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Hiscox Ltd is a founded in Bermuda that deals with the insurance products. The company is listed in the London Stock Exchange and acts as an underwriter in Lloyd’s of London. The areas of operation and selling are mainly concentrated in the niche markets. The main products of Hiscox Ltd include property and casualty insurance that is given to other companies and individuals with high net worth.It also sells home and contents insurance for luxury homes, cars,personal accident, bloodstock etc. The company covers almost all the risks such as hacking, kidnapping, satellite damage and so on. In the recent period, 2014, Hiscox USA launched a new brand called “Encourage Courage”. In this Unit 2 Marketing Planning Assignment - Hiscox Ltd report, the relevance of a marketing planning in Hiscox is discussed. A more effective marketing plan involves the designing of the marketing objectives according to the business goals and capacity of the business to enable marketing strategy execution in the changing complex business environment. The report highlights on the compiling market audits, barriers to marketing planning, marketing plan for a product or service and Ethical issues in marketing.
Understanding the external environmental factors is an integral part in the organization audit. External environmental factors are subjected to changes on a frequent basis and hence, there is a vital need to know the impact of the external environments, which is the market fluctuations in the company along with the internal factors. The internal environmental factors include the mission and vision of the company including the business goals and objectives. The analysis of which helps in knowing the future business requirements in the marketing. Another internal factor is the existing customers (Hutt, M., & Speh, T, 2012). While conducting the market audit, the needs and preferences of the existing customers should be focused. Resources of the company are another internal factor that involves management structure, finance, information technology used and so on. Employees and their relations are another major internal factor that needs to be considered.
As the first step in the Hatton’s marketing planning process, the analysis of a company’s current product portfolio and its market position can be done in a better way for Hiscox using the portfolio analysis of BCG matrix. This matrix helps Hiscox toanalyse its portfolio as it provides a graphical representation of the company to evaluate its different business functions. The two key elements considered to evaluate the business position are the market share and the industry growth rates. In BCG matrix, Hiscox will be able to analyse the capacity and potential of its business activities as well as analysis of the market environment.Business classification can be done under BCG matrix using the comparison on industry growth rate and relative market share. There are four cells in the graphical representation of BCG matrix each showing different type of business.
However, external environmental factors are more fluctuating and challenging that the internal factors. The external market factors can be analysed in the organizational audit using PEST analysis, which is the analysis of Political, Economic, Social and Technological factors. By auditing these factors, the impact of them in the organizational activities is known. SWOT analysis (Strengths, Weaknesses, Opportunities and Threats analysis) helps a company to know the organizational culture and the future business prospects along with the assessment of the external business market. External market analysis helps to know the customer needs, competitors’ strategies, awareness of market size, number of competitors, market prices, marketing techniques of other companies, target market effects, better product promotional and distributions methods and so on
Before conducting the marketing planning, it is essential to know the organizational capability to plan its future market. This includes knowing several elements which are as below:
Marketing planning is a challenging aspect and there can be many barriers to the market plan to develop and execute. Some of the barriers in the market plan may include the following:
It is essential is for Hiscox to overcome the barriers in the marketing planning so that the company can increase its profitability and market share in bringing the new specialist flood insurance product to market. According to the professor McDonald, there are ten rules to overcome the barriers in the marketing planning (O'Mahoney, J., & Markham, C, 2013). Hiscox has to follow these rules in the company so that there can be a better marketing planning possibility. These rules are as below:
SWOT analysis is one of the main organizational audits that helps the company to know the Strengths, Weaknesses, Opportunities and Threats of the company and its impact in the external market. The main aim of the SWOT analysis is to increase the benefits of strengths and opportunities and to reduce weaknesses and to avoid threats faced by Hiscox. Some of the strengths of the company is the market share in the insurance industry, The skills and expertise of the company among the competitors, the location of the business, whether it is located in the prime area, The quality process of the company and so on. Weakness of the company is the issues and problems in the company in the external market. These include bad reputation, lack of fund, improper supply chain management, low market share and reduced customer base, less competitive edge etc. Opportunities of the company are the possibilities of growth to the company offered from the external market. These include less competition of their weakness, increased market share, globalised market, innovations etc. Threats to the company are the issues that make the existence of the company difficult in the external market. This include new competitors, changes in the government tax law, competitors increased market share and customer base and so on.
