Year: 2020

Insurance Marketing

Marketing of Insurance Service to achieve increased customer orientation and generation of profit is called Insurance Marketing. