Marketing Management - 2

Marketing Plan - 1
Group-5 2/16/13 Fore School Of Management

Contents
Mission .................................................................................................................................................................. 4 Vision .................................................................................................................................................................... 4 How SBI his aligning itself with Mission and Vision .............................................................................................. 4 Current Strategies ............................................................................................................................................. 4 What these Strategies have resulted in? .......................................................................................................... 5 Segmentation, Targeting and Positioning ............................................................................................................. 5 MARKET SEGMENTATION ................................................................................................................................. 5 TARGETING: ...................................................................................................................................................... 6 POSITIONING: ................................................................................................................................................... 6 Last Six Years Comparison on Different Parameters ............................................................................................ 7 Premium income .............................................................................................................................................. 7 Paid Up Capital ................................................................................................................................................. 7 Additional Infusion ............................................................................................................................................ 7 New Policies ...................................................................................................................................................... 8 Commission Expense Ratio ............................................................................................................................... 9 Operating Expense ............................................................................................................................................ 9 Benefits Paid ................................................................................................................................................... 10 Profit ............................................................................................................................................................... 10 Projections for next three years ......................................................................................................................... 11 Premium Income............................................................................................................................................. 11 Operating Expenses ........................................................................................................................................ 11 Profit ............................................................................................................................................................... 12 TOP 5 MARKET LEADERS (PRIVATE): ................................................................................................................... 12 Market Share Overview: ................................................................................................................................. 13 Most Probable Idea of To-Be Launched Product ............................................................................................ 13 Rural Segmentation ........................................................................................................................................ 13 A glimpse at the market penetration globally: ............................................................................................... 14 Insurance Premium and Density in India ........................................................................................................ 15 Insurance Penetration in India........................................................................................................................ 15 Insurance Density in India............................................................................................................................... 16

PORTERS FIVE-FORCE OF INSURANCE INDUSTRY ............................................................................................... 18 Competitive rivalry: HIGH ............................................................................................................................... 18 Power of suppliers: MODERATE ..................................................................................................................... 18 Threat of Substitutes: ..................................................................................................................................... 18 Threat of substitute as a Risk-Coverage tool (LOW):.................................................................................. 18 Threat of substitute as an Investment and saving tool (HIGH): ................................................................. 18 Power of buyer: HIGH ..................................................................................................................................... 18 Threat of new entrants: LOW ......................................................................................................................... 19 Competitive Advantages of Competitors............................................................................................................ 20 Life Insurance Corporation of India ................................................................................................................ 20 ICICI Prudential Life Insurance Company ........................................................................................................ 20 HDFC Standard Life Insurance Company Limited ........................................................................................... 20 Bajaj Allianz General Insurance Company Limited ......................................................................................... 22 SWOT ANALYSIS for SBI Life Insurance ............................................................................................................... 22 Strength: ......................................................................................................................................................... 22 Weakness: ....................................................................................................................................................... 23 Opportunities: ................................................................................................................................................. 23 Threats ............................................................................................................................................................ 23 Performance Review ........................................................................................................................................... 24 Past performance of the product ................................................................................................................... 24 Perceptual Positioning Map ............................................................................................................................ 24 Current Perception ......................................................................................................................................... 25 Possible Repositioning .................................................................................................................................... 26 PESTLE Analysis ................................................................................................................................................... 26 POLITICAL FACTORS ........................................................................................................................................ 26 ECONOMIC FACTORS ...................................................................................................................................... 26 SOCIAL FACTORS ............................................................................................................................................. 27 TECHNOLOGICAL FACTORS ............................................................................................................................. 27 LEGAL FACTORS .............................................................................................................................................. 27 SBI LIFE INSURANCE MARKETING MIX ................................................................................................................ 27 PRODUCT: ....................................................................................................................................................... 27 PRICING: .......................................................................................................................................................... 28

PLACE: ............................................................................................................................................................. 28 PROMOTION: .................................................................................................................................................. 28 PEOPLE: ........................................................................................................................................................... 28 PROCESS:......................................................................................................................................................... 28 PHYSICAL EVIDENCE:....................................................................................................................................... 29 OBJECTIVES ......................................................................................................................................................... 30 TO MAXIMIZE THE SALES VOLUME ................................................................................................................. 30 INCREASE THE MARKET SHARE ....................................................................................................................... 30 INCREASE THE BRAND VALUE ......................................................................................................................... 30

MARKETING PLAN-I
Mission
"To emerge as the leading company offering a comprehensive range of life insurance and pension products at competitive prices, ensuring high standards of customer satisfaction and world class operating efficiency, and become a model life insurance company in India in the post liberalization period".