Marketing is one of the main functions of a business that helps the company to increase its sales volume, revenue, profitability through its products and services. A successful marketing planning and its implementation enable the company to survive in the competitive business world in a long run. Hence, in the Business Strategy, there is a vital need to include the marketing plan. Marketing planning helps Hiscox to focus on its target market and the customers who may be interested to buy its insurance products. It also helps to know the needs and preferences of the customer with related to the different insurance products of the company. Marketing planning helps Hiscox to know the potential customers in the niche markets in UK, US etc. Through the conduct of marketing planning, the demand of its products among the market is identified. Marketing plan helps to know the strength and weakness of the competitors and there by a better competitive edge can be gained. Marketing plan included in the business strategy enable the company to know the cash operational activities and the ways to make good profit (Gummesson, E., & Grönroos, C, 2012).
Marketing planning is an integral aspect of the company that helps the management to know the flaws in the current marketing strategies and activities, how to develop a more focused business goals, how to achieve more competitive edge and market share and soon (Kotler, P, 2011). The changing market fluctuations and its future market prospects are included in a proper marketing planning so that the company will be able to withstand even in the market crisis. Considering Hiscox Ltd., the insurance provider, it offers variety of insurance products like personal and commercial insurance, home and content insurance etc. in the niche market. Hence, it is essential for Hiscox to know the changing market trends in the niche market and the performance of the other competitors in the insurance industry are compared and analysed to eventually do a better and successful marketing plan for Hiscox. The company acquired DirectAsia to start the direct-to-consumer businesses in many markets like US and Europe. DirectAsia brand is a challenging and one the marketing planning of Hiscox has to incorporate the strategies to successful sell the products direct to consumer.
It is also essential for Hiscox to do a proper market analysis in the internal and external market environment before conducting a marketing planning. The factors that act as the strengths, weakness, opportunities and threats in these marketing environments have to be analysed effectively so that the company will be able to face any difficult scenario in the market as well as its marketing strategies will be unique and better from its competitors in insurance industry.
Developing a new product like new flood insurance product for high value domestic property, is a critical aspect as it decides the sales volume, profit margin and the overall development and growth of the company. Hence, there requires a more focused evaluation of market conditions as well as the business goals (Simms, C., & Trott, P, 2014). New product development is a process which involves the designing and planning to develop a product that also has to include the analysis of the feasibility and viability of the product in the market. The new product development process include the below factors:
The marketing planning will have more impact on the customer ethics. The ethical customers are the customers that are conscious about the environmental issues such as issues related to social and other issues. While considering the marketing plan, the company has to ensure the customer right is taken in to account. If the company is immortal in the product sales and pricing, it will create a bad reputation to the company affecting the sales volume and profit margin of the company. If an ethical consumer buys the products of the company that are developed and marketed in an unethical manner, it will have a direct consequence on the customers cause to customer annoyance and dissatisfaction. Thereby, the goodwill of the company will be hampered and it will make the survival of the company difficult in the market (Papadopoulos, N., & Heslop, L. A, 2014).
