Life Insurance Corporation(LIC) is a government-owned insurance and investment company. LIC holds 66% of the total market share in the insurance industry. And, in this blog, we will discuss the marketing strategy of LIC. Along with that, we will also look into the marketing mix, competitors, and SWOT analysis of LIC.
So, without any delay, let’s get started with the company introduction.
LIC (Life Insurance Corporation) or often known as Bharatiya Jeevan Beema Nigam is an Indian Government Corporation that was established in 1956. It is an insurance company with 8 zonal offices and 101 divisional offices with its headquarters located in Mumbai. Besides giving life insurance, LIC also offers mutual funds, health insurance, and investment management services. LIC International, LIC Nepal, LIC Lanka, and LIC Housing Finance are all subsidiaries of India’s life insurance firms.
LIC offers a very vast and huge range of diversified products catering to the needs of various sections of people in India and outside of India. It offers individual solutions considering their specific financial requirement and risk profile and helps to solve it.
Now, let’s have a look at the marketing mix of LIC.
Marketing Mix of LIC
The marketing mix of LIC is consists of 7Ps, but here we are discussing major 4 strategies, which are:
Price/Pricing Strategyof LIC
The main objective of LIC is to offer enough financial cover at a reasonable and affordable cost to all insurable persons. LIC’s product range is as vast as its price range.
On the official website, there is a ‘premium calculator’ service where the premium for each scheme of LIC can be calculated which is dependent on age, term, and sum assured. Payment of the premium can be done by cash, cheque, or depositing in the cash counter of any LIC branch.
For the ease of the customers, a premium can be paid through the official website of the company. As for the tax, the rate will be different for different schemes.
Product Strategy of LIC
Insurance is mainly taken out to provide for the family members in case of death by natural causes or accidents. LIC has designed several products according to the requirements of the common people, which are as follows:
- Life Insurance
- Investment Management
- Health Insurance
- Mutual Fund
- Property Insurance
- Auto Insurance
- Home Insurance
- Casualty Insurance
- Liability Insurance
- Credit Insurance
Besides this, LIC has various pension plans, group schemes, and special plans for the benefit of the customers. LIC-Life Insurance has also launched different products for children, women, senior citizens, and differently-abled persons.
Placing Strategy of LIC
LIC currently has eight zone offices, 109 divisional offices, 992 satellite offices, 2,048 branches, and a large number of corporate offices. It also boasts a network of 242 corporate agents, 1,337,064 individual agents, 79 referral agents, and 98 brokers that have ties to 42 banks. LIC- Life Insurance is a service industry, the distribution of its products is done through various channels – directly or indirectly. Many routes are taken to reach the potential customer and the most important and basic channel member until this date has been the “Insurance agent”.
Physical delivery of service items, in this case, finances, and support, at the correct time and location, is a key component of LIC’s marketing strategy. The organization’s channel of distribution consists of different agents, brokers, development officers, retail services related to finance, branch office, alliance with banks and distributors, corporate agencies, and proper and well-maintained infrastructure.
Promotion Strategy of LIC
The promotional strategy of LIC is straightforward. Its main aim is to keep consumers updated about its various policies and its brand. To fulfill this, it has taken steps like exhibitions, personal sellings, demonstrations at events, new schemes, and advertising.
They had also distributed some stationery like diaries, calendars as gifts, and incentives to the policyholders. As promotional activities, advertisements are presented on televisions, newspapers, and billboards.
A mobile van is used to create awareness programs across the rural areas of the company. LIC-Life Insurance has a website and a webpage where it provides extensive information on any conceivable query in order to satisfy customers.
The majority of advertising is driven towards insurance which can be purchased by the common man to increase the reach of the company and at the same time, the sale of the product. Thus, the major objective of all the advertising and promotion was brand retention.
Because this is a service marketing brand, here are the other 3Ps to complete the LIC 7Ps marketing mix (Life Insurance Corporation of India).
- Physical Evidence
SWOT Analysis Of LIC
The strengths and weaknesses of Life Insurance Corporation of India (LIC) are considered internal elements, while opportunities and threats are considered external factors in a SWOT analysis.
- In India, it is the most reputable insurance firm.
- Customer satisfaction and after-sales service in the long-term plan hold much importance.
- Created employment opportunities for more than 1,15,000 people
- Has around 2000 branches across India and 10,00,000 agents and worldwide
- There is very little innovation since it is a government-owned organization
- Gets affected by bureaucracy and fraud
- It becomes difficult to manage the huge workforce in times of economic crises
- With the use of modern technology, it can provide good service in the urban areas and widen its connection.
- Proper government schemes should be implemented
- Economic crisis
- New NBFCs are entering the market.
- Varying Govt policies
Now, let’s have a look at the competitors of LIC.
Competitors of LIC :
In this era, many insurance companies of different types have been established to provide facilities to the public. But the company that stood out from the rest of the crowd is LIC. Many of them come and go but LIC is there and always will be.
The top 3 competitors of LIC are:
- SBI Life Insurance
- Sahara Life Insurance
- HDFC Standard Life
And from the above all competitors, LIC is the market leader covering 66% of the market.
LIC Market Environment
The companies like LIC and all the other actors operate in a large macro environment that shapes the opportunities and pose threat to the company. Major forces are :
Since literacy and education increases employment opportunities, higher earning jobs also bring a change in perception about the need for insurance.
Because the real value of money decreases with an increase in the inflation rate, high inflation reduces the insurance business.
More innovative channels like banks, post offices, ATMs should be introduced in areas where there are limited development facilities and are still facing difficulties.
According to the IRDA act, 1999: the bill allowed for 26% for equity participation in the insurance sector.
A strong trade union was made for managers so that the job is done as the work culture in the organization was sloppy.
Now, let’s discuss the marketing strategies of LIC.
Marketing Strategy of LIC
The motive of using a marketing strategy is to achieve business goals & objectives. There are several strategies like product/service innovation, marketing investment that has helped the brand grow. Let’s take a look at the marketing strategies used by LIC:
- LIC offers a variety of products differing from other insurance companies, which helped them to stand out from the rest of the companies.
- It got the first-mover advantage.
- With the help of advertisements, LIC promotes its brand value.
- They use creative slogans to attract the customer’s mindset.
- They avoid any unnecessary interference with the customers so that the correct messages can be reached to all of their customers.
LIC Advertising Campaign
LIC had always created campaigns with some funny twists as well as connecting with emotions. Let’s discuss one of the best advertising campaigns by LIC.
“Smart logon ki clear hai priority, baaki sab baad Mein, Pehle LIC”
The campaign shows the importance of life insurance. It shows how essential life insurance is. It emphasizes fulfilling the dream like buying a house, owning a startup, having a degree from a foreign college, and having a holiday plan.
The campaign was firstly launched digitally, but to maximize the reach, the company did a flash mob at a mall in Mumbai. The campaign got a lot of traction in malls with their family and friends. The flash mob was aligned with Valentine’s Day celebrations. The dancers held a Love Note that read, “Gift your loved ones Jeevan Bhar ka Saath on this Valentine’s Day.”
Lastly, we can say that the company is performing well in its marketing using all channels of marketing to reach out to their target customers. There is a scope of improvement by moving digital and providing online support to their customers
LIC is the biggest life insurance corporation in the Indian insurance industry. Its strong brand backed by long experience and a well-established network has helped it to remain at its peak for a long period. They use all forms of marketing, like online, offline, and direct marketing. The company can improve its marketing strategy by focusing more on digital marketing and having a good social media presence.
Also, are you interested in learning more about digital marketing? To learn more about digital marketing, take a look at our Free Digital Marketing Masterclass with Karan Shah.
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