New Media Strategy for IFFCO-Tokio

Submitted by:Sahil Chopra (01)

Richa Bhardwaj (26)

MBA - PR1

Industry Analysis andNew Media Strategy

Insurance Industry Overview

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India is the fifth largest general insurance market in Asia with annual premiums of $6.3 billion in FY09

21 companies operating in India: 13 private sector companies – multiline (JV with foreign insurer) 4 public sector companies – multiline 2 private sector companies – health 2 public sector specialty companies Intense competition and strong growth between FY01 and FY08 Premium grew at 19.5% per annum Penetration levels (premium as a % of GDP) increased from 0.4% to 0.7%

(world average being 3.1% in 2007) Annual premium in April 2008-March 09 was $6.3 billion (excl health and

specialty companies) Market continues to be dominated by public sector, though share has declined since

FY01 Large middle class population, increased awareness and income levels have fuelled

growth Currently maximum foreign partner investment is 26% - soon expected to increase

to 49%

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Home insurance segment is set to achieve a 100% growth as financial institutionshave made home insurance obligatory for housing loan approvals. It is poised tobecome the second largest business for non-life insurers after motor insurance by2011.

Insurance Laws Amendment Bill, 2008 was introduced in the Rajya Sabha. The Billhas been referred to the standing committee on finance for its report, which isexpected shortly. The key amendments proposed in the Bill are as follows:

Increasing the FDI limits in insurance from 26% to 49% Introducing “Health insurance business” as a separate category of insurance. Minimum

paid up capital of INR 500 million (USD 10 million approx) has been prescribed forstandalone health insurance companies.

Newer products are being introduced for agricultural insurance and extensive effortsbeing made by the insurance companies to reach out to the rural markets. This isexpected to shift the skewed nature of insurance, slowly but steadily, towards a morebalanced state.

With the entry of several low-cost airlines, along with fleet expansion by existingones and increasing corporate aircraft ownership, the Indian aviation insurancemarket is all set to boom in a big way in coming years.

Industry SWOT

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STRENGTHS

- The variety of products is increasing

- Deregulation and detarrification of industry

- Health, micro insurance facing a boom

- Customer satisfaction mandatory

- Prospects expect more services from theirbrokers.

-Premium rates are increasing and so arecommissions.

WEAKNESS

-Insurance companies often slow torespond to changing needs.

-There is an increasing trend of financialweakness among the companies.

-Rural area pentration is low

-Awareness about the subject is still low

OPPORTUNITIES

-Ability to cross sell financial services barelybeing tapped.

-Improved technology available- paperlesstransactions available.

-Newer distribution channels being identified

-Innovative covers on offer- HIV, terrorism etc

-The client's increasing need for an "insuranceconsultant" can open new ways to service theclient and generate income.

THREATS

-The increasing cost and need for insurance mighthit a point where a backlash will occur.

-Government regulations on issues like health care,and terrorism can change direction of insurance.

-Increasing expenses and lower profit margins willhit smaller insurance companies hard.

-Investment policies facing a downturn linked toeconomic slowdown

SWOT

General Insurance - Major Private Players

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1. ICICI Lombard General Insurance (11%)

2. Bajaj Allianz General Insurance Company Limited Royal (9%)

3. Reliance General Insurance Company Limited. (6%)

4. IFFCO-Tokio General Insurance Co. Ltd (5%)

5. TATA AIG General Insurance Company Ltd. (3%)

6. Sundaram Alliance Insurance Company Limited (3%)

7. Cholamandalam General Insurance Company Ltd. (2%)

8. HDFC-Chubb General Insurance Co. Ltd. (1%)

9. Future Generali India Insurance Company Limited (1%)

10. Apollo DKV Insurance Company Limited (0%)

11. Universal Sompo General Insurance Company Ltd. (0%)

12. Bharti Axa General Insurance Company Ltd. (0%)

13. Raheja QBE General Insurance Co. Ltd (0%)

Market Share

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IFFCO-Tokio 237 255 313 5% 4% 5%

