LV Thạc sĩ Marketing Activities For Insurance Financial Consulting

MBA Program 17th Intake (2008 - 2010) Consultancy Project “MARKETING ACTIVITIES AT INSURANCE FINANCIAL INSURANCE CONSULTING” Author Tutor : Phi Thanh Huyen : Tran Van Nhu Hanoi, November 2010 Marketing activities for Insurance Financial Consulting ACKNOWLEDGEMENT I would like to send my special thanks to Mrs Tran Van Nhu… who was always eager to provide me with right direction and comments for my project Her easyto-understand instruction, I could be able to conduct my project on timely manner and meet the requirement of the CFVG’s Board I would like to send my special thanks to Mr Pascal Hobadam… – Director of IFC, for his treasure just-in-time guidelines and more-than-expected training with which I have gained fruitful knowledge and materials for my project I would like to share my wish on the company’s business development I hope that my project could contribute a small part on the company’s marketing operation which is crutial for its growth Phi Thanh Huyen – 17th Intake Page of 36 Marketing activities for Insurance Financial Consulting TABLE OF CONTENT Acknowledgement TABLE of CONTENT .3 INTRODUCTION The Objective of the Project The Need of the Project The application of theoretical framework into the project .5 CHAPTER I: Analysis on IFC marketing strategy 1.1 Introduction about IFC company 1.2 Marketing Practice at IFC company 1.2.1 Position of IFC in the market 1.2.2 Market segmentation and Targeted customers 10 1.3 Current Situation of IFC marketing activities 11 1.3.1 Services 11 1.3.2 Premium strategy 12 1.3.3 Combination of Direct and E-marketing 13 1.3.4 People strategy 16 1.3.5 Distribution/Place strategy 19 1.3.6 Physical evidence 21 1.3.7 Supporting tool: Act Database 22 1.4 Evaluation on IFC’s marketing activity - Existing problems and causes .25 3.4.1 The inefficient of the combination between Direct and Emarketing 25 3.4.2 Informal and inappropriate HR policy leading to high turnvover rate 25 3.4.3 Limited physical presence 26 3.4.4 Low Utility of Act 27 CHAPTER II: RECOMMENDATIONS .28 2.1 Fostering E-marketing 28 2.1.1 Emaling marketing .28 2.1.2 Effective Link Building Techniques for Web Sites 28 2.1.3 Use Video Marketing in the website .29 2.2 People - Enhancement of staff quality and Reduction of staff turnover ratio .30 2.2.1 Improving staff quality - Defining a stable HR policy and sticking with it .30 2.2.2 Improving the productivity of sales staff by increasing the number of meetings 31 2.2.3 Improving marketing professionals – Client model .32 2.3 Expanding network 33 2.4 Supporting tool: Mastering Act Database .33 2.4.1 Utilizing Act capacity 33 2.4.2 Training for Act user .34 2.4.3 Dedicated team for IT 34 ANNEX I .35 REFERENCE 36 Phi Thanh Huyen – 17th Intake Page of 36 Marketing activities for Insurance Financial Consulting INTRODUCTION The Objective of the Project This part aims to introduce the overall objective of the project and the reason why the author choose IFC’s marketing strategy for this project I decided to choose this topic because I had been working for IFC as a consultant for months Beside consulting works, I had to participate in several projects with purposes of building marking strategy for the company Thanks to those experiences, I had recognized how difficult to defining and setting up a marketing strategy and align it with the business activities At IFC, there have been several smart and innovative marketing initiatives that inspired me to conduct this project Therefore, the objectives of the project would be: Firstly, to summarize the fundamental knowledge of marketing and how to apply marketing strategy into insurance brokerage business, especially for small company, Secondly, to analyze the current situation of marketing at IFC company in adherence with mentioned theories/concepts Besides, the writer expect to share some impressed experiences while participating in the company’s marketing projects which are considered as useful information for other companies in peer group, Thirdly, to carry out recommendation to eliminate existing drawbacks and constrains inside the company marketing strategy The Need of the Project Marketing strategy for small company like IFC is not easy to handle given the limited resources of budget, staff etc There are many players in the market those who are continuously creating fierce competition and the market is promisingly potential in the next 10 years Being established since 1990s, IFC is one of the oldest insurance brokers in Vietnam However, the company remains small in term of market share and customer base Again, it is suffering from increasing and tougher competition from big to small brokers and the intensive sales-force from insurance company Given the age of 10 year working in Vietnamese market, IFC could better to increase their market share and to expand its business The company advantages are being one of the volunteers in the new and young market and being leaded by a “Vietkieu” Director who graduated abroad and has very strong knowledge and solid experiences in the field However, the limited customer base and market share not only reflects the company’s business strategy but also shows the uneffectiveness and inefficience of its own marketing activities Up to now, there have been no official/written project or surveys organized by IFC or any other third party with regard the mentioned topic By conducting this Phi Thanh Huyen – 17th Intake Page of 36 Marketing activities for Insurance Financial Consulting researd, the autho would like to give a comprehensive picture of its own marketing and find out the reasons why IFC’s marketing has not reach the Director’s expectation The respective recommendations could be useful for the company as an official material for its Marketing Department in planning and implementing marketing The application of theoretical framework into the project The theoretical framework will be selectively applied in the analysis in the follwing chapter in order to undertable thoroughly the strong vs weak points of the IFC In practice, not all above concept/theory will be used by the company rather than be applied in a selective way in line with the company existing resources and the nature of its own business In the follwing chapter, the under concept will be used respectively: Market segment and service positioning This will be used to identify the IFC’s