Vision
To be the most trusted and preferred life insurance provider.

How SBI his aligning itself with Mission and Vision

Current Strategies
SBI LIFE has trust and transparency of the SBI brand, customer centric approach and capital efficient multi distribution model. It has a varied product line and provides products in numerous categories such as ULIPs, Child Plans, Pension Plans, Protection Plans, Savings Plans, Group Plans, Corporate Solutions, Retirement Solutions, Group Plans, Health Plans, etc SBI LIFE offers very simple, economical and need-based life insurance solutions to the customers. This strategy is reflected in all the products that SBI LIFE have launched so far. In FY 08-09 in view of the economic downturn and realising the need for a guaranteed product SBI LIFE launched SMART ULIP, a NAV guaranteed product. They also recently launched Maha-Anand Insurance that offers an opportunity to larger sections of society to participate in the equity markets and benefit by systematically investing over a long term horizon. With the SBI brand behind these products, they have seem working wonders in the market. This wide product range completely helps them in aligning with their mission of serving the customers with range of life products. While other big players are largely focused on savings products, especially unit-linked products. They have recruited agents in massive numbers and naturally their initial customer acquisition expenses are very high. Unlike other insurance companies, SBI LIFE have taken advantage of bank-assurance set-up which is a very cost effective medium for SBI Life. SBI LIFE have a ready distribution set-up of over 6,000 branches of State Bank of India (SBI) selling insurance product which serves as a great advantage for the company in terms of reaching to the customer and providing easy access for the customer throughout

the country which comes as a benefit of being preferred by the customer because of the wide network. It provides a very high level of customer service by huge workforce of about 85000 Insurance Advisors who are highly qualified. They also offer door to door services to their customer. This strategy shows the ambition of the company which reflects in their value also it helps them in achieving their vision of becoming the most trusted and preferred company. SBI LIFE has also been involved in various CSR activities such as organizing campaigns like read Drishti and read India pledge and enabling mentally challenged children, which helped them enhancing the brand value as well as sending the message of giving back to the society.

What these Strategies have resulted in?

Despite the recent economic slowdown SBI Life Insurance has shown year-on-year growth. SBI LIFE earned a net profit of 622 crores and up by 12%. Contrary to the continued business decline faced by the life insurance industry, SBI Lifes regular new business premium increased by 19 %, to Rs. 2,618 Cr during the FY 2012-13 from Rs. 2,193 Cr in FY 2011 -12. SBI LIFE received the Global Performance Excellence Award 2013 by Asia Pacific Quality Organizations (APQO) under Large Service Organizations category.

Segmentation, Targeting and Positioning

MARKET SEGMENTATION
In Micro Insurance Industry we basically segment on the basis of Rural and Urban Population. Since In India we have around 70% population living in Rural India. Then, we further segment on the basis of income (Demographic Segmentation) and to do this we might use houses level based on Kuchha Pucca else we now a days segment on the basis of consumer durables available in the family. That is more the durables richer the person. In country like India Low Income groups are more compared to High Income. According to the Insurance Regulatory and Development Authority (IRDA) defines rural sector as consisting of (i) (ii) (iii) a population of less than five thousand, a density of population of less than four hundred per square kilometer, and more than twenty five per cent of the male working population is engaged in agricultural pursuits

TARGETING:
Targeting involves breaking a market into segments and then concentrating your marketing efforts on one or a few key segments. We basically target the segment who earn 70 Rs to 300 Rs on daily basis. It will target the daily wage earner group and among the low income group we need to target the families where there is only one bread earner in the family. Since it provides Crop insurance as a part so farmers are one of the key segment. As it provides Disability insurance as one of the product then it will focus that group which has hazardous or difficult working condition for ex workers at construction sites. It will focus those groups where there is family size of more than four. Moreover the categories of workers falling under agricultural pursuits are: cultivators, agricultural labourers, and workers in livestock, forestry, fishing, hunting and plantations, orchards and allied activities. The social sector as defined by the insurance regulator consists of (i) (ii) (iii) (iv) unorganized sector informal sector economically vulnerable or backward classes, and Other categories of persons, both in rural and urban areas.

POSITIONING:
We need to position the product in the minds of the targeted audience as a very user friendly product and trusted friend of rural India. It needs to be in the local language and specially focused on Hindi language as a medium to promote so that it gets positioned as a familiar product in the mind of rural market. It has to be carefully positioned as a product which is just a step away from the user by providing a SMS update system or 24 hours toll free system. Simultaneously, we need to position it as a very affordable product which can be in the reach of every person in the targeted segment. Also positioning must be in such a manner which makes them believe that this investment provides them value for money.

Last Six Years Comparison on Different Parameters

Premium income

Premium Income (Crore)

350000 300000 250000 200000 150000 100000 50000 0 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 Premium Income (Crore)

Premium income generally refers to the money an insurance company receives by charging premiums to clients. This money is not all considered profit because claims must also be paid out of this money, as well as administrative expenses. Nevertheless, it is one of the primary sources of income for many insurance companies, along with investment income. The premiums are generally regulated by a governing body, and therefore cannot generally be excessive or outside of a certain range for the industry and the protections offered.

Paid Up Capital

Paid Up Capital(Crore)
30000 25000 20000 15000 10000 5000 0 Paid Up Capital(Crore)

It is the amount of a company's capital that has been funded by shareholders. Paid-up capital can be less than a company's total capital because a company may not issue all of the shares that it has been authorized to sell. Paid-up capital can also reflect how a company depends on equity financing.

Additional Infusion

Additional Infusion(Crore)
8000 6000 4000 2000 0 Additional Infusion(Crore)

It is the value that is often included in the contributed surplus account in the shareholders' equity section of a company's balance sheet. The account represents the excess paid by an investor over the par-value price of a stock issue. Additional paid-in-capital can arise from issuing either preferred or common stock.

New Policies

New Policies(Lakhs)
600 500 400 300 200 100 0

New Policies(Lakhs)

It represents the number of new policies brought, cumulatively.

Commission Expense Ratio

Commission Expense Ratio

7.2 7 6.8 6.6 6.4 6.2 6 5.8

Commission Expense Ratio

It is the net commission expense as a percentage of net earned premiums.

Operating Expense

Operating Expense (Crore)

35000 30000 25000 20000 15000 10000 5000 0

Operating Expense (Crore)

It is a category of expenditure that a business incurs as a result of performing its normal business operations.

Benefits Paid

Benefits Paid
250000 200000 150000 100000 50000 0 Benefits Paid

It denotes the total benefits returned to the consumer in case of normal repayment after term expiry or payment after expiry of the insured subject.

Profit

Profit
8000 6000 4000 2000 0 -2000 -4000 -6000 Profit

It is the difference between premiums received and the benefits paid and it can be seen that during the early years, they were in to losses and then from 2009 onwards they started reaping profits.

Projections for next three years

Premium Income
294000 293000 292000 291000 290000 289000 288000 2013-14 2014-15 2015-16 Series1

The premium earned will be almost constant as followed in the previous years. A slight increment can be there.

Operating Expenses
35500 35000 34500 34000 33500 33000 32500 32000 31500 2013-14 2014-15 2015-16

Series1

The operating expenses for this industry have increased in the last six years. This industry will have the same increasing pattern in its operating expenses. As this industry is gaining profit so the operating expenses are increasing.

Profit
12000 10000 8000 6000 4000 2000 0 2013-14 2014-15 2015-16 Series1

The future trend analysis also says that this industry will earn profit higher comparing the previous years. As companies are coming up with new product variants which possibly people will look for in future.

TOP 5 MARKET LEADERS (PRIVATE):

Source: www.towerwatson.com 1. ICICI PRUDENTIAL 2. HDFC Standard 3. Reliance Life

4. SBI Life 5. Birla Sunlife

Market Share Overview:

The IRDA review of the industry compares LIC and all the other Private players as a separate entity. The market share of each of these entities shows a considerable difference in share. We have analyzed market share details of the last 6 years. Here are the few key points of detail: The market share of LIC in 2007-08 stood 74.39 % whereas Private bodies had a share of 25.61 % From the next year onwards, it can be observed that there was a considerable decline in LICs market share. The steady influx of foreign players with heavy commercial ization can be attributed to this fact as more and more private players had a bite of the market. This trend can be observed till 2010-11 as the market share of LIC decreased from 74.39% to 69.78%. However, from 2011 onwards the market share of LIC was a growing curve. It increased from 69.78% in 2010-11 to 72.7% in 2012-13. This can be attributed to the recession observed in the Indian economy. The bank failures abroad may have likely been the cause to trigger a sense of cautiousness in investing with private bodies and opting for the more reliable option of the LIC.

