“People need to understand content in their own context,” says Yateesh Srivastava, Chief Marketing Officer, AEGON Religare Life Insurance. Srivastava talks about creating brand distinction via an upgraded service quotient and driving the direct-to-consumer space
Q] In a scenario where the offerings and communication of insurance players is similar, how does the brand distinguish itself?
From our inception we have firmly believed that we are here to help people plan their lives better. That is our stated vision; the single largest gap in this sector today is in under-insurance. When we looked at this market, we always stressed on the need for adequate protection, this is clearly projected in our campaigns like Kam Insurance Lene ki Bimari (KILB). Or in terms of our product and distribution strategy, where we have focused excessively on the online space in selling protection products at a time when the industry was chasing Unit Linked Insurance Products (ULIPs). This has been our significant shift in terms of product mix. For the channels which are in our control, we would definitely like that protection to be a minimum of 30% of the overall product mix, the balance will come from long-term savings. From a communication perspective, we would be driving the underinsurance theme in different and refreshing ways. We clearly focus on protection; and will launch new protection products soon. We are trying to bring protection to the focus, it is good for the customer, it brings sales credibility, as well as a profitable product to have in your portfolio. It is a win-win combination. The protection platform is critical for us and we will continue working on it and getting it to the fore of what we are doing. We are also going to provide localized support at the ground level for branch marketing in an intense fashion, customized to local market in terms of language and choice of medium. This will be over and above what is happening at the national level.
Q] What are the factors that help you determine the choice of media?
With media costs being what they are and the industry being what it is, we have to balance fairly tight media budgets with what we want to achieve. We want to focus our entire marketing on customers and where they want to be tomorrow; so we have a lot of focus on digital marketing, the Internet and social media. Our marketing analytics is used to a large degree to retain existing customers; this also helps us in cross-selling. Today, we run at 18% cross-sell ratio, which is not bad for a new company.
Q] Has the notion changed from a product that has to be sold to one that has to be bought?
I would be smiling a lot more if that was the case. We are definitely seeing a transition. Take the guys who are buying online - we expect that to percolate and grow. After that, there is a segment of guys who research online and buy offline, so that when they meet an agent, they are extremely well-informed and aware. We need to train our staff to answer very pointed questions. This pyramid also consists of segments who may not have access to the information, and so on. Has the transition completed to where we see pure pull instead of pure push? No. But the transition has begun at the top, as we see technology proliferating and people becoming more and more comfortable with content. I don’t think there is enough content for consumers in smaller towns. We are seeing the transaction rates going much higher, the market is now two to 2.5 times what it used to be two years ago. No one distribution is going to dominate the market – there is space for everyone. Banks have their space, so do insurance agents and brokers. The direct to consumer space is the next emerging space to watch out for.
Q] The trend of online research and offline purchase originates from the fact that the consumer needs a one-on-one at the point of purchase. Given the nature of the product, what is the brand doing in this direction?
Trust is a very big factor. We have an e-sales system, where very often consumers call the number not for help with their policy, but to say ‘I haven’t heard your name; you are going to be there, right?’ They need the assurance of a human being on the other side of the line. For a new brand, we need to build the trust, which is part of the course. I expect this to grow from direct to customer, and a service differential via word of mouth and fiercely loyal customers, which is more effective than advertising. Research online and purchase offline in our case also happens because of the complexity of the products; so we are trying to simplify this. We will then see our products moving faster. Simplicity is coming back in a big way. We are also trying to take some steps on service, which is difficult. Ask and the first time it wows you; the second time it is nice, and the third time it is expected. But we are working towards creating a service differential.
Q] What is the brand’s presence in smaller cities? What is the contribution ratio of these cities?
We are present in 86 cities through our own network, and through our partners in 190-200 cities. We have just expanded our electronic reach to 180 cities. We launched the product in 2009, and from 2010, 60% volume was driven by the top four cities and 80% was driven by the top eight in terms of internet penetration. Today, the top four are down to 40% volume on an extended basis, and top eight are down to 60% volume. We are now beginning to see a long tail effect - online policies from Jabalpur, etc. Some amount of percolation is happening. How we harness the local flavour, language and market is going to be important. People need to understand content in their own perspective. Demographically, people may be in our target profile, but are unable to relate to an English website.
Q] Is the brand able to convert its social media presence into sales?
I am giving you a very honest answer - at the moment, it does not increase sales. This is not restricted to financial services alone. A lot of other industries are grappling with the same answers. We changed our objective. When we started out, it was to do with the number of fans. Now, that is not the case. We said we would live with fewer fans who are long-term, rather than those who only like our page to win a contest. The real power of social media is to create a servicing hub, which is what we are working on.
Q] What are the challenges faced by the industry today?
As an industry, we need to change the push attitude to interaction with consumers. In the past, we have kept a distance from the customer but at the same time, pounced on them with sales offers. We need to move forward in a collaborative way.
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