IFFCO-Tokio & Its Competitors Past Campaigns

IFFCO-Tokio Campaign - Phase I

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When Iffco-Tokio came into existence, its tagline was: The Life You Deserve

Two campaigns were launched in this initial phase:

• Ad agency: Dentsu• PR Agency: Genesis BM

Campaign I: Whichever way life takes youo Insight: Consumers value trustworthiness the most for an insurance

brando Positioning: Trustworthy, Honest, Reliableo Media: TVCs and print ads

Campaign II: Hassle-free claimso Insight: Speedy claim settlement is extremely critical for satisfied

customerso Positioning: Quick, easy claim settlemento Media: TVCs and print ads

IFFCO-Tokio: Advertisements

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IFFCO-Tokio Campaign - Phase II

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In 2008, Iffco-Tokio makeover with a new logo and tagline: Muskurate Raho

Two campaigns were launched in this initial phase:

• Ad agency: Publicis

• PR Agency: Genesis BM

o Campaign: Albert Pinto kyon muskura raha hain

o Rationale:‘Muskurate Raho’ is the need for Indian Masses in the present day life which is full of risks and tension.

o Brand Ambassador: Paresh Rawal

o Positioning: Friendly, hassle free, trusty

o Media: TVCs, print ads and brand activation (outdoor)

o Add links

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2009

http://www.youtube.com/watch?v=wHy2mqASkrs

http://www.youtube.com/watch?v=qqyBPbb4o3I

http://www.youtube.com/watch?v=4aZmNzD4L50

http://www.youtube.com/watch?v=pjvR_q_CzzI

http://www.afaqs.com/perl/advertising/creative_showcase/index.html?id=18397&media=Digital

2008

http://www.afaqs.com/perl/advertising/creative_showcase/index.html?id=7213&media=TV





Competitors’ Campaigns

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A few links to the campaigns rolled out by ITGI’s competitors:

Future Generali -http://www.afaqs.com/perl/advertising/creative_showcase/index.html?id=18076&media=TV

Tata AIG Superstar -http://www.afaqs.com/perl/advertising/creative_showcase/index.html?id=17726&media=TV

Bajaj Allianz -http://www.afaqs.com/perl/advertising/creative_showcase/index.html?id=17609&media=TV

Bajaj Allianz -http://www.afaqs.com/perl/advertising/creative_showcase/index.html?id=18418&media=TV

ICICI Lombard -http://www.afaqs.com/perl/advertising/creative_showcase/index.html?id=18617&media=TV

TATA AIG -http://www.afaqs.com/perl/advertising/creative_showcase/index.html?id=18184&media=Digital#

Print Advertisements

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Outdoor Advertisements

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IFFCO-TokioProposed disruptive ideas

Defying the rules: ITGI

Step I:

Study and analyse the insurance industry in India

Step II:

Identify the industry conventions in marketing, distribution, consumer, communication, corporate, etc.

Step III:

Defying the existing rules of the game for the industry by disruptingthese conventions

STRATEGY I

Micro-insurance

Distribution Convention: The distribution and communicationchannels being exploited by the insurance companies in the ruralmarkets are agents, formal banks, regional rural banks, post offices,NGOs, Self Help Groups etc.

Idea: Rural knowledge centers and Internet zones are becomingincreasingly popular in rural areas. These act as information resourcecenters to the rural people. These can be used effectively by ITGI toeducate the people about insurance in general as well as its products(in their regional language). Internet’s reach in rural areas is quiteoften underestimated.

Micro-insurance

Consumer Convention: Poor people live for the present and do not planfor the future. Given this fatalistic attitude, it is quite tough to explain theconcept of insurance to the poor. The poor view the premium oninsurance policies more as a cost than a risk-cover.

Idea I: In order to improve rural sales, ITGI must look at winning the trustand partnering effectively with the local NGOs of the region who aregenuinely trying to uplift the situation of the poor. It is through theseNGOs that ITGI can educate the poor about the importance of insuranceand in due course increase its sales.

Idea II: ITGI must look at involving the local NGOs to develop customisedinsurance products which would be of value to the people of the village.

STRATEGY II

Retail Products: Urban

Distribution & Marketing Convention: The Indian general insuranceindustry has historically been dominated by the agency channel, throughwhich 75% of total premium income is sourced. But in recent periodsother channels – for example, bancassurance (ICICI Lombard - ICICIBank), brokers, corporate tie ups, motor company tie-ups are gainingimportance.

As of December 31 2007, 267 brokers were registered with IRDA,including 228 direct brokers, 33 composite brokers and 6 reinsurancebrokers. In a deregulated environment, the broking community will haveplenty of opportunity to become an integral part of the insurance and riskfinancing process.

Idea: This is an opportune moment for ITGI to initiate the process ofbuilding a strong relationship with independent brokers, corporates andautomobile companies through rapport building events and activationcampaigns.

STRATEGY III

Claim servicing

Corporate convention: All the insurance companies are severelyhampered in claims servicing by their process-oriented approach andlimited operational flexibility. They have been unable to expedite claimsettlements leading to high customer dissatisfaction. Hassle free claimsettlement is one of the key enticers for customers.

Idea: IFFCO-Tokio with its campaign tagged- Hassle Free Claims, did try todifferentiate itself from its competitors on this very factor. But thecampaign turned out to be largely unsuccessful due to the lack ofefficiency of the company in settling its claims out. Thus, ITGI shouldideally put in all efforts to ensure that an extremely speedy & effiicentclaim settlement process is put in place. This is bound to improve the levelof satisfaction and loyalty amongst ITGI’s policy-holders.

STRATEGY IV

NEW MEDIA STRATEGY

Objectives

• Study and analyse the present use of web by IFFCO-TOKIO (and its

competitors) to develop critical insights

• Propose key online marketing and communication strategies to the company

based on:

Critical evaluation of each aspect of the web- its potential for the

insurance industry

Competitor analysis - what are they up to in the online space

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Celent, a US-based global research and advisory firm: online insurance sales will doubleby 2011 (worldwide) and web will play a major role in most personal insurancepurchases across auto, life, and health.

Insight: Marketing & communication initiatives will now become more specific and one-to-one marketing will see a rise.

Key findings include:

• Web has become an increasingly important communication channel between sellersand buyers of personal insurance.

• At present, most consumers’ purchasing process is “Web Influenced”• Search engines like Google and Yahoo! are critical channels for insurers that cannot

afford massive consumer marketing campaigns to drive shoppers directly to theirsites, and more insurers are embracing search engine optimization to help capturethese shoppers

• Pure online sales are growing, but will still account for less than 15% of sales, even inpersonal auto.

• While 100% online sales are unlikely to exceed 30% in any area, the Web will be amajor influencer for nearly all sales within five years.

Online Insurance Sales and Marketing: Celent

New Media: Key Insights

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Primary survey conducted by IAMAI and IMRB International across 30 cities and 90,000

respondents reveals:

1. Out of the total internet users in urban India (50 million), 37 per cent of them stay in top 8

metros and 30 per cent in towns with populations below 5 lakh.

2. 37 per cent of the total internet population in urban India belongs to SEC A and 32 per cent

belongs to SEC B categories.

3. Among the active internet users in 30 cities (17.9 million), 30 per cent are young men below

35 years who are not school or college students, and 27 per cent are college-going students.

4. 12 per cent are school-going kids while 11 per cent of the active internet users in 30 cities

(17.9 million) are working women; only 6 per cent are non-working women.

5. 37 per cent of the 17.9 million active internet users surf the net at cyber cafes, 26 per cent surf

at home while 27 per cent surf at office

6. 91 per cent of the surveyed consumers use internet primarily for e-mail, 76 per cent prefer to

use it for general search, while 49 per cent consumers are looking for educational content.

Useful Insights for ITGI

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• The reach of internet is not just limited to just the 8 metros, as is often perceived.Thus, it gives ITGI a chance to connect with people from smaller cities and towns(tier I & tier II) as well through the web.

• SEC B forms as important a part of ITGI’s TG as SEC A and the internet has a balancedmix of both.