Most Probable Idea of To-Be Launched Product

A model to insure the rural India through micro insurance In order to make them aware of the insurance products and more importantly the need for insurance, it is necessary to educate them in person thus requiring a high touch service model to be followed. This requires identifying the centres of influence to create awareness of insurance products, educating them on the need to be insured and finally converting them in a cost effective manner to tap this un-insured and under-insured market.

Rural Segmentation
1. As per the 2011 census, there were 589 District Panchayats, 6,321 Intermediate Panchayats and 238,957 Village Panchayats across India. 2. As at 31 May 2012, there were 713 Multi-State Co-operative Societies in India. 3. As at 31 March 2012, there were 9,743 branches of Microfinance Institutions (MFIs) across India. 4. As at 31 March 2012, there were 1,078,407 government schools covering 644 districts across India.

5. As at date there are 48,125 voluntary organisations/state organisations registered under the NGO-partnership system with the Government of India.

A glimpse at the market penetration globally:

Insurance penetration in selected countries: 2012

Out of the popular countries mentioned in the graph, India seems to have a huge untapped market for the Insurance Companies. Where its penetration of Life Insurance (only) is more than 9 countries out of which 5 can be easily recognized and 4 other includes Malaysia, Thailand, Australia and Germany. Moreover considering the population of the country, this unpenetrated market in India includes lots of customers.

Insurance Premium and Density in India

From this table, one thing can be clearly that Non-Life insurance are getting popular at a better rate as compared to the Life Insurances, though the penetration for Life Insurance in more. Similarly, Industrial insurance is showing continuous fluctuations responding to the economic scenario of the country.

Insurance Penetration in India

Insurance Density in India

The Life Insurance Council, the industry body of life insurers in India, has estimated the sector to grow at (CAGR) of 12-15 per cent over the next five years. Life insurance penetration measured as the percentage of insurance premium to gross domestic product (GDP) is expected to grow to five per cent by 2020 from the current 3.2 per cent, according to the council. For the last couple of years the life insurance went through a transition phase that has changed the dynamics and approach of the insurance players. It is facing a number of challenges involving the macro-economic environment, consumer sentiment and rapid regulatory changes. In financial year 2012-13, the industry has seen a de-growth of 0.5% in Total Life Insurance Premium Income. Insurers focusing on customers to remain invested for longer term resulted in improved persistency ratio for the industry. With low insurance penetration as compared to the large Indian population base, there is tremendous scope for the life insurers to capitalize on. Particulars LIC Total Premium Private Total Premium Industry total FY 2013 208803 78398 287202 FY2012 202889 84182 287072 Change (%) 2.92 -6.87 0.05

As at March 31, 2013, on the basis of total new business premium, the LIC is the market leader with market share of 71.25% whereas the private sector claims 28.75% of total new business premium market share in FY 2012-13.

During the FY 2012-13, SBI Life has maintained its No. 1 position amongst private players on Total Premium basis, 16.85% of total premium of private sector. NEW BUSINESS PREMIUM Particulars LIC Regular Premium Single Premium LIC New Premium Private Sector Regular Premium Single Premium Private Sector New premium 21877 8872 30749 22040 10039 32079 30313 46297 76610 40194 41667 81861 FY 2013 FY2012

New business premium fallen from 114,233 crores for the previous year to ` 107,011 crores for the current financial year2012-13, showing a decline of 6.3%. Private sector has also shown a decline of 6%. Private sector claims 28.8% of total new business premium market share in financial year 2012-13.

PORTERS FIVE-FORCE OF INSURANCE INDUSTRY

Competitive rivalry: HIGH
SBI Life Insurance experiences a high level of rivalry from existing firms. The total market share of SBI Life Insurance in terms of total premium collected for fiscal year 2011-12 stands at 4.64%. The major share of market in the insurance sector is served by LIC (71.61%) which is the only public sector enterprise in the industry. There is cut thought competitions among rivals in life insurance industry There are mainly 13 private organizations and 1 public organization in life insurance competition Equally Balanced Competitors. Insurance companies deal in identical policies as service levels offered are similar Ministry of finance controls all the insurance companies that are in the industry at present hence there are less chance of exit. Policy designer tend to have less leverage to Bargain over premium. Insurance is tax exempted so that suppliers bargaining power increases. Solvency of private players is not certain.

