Now you can find top-ups of Insurance policies!

“Small is Big” is an old formula which has transformed FMCG industry, telecom sector and now it’s the turn of the insurance business. Now be ready to find insurance policies selling at your neighborhood kirana store and paanwallah shops. Looking at the huge opportunity in rural sector, insurance companies are looking for innovative marketing strategies in order to establish themselves in these markets. Recently, I heard the news of Max New York Life Insurance Company launching Max Vijay, a new product in rural areas. This product would be packed in a DVD-like pack and sold through the grocery stores. This sounds as an interesting move to me because of the comprehensive distribution strategy. The enrollment price could be minimum Rs. 1,000 and maximum Rs. 25,000 depending on the plan opted for.

I feel Max Vijay has been developed looking at the mobiles phones’ successful distribution strategy in these markets. The identity proof and other relevant documents from the buyer will be collected by the store owner who sells the policy. As Analjit Singh says, “It is like a mobile recharge – one goes to a store and buys a prepaid card.” In my view it will more suitable for people like construction workers and daily wage earners who might not have regular income to pay the subsequent premium.

Apart form life insurance sector in India, I believe there are many other markets which will be tapped in the next phase of the ongoing revolution. Two wheelers’s insurance industry, for example, has a lot of opportunity for insurers. Around 70-80% of two wheelers are not insured after they are 1 to 2 years old. Most of the two-wheeler owners find it very inconvenient to present their vehicle at the time of filing in the details and as a result, with seven million two wheelers sold every year, it is a huge market still waiting to be tapped. I hope the strategy adopted by Max Life Insurance will inspire the general insurance companies as well and they come up with similar innovative ideas to tap the other markets.

Email id: keshavkd@gmail.com

Get Insured Even After 65 Years!

Al the senior citizens now need not worry about their health problems as they can get insured even after 65 years. IRDA has asked the insurance companies to make health cover affordable to all senior citizens in the country. It is certainly an encouraging step been taken by IRDA which will give some relief to those who could not get themselves insured at an early age. However, before introducing such a health insurance system, all the implications which might come in the way should be thoroughly studied.

I believe that one of the most common complaints registered by ageing people is about insurance companies denying renewals. Therefore, if this new system is introduced, people should be given guaranteed renewal of their insurance without any upper age limit. However industry experts say that people should embrace health insurance at an early age so that insurers could distribute their risk better. I also feel there is no free lunch in today’s world and therefore government should take responsibility to provide health security to the senior citizens.

In my view, this programme can be begun with those who are working in the organized sector from the day they take up employment and then it can embrace those working in unorganized sector as well. India is a country where a lot can be achieved in health insurance sector if the companies come up with even a competitive premium scheme. But I think the programme needs to be designed in such a way that the employee will not have to pay premium after retirement. All the money should be collected when the person is in his or her employment. IRDA should also take care of the profitability part of insurers.

We can certainly expect a lot of health insurance products selling in the country as soon as FDI norms for this industry are relaxed. Currently Foreign Direct Investment (FDI) in this sector is 26% which is likely to be increased to 49%. If it happens, it is expected that a minimum capital of Rs. 50 crore can come in form new entrants who in my opinion will benefits the consumers to a large extent. They can get better pricing and better deal when competition intensifies among all the existing and new players in the market.

Wait, Rural People are using Mobile Banking!

Having one bank account for every household is the aim of Indian government. With the arrival of mobile banking which is catching up very fast in the metros and other cities, it can be achieved soon. Recently, I read an article which commented on the scope of mobile banking in rural India. The article said that people form rural India can perform banking transactions using mobile phone which made me think over the road-ahead of this development.

A mobile phone acts as a branch of the bank which also stores the database of customers. The name, address, photo, and other relevant details held by issuing bank are stored in the smartcard of phone. Customers get a secure electronic identity using which they can perform banking transactions wherever they want to. Mobile banking also helps banks and government in saving crores of rupees by way of reduced transaction costs. As per a data analysis, it reduces the transaction cost by 70-80%.