• Amongst the internet users, people below 35 years of age form a major chunk(around 57 per cent). Younger people are more open to new concepts, services andproducts. Thus, there is an opportunity to make them perceive insurance cover asessential – the smart thing to do.

• 76 per cent of the people surveyed prefer to use the internet for general search, while49 per cent are looking for educational content. This provides excellent reason forITGI to invest in Search Engine Optimization, setting up of blog and keeping itswebsite updated.

Avenues: E-Commerce

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ANALYSIS: ONLINE MODEL V/S AGENT MODEL

Advantages Disadvantages

Distribution made easier Information overload

Digital policy accessible to customer No scope for negotiation/bargain

Online customer service 24X7 Lack of privacy/trust

Paperless Transactions Security concerns e.g. spam

Ease of use, convenience No. of users (potential buyers online)

still low

Lower costs User expects freebies

OBSERVATIONS

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ICICI Lombard leads the way in e-transactions. It allows visitors to buy, change, extend or

renew their policies online through its website (travel, health, motor and home) in an

extremely simple procedure.

Bajaj Allianz General only allows users to buy motor policies online. Also, it allows them to

renew their existing policies as well.

Reliance General allows its visitors to buy policies online but not renew their old policies. It

offers only travel, motor and health insurance policies, not home.

Tata AIG only allows existing customers to renew their existing policies online.

IFFCO-Tokio allows visitors to buy (motor, travel, health) as well as renew their policies

online. But, both the times we tried to check the process of buying the policy out, the server

seemed to be unavailable or down.

ICICI Lombard, TATA AIG and Reliance General, Bajaj Allianz General and IFFCO-Tokio

have all tied up with policybazaar to sell their insurance products.

COMMENTS AND SUGGESTIONS

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ITGI’s online policy selling process is quite fast and customer-friendly. There are few

clicks, new pages or new windows opening in the process so as to make it faster.

ITGI can look at offering/selling its other products like home insurance etc also through its

website.

ICICI Lombard and Reliance General have agents’ login facility on their website for the

agents to buy policies for clients, renew them, check their status etc. ITGI can look at

exploiting that aspect too. Why limit the service to just end consumers?

ITGI can look at tying up with other websites such as www.insurancemall.in to sell its

products.

Avenues: Online Advertising

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• Categorised into two types: search and display

• While the current ratio of search to display roughly stands at 30:70, share of search is

expected to increase significantly this year

• The internet allows real-time monitoring, mapping and adjustment of campaigns

• It also allows fine tuning of the campaign based on response and feedback to reach the desired

goal

OBSERVATIONS

ICICI Lombard uses the specialised services of AdGuru, the ad-network unit of the

Bengaluru based Internet search firm Guruji.com.

IFFCO-Tokio has initiated digital advertising of its products (Motor, Health, Travel) on

various high

traffic websites like Rediff, Yahoo, in.com, IBN live, cricbuzz etc. The same was done during

Elections and IPL. To ensure consistency in the initiative, ads and sponsored links are

featured continuously on Carewale.com, Yahoo.com and Google search.

Avenues: Websites

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• The most controllable source of providing information and relaying messaging on the

Internet

• Most trusted when supported by third-party credibility

• Must leave a positive impression on the visitor's mind (appropriate content and design)

COMMENTS AND SUGGESTIONS (Post Competitors’ Website Analysis)

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IFFCO-Tokio’s website is quite nicely developed with an excellent interface which isextremely uncluttered, very interactive and user friendly. However, it can still look at addingthe following segments to

its website.

Awards showcase/tab

Customer testimonials

Agent login

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Set policy renewal reminder- E-mail/SMS

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Sharing business ideas

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Customer feedback- website, company, products, services

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Develop relevant microsites or blogs

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Downloads- brochures, forms (claim, application, renewal etc)

RSS feeds: Subscribe to company news through mails, newsletters etc

Avenues: Search Engine Optimisation

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OBSERVATIONS

Bajaj Allianz has hired Communicate2, a search marketing agency based in Mumbai

which has recently become a certified Google Analytics Authorized Consultant (GAAC).