Power of suppliers: MODERATE

Threat of Substitutes:
Life insurance mainly serves three consumer needs: Risk-coverage, Investment & Saving Threat of substitute as a Risk-Coverage tool (LOW): There are not many substitutes which can provide the benefits of risk-coverage to the customers at the same cost. Threat of substitute as an Investment and saving tool (HIGH): There are multiple tools available in capital market that provides similar returns for the risk involved.

Power of buyer: HIGH

There are signs of fundamental changes in consumer behaviour, a factor which will affect all insurers.

Recent Accenture research confirms that customers are increasingly dis-loyal to their insurance providers. Only one out of two consumers who intend to purchase insurance in the next 12 months is planning to purchase from his or her existing provider.

Due to a high level of competition in the life insurance sector, the customers enjoy a moderate to high bargaining power. Firms compete with each other on the basis of customer service, lower premiums, higher coverage, tax benefits which result in an overall benefit to the customer. Market is highly segmented Insurance industry very return oriented and switches easily High switching cost creates buyers lock in and makes a buyers bargaining power Exercise bargaining leverage over premium

Threat of new entrants: LOW

Though there are high barriers to entry in the life insurance sector; joint-venture and partnering models are changing the competitive landscape across the world. Insurers are teaming up with large non-traditional players or companies from other industry sectors. Information from data provider BvD suggests that both mature and emerging markets find joint ventures attractive: 40 percent of almost 400 joint ventures in the insurance sector since 2000 were established in the Far East and Central Asian region, with about 30 percent in Western Europe. Potential Indian would seek for a brand with high brand visibility and thus they would attribute higher reliability to it. The acceptability of new brand is also very low. Economies of scale are difficult to find in the initial stage of entry in to market. Special permission is required from the government to enter in the insurance sector.

Competitive Advantages of Competitors

Life Insurance Corporation of India
Life Insurance Corporation (LIC) came into existence on 1st September 1956 through the amalgamation of 154 Indian insurance companies, 16 non-Indian companies and 75 provident. The amalgamation was achieved with the help of Life Insurance Act passed by the Parliament in the same year. Sovereign Guarantee: LIC has sovereign guarantee from central government. By sovereign guarantee, government gives the policy holders of LIC a commitment that it will fulfil all the promises made by the company. LIC enjoys this dominance because it is obvious that investors want a guarantee of their money irrespective of cycles of market. They know that it would be a safe play to invest in LIC as the government guarantee to bail out in case of any mishap. This denies the life insurance market from a level playing field to the competitors. Distribution Network: The LIC has vast distribution network in the rural and semi rural urban areas. This would be hard to duplicate. One potential way to duplicate it could be increasing other distribution network like banc assurance. Also, since LIC started with 100% of market share, it will lose market share simply because of expansion of market itself and less because of loss of existing customers. Product: In a competitive market, there is a greater need to provide insurance products that meet the needs of our customers. LIC therefore offers a wide variety of products, which fulfils the needs of different segments of the society. As at the end of the financial year 2010 - 11, the Corporation had 52 products available for sale. During the Year Corporation introduced 5 new plans viz. LICs Pension Plus, LICs Endowment Plus, LICs Bima Account I, LICs Bima Account II and LICs Samridhi Plus. As a result of product innovation by private players, LICs market share has gradually reduced in the post-liberalisation period. Despite that, the Life Insurance Corporation of India continues to remains the largest player in the Indian Life Insurance market with a market share of 71.3% in 2011-12.

ICICI Prudential Life Insurance Company

ICICI Prudential is a joint venture between ICICI bank and Prudential plc, both having strong operations in their respective countries. ICICI Prudential was the first insurance company in India to receive a National Insurer Financial Strength rating of AAA (Ind.) from Fitch ratings. Distribution Network: The distribution network is one of the best, and is spreading across the length and breadth of the country. As on December 31, 2006, it had made imprints in over 360 cities and towns in India. It has over 1,75,000 advisors across the country.

HDFC Standard Life Insurance Company Limited

HDFC Standard Life Insurance Company Limited is one of the first companies to be licensed by IRDA to operate in the Insurance sector.