Around 66 percent of rural India is still unbanked and I believe one of the strong reasons of this huge gap is lack of formal financial services in rural areas. People in these areas do not have access to banks and as a result government looses a huge sum of money in form of taxes and other transaction costs. Looking this huge opportunity, RBI has asked banks to launch mobile-banking services in the under-banked regions. In some of the states, these services have got huge response. In Andhra Pradesh alone, for instance, more than 2.5 lacs people have registered for mobile banking services.

Other than banks, many microfinance institutions and financial institutions are coming up with their innovative offers to attract the rural customers. SKS Microfinance and Ujivan are among the leading MFIs which are in talk with different banks to provide mobile banking services in rural areas. Many mobile services providers have also shown interest in these developments which may bring sea change in banking services in rural India. However, in my view, before introducing these services, all the institutions must work together in order to provide maximum benefits to the customers.

Do Advertising Balloons Catch your Attention?

One of the fastest growing tools in advertising is advertising balloons which offer a cost-effective alternative solution to advertisers. These are not only cheaper than other intense media advertisements like television and newspapers but also give us a more direct and visual promotional activity. I see it as a fast growing advertising tool that allows you to connect to your target customers directly.

I used to wonder how advertising inflatables like balloons, replicas and air dancers can catch attention of today’s smart customers. It was only after reading a newspaper article, I realised the use of such marketing inflatables is growing very fast especially for trade shows, parties and corporate branding. There are certain advantages associated with these which make them very powerful advertising media. They increase awareness of the brand and logo as they can attract customers walking up to a distance. Moreover, a lot of creativity, visibility and advertising excellence are involved in creating such balloons which help you in connecting with valued customers.

I believe that the success of a company or brand depends on the customers and therefore getting their attention is today’s marketing need. In order to get your brand or message spread across, a marketer should use a medium which is different form others and I believe no other form of advertising can match with the burst of colour of an Air Balloon against a perfect blue sky. Here are some of the advantages of using advertising balloons for successful marketing.

• The size of these balloons is big and therefore advertisers can reach a wider set of audience.

• These can easily catch attention of people and because of novelty factor, these balloons are more likely to stay in people’s minds.

• These balloons keep on floating all over any area you wish to which makes them effective mobile advertising tool.

The trend of using advertising balloons in different ad campaigns has increased in recent times. These have been very successful in trade fairs, job fairs, exhibitions and other business events. In my view, it is the future of advertising since it connects directly to the customers and which is why these balloons are available in different colors, shapes and size now.

Up, down, up. Where is the Economy Going?

Over the last few months everything in the Indian economy has been up, down, up with no end in sight. After the recent downfall in the stock markets, experts have made different opinions about future of our economy. Many of them say, with stock markets nose-driving, sky-driving fuel prices and prices of basic commodities going high, the fear of an economic recession worldwide is looming large. This fear can well affect India’s strong run in terms of becoming economic superpower.

Well, I feel there is nothing extra-ordinary about the impending recession and believe somehow the global economy has been prone to go through cyclical boom and bust. In fact, failing home loans and municipal bonds are the key factors behind the recent sub-prime crisis in the United States. Moreover, the monopoly situation of the countries like US, UK and other European countries has gone now and process of globalisation has provided a semblance of independence for some of the developing countries. Therefore, I am confident that the US recession might dampen the pace of growth in India, but can not affect in the long term. A recent speech delivered by Indian Finance Minister, Mr. P. Chidambaram highlights some key statistics which suggests how India fast India is growing. Here are some of the extracts from that speech.

• GDP at market prices has increased from US$ 20 billion in 1950-51 to US$ 920 billion in 2007-08 and is expected to cross a trillion dollars in the current year
  

• During 1999-2000 to 2007-08, India added to its workforce about 15 million people each year and the rate of growth of employment was 3.9 percent per year
  

• The proportion of people living below the poverty line in India has declined from 51.3 per cent in 1977-78 to about 20 per cent in 2007-08
  

Keeping in mind the above data, I feel that possible recession in the western countries brings an opportunity for India, especially in the IT/ITES industries. Indian domestic IT companies are most cost-effective in the world and as the result more business from these countries can be expected. Infosys chief mentor, N R Narayana Murthy says “"The fact that there may be a slowdown in the US means people will become much more concerned over better value for money...we could look at it as an opportunity," I also feel the focus on better value of money will generate a lot of business in India. With strong consumer base and high economy growth rate, India is capable of surviving the negative impact of global recession, if any.

