What is the (sole) mission of marketing?
Client satisfaction
What is important about systems, pertaining to marketing?
Marketing consists of multiple, simultaneous tasks that must work together in a “system”, and must be coordinated.
What is “value” in marketing?
The creation of good value for clients, and for it to be communicated that they are getting good value through interactions with the firm.
What builds long-term relationships in marketing?
Satisfying client needs.
What does “if you build a better mousetrap, the world will beat a path to your door” mean?
If a firm provides a great product and prices are reasonably low/competitive, clients will come from far and wide to buy from the company.
What are the fundamental strategies of marketing? (3)
- Marketing segmentation - deciding which market segment the firm wishes to prioritize and do business with
- Differentiation - giving clients a reason to deal with them rather than with the competition (what sets the firm apart from others)
- Market positioning - deciding what type of company it will be, and the position that it wishes to occupy
What is the best case scenario in the purchase of insurance, from a client’s point of view?
Never having to use the product/make any claims.
How can a brokerage frame the purchase of insurance in a way that provides a value to clients?
The brokerage can emphasize that the purchase of insurance is, at its core, the purchase of security, peace of mine, protection. The clients are buying competent, fair, and speedy claims services. The comfort of knowing that they are dealing with experienced insurance professionals.
They are buying into a trusting relationship with professionals who have their best interests in mind.
What is the marketing mix made up of? (5)
The 4 P’s
- Product - determines which product lines and/or insurers to represent, and what sort of packaging/bundling of products would be available.
- Price - includes the base price, credit/financing terms, and fees. The rates used are negotiated with insurance companies, and are affected by economic conditions. The brokerage’s willingness to adjust commissions can also be considered.
- Place - essentially, where the brokerage would be located, and how the firm’s services can be accessed by clients. Could include considerations around online presence, call-centre operations, hours of operation, etc.
- Promotion - personal presentation, advertising, public relations, and direct marketing.
- People - the clients’ perception of the value of the service received at the brokerage is partially based on the interactions that they had with the employees working at the office.
What are the 2 types of marketing advantages?
Positioning advantage - how the brokerage is perceived by clients in relation to competing brokerages; the image of the brokerage.
Differential advantage - any feature, product, service offered by the brokerage that differentiates/sets them apart from others. Aspects that bring value to clients and are deemed important by the clients.
What are the components unique to a marketing action plan (strategic marketing plan)? (3)
- Financial schedules - business analysis that forecasts sales, expenses, and profits, as well as budgets that outline the resources allocated and available for the initiative(s).
- Timetable - schedule of the timing of activities that are planned for the coming year.
- Evaluating procedures - an outline of how the marketing action plan’s performance is to be evaluated. This can identify moments where changes are necessary, but is also flexible enough to allow for changes.
What is a client segment?
A group of individual clients who have similar needs and wants. These are sub-markets that come from dividing the entire market using characteristics.
What are some examples of characteristics used in creating sub-markets? (The categories generally used in segmentation) (5)
- Demographics
- Geographic location
- Psychographics
- Behavioural variables
- Relationship variables
What are some demographic elements that would be important in marketing? (6)
- Age - important with respect to the types of insurance they need at different points in their lifespan.
- Gender - many products appeal to only men or only women (predominantly).
- Life cycle - distinct phases in the life of a typical family/individual (eg. single, married without children, full nest/married with dependent children, empty nest, older & single).
- Education - acquired levels of education can influence occupation, income, reference groups (friends & colleagues), and can affect behaviours in the buying process (asking more questions).
- Occupation/income level - influences the likelihood and/or ability for the client to purchase the product.
- Ethnic background - can influence a client’s preferences in terms of the sort of interaction that they expect/want in a transaction (eg. in person, spoken in their native language, dealing with someone from their own ethnic background)
What are the most important geographic characteristics used by brokerages in segmenting markets? (3)
City size, urban vs rural, and climate.
Why is population/city size an important characteristic to consider when segmenting markets?
There are concerns that come up as population increases, such as incidence of crime and accidents.
What are psychographic variables in regard to client segmentation?
Social class and lifestyle, giving marketers insight into client preferences.
What are some behavioural components of clients that a brokerage should pay attention to when creating market segments??
All client behaviours with respect to the purchase and usage of the product. This could include whether or not the client tends to shop around at renewal time, how they make payment (instalment vs paid in full), the types of coverages they are purchasing, and what claims have been made.
What are the relationship variables that a brokerage may look into when attempting to create market segments?
The brokerage would seek to understand how clients perceive their relationship with the broker/firm, and whether they feel that a relationship even exists.
What is important when a brokerage starts selecting target markets? (2)
- That the target segments are compatible with the goals and image of the brokerage.
- That the brokerage’s resources (insurer markets) match with the needs of the target market.
What is an undifferentiated target market strategy?
One marketing approach for the entire market.
How does a differentiated marketing strategy work?
The firm uses a different marketing mix for each of the recognized target markets.
What is niche marketing?
When a firm selects one target market and concentrates all resources and efforts on that market (fairly specialized).
What does a customized market strategy do?
It allows marketers to use different marketing mixes for each client.
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Chapter 1: Planning26
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Chapter 2: Organizing31
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Chapter 3: Human Resources11
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Chapter 4: Leading17
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Chapter 5: Broker - Insurance Company Relations32
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Chapter 6: Marketing30
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Chapter 7: Building Long-term Relationships11
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Chapter 8: Technology & Brokerage Operations12
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Chapter 9: Brokerage Financial Management29
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Chapter 10: Monitoring7