segmentation and how the company positions its service in the market place 5P mix concept will be used as follows: Product: Insurane brokers like IFC don’t have their own products They are just selling/distributing products of other insurers only In the case of IFC, they are offering a number of products of more than leading international and domestic insurers Therefore, PRODUCT will be analyzed from SERVICE perspective As IFC does not design the product and the price of each product, they are following the commission sharing policy stipulated by the Ministry of Finance Within the regulated commission rate, IFC can flexibly decide the commission rate that the company comfortable with and comply with the company’s long term strategy Hence, PRICE will be analyzed in form of “Premium + Commission” that IFC use to offer their service People will be an interesting party for IFC case as the company is applying an “autonomy mechanism” whereby each staff can be a “2 in 1” consultant That means each staff can work independently to deliver the company services Place and Promotion will also be used to understand the company strategy in distribute and expand their network and customer base The combination of Direct and E-Marketing will be mentioned in this analysis The participation of information technology in the company Emarketing activities will be emphasized to see the company’s interest and priority in this field Especially, Act Database, a software that IFC is using to conduct their own daily work will be describe in detailed to see it key roles and advantages in facilitating the company marketing Phi Thanh Huyen – 17th Intake Page of 36 Marketing activities for Insurance Financial Consulting CHAPTER I: ANALYSIS ON IFC MARKETING STRATEGY 1.1 Introduction about IFC company Insurance Financial Services (IF Services) was officially established in 2002 in form of limited liability company with the Vietnamese name “Doanh nghiệp Tư nhân Tiếp thị Thị trường” However, the company business had been originally in place since 1999 under the control of Cameron Butler, part of Finesco based in Brunei, an independent financial adviser In 2009, the company rename into Insurance Financial Consulting – IFC The head office is based in Hochiminh city with about 10 staff including consultants, PR and admin The company made it presence in Hanoi in 2006 with about 1-2 full time consultants/PR and admin staff The company organization is as described in the following figure Figure 1.1: IFC’s organizational structure Senior Consultant cum Director Head office in Hochiminh City Admin and Claim Dept Marketing Dept Branch office in Hanoi Admin Marketing Dept It can be said that IFC is quite small broker with the customer base of more than 1,000 customers (as groups and individual) in both regions of which the south region accounts about 80% of the company’s total turnover volume Compared to other brokers in the market like Aon, Grass Savoy… IFC remains very much smaller in term of size as well as market share As many other insurance brokers, IFC is providing advisory and insurance services to its custormers in non life insurance field The company itself doesn’t have any insurance products with its own brand name Currently, IFC is representing for more than international leading insurance companies including AIG, Bupa, Alianz, William Russel, Groupama… The company focuses on delivering client with personal insurance advice on medical, office, house, travel, and car… As mentioned above, IFC is representing for more than 10 insurarers and offering their products to its customers and receive commission from insurance products Phi Thanh Huyen – 17th Intake Page of 36 Marketing activities for Insurance Financial Consulting sold The main and only income of the company come from the commission over contracts signed At present, IFC is more specialized in selling private medical insurance which is contributing about 80% of the total income On daily basis, IFC’s consultants and PR go to meet prospects who are interested in non life insurance Based on analyzing prospect’s situation and demand, IFC’s consultants give produce a comparative quote collecting from the likely most suitable insurers This quote will be sent to prospect with attached detailed explanation and advisory from the consultants Once prospect agrees with one solution and the contract is signed, IFC become appointed broker who will directly deal with customers for collecting premium on behalf of the insurer, receiving claims, informing renewal or updating customer with any new policy from the insurer As the nature of the brokerage service, IFC is not be responsible for any problems arising from customers as well as insurer sides rather than to deliver the best solution/advice to customers 1.2 Marketing Practice at IFC company 1.2.1 Position of IFC in the market Social economic situation At the end of 2008, there were 18 of 26 life insurers to have insurance business at loss or without profit Earlier of 2009, Vietnam socio-economy has been seriously affected by crisis of global recession, a lot of production or trading enterprises were keeping declining operations and not enough business perfunctorily; lacks of jobs for workers made income decreased and not enough financial capacity to buy insurance Not few of traditional customers of insurers don’t have budget to pay for insurance premium, even though the needs of insurance service don’t decrease any more and even more and even increase for the sectors as maritime transport, air transport, minerals and coal…Number of potential customers of life insurance service reduced due to financial difficulties A lot of customer can’t pay insurance premium to maintain the insurance contract In 2009, a lot of disasters and floods, particularly the storm No and 11, caused serious loss for central provinces Stock market in some times downed to 235 points of VN INDEX (24 February), real estate market and foreign exchange were instable to cause large impact on investment efficiency of insurers To deal with the situation, insurers tried to find out the way to overcome the difficulties by internal forces to rearrange business management, innovate current insurance products, study for new product development, expand and improve distribution channels, corporate with customers to overcome difficulties and financial problems by postpone the time-limit or provide lone service for premium payment… Since 