Islamic Banking: A tailor-made banking opportunity for Muslims

Islamic banking is not a new name in countries like US and UK, but its promising growth opportunity in India caught my attention when I recently read a market analysis report made by Grail Research Company. It suggests that the asset base of Islamic finance institutions is expected to rise by more than 200% by 2016. Now, this data analysis has made me ponder over the reasons for this tremendous growth opportunity, for which I have some interesting points to discuss here.

India is a secular state and there has been a favourable change in regulatory environment for banking institutions in recent past. Also, increased awareness among Muslims about banking and other financial entities supports the huge potential for Islamic banking here.

The size of the market is very large (about 17 crore) in India, but majority of them have not been able to access the banking services because giving or receiving interest is prohibited as per Islamic principles. However, one can lend money on profit sharing or a fee based model and therefore I believe Islamic financial institutions can flourish in the country.

In my view, Islamic banks can attract trillion of dollors belonging to Muslims and their money currently invested in US and other European countries. After 9/11 attacks, these people are looking for alternative investment destinations and India tops the list because of her liberal banking policies.

Presently in India, only 10-15 such banks are operating and they are confined to co-operative sector only. The sources of funds of these institutions are limited and therefore they have no options but to operate on small scale missing huge opportunity. I believe one of the reasons for widespread poverty among Muslims is that they are not open to taking loans from financial institutions and banks due to their religious principles as discussed earlier. They will be able to do business only when they start getting interest-free loans and Islamic banking brings the right solutions for them.

Is the million dollars Bonanza for Cricket stars over?

Gone are the days when cricket stars dominated the advertising scene. It was the title of an article I read on a website the other day which prompted me to ponder over the ongoing phase of revolution in the Indian advertising industry.

It is true that the magic of “Fab Four” seems to have missed out to catch the nerve of Brand India and which is why everyone has started underrate the power of cricket stars. Bollywood superstars are said to be preferred for brand endorsements and different statistical comparison are quoted to prove the same. Other sportspersons like Abhinav Bindra and Sania mirza are also said to be the hot properties for future, however, I feel Indian cricketers are still ruling the roost. Young guns like Dhoni, Yuvraj, Ishant Sharma and Gambhir are enjoying a strong run in the brand arena. Advertisers are bullish about lapping them up and in the process ignoring the big daddies of Indian cricket.

“The trend of big brands signing young cricketers is here to stay and whether the team starts losing or even if an individual's performance drops, it is not going to be a loss for these guys at all.” This is the statement made by Rohit Mukherjee of McCann Erickson, a leading advertiser in the country and I believe the reason for this strong confidence comes from the power of young Indians from whom the income is coming and therefore the companies do not want to miss this opportunity.

I wonder if any event other than T20 world cup final match grabbed more TRPs in recent times. The success of recently played IPL also supports my viewpoint. In fact, it’s the face that keeps on changing but Indian cricketers are still leading the race as far as connectivity with the young audiences are concerned.

Consumer is more than king!

Interactive advertising is the new buzz in the Indian market and advertisers are trying to connect the consumers in the mainstream. In fact, I believe it has transformed the whole idea of branding and media planning. With increasing influence of the youth, consumers are no longer just the “target audience”, but they actively participate in deciding key advertising strategies.

Advertisers are like incredible dance partners who know when you are going to take a sudden step and how to develop a solid chemistry with you. Recent example of India’s largest watchmaker Titan joining hands with Radio One for their brand’s “Move on” campaign highlights the changing face of advertising industry. I strongly believe that it’s a win-win scenario for both advertisers and consumers. Consumers get a significant brand connection through participation and companies are able to keep an eye on changing trends.

