Copy right of service is impossible How can the firm differentiate in service? Looks similar airline ticketing or insurance policy Intense competitive environment
Role of marketing in Insurance Industry
Marketing activities Who does marketing Is marketing dept necessary How does marketing dept operates How does marketing relates to other business functions
Marketing activities
For need-satisying products, business requires the following activities to be done:
Identify and target those markets that best fit its resources (banassurance) Develop the products that meet the needs of target market better than the competitors Make products readily available for consumption (online sales) Develop consumer awareness of value delivered or problem solving techniques (new
plans and claims process)
Generate formal and systematic feed back.
Who does marketing One individual will be accountable for all the marketing activities, however, every one in orgn , in way or the other responsible for marketing that business. They can all have an influence on customer satisfaction through their work.
Is a mktg dept necessary

Not essential for undiversified businesses where the Chief Executive understands customer needs. Not necessary for a larger orgn , since their product mgt could be done by U/Wrs , actuaries, distribution by brokers. Danger could be underwriters developed a master piece of a policy unwanted by customers. Accountants concern themselves with cost instead of market value; Distribution optimizes delivery process with out customer service.
How does mktg function operate

Marketing as an activity is carried out in a variety of contexts;
B2C Consumer end user, on emotion B2E Employee benefit scheme
B2B
Manufacturers, wholesalers, retailers On logic
C2C Auction, exchange forums
C2B
Invite for bids, offers
How does mktg relate to other business functions

What ever the objective, top level support is essential for success of orgn. There must be demonstrable link between mktg and business ability to achieve its commercial objectives Functional business structure
Chief executive operations
services
Purchasing
Marketing
Personnel
Finance
High degree of communication between functional sections is needed for the marketing function to be successful. Mktg dept to be consulted in designing the product, production, distribution and finance.
Marketing within a divisional structure

Development of divisional organization is found when they offer wide range of products. Each division handles all activities associated with producing and marketing its own product
Group head office
Group functions
Finance, mktg
Division A
Division B
Division C
Marketing within a Territorial structure

This design creates work groups based on territories. All activities in a particular geographical area should be controlled by a single manager
Group head office
International marketing director
UK
France
USA
Marketing within Matrix management structure

Combination of all the above structures, this structure allows the benefits of a rigid vertical management structure to co- exist with a loose horizontal project management structure.
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Role of MKTG

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Subject: Marketing insurance products and services IPGD- CORE SUBJECT

Covered in 33 sessions Based on CII 945 Subject

Chapters and contents

Chapter 1 Chapter 2 Chapter 3 Chapter 4 Chapter 5

Chapter 6 Chapter 7 Chapter 8

Chapter - 1 Introduction to Marketing

Market, Marketing fundamentals Importance of Customer Marketing Definitions

Role of marketing in insurance industry

What is marketing in general

Factors which influence marketing

Customers ability to pay ability to pay

Target sales volume

Price of Competitors products

How important a customer is

How important a customer is

The matching process

(for application of marketing)

Production based Product based Reluctant

Role of marketing in Insurance Industry

Generate formal and systematic feed back.

Is a mktg dept necessary

How does mktg function operate

C2C Auction, exchange forums

How does mktg relate to other business functions

Marketing within a divisional structure

Marketing within a Territorial structure

International marketing director

Marketing within Matrix management structure

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