It against the requirement of 20%, the Company did 21.8% of Rural business (as percentage of total policies written direct), and covered more than 8 lac lives (as against a regulatory target of 55,000lives) under the Social sector category. Price: Didnt Get much information about this section Place: The Lean Branch initiative undertaken by the Company in FY2010-11 has been continued with renewed rigour and it has led to further reduction of total rented area and the associated overhead costs. The Company currently has a network of 481 offices across the country through which Companys financial consultants, corporate agents and brokers are able to service customers in over approximately 940 cities and towns across the country. Promotion: A series of initiatives under Udaan have been launched in Direct Sales to improve productivity and optimize new business acquisition costs. has a strong base of financial consultants which provide need based selling to its clients based on its eight step structured process-Disha. Product: The Companys product offering spans across the entire spectrum retail and group, conventional and unit linked platforms that are aimed to address customer needs across protection, investment, pension and health insurance. The Companys current product portfolio comprises of 34 products. They have specially designed plans for women-HDFC Life Smart Woman Plan. Traditional Retail Annuity Unit Linked Traditional Group DIP Unit Linked Rural Traditional Health Total 2 34 14 1 6 6 1 2 2

Individual Group Total

25 9 34

Bajaj Allianz General Insurance Company Limited

Bajaj Allianz General Insurance Company Limited is a joint venture between Bajaj Auto Limited and Allianz AG of Germany. In the very first year, the company made a strong position for itself in the industry and was reckoned amongst the top private insurers. The premium income of the company as on 31st March 2006 was Rs. 1285 crores, whereas the profit after tax made was Rs. 52 crores. Bajaj Allianz has a Pan India network covering over 100 towns and aims to spread its operations in many other cities. Key Features Strong earning history with focus on underwriting profitability. Diversified portfolio with a fairly strong retail presence, which is expected to drive future growth. Existing strong support from Allianz, its foreign JV partner, in areas of underwriting, reinsurance and risk management is expected to lend further support in designing new products in the de regulated scenario Strong parentage, with sponsors having adequate financial strength to capitalize the company, as and when required.

SWOT ANALYSIS for SBI Life Insurance

Strength:
1. Healthy Financials. The Company has earned a Gross Written Premium (GWP) of `10,450 crores on the back of consistent growth in Individual business during the financial year (FY) 2012-13. During the financial year 2012-13, the Company has added nearly 8.89 lakhs new policies to its portfolio. 2. Association with State Bank Group offers platform for cross selling insurance products to over 100 million accounts across the country. 3. Strong market share 16.33% amongst private insurers and 4.64% overall in terms of total premium collected. 4. Despite slowdown of economy, the Company has improved renewal premium collection and retention of clients over years. The Companys conservation ratio stands at 68.07% as at March 31, 2013, is testimony to SBI Lifes commitment towards its customers. 5. Profitable business growth demonstrated by all key distribution channels.

6. Superior Claims Settlement Process (Certified by ISO 9001:2000)

Weakness:
1. Is less aggressive in generating business compared to other private life insurance players. 2. Over dependence on the banc-assurance channels. 3. The bureaucratic attitude is frequently held responsible for sluggish growth

Opportunities:
1. Growing population, strengthening incomes, purchasing power, and transforming demographics provide growth opportunities. 2. Awareness of need to invest for a secured future for self and family 3. Increasing universe of potential insurance takers Individuals and Companies across industries. 4. Mobile-based insurance model: There are over 865 million mobile users in India as of December 2012 of which aroun d 535 million are urban users while 330 million are rural users. Extending the business capabilities to mobile devices has quickly become a fundamental requirement for companies. Customers increasingly expect it and business partners and employees have become more comfortable with communicating and sharing information through mobiles. As mobile users are already KYC compliant, and with Aadhaar -enabled bank accounts, piggybacking on the mobile wallet, mobile banking platform to offer insurance solutions is a costeffective method to tap a large market. (KPMG-Insurance Industry: The road ahead)*.

Threats
1. Introduction of new players in the market with high level of product differentiation threatening the existing market share of the companies. 2. Increasing number of providers offering a comprehensive range of products at competitive prices and higher level of customer satisfaction 3. Decrease in the savings of the people which will lea d to lesser income to be invested in insurance plans. 4. Ban of three years on operations by Haryana Government can have detrimental effect in group image. 5. Regulations and standardization of business from IRDA.

