Marketing for Actuaries (LIMRA) - Chapter II - MARKETING MANAGEMENT OBJECTIVES AND STRATEGIES

Overview

Critical Ins Co functions
- establishing mkt objectives
- determing how to grow in mktplace
- implementing strategies to implent these goals
mktg objectives s/b designed to maintain existing business and generate NB w/in existing mkts adn from existing dist channels
growth objectives s/b designed to generate NB from new mkts, new products and new dist channels
mkt adn growth objectives s/b based on
- historical results - where co has been, is today, and why
- strengths - s/b viewed as opportunities and capitalized as either competitive edge or way to enhance profitability
- weaknesses - eliminated or minimized as much as possible
- external environment - assesment includes
  - competition
  - consumer needs/desires
  - demographics
  - economic conditions
  - int rates
  - inflation
  - reg climate
  - consumer attitudes
  - gov't intentions (regarding public/private fin security issues)
- internal assumptions
  - assume sufficient CF & reserves to support sales goals and forays into new mkts, products, dist channels
  - strategic assumptions about how it will utilize capital and other resources
mktg strategies
- specific interrelated & complementary activities a co will perform to achieve its goals
- markets, product, distribution

Markets

specific mkts co wants to operate in
must be indentified and defined as precisely as possible
definition includes
- demographic characteristics
- geographic location
- lifestyles
- motivation
- needs
- product use
- social mobility
each mkt mustbe measurable (size and purchasing power)
must be large enough to be profitable and reachable by distribution
once mkts identified, can plan how to best penetrate these mkts
- req'd resources, who will implement, time frame

Products

products offered must be suitable to targeted mkts and dist systems
must be designed to support mktg adn pricing objectives
objectives for quality, services and growth s/b met w/in budget adn w/in expense loadign for each product line

Distribution

Cos must tailor each dist system to mkt it will serve and products it will sell
pay attention to what is needed to enhance capability of field & HO to deal w/ new products and to penetrate targeted mkts
pay attention to how internal programs might impact dist system

Role fo the Actuary

offer assistance to mktg officer in formulation of mktg mgmt objectives and strategies
gauge potential effects of mgmt decisions
project expectd results
take active role in design of product and compensation
measure progress toward attainment fo mktg objectives
advise on impact of strategies on fin rating
advise on appropriateness of sales illustration

Copyright © 2004 Steve Welander.
Permission is granted to copy, distribute and/or modify this document under the terms of the GNU Free Documentation License, Version 1.2 or any later version published by the Free Software Foundation; with no Invariant Sections, no Front-Cover Texts, and no Back-Cover Texts. A copy of the license is included in the section entitled 'GNU Free Documentation License'.