Discuss the marketing audit of AIA.
Today, marketing has emerged as a key organizational function. The large organizations have realized the importance of marketing audit. Simply defined, a marketing audit is a thorough review of the marketing plan, objectives, strategies, and current activities being executed in the business. The goal is to see what’s working and what isn’t, so businesses can identify areas for improvement. It is important that the marketing audit should be based on the overall business strategy of organization. At the same time, organizations and leaders should involve various internal and external stakeholders to conduct marketing audit. There are various activities that are done as part of marketing audit (Brodie, Ilic, Juric & Hollebeek, 2013). The two-key set of activities undertaken as a part of marketing audit is to assess the internal and the external environment. The tools like competitive analysis and SWOT analysis are used to assess the internal and external environment. A Marketer has to study local culture of the desired market in depth before offering any product or services in order to have a certain chance of success for that particular offering. This has to be done because every product required a communication channel in order to do promotions and to influence customer’s decision (Stratton & Northcote, 2014). As per human tendency, everything comes under the judgement as per their cultural measurements and self-learning process. The objective of this report is to do the market audit of AIA-Singapore. A brief organizational background can be discussed as:
AIA Group Limited, known as AIA, is the largest public listed pan-Asian life insurance group. It offers insurance and financial services, writing life insurance for individuals and businesses, as well as accident and health insurance, and offers retirement planning, and wealth management services. The company was established in the year 1919 and since then it has emerged as a matured brand in Singapore insurance industry. AIA is a global brand that is present in 18 Asia-Pacific nations. The head quarter of the company is in Hong-Kong. AIA offers various insurance products like life insurance, employee benefits, health insurance, pension services and credit services. The competition is really high in the insurance industry and there are number of players that operate in Singapore market. However, AIA has been able to establish itself as a known player in the market. The company is known for quality services to its consumers (Stratton & Northcote, 2014). The claim settlement rate of AIA is also very good as compared to its competitors.
There are various tools to perform the situational analysis for organizations. The environmental analysis for AIA Singapore can be discussed as
Environmental analysis
The environmental analysis would include the analysis of both micro and macro environment. The micro environment are external factors that organizations would find it difficult to manage (Brodie, Ilic, Juric & Hollebeek, 2013). The macro and micro environmental analysis for insurance sector in Singapore can be discussed as:
Macro environmental analysis
One of the most widely used macro environmental analysis tool is PESTLE analysis. The PESTLE analysis is done at the industry level (Stratton & Northcote, 2014). It consists of various factors like political & legal, economic, environmental, etc. The PESTLE analysis for insurance sector and AIA in Singapore can be discussed as:
PESTLE analysis
The influence of these external forces on the business of insurance companies can be discussed as:
Political & Legal
The political and legal factors are positive for the business operations of organizations in the insurance sector. The insurance sector in Singapore is a highly regulated sector. The government wants to create a system of check and balance over the insurance providers in the company. However, government supports the initiatives of players in the insurance sector. The government support has also enabled the private players to have large scale operations in the country (Berman & Evans, 2015). With time, the Singapore government has opened the door to number of internal players in the Insurance sector. Today a large number of private insurance players operate in the market. It is expected that the political and legal factors would remain positive for the insurance companies in the country (Shaomian & Heere, 2015).
Economical
The economic factors are also positive for insurance players in Singapore. The disposable income of consumers is high in the country and this is a positive sign for insurance providers. The consumers want to buy the insurance products as they want to safeguard their lives. The economy of Singapore is also growing at a good growth rate. It is expected that the economic factors would remain positive for insurance companies (Shaomian & Heere, 2015). With time, the economic conditions of Singapore have improved a lot. A lot of foreign companies have entered and expanded in Singapore. This has further strengthened the economic environment in the country.
Social
The social factors are also positive for insurance players in Singapore. However, one of the concern for insurance players is the issue of scalability. Singapore is a small country and it is not possible to scale the business operations within the country. The retirement age is 62 years in the country and the good thing for organization is that the citizens realise the importance of insurance (Kuo & Feng, 2013). There is already a great push in the marketing. The market of insurance has been greatly governed by the social factors and it is expected that that the social factors would remain positive.
Technological
The technology factors also have a great impact on the operations of insurance sector in the company. Today, Singapore citizens can purchase the insurance at a click on their laptop or with a touch on their smart phone. With the penetration of Internet and technological advancements, the insurance products have also evolved (Zablocki, Schlegelmilch & Schant, 2017). The technological factors have been a key strength of efficiency improvement in the insurance segment.
Environmental
It is expected that the companies operating in the insurance sector would have a policy toward sustainability and corporate social responsibility. The environmental concern is one of the biggest concern for the Singapore government (Berman & Evans, 2015). The government always support the organizations that have a sustainable policy in place.
Micro environment
The micro environment are the factors that have an impact at the company level. The key difference between macro environment factors and micro environment factors is that macro environment factors affects at industry level and micro environment factors affects at the organization level (Kuo & Feng, 2013). The key factors that are part of micro environment of AIA can be discussed as:
Employees
It would be correct to say that employees are the biggest asset for AIA. The performance of employee directly impacts the business of AIA. Therefore, AIA wants that it should have strong employee base. AIA is known to provide good incentives to its employees so that employees can work with high level of productivity (Laroche, Habibi, Richard & Sankaranarayanan, 2012).
Culture of innovation & research
AIA would be able to emerge as a market leader when it would have a culture of innovation (Stratton & Northcote, 2014). The innovation accounting also considers the process of MVP, which allows the business to indicate the progress and validation of their products or services. As Tasci (2018) mentioned that it allows the business to take decision about investment of new product or modification of existing products. It is also important that AIA should be able to understand the pulse of consumers through market research and survey (Zablocki, Schlegelmilch & Schant, 2017). In order to make the research study in an effective manner the concept of the innovation accounting should be clear, it will help the reader to understand all the aspect related with the topic that will be presented in later section of the study and other financial practices shed an unappealing light on process of innovation, so that it can be said that concept of innovation accounting makes effect on value of intangible assets of a business organisation. There are two different types of research approach and they are inductive and deductive (Vomberg, Homburg & Bornemann, 2015). Deductive research approach is used to test or establish the research hypothesis, so that deductive method is applicable for those research works which have hypothesis based on research topic.
Customers
In the end the key stakeholder for the company is customers. Therefore, every strategy and policy in the company is made with customers in mind. It would be correct to say that customers have a deep impact on the operations of AIA (Tasci, 2018). Moreover, customers can choose form number of insurance companies and a switching cost is also low in insurance sector. Therefore, it is important that AIA should provide good quality and better services to its customers.
SWOT analysis
Another key tool to assess the environment of any organization is SWOT analysis. With SWOT analysis any organization can realize its area of improvements. It is important that the future plans of the organization should be based on the learning from SWOT analysis (Baumgarth, Kaluza & Lohrisch, 2016). The strengths, weaknesses, opportunities and threats for AIA can be discussed as:
Strengths
The brand name and the brand reputation of the company is its biggest strength. The company has excellent financials, and this is also one of the key strengths of the company (Keller, 2016). The company has good decent cash reserves to spend on marketing and other activities. The financial snapshot of AIA can be shown as:
Weaknesses
The lack of flexibility is one of the weaknesses of the company. The attrition rate is generally high for players in the insurance sector and this is one of the key problems for AIA also (Vomberg, Homburg & Bornemann, 2015). The employee loyalty is low in insurance industry and people would frequently switch job. It is important that AIA should work on its weaknesses.
Opportunities
The market is growing at an exponential rate and this is the biggest opportunity for AIA. It is expected that the insurance industry would grow at a CAGR of 10% and this is a great opportunity for AIA (Keller, 2016). Every year, there would be more and more people who will need insurance and AIA has the opportunity to target these people.
Threats
The biggest threat for AIA is the threat from other players in the market. It is difficult for AIA or any other player to create differentiation in the market and this is also an area of threat for the company. Basically, AIA does not have any great positioning that can keep customer stick to the company (Laroche, Habibi, Richard & Sankaranarayanan, 2012).
With the tool of competitive analysis, organizations can actually analyse the standing of competitors against its own standing. The competitive positioning map of AIA and its competitors can be shown as:
The above competitive map shows that AXA is a leader in the market. The map also shows that the position of AIA is also good. The competitive analysis suggests that none of the players has less cost for the offerings and all the competitors believes in providing high quality to consumers (Mokwa, 2017). In recent times a lot has been changed in the insurance sector in Singapore. The changing nature of the industry is one of the biggest driver of change in the competition in the insurance sector. In last decade or so a transformational change is observed in the insurance delivery. With the incorporation of Electronic Health Record system, the health care insurance and life insurance is not the same. This or any other change in the health care system demands change in the workface. It is expected that the health care and life insurance would continue to change and as a result the competitive landscape would keep on changing. There is a need that insurance workforce should be given regular training about the new things in industry. The employer can also conduct various workshops where people get to know about the latest industry news. It is the responsibility of insurance leaders to ensure that their workforces and affiliated providers are well positioned for the future (Datta, Ailawadi & Van Heerde, 2017). It would need considerable investments from employers and it is important that the leaders should be willing to make this investment.
