7P’S OF MARKETING
The formulation of product mix for the insurance business makes it significant to take a look at the services and schemes of insurance organisations. The product portfolio is known and the process of formulating a package should be known. It is natural that the users expect a reasonable return for their investments. It is quite natural that the insurance organisations want to maximise profitability. Both of these dimensions are found interrelated.
It is well known that the key objectives of insurance business are mobilisation of savings and channelisation of investments. This makes it essential that insurance business is made lucrative so that the users /potential users get incentives to buy a policy or to invest in the insurance organisations. The insurance organisations also need to promote the underwriting activities, which would activate the process of arresting the regional imbalance. In the context of formulating the product mix, it is essential that the insurance organisations promote innovation and in the product portfolio include even those services and schemes which are likely to get a positive response in the future.
The corporate objectives indicate that the insurance organisations are required to be careful, especially while launching a new policy. The policies should not only generate enough premium but it is also important that the policies cover persons working in the informal sector, serving as porter, working as manual labourers, or engaged in farm sector. It is the need of the hour that the insurance organisations make their service internationally competitive. This makes a strong advocacy in favour of innovative product mix strategy for the public sector insurance organisations. Thus the formulation of product mix should be in face of innovative product strategy. Strategies of foreign and private insurance companies should be taken into consideration while initiating the innovative process.
The formulation of product strategy should assign due weightage to the rural segment emerging as a big profitable segment especially in the 21st century. The policies and schemes should have rural orientation so that backward and neglected regions of the country get priority attention and the regional imbalance is minimised.
In this context, it is also pertinent that the insurance organisation make possible welfare orientation and include in the product portfolio even those policies and schemes which become instrumental in safeguarding the interest of the weaker sections of the society. The formulation of package is also found important. Designing a package on the basis of the needs and requirements of the concerned segment would make the product mix more competitive.
The partially tapped or totally untapped profitable segments of the future should be identified and tapping the potentials optimally is also important.
A sound product portfolio is the need of the hour and therefore the regulatory barriers or constraints in activating the innovation process should be minimised.
Product Planning & Development
The purpose of insurance business is to generate profits besides subserving the social interests. The present business is likely to be more competitive. Product is like a stage on which the entire drama of successful marketing is acted. It is like an engine that pulls the rest of the marketing programmes. It is in this context that the product management in an insurance organisation needs an intensive care. Yesterday, the policyholders had limited hopes and aspirations but today they expect more and they would even like something more tomorrow. This focuses on the fact that strategic decisions are influenced by the environmental conditions. The product development needs a new vision, a new approach and a new strategy. Till now the public sector insurance organisations have made possible an optimum utilisation of their marketing resources especially in rural...
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