2dn quarter of 2009, the government launches series of stimulus program as loan subsidy, improvement of public investment, reduce of VAT and registration fees for some items, reduce business corporate tax and extend tax payment Phi Thanh Huyen – 17th Intake Page of 36 Marketing activities for Insurance Financial Consulting deadline for business corporate tax of 2008, exempt PIT for first months of 2009… The mentioned solutions have developed positive effects 2009 GDP reached 5.32%, investment of whole society account for 42.5% of GDP, FDI attracted 20 billion USD, ODA attracted 8.1 billion VND, exports reached 56.6 billion USD, and imports reached 68.8 billion USD Insurance sector has caught the opportunities to overcome difficulties to complete the task of being economic shield for socio-economy before covered unexpected natural disasters or accidents… Table 3.1: Growth rate of direct premium by company As of 31 December 2009 Unit: VND million No 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 Companies ACE insurance Chartis Baolong BaoMinh Bao Ngan ABIC Bao Tin Bao Viet BIC AAA UIC FUBON Groupama Hang khong Hung Vuong Liberty MIC MSIG PJICO PTI PVI QBE Samsung Vina SHB Vinacomin Toan Cau VIA Vien dong Total Phi Thanh Huyen – 17th Intake Direct Insurance Premium reported the same growth peirod period before rate Market share 14,209 130,386 324,816 1,824,353 66,499 275,411 32,052 3,676,577 366,532 336,720 121,985 36,016 2,333 299,425 18,404 173,234 341,708 40,388 1,297,830 459,042 2,770,089 42,683 13,574 103,650 253,938 1,884,429 23,824 130,597 8,654 3,319,978 264,090 202,688 177,849 439 3,868 72,270 6,809 45,202 143,185 1,060,788 443,374 2,020,554 37,075 5% 26% 28% -3% 179% 111% 270% 11% 39% 66% -31% 8104% -40% 314% 170% 283% 139% 22% 4% 37% 15% 0% 1% 2% 13% 0% 2% 0% 27% 3% 2% 1% 0% 0% 2% 0% 1% 3% 0% 10% 3% 20% 0% 148,116 87,598 69% 1% 142,748 1% 247,527 193,309 28% 2% 192,084 168,789 14% 1% 262,794 220,647 19% 2% 13,643,961 10,887,178 25% 100% Source: Association of Vietnamese Insurers 2009 Page of 36 Marketing activities for Insurance Financial Consulting Non-life insurance market According to the report from Ministry of Finance, there are 50 insurance enterprises in the market including 27 non life insurance, 11 life insurance, 10 insurance brokers and re-insurance company Currently, the Ministry of Finance has approved the issuance of establishment and operation for non life insurance, Vietnam Cathay insurance company, and life insurance, Fubon Vietnam Insurace company Total premium turnover for the six months of 2010 is estimated at more than VND 14 billion, 21% increased compared with the same period of 2009, in which turnover from non life and life insurance are estimated at VND 7.9 (29% increased) and VND 6.4 (14.3% increased) respectively The non life insurance market reached the turnover of more than VND billion, equivalent to 28% increased In general, all types of non life insurance recorded the growth in term of turnover in which fire insurance increased 125%, agriculture: 109%, construction: 68%, transportation: 38.5%, business interruption: 39%, public liability: 33%, health and accident: 30.5% Leading players were PVI, BaoViet, BaoMinh, PJICO, PTI Companies recorded the high grow rate of turnover were: Hung Vuong, 272%, Bao Ngan, 141%, ACE 117%, SVIC 109%, Fubon 95%, BIC 72%, SVI 64%, PTI 56%, Chartis 51% Compared to the other brokers, IFC is quite small in term of size, turnover as well as market share, especially the company market share is hard to measure as the followingma reasons: - The company is working as an unregisted broker that means it doesn’t have the certificate of broker issued by the Ministry of Finance This leads to the fact the company is not listed in the list of insurance brokers in the market right now The company is still allowed to act as an intermediary to delivering brokerage service for leading insurers like Chartis, William Russel, Bupa, Groupama… but several prudent insurers like UIC, they are not willing to use IFC as an broker for their products - The company’s net income by the end of 2009 is about VND 50 million which remain significant smaller than that of Hung Vuong which is accounting zero percent of the total market share - The awareness about IFC’s presence in the market, especially in Hanoi is relatively low According to the company monthly report on Hanoi performance, there was only about under 10 requests for service (prospects contacting IFC for service) on average during the period of second half of 2009 The following chart demonstrates the number of new requests for from July to December 2009 Phi Thanh Huyen – 17th Intake Page of 36 Marketing activities for Insurance Financial Consulting Figure No 1.1: New request from July to December 2009 Source: IFC’s monthly reports 1.2.2 Market segmentation and Targeted customers In field of business in general, and in isurance business in particular, customer orientation is a crutial part of business and marketing strategies Overall goal of this strategy is to develop strongly the list of existing customers and to find effective solution to attract further more customer groups Providing consultancy and being a broker of non-life insurance products, the target market of IFC is the niche market for private medical insurance The company main target is the expatriate community which can be divided into kinds of expatriates: Western and Asian Western customers: they need medical insurance and must/want to be insured specially if they have a wife and children, their company give them an allowance… because they are used to the best hospitals in their home country where costs are unaffordable unless the Social security or Private medical insurance pays for it Such customers can be classified into three categories: Western Europe, Australia & NZ and US citizen Asian expatriates need the same high standard of treatment but are not used to international prices so they believe they can pay by themselves or they can go to local hospital These customers can be classified into categories: Rich Asian nationals and Developing Asian citizen These customers are foreigners working in international or foreign companies/organization in Vietnam or even customers living in neighboring countries like Lao or Cambodia where there is no official offices or competition of other insurance broker companies Other target is the Vietnamese community for travel and