Performance Review
Past performance of the product
India has always been a huge market for life insurance. It is a nation of a billion people (with 70% Rural population) of whom merely 100 million people are insured. And those who do have insurance are grossly underinsured. The emerging middle class population, growing affluence and the absence of a social security system combine to make India one of the worlds most attractive life insurance markets. No matter how you look at it whether in terms of life insurance premiums as a percentage of GDP or premium per capita the market is under penetrated and people are under-insured. In a country where there is high unemployment and where social security systems are absent, life insurance offers the basic cover against lifes uncertainties. Moreover, India has traditionally been a savings-oriented country. The role of insurance in the economy is important and inevitable phenomenon to tap huge untapped potential. As the market for insurance has been dynamic and accompanied by rapid changes in the environment due to advancements in technology and uncertain economic conditions, coupled with inflation. The life insurance premium market expanded at a CAGR of 20.1 per cent, from USD11.5 billion in FY03 to USD59.9 billion in FY12. The non-life insurance premium market rose at a CAGR of 18.0* per cent, from USD3.4 billion in FY04 to USD12.7 billion in FY13. With a share of 2.3 per cent, India stood 10th among 156 countries in the life insurance business in FY12 The growth in life insurance and non-life insurance premium in India outperformed the average global growth as well as the emerging markets over last two years. While life insurance premium witnessed a 2 per cent decline in 2012 due to adjustment in the new regulatory environment, non-life insurance rose 37 per cent in 2012 compared to the previous year.

Perceptual Positioning Map

Marketers typically choose Point of Parity(POPs) and Points of Difference(PODs) that make up their brand positioning. Customers are usually interested in benefits and what exactly they will get from a product. For choosing specific benefits as POPs and PODs to position a brand, perceptual map may be useful. Perceptual maps are visual representations of consumer perception and preference. To choose axis let us first see few factors people consider before buying Life Insurance Product Trust in the company Claim settlement Ratio of the company Fund Performance of the Company

Freelook' facility, which allows you to return the policy to the insurance company within 15 days of buying it for a refund Return - But returns we get will be different for different product. Service Cost

We finally shortlisted two axis X Axis Trust in the Company (It includes Claim Settlement and Fund Performance) Y Axis Service provided by the company

Current Perception

Possible Repositioning

SBI Life making its image showing more Professional and Service oriented company like ICICI can change its perception in mind of customer as SBI A and It can use POP as Service. SBI Life by making its image more Trustworthy can become SBI B and Can use the brand SBI associated with it to make it possible ad It can use POP as Trust and POD as Service.

PESTLE Analysis
POLITICAL FACTORS
Before 1999, there was no provision for the private and the foreign companies to enter this sector but IRDA lifted all these restrictions after the year 1999. Moreover the FDI limit is up to 26 percent, which has also been very much beneficial for the Life Insurance sector. Provision of Micro-Insurance, is also been introduced especially for the rural sector of our country, which is certainly the huge untapped market for Life Insurance sector.

ECONOMIC FACTORS
High CPI Inflation has reduced the growth rate of GDP to 4.8% in the previous quarter which was also the reason for a slight downturn in this sector also.

Moreover, the unemployment due to slow economic growth also has a direct impact over these markets because with low savings customers cannot think of prioritizing life insurance as their primary investment provisions.

SOCIAL FACTORS
Most of the people are unaware about the exact benefits available from these life insurance policies, they think that the money paid by them as the premium cannot be retrieved by them rather it will only go to their family members. These days, joint families are very rare (especially considering the urban sector) and so nuclear families, where source of income is usually one or two members are getting more inclined towards these policies. Life Insurance is not considered as a wise source of investment in our country. As most of the customers perceive it as the cluster of rules and regulation which are difficult to clearly understand. Moreover, at the time of maturity of death, the nominee has to go through large number of stringent formalities to get his or her claim.

TECHNOLOGICAL FACTORS
Internet has played a vital role in this industry by giving the customers a privilege to compare the policies across different companies and get fully aware about all the norms related to those policies. Websites like policybazar.com give a very good idea to the customers about the relative benefits offered by all the life insurance policies. Calculation of premium to be paid and the filling of application for the Life Insurance has gone digital and takes considerably less amount of time.