The interactive tilt, which was started few years ago, is becoming more visible now. Companies like PepsiCo, Intel, and Kingfisher have also adopted same strategies in the recent past and I am amazed to see the response by consumers throughout the world. 94.3 FM got more than 5000 SMS and 3000 calls during one week of Titan’s campaign and listeners came up with many innovative ways of using brand’s tagline.

Encouraged with rising disposable income of Indian consumers, more companies are expected to follow interactive strategies in the times to come. As a prospective consumer, no wonder if I get a chance to fly a fighter plane or swim with the whales. Advertisers will be able to create ads based on what consumers want, and not just what clients want. More and more ad contests, brand participation and innovative platforms are set to take the industry to next level. I can foresee the trends emerging out which involve consumers into lasting relationships and give them more choices in terms of interactivity.

Celebrity Blogging - Is it just another way of making publicity?

Blogging is the new flavor these days not only for mortals like me but our immortal celebrities are also able to find out time to make their mark in cyberspace. I wonder what is it that propels these superstars writing blogs and tried to find out the obvious reasons for it.

I came across a newspaper article which was focused on how blogging has increased in recent times and how celebrities are using it as an effective advertising tool. The list of avid bloggers which was mentioned in the article includes Amitabh Bachchan, Aamir Khan and Ajay devgan. Realizing the power of written words, our Bollywood denizens are taking to blogs like a fish takes to water. Salman Khan and Ram Gopal Verma are among the latest celebrated bloggers who have made headlines.

A blog is a successful means to promote oneself. In fact, it is not only publicity propaganda but also a noted way of expressing emotions and connecting to the readers. I googled Big B’s blog the other day and was amazed to see the amount of comments he receives every day. Though the response can be of any kind, it provides him direct access to his fans. At the same time, it was nice to see that these celebrities respond to people and asking for their feedback.

I agree with what Siddharth Roy, CEO of Bigadda.com says that “A blog is a social platform for an individual to put forward his or her views, what they write on it is completely up to them”. However, I feel one should not make it as a tool to get cheap publicity. It should only be a common platform where writer and reader can directly interact and share thoughts. I also feel that it is important for celebrities to write regularly so that they could keep the readers connected. If it does not happen, the readers’ interest may soon die and they stop reading such blogs.

Effectiveness of advertising campaigns

To measure the effectiveness of advertising is not rocket science. The purpose of advertising is to create interest and persuade potential buyers that you have the offers which they need. The most successful advertising campaigns have created and nurtured that sense of need and encourage people to go and avail whatever the advertiser is promoting.

TV Commercials are the most common form of advertising. Their effectiveness can be evaluated in many ways such as consumer surveys, television ratings, industry awards and few others. Specific websites and toll-free numbers are also listed with some infomercials and other ads through which responders can give their view points.

Print Advertisements have been the traditional form of advertising. Like TV Ads, specific web address or phone numbers are given with the advertisements in magazines, newspapers and other printed items. Industry related publications and some magazines usually include sewn-in postcards which contain numbers corresponding to ads in issue. The effectiveness of the ad is measured on the basis of readers’ response through the numbers. These numbers are provided to the advertisers in these magazines and thus they come to know how effective their ads were.

It can be seen that mailboxes worldwide are filled with printed promotional pieces. Many of them include response cards which can be used for requesting detailed information, price quotation or sales calls. The marketers can easily find out the effectiveness of their ad efforts by gathering customers’ feedback given through these cards. Web Ads are the simplest to measure their effectiveness. Consumer buying behaviour can be easily collected and analysed in case of web ads. Many site statistics software are also available through which one can know the web pages where customers visited and made enquiries.

Effective ads are convincing. They engage prospects as if the advertiser is speaking directly to them. Some of the best advertisement campaigns such as Coca Cola’s “Thanda matlab Coca Cola”, Mento’s “Dimag ki batti jala de” and Bajaj’s “Buland Bharat ki buland tasveer… Hamara Bajaj” endorse this theory. Therefore, the best way to find out how well your ad campaign is doing is to hear people on the street whistling your jingle.