Marketing plan is a vital document that includes the market analysis goals and objectives, the guidelines and methods to conduct marketing etc. This is a critical element in the company so that Hiscox can ensure a better sales volume of its insurance products in the niche markets all over the world. According to McDonald (1995), there is a four step marketing approach which is as below:
In order to make a product successful in the market and attractive to the customers, there has to be an effective pricing policy, distribution and communication mix. Distribution mix is to the place in which the product is sold out. The niche market selection is to be done by Hiscox to sell its insurance products. The target market selection should be based on the product features and customer preferences in the target market. This includeschoosing the methods of transportation, controlling the inventory level in each target market. All these factors increase the sales volume of Hiscox products
Also, it is essential to ensure a correct pricing strategy is implemented in the respective target market so that more customers will be attracted. The prices of the products will be determined on the basis of the customer buying behaviour and customer perception. Hence, while making a marketing plan, the exact buying pattern of the customers in each target market is to be analysed (Jobber, D., & Ellis-Chadwick, F, 2012).
The communication strategy has to be effective in the marketing plan as the product sales and brand image of the company is determined on the basis of how well the product is communicated to the customers. The different communication techniques include promotional and marketing activities. This has to be unique and grab more customers so as to increase the market share of the Hiscox.
A suitable marketing plan helps in the easy achievement of the business goals by reducing the risks in the business and increasing the profit margin. The marketing plan can be executed with the help of the marketing tools and gathering information that helps in the business growth and expansion in the competitive market. Some of the factors that help in the marketing plan implementation are as below:
There is a vital requirement that the control plan has to be in align with the strategic objectives. This will ensure a proper execution of the marketing plan and thereby a smooth marketing activity is possible. Hence, while monitoring and controlling the marketing activities, it will help the company to know whether the conduct of the activities is in accordance with the strategic goals. If not, necessary actions can be taken through an effective control system.
Ethics is a set of principles that consists of right of conduct that enables the organization to make the appropriate decisions. Ethics in marketing covers address the issues of standards of fairness, principles etc. The main aim of the ethics in marketing is to ensure that no one violates the ethical principles in marketing, especially in the process of marketing planning. If there is a violation of the marketing ethics, it will lead to many further complications in the marketing implementation and thereby the company may have to incur losses. If ethical standards are met by the organization, it helps the company to ensure q positive attitude towards its products and services. This will increase the brand image of the company leading to an increased goodwill. The ethical issues that have happen for Hiscox in its Wi-Fi campaign for B2B customers include the following:
By the practice of any unethical steps, the company will lose its image in the market. This will lead to loss of customers and bad reputation. Thereby, the customers will be dissatisfied and the trust factor on the company will be faded on the part of the customers. Hence, complying the ethical standards and principles in the marketing plan and its implementation is an essential aspect for company survival (De Mooij, M, 2013).
There are a few strategies that help in following ethical behaviour in the company and this eliminates unethical practices in the company. One of the main thing is that management has to ensure that the ethical principles are communicated to all employees in the company so that all are aware of the ethical behaviour aspects and this will be followed effectively (Terpstra, V., Foley, J., & Sarathy, R, 2012). Secondly, there is a vital need on the part of the company to provide ethical training to all the employees so that the self-discipline will be followed by employees. Some of the ethical issues that organization should avoid include:
While concluding, it is noted that there is a vital need for an effective marketing plan developed and implemented in the company so that the company can benefit in many ways and improve its business success. The marketing plan off Hiscox Ltd, a UK based insurance company is discussed in this Unit 2 Marketing Planning Assignment - Hiscox Ltd. There is a vital need to conduct proper and timely market audit involving the analysis of the external and internal environmental factors through PEST and SWOT analysis. This helps the company to know what areas in marketing needs to be improved in future and what are its strengths and opportunities, threats and weaknesses. The barriers to the Marketing Planning have to be eliminated so that a smooth formulation of the marketing strategies and its effective marketing implementation can be ensured. The Marketing Planning steps involve situational review, goal setting, strategic formulation and its implementation and monitoring marketing activities. A god marketing plan has to consider the ethical standards and principles. This will ensure a good reputation, more customer base and profit margin to the company. However, violation of ethics by the company makes it difficult for the company to survive in the market (Doole, I., & Lowe, R, 2012).
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