LEGAL FACTORS
IRDA is the major regulatory body which keeps on changing the policies of the life insurance making it opt as per the current economic trend in our country. Example - IRDA is considering to increase the CAP limit on FDI, the bill is still pending to be passed. The registration of all the insurers are renewed for the new fiscal year by IRDA.

SBI LIFE INSURANCE MARKETING MIX

PRODUCT:
Unit Linked Insurance Plans - are long term investment cum protection plans that offer you an opportunity of availing market linked returns while providing life insurance protection. Child Plans - Financial planning for child.

Protection Plans - Protection Plans are low cost insurance plans which are specially designed to provide full protection & financial stability to your family in case of any unforeseen events. Savings Plans - SBI Lifes plans will help you plan for your savings, be it your childs wedding or education, buying a house or that dream vacation.

PRICING:
The pricing decisions or the decisions related to interest and fee or commission charged by banks are found instrumental in motivating or influencing the target market. The pricing policy of a bank is considered important for raising the number of customers vis-vis the accretion of deposits. Also the quality of service provided has direct relationship with the fees charged. Thus while deciding the price mix customer services rank the top position he pricing decisions or the decisions related to interest and fee or commission charged by banks are found instrumental in motivating or influencing the target market

PLACE:
Offers the services through 628 branches and employee strength surges to 7334 employees.

PROMOTION:

Print media: hoardings, newspaper, magazines Advertising: Television, radio, movies, theatres Publicity: road shows, campus visits, sandwich man, Sponsorship Sales promotion: gifts, discount and commission, incentives, etc. Personal selling: Cross-sale (selling at competitors place), personalized service.

PEOPLE:
All people directly or indirectly involved in the consumption of banking services are an important part of the extended marketing mix. Knowledge Workers, Employees, Management and other Consumers often add significant value to the total product or service offering. It is the employees of a bank which represent the organization to its customers. To realize its potential in bank marketing, SBI Life become conscious in its potential in internal marketing the attraction, development, motivation and retention of qualified employee-customers through need meeting job-products. The starting point in internal marketing is that the employees are the first internal market for the organization.

PROCESS:
Flow of activities: All the major activities of SBI banks follow RBI guidelines. There has to be adhered to certain rules and principles in the banking operations. The activities have been segregated into various departments accordingly. Standardization: SBI bank has got standardized procedures got typical transactions. In fact not only all the branches of a single-bank, but all the banks have some standardization in them. This is because of the rules they are subject to.

Customization: There are specialty counters at each branch to deal with customers of a particular scheme. Besides this the customers can select their deposit period among the available alternatives. Number of steps: Numbers of steps are usually specified and a specific pattern is followed to minimize the time taken. Simplicity: In SBI banks various functions are segregated. Separate counters exist with clear indication. Thus a customer wanting to deposit money goes to deposits counter and does not mingle
elsewhere. This makes procedures not only simple but consume less time.

Customer involvement: ATM does not involve any bank employees.

PHYSICAL EVIDENCE:
Physical evidence is the material part of a service. Strictly speaking there are no physical attributes to a service, so a consumer tends to rely on material cues. There are many examples of physical evidence, including some of the following: Internet/web pages Paperwork Brochures Furnishings Business cards The building itself

The physical evidences also include signage, reports, punch lines, other tangibles, employee dress code etc. Signage: Each and every bank has its logo by which a person can identify the company. Thus such signage are significant for creating visualization and corporate identity. Financial reports: The Companys financial reports are issued to the customers with emphasis or credibility. Tangibles: Bank gives pens, writing pads to the internal customers. Even the passbooks, checkbooks, etc. reduce the inherent intangibility of services. Punch lines: Punch lines or the corporate statement depicts the philosophy and attitude of the bank. Banks have influential punch lines to attract the customers. Employees dress code: SBI bank follows a dress code for their internal customers. This helps the customers to feel the ease and comfort.

OBJECTIVES
TO MAXIMIZE THE SALES VOLUME
Sales volume of SBI Life can be increased by launching the new micro insurance product which specifically targets the rural segment, which has been untapped till now.

INCREASE THE MARKET SHARE

SBI Life is one of the major players in the private sector; by launching the new product within the core competencies of the SBI Life the share can be increased as the introduced product will be the one of its kind.

INCREASE THE BRAND VALUE

By targeting the rural segment, customer base can be enlarged and also by launching various campaign to generate awareness about the new micro policy will increase the brand equity of the SBI Life.