medical Of course such group must have a medium or high income or at least are employee of international companies Phi Thanh Huyen – 17th Intake Page 10 of 36 Marketing activities for Insurance Financial Consulting In general, the company physical evidence can be considered as one of the company weak points The Director himself has to running arount to make the company presence as much as possible then it image/face rely very much on him Once he is not avaible or absent due to traveling, customer will have difficulty in enquiring for claim or further consultation This issue is not easy to handle as he need to give the consultant the autonomy to make decision and to be professional enough to response to customers at the fastest manner 1.3.7 Supporting tool: Act Database What is Act!Premium Workgroup? Act! Premium Workgroup is designed for business teams and workgroups of to 50+ users Depending on your operating system, ACT! Runs on Microsoft SQL Server 2000 Desktop Engine (MSDE) or Microsoft SQL Server 2000 Standard Edition In IFC, ACT is installed in every PC as a tool for daily working Each employee is provided with an account in ACT The existing ACT version allows the company to add up 10 users at the same time In this assignment, the author only introduce about Act from the opinion of a normal user Figure No 1.7: Inter-face of Act Source: ACT Databse software Phi Thanh Huyen – 17th Intake Page 22 of 36 Marketing activities for Insurance Financial Consulting Figure No 3.8: Act Database in the company workflow ACT DATABASE Business group * Hospital/ Clinic * * 1 Prospects BI/Partner PR/Client Relations Consultants Administration/ Accounting Insurers CLIENTS Old/Existing Clients 1- Potential client/prospects come from many sources/referrals They can be referred/introduced by the company’s existing clients, partners, hospital/clinic etc 2- Any one interested in insurance services can contact PR/Client for enquiry 3- PR/Client passes by prospect to consultant for further follow up 4- If prospect becomes client, admin will take care of the following steps: collecting application and supporting document, forwarding them to insurers, collecting cash from clients if needed 5- Admin works with insurers to finalize offer and invoice for client 6- PR/Client, Consultant and Admin can work directly with Clients via email, phone call, or meeting if necessary 7- All the above-mentioned activities have to be recorded in Act Phi Thanh Huyen – 17th Intake Page 23 of 36 Marketing activities for Insurance Financial Consulting How Act is used in IFC? Working with Act seems to be the crucial and compulsory at IFC All the company employees start a working day by turning on the company and opening Act It will take you not more than 01 day to get familiar with Act It can be said that it is not so complicated to use Act The thing is there are many features available inside Act which requires an employee must know how to use it effectively and efficiently In the framework of this project, the author is not ambitious to say something insight about Act except for mentioning about what an IFC’s consultant is doing on daily basis with Act - When she has a prospect: Key in all information about her in Act, book a meeting a phone call in the To-do-list, - Every month, with Act a consultant knows how many clients with contracts are due for renewal From Act, she can send Renewal Invitation to all of client She can also make call phone directly from Act as long as my PC connected to phone line, - She can print out her monthly/weekly reports showing what she had done: How many meetings she made, How many prospects she got, How many prospects she lost, How many clients come into office, etc her year-end appraisal will be based on such reports, - She can also see how her colleagues are doing with their own account to see the whole picture of the company performance, Advantages of using Act Obviously, IT is becoming increasingly important for company, especially for such company like IFC As the nature of brokerage business, the company is dealing with a numbers of prospect, clients/contracts, claims, renewal etc The following demonstrates the benefits which Act brings to our company • Saving cost: With Act, all the activities of the company are recorded in details and information can be circulated internally without sending any physical notices or documents This could help the company save a lot of money and time for communication between Hanoi and Hochiminh offices and of course among the employees Just look at Act, a stff know what she has to at least for the whole month If she encounteres something difficult, she would then pick up the phone and escalate issue to the higer senior manager • Efficiency: Together with a flat organizational structure, Act helps the company’s workflow simpler, smooth and fluent This enables the highest mobility of every staff • HR Management: There is HR department inside the company Act helps the manager it by his own He can easily evaluate the performance of a consultant based on the number of consultation meetings and contracts signed For example, a good consultant needs only meeting, several phone calls to win a client while so-so consultant has to take meetings, phone calls and may be loose the prospect after the first meeting If somebody quits the company, the substitute can quickly take over the task based on what have been recorded in Act 24 Marketing activities for Insurance Financial Consulting • Business evaluation: the company manager can evaluate the company business based on a bunch of reports generated from Act He can see the trend of growth, analyze the reasons of failure, and set up marking plan etc for the next phase • Strong tools for e-marketing: As you can put contact in different groups (business group, drinking group, housewife group etc.), you can contact your own e-marking campaign For example, there will a woman charity event in January, PR/Client Relations can quickly send the event notice by EMAIL to a housewife group By the way you can remind them about your company existence If you contact such campaign periodically, you could strengthen your company’s image We can again confirm the role of IT for the company’s survival and development IT becomes a dispensable element in a company’s strategy It does not enable the effective management but also create the comparative advantages for companies 1.4 Evaluation on IFC’s marketing