COMMENTS AND SUGGESTIONS

Hire an agency to help with SEO and search listings for even according to the trends

search advertising is the way forward for web advertising.

A similar sort of benefit can be derived by using web tools like Stumble Upon, Reddit

and Digg bookmarks. These can be used expertly for specific interesting pages of the

ITGI website and related blogs on insurance in order to drive net user traffic to them.

Thus, promoting the company, its products and initiatives.

Avenues: Social Media - SWOT

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STRENGTHS

- Direct contact with audience

- Scope for interaction

- Measurable results thanks to web analytics

- High reach within the TG

- Cost-effective

-Scope for continious change and improvement

- Helps build strong, long-term relationships

WEAKNESS

-Results may be lower as against other media

-Sometimes impersonal due to outsourcedexecution

-Rapid, ever-changing environment

-Sometimes messaging becomes inconsistent

- Less time to correct glaring errors, if any

OPPORTUNITIES

-Presence where the TG lies

-The TG helps with word of mouth

-Place to identify and connect with new talent

-Innovative covers on offer- HIV, terrorism etc

-Reach out to people that other media cannot helpwith

THREATS

-Possibility of excessive brand exposure

-Espionage: competitors are more likely to knowwhat you are doing

-Close competition in the medium may lead to needfor very high level of promotion

-Judgemental consumers

SWOT

Avenues: Social Networking Sites

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The best and most credible form of publicity for a brand is word of mouth publicity and these

social networking sites provide us with a platform to promote just that.

Tools to be utilized:

Starting up of separate, dedicated and highly active and interactive communities for ITGI

Developing an ITGI profile on Twitter to keep the followers updated.

Developing fan pages for ITGI and its innovative products, schemes and policies.

Developing applications to like How much do you know about insurance quiz, Do you need insurance

quiz, Which insurance policy best suits you quiz etc to promote brand loyalty and gain customer

feedback on the products.

Using these social networking sites to leverage and promote the initiatives undertaken by ITGI and

even gauge feedback on its new advertising and promotional campaigns.

Using these communities to promote the new product offerings- policies and services.

Regular tracking to gauge customer feedback and negating the negative opinions and feedback of the

customers on the brand.

Avenues: Youtube

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Tools that can be utilized:

ITGI can put expert talk videos on Youtube about the current industry scenario,innovations in the industry etc. (This can be used for management profiling as well-as the top management people from ITGI can be a part of these discussion videos)

ITGI can also look at putting up videos to educate the consumers who have still nottouched insurance products to educate them about the need and benefits of theseproducts and services.

TVCs- Posting TVCs on youtube can help get feedback from people on a real time basis. It can help

ITGI understand if its TVC is connecting well with the audiences or not. Some companies have

even gone a step ahead and used youtube as the testing ground for their TVC. Even before buying

spots on television to post their commercials, they have put them up on youtube for feedback

purposes.

Avenues: Social Gaming Sites

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Advertisers have realised that consumers may overlook brands in display and

search ads. However, it’s hard to do so when they are actively involved in playing a

game that has the brand as its central theme or character.

OBSERVATIONS

Bajaj Allianz tied up with Contest2win to create a game for it.

Zapak has developed advergames for LIC and ICICI Lombard.

SUGGESTIONS

IFFCO-Tokio can look at a gaming tie-up as well to promote its product through

forums, gaming sites as well as its own website.

Avenues: Other Suggestions

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DIRECT WEB MARKETING

DIRECT MAILERS, REGULAR EMAILERS, NEWSLETTERS should be developed

CREATE AN EXCLUSIVE ITGI GROUP (a premium group for its loyal customers) and

look at offering them special services through the web and offline. This activity can

be leveraged across media, the web being an important part.

Case Studies

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New game by Bajaj Allianz makes you count your

pennies

ICICI prudential, health insurance and the moral dilemma

ICICI prudential launches job portal for senior citizens

ICICI prudential life launches aboutulips.com

For details refer to the appendix in the attached MS Word document

New Media Strategy for IFFCO-Tokio

Education

Transcript of New Media Strategy for IFFCO-Tokio