The important thing for AUA is to have a vision in place and this vision should be developed based on the inputs of various internal and external stakeholders. It is also important that this vision should be communicated to employees at different levels (Mullakhmetov, Sadriev, Gabidinova & Akhmetshin, 2016). The engagement from the workforce would be high only when they feel motivated. Therefore, motivation of employees is the key. The communication should be effective in the organization and leaders should always be available to answer the queries of team members. It is recommended that leaders should engage the workforce through various training and developmental programs. The engagement levels would be high if the employees are given some incentives to attend and participate in training and developmental programs (Dietz et al., 2015). In the entire process, planning is the key and it is suggested that health care leader should have strong planning so that they can implement their program efficiently. The support from various internal and external stakeholders would also help the leaders to have effective strategy in place (Song et al., 2014). The bottom line is that leaders should not be fear any change in the industry and insurance industry is an ever-changing industry (Datta, Ailawadi & Van Heerde, 2017).
The strategic priority for AIA would also include the focus on service improvement through tools like lean management (Zhang, Zhou, Su & Zhou, 2013). With lean management the focus is on collaboration among all the departments so that the overall efficiency of the organization is high and waste in the system is limited. With six-sigma, the objective of our organization is to reduce the defects to continuously improve the service levels. Six Sigma can also be thought of as a measure of process performance, with Six Sigma being the goal, based on the defects per million. Once the current performance of the process is measured, the goal is to continually improve the sigma level striving towards six-sigma (Baumgarth, Kaluza & Lohrisch, 2016).
Conclusion and Recommendations
The above paper discusses the marketing audit of AIA. With the above discussion, it can be said that the company is doing good in the market. One of the good thing for AIA is that it is amongst the market leaders. However, the strategic positioning of AIA appears to little less than AXA. Therefore, there is a scope of improvement and with a focused marketing plan in place, AIA can definitely attain the position of market leader. It is recommended that AIA group should create the best working environment. This can happen by eliminating the discrimination. It is about taking specific actions against the people belonging to the particular’s group. Although, it is illegal to practice discrimination at workplace, but it is common practice at subtle level. For instance, if the management consists of all the males, it will prevent the reaching any female to take up such position. At the same time, ANZ group should also work on tokenism. It means that an organization appoints a small number of the members of the minority group to higher management position without seeking the active representation of that group. By practicing tokenism, organizations are trying to safeguard themselves so that no one raises questions.
References
Baumgarth, C., Kaluza, M., & Lohrisch, N. (2016). Brand Audit for Cultural Institutions (BAC): A Validated and Holistic Brand Controlling Tool. International Journal of Arts Management, 19(1), 54.
Berman, B., & Evans, J. R. (2015). A Model for Implementing the Marketing Audit. In Marketing Horizons: A 1980’s Perspective (pp. 338-343). Springer, Cham.
Brodie, R. J., Ilic, A., Juric, B., & Hollebeek, L. (2013). Consumer engagement in a virtual brand community: An exploratory analysis. Journal of Business Research, 66(1), 105-114.
Datta, H., Ailawadi, K.L. and Van Heerde, H.J., 2017. How Well Does Consumer-Based Brand Equity Align with Sales-Based Brand Equity and Marketing-Mix Response?. Journal of Marketing, 81(3), pp.1-20.
Keller, K.L., 2016. Reflections on customer-based brand equity: perspectives, progress, and priorities. AMS review, 6(1-2), pp.1-16.
Kuo, Y. F., & Feng, L. H. (2013). Relationships among community interaction characteristics, perceived benefits, community commitment, and oppositional brand loyalty in online brand communities. International Journal of Information Management, 33(6), 948-962.
Laroche, M., Habibi, M. R., Richard, M. O., & Sankaranarayanan, R. (2012). The effects of social media based brand communities on brand community markers, value creation practices, brand trust and brand loyalty. Computers in Human Behavior, 28(5), 1755-1767.
Mokwa, M. P. (2017). The policy characteristics and organizational dynamics of social marketing. In Marketing the Public Sector (pp. 43-55). Routledge.
Mullakhmetov, K. S., Sadriev, R. D., Gabidinova, G. S., & Akhmetshin, E. M. (2016). Control in marketing-based management. Academy of Marketing Studies Journal, 20(2), 13.
Shaomian, A., & Heere, B. (2015). The Path to Loyalty Among Theater Patrons: The Importance of Interaction and a Sense of Brand Community. MEIEA Journal, 15(1), 13.
Stratton, G., & Northcote, J. (2014). When totems beget clans: The brand symbol as the defining marker of brand communities. Journal of Consumer Culture
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