activity - Existing problems and causes 3.4.1 The inefficient of the combination between Direct and Emarketing As more and more organizations want to more with less, cost-effective and highROI marketing channels will gain traction E-mail is an affordable alternative to direct mail because you don’t have to pay for printing or postage If you market to multiple segments, e-mail allows you to affordably tailor messages that are relevant for each audience In addition, e-mail campaigns can be easily launched and tracked, allowing companies to quickly communicate important information and swiftly respond to market changes Despite the fact that the Director understood the importance of emailing in his low cost marketing strategy, emaling marketing not has been done at the best level of effectiveness and sufficience The main purposes of the Director in the emailing program are: - regularly (every month) sending introduction/update on the compnay status/services to everyone in the company database which is continuously updated by the admin staff - sending update on non life insurance market situation (particularly hot news) for revelant receivers in the database Selective receivers must be applicable for the contents of the messages In fact, the company is only sending the introduction about its own business with the detailed contact point in the messages The other kinds of contents have not been done due to the disorganized database and lack of interaction among staff in fulfilling their tasks 3.4.2 Informal and inappropriate HR policy leading to high turnvover rate During the time working for IFC, I had seen a very high turnover ratio and the gap of the staff qualification among staff recruited Firstly, there is only one consultant working for Hochiminh office for years, the rest has just staying with the company for under 12 months This issue is causing a big challenge for the company to standardize the process and to improve the staff quality 25 Marketing activities for Insurance Financial Consulting This is because to become a good consultant, one must experience at least 12 months intensively working and being trained by the manager The IFC’s manager had to spend a lot of time coaching, training and explaining to the new bee about soft skills, product knowledge, the rule in insurance broker…If a consultant leaves after months, that is not a big deal But if she or he leaves after 12 months or more than that, that would be a nightmare to the Director as the quitter leaves behind a huge empty space to fill in Given the fact the labor market is very lack of people that have sufficient qualification satisfying the IFC’s recruitment require, the company has been taken a lot of times to find a suitable person Another reason why the staff turnover ratio remains so high is the “flexible and dynamic” HR policy of the Director From time to time, he changes his set of required criteria for PR and Consultant Few years ago, he followed the idea that his staff should be 100% foreigners who can exactly understand “foreigner’s mind” as well as insurance serives But in the last 12 months, he regconized that Vietnamese market is emerging and Vietnamese is becoming richer He decided to combined 50% foreigners and 50% Vietnamese staff in his team His argument is Vietnamese consultant can give better advice to Vietnamse customer than a foreigner can His argument is right but in practice, there is still a big gap between Vietnamese and foreigners in perceiving insurance products and the way they behavior This over flexibility in HR policy has made the team have different look from time to time and causing confustion to customer Strict customer may question about the internal issue of the company Secondly, the inconsistency in the staff’s level of quafilication has been causing inefficiency of the working process Several senior consultants had a very good background and qualification, even high level of education such as PhD, Master… used to work for IFC As such people can not fit with the organization with all of informal process and underqualification colleagues For example, a foreign consultant can not work well with an admin who English is so poor Sometimes such consultants felt like being down grade and under-appreciated Thirdly, an informal working process is causing impacts on the effectiveness of the business The idea of the Director is to free up staff and let them self-improving This policy can be applicable for those staff who reached a certain level of skills and qualification They can be self responsible and keep a good track on what they are doing In contract, low level staff can not see any benefit of policy They need somebody to hold their hand and tell them what they should That means “One solution does not fit all” 3.4.3 Limited physical presence Again, having the two small offices in Hanoi and Hochiminh has been creating many difficulties in approach and servicing people based in the Middle area The company had received several requests from the middle province like Da nang, Hue etc To following up on the request, consultant can only use phone call and emails So if there is any problems, both customers and IFC will find at costly and hardly to settle from afar Upto now, just very few customers of IFC based in the Middle while this area is remain very potential 26 Marketing activities for Insurance Financial Consulting 3.4.4 Low Utility of Act As above analysis, Act Database is a very powerful system which atmost suitable for company like IFC The below figure is the expected model that the Director is wish to implement Figure No 3.9: Ideal model for ACT Database utility Reports Prospect/ Customer input ACT DATABASE BIs input Marketing campaigns www.tip4tips.com If the company can so, Act Database can bring it a huge benefits and advatanges that can be used to speed up the growth of business Especically, PR can use Act as a strong tool to conduct her series of marketing program like: - updating customer about interesting case on insurance, premium discount from insurers, - sending out invitations for events organized by IFC customer: this is a win win situation for both IFC and exisint customers, - effectively managing the development trend of business and taking action if needed, Such actions don’t cost any money from IFC, it is just a matter of mouse clicking and see However, not all staff fully aware about such system They are using Act under its capacity then Act currently does not support them at the best level Currently most of staff only use Act as an administrative program that they can search for customer contact details, browsing transaction history, sending out invitation of renewal only Thefore, Act now is used as a tool which mostly supports admintration staff Another reason of the low utility of Act is that IFC has got a separate team or specialized IT expert All kinds of activities related to Act or website are being outsourced The company’s IT infrastructure is very much relying on the external IT company This leads to the fact that, any time IFC encounter problems with Act/Website, a staff has to pick up the phone and make enquiry The minor problems can be fixed easily via remote access into IFC’s computer systerm or even via phone instruction If if something is serious, IFS’s staff need to wait for the IF expert coming in to fix it This is very time and money costly for the company 27 Marketing activities for Insurance Financial Consulting CHAPTER II: RECOMMENDATIONS 2.1 Fostering E-marketing 2.1.1 Emaling marketing In order to utilize the benefit of emailing, IFC need to setup formal emailing acvities schedule and tailor email contents subject to specific receivers Such agenda could be as following: Table No 4.1: Suggested Emailing plan No Purpose Update on new insurance policy/insurers/produ cts Receivers Frequency Prospects and Upon pratice customers going due for renewal Update on company’s changes/innovation/ appointment Update on insurance market Global customers Upon pratice BI, hospitals, Every clinics… months Content Short briefing on update, emphasizing on added value/new benefits for customers Shortly update on news Headline news If the company can implement emailing program on regular basis, it will soon become a dispensible part of the marketing activities In the short run, it makes the company’s image professional and innovative In the long run, the company regular interaction creates a deep impression in the audience mind 2.1.2 Effective Link Building Techniques for Web Sites From above analysis, we can see the extremly low in traffic rank in to the IFC’s website Improving/increase the traffic rank Link Building is the process of creating inbound links to the company own insurance Web site Inbound links, also known as backlinks, incoming links and inlinks, are an essential part of the search engine optimization (SEO) process and a fast way to improve the company Web site’s popularity When building up good quality inbound links to the company insurance Web site (or blog), IFC improve its visibility and credibility with insurance prospects and search engines The more inbound links to the company Web site, the more Internet exposure the company site enjoys With more exposure, IFC has a higher likelihood of being found online by insurance buyers That’s because backlink quantity is one criterion used by search engines to determine the company Web site’s search engine ranking There are many different ways to obtain quality backlinks to the company Web site Fortunately, it doesn’t take a big budget or the company specializing in link building to achieve search ranking improvements If IFC have the budget, a link building campaign may be a good idea But, even if it doesn’t, here are four simple and 28 Marketing activities for Insurance Financial Consulting effective do-it-yourself link building techniques to get the company insurance site noticed: • • • • Press releases: Online press releases build brand awareness and provide high quality links to your insurance Web site This form of link building is most desirable because it’s a one-way link pointing to your site without requiring a reciprocal link in return One press release can result in 100 immediate link backs! Guest blogging: Guest blogging is a great way to introduce the company to new people, earn exposure and gain one-way backlinks to the company Web site Search for blogs in your same niche and write for them as a guest writer, or simply post comments on related blogs that include a link back to your site Just make sure the other blog provides quality information and projects a professional image Ezine articles: Each time you publish an article online, you create a new path to your Web site When you publish more articles, you create more paths back to your site and soon, you enjoy a healthy increase in site traffic The results are very easy to track EzineArticles provides you with reports that tell you how many people viewed each article and how many linked back to your site If you’re a company that pays for key word advertising, you’ll probably find that within a few months, you’ll no longer need to so Your “web” of published online articles creates the same increased traffic effect – better yet, it’s free Social networking sites: By establishing professional profiles on LinkedIn, Facebook and other networking sites, the companys consultants/PRs can further bolster the backlink volume 2.1.3 Use Video Marketing in the website Are you looking for a new way to boost brand awareness, drive traffic to your site and increase sales conversions? Today, the answer may be as simple as harnessing the power of video Video marketing is on the rise and proving to be an effective way for companies to get the message out to prospects and customers Jimm Fox, President of One Market Media and author of the Marketing with Video and Rich Media blog, says video and video marketing will play a dominant role in the next phase of the Internet’s evolution He offers seven compelling reasons why web video should be a top marketing priority this year: Better ROI Adding video to the online marketing campaign can significantly improve the results In a recent study by Eyeblaster of online advertising campaigns, video increased dwell rate on ads by 20% and dwell time by %100 Another study by dynamic logic also indicated significant improvements in brand favorability, aided brand awareness and purchase intent of rich media ads with video compared to traditional static display ads Traction ComScore released web video consumption results in September 09, which indicated 85% of people online consumed an average of 10 hours of video a month online That number continues to grow every month 26 billion videos were consumed in 29 Marketing activities for Insurance Financial Consulting September in the US Video has taken root on the Internet to the point where visitors to Web sites are now looking for video content first Engagement Video is the best way to keep visitors to your site engaged and the best way to engage people with your brand Time-on-page and time-on-site numbers increase when you add video Images, podcasts, polls, charts and graphics are all great but nothing engages a Web site visitor more effectively than video There are hundreds of blog posts and articles like this one where Patrick Moran explains how his sales team improved their close rates by 20% and online registrations by over 25% using web based video Video Is A Top Priority for Marketers According to a recent survey by Marketing Sherpa, for the second year in a row video marketing is the top priority for marketers surveyed, ahead of SEO, PPC, social media, email marketing and all other online marketing tactics Turnhere has also released a study in the fall which revealed the same results – “When asked to rank various online marketing priorities for 2010, video was ranked as the top priority.” Ubiquity In a recent post conference interview Jeremey Allaire, CEO of Brightcove summarized the outlook for web based video this way, “Video will become as ubiquitous as text on the web.” He went on to say, “what we’ve seen happening over the last year is this incredible growth in the number of organizations and corporations, of all types, of all industries, of all sectors of societies, embracing video to enhance what they are doing on the web.” 2.2 People - Enhancement of staff quality and Reduction of staff turnover ratio Under suggestion would be considered as applicable for IFC at the moment 2.2.1 Improving staff quality - Defining a stable HR policy and sticking with it From now, the Director should defind clearly his own HR policy which shoud be including: • Detailed job description and career path for each • Transparent salary policy with retention program that could help keeping staff staying with the company longer • Formal training program that could help junior staff to better improve themselves • Regular review on employee performace Having a good job description together with a precide business plan help the Director build up a good KPI (key performance indicator) which can be used to evaluate staff performce as welll as the effectiveness of Marketing activities Last but not least, the recruitment criteria should be adjusted to be applicable with such small like IFC to leverage the business capacity 30 Marketing activities for Insurance Financial Consulting 2.2.2 Improving the productivity of sales staff by increasing the number of meetings The number of meetings during a month or a year reflects part of the company business Unfortunately, inefficient meetings cost insurance organizations billions of dollars each year That’s because most meetings are not managed effectively Here are a few simple ways to maximize insurance meeting productivity: • Establish a structured agenda Distribute the agenda in advance with instructions to review This will provide purpose and direction Each consultant always keep along with her a hardcopy agenda with all note about meeting schedule and urgent tasks need to be done • Start and end on time Be disciplined, set a time limit and stick to it! Using a watch sometimes not only make a consultant fashionable but also make her be well organized • Discourage sidebar conversations and messaging If possible, establish a “no pda” rule and discourage participants from messaging one another during meetings If a consultant goes to see a prospect intested in medical insurance, she should bear in mind the topic of discussion is about medical insurance She should not go beyond this topic if the prospect does not intend to The wrong direction of discussion should lead to the un-focused meeting and can end up in failure • Take time to manage disputes Most meeting conflict is unproductive By heading off disputes early, you’ll save time and increase participation Establish your own version of the “dead horse” card so participants can preempt low productivity Insurance is all about risk and money If no risk/accident occurs, life is smooth But in reality, customers always conflict with insurers in term of indemnity amount conditions Willing to settle dispute will very highly appricate from customers but on the other hand, the broker may cause harmful to his business with broker A consultant must know clealy what would be the barrier to fight for and how to balance the benefits of all concerned parties • Keep your mission and goals front and center Often, conflicts can be resolved by si mply referring back to the company’s mission and goals Ask participants how well an initiative or idea supports the company mission and if how effectively it will advance the organization toward the achievement of key goals This approach maintains objectively and promotes fact-based decisions • Require objective data To further promote fact-based decision making, require hard data before debating options and considering ideas It’s difficult to make a good decision if you don’t have the complete picture At IFC, there is a list of questions and a meeting minute template which must be used in all meeting with prospects/customers The questionaire helps consultant collect enough information about customers and support her in choosing right plan/solution for them In order to improve the quality of every meeting, PR/Consultant should learn by hard those questions and know how the best way to collect information As private issues questions sometimes will be considered as impolite or crude behavior • Distribute an after-meeting action plan After each meeting, e-mail participants 31 Marketing activities for Insurance Financial Consulting the action plan with assigned responsibilities and dates Start the next meeting by reviewing last week’s action plan Writing meeting minute and reporting after meeting should be a compulsory step in the whole working process It is not only to help consultant to share her work with the team but also help her to seek for a suitable recommendation from her colleagues or senior manager All above hints are very helpful for a sales person not only insurance broker company in particular but for the whole company in general 2.2.3 Improving marketing professionals – Client model What is the difference between “sales” and “marketing” In the former, you are trying to convince a prospective client to buy what you have an offer In the later, you are discovering what a prospective client wants and, if possible, providing that service and/or products Currently, producers/brokers tend to be sales professionals as opposed to marketing professtionals They see prospective clients and talk about concepts, ideas, strategies and products” This approach does indeed work If you approach enough potential clients in this way, some of them will sure be interested in what you have to offer Given that fact that IFC is more focusing on medical insurance, the following suggested model could be a good thing for them to pratice Source: Achieving success with the whole client model – National Under-writer Life and Health insurance, January 2006 This model enables the company to create client profile categorized into groups with which you can put all information into one page by using modified mindmapping approach By organizing information in this way, you can easily see what are the issues with prospect clients, what are they expecting and what they can afford 32 Marketing activities for Insurance Financial Consulting In the case of IFC, their marketing professionals should focus on the group No 1, 3, and This focus help their consultant better understand the prospects’ need and deliver better advices and choose the most suitable solution accordingly 2.3 Expanding network It is obvious that IFC must have their presence in the Middle area to exploit this potential market Opening one more office should not be an idear It should be a plan with a practical roadmap to implement As feedback by the Director, he is considering the cost versus benefit of opening one more office But he should push this plan forward because IFC is loosing customer in this area for the time passing by Besises, recruiting more two consultants for Hochiminh Office would be a critical poit as the business growth in the city as well as the number of customers that Hochiminh office serving is rapidly increasing 2.4 Supporting tool: Mastering Act Database 2.4.1 Utilizing Act capacity The director should incorporate Act expoitation in a formal Act-in-use policy in order to encourage staff to get familiar with Act and take advantages of all utilities it has Once they are getting familiar with it like using a mobile phone, they will gradually explore many other hidden of Act that could help them to improve their own productivity This policy shoud look like that: Table No 4.2: Suggested reporting schedule Position Type of reports All staff PR and consultants Consultants Consultants Consultants No.of meeting reports No.of new prospects referred by BI/existing customers/family etct No.of pending cases No of finished cases Volume of commission collected Reporting frequency Monthly Monthly Remark and quality evaluation Monthly Monthly Monthly Then on the first week of the new month, the Director will have with him a comprehensive picture on the business of the company and take appropriate action For example, if a consultant owns largest number of pending cases, Director may raise question and give her a hand in solving her job In the worse case, part of her job can be reallocated to other consultant to speed up the service delivery process Moreover, a consultant can clearly see her performance in comparison with the team Her weak points can be identified to improve or for further training in the future 33 Marketing activities for Insurance Financial Consulting 2.4.2 Training for Act user As Act is a very complex software, the company needs to have a very precise and comprehensive training on how to use it and how to take advantages of all data that Act captures and generates These internal training courses should be conducted at the induction phase for every new staff and frequently for older staff 2.4.3 Dedicated team for IT As mentioned above, IFC is very keen on the development of the IT and applying IT into its own marketing In order to so, they need to set up a dedicated team/staff for IT implementation This staff/team is not only in charg of maintaining the company IT’s infrastructure but also responsible for developing new toos/application to facilitate the marketing implementation This staff/tream should have a solid knowledge on IT as well as Emarketing It helps the staff/team to easily grasp the marketing initiatives and translate them into IT form Given the fact that the source of such labor is quite limited in the Vietnamese marketing, IFC should be very careful in choosing candidates Otherwise, the cost for such position good be very high compare to the company limited budget Choosing new graduated student could be taken into consideration as IFC can train them on insurance business field together with other staff 34 Marketing activities for Insurance Financial Consulting ANNEX I The world insurance market Turnover/ Population Market share Country cost (million) (% of the world) (million) China 1.345,8 163.047 4,01 premium/ Premium income headcount / GDP (%) (USD) 121,2 3,4 Korea 48,7 91.963 2,26 1.890,3 10,4 Singapore 4,7 14.245 0,35 2.557,6 6,8 Thailand 67,8 10.460 0,26 154,4 4,0 Vietnam 88,1 1.440 0,04 16,4 1,6 Malaysia 27,5 8.840 0,22 321,8 4,4 Indonesia 230 7.285 0,18 31,7 1,3 Philippin 92 2.399 0,06 26,1 1,5 Source: www.webbaohiem.com.vn 35 Marketing activities for Insurance Financial Consulting REFERENCE Fundemental Marketing, CFVG’s 17A2 Handout Marterial on Marketing from Online Library of La Trobe University The application of Marketing – The case of Aon Vietnam, Mr Nguyen Anh Tai, CFVG 15th Intake Internal material from IFC’s marketing department: Monthly report, business plan, HR statistics etc 2009 report of Association of Vietnamese Insurers Websites: www.webbaohiem.com.vn, www.insuranceinvietnam.com, www.tip4tips.com, www.hanoian.com, www.alexa.com etc Other internet searches 36 ... company marketing Phi Thanh Huyen – 17th Intake Page of 36 Marketing activities for Insurance Financial Consulting CHAPTER I: ANALYSIS ON IFC MARKETING STRATEGY 1.1 Introduction about IFC company Insurance. .. Page of 36 Marketing activities for Insurance Financial Consulting researd, the autho would like to give a comprehensive picture of its own marketing and find out the reasons why IFC’s marketing. .. small part on the company’s marketing operation which is crutial for its growth Phi Thanh Huyen – 17th Intake Page of 36 Marketing activities for Insurance Financial Consulting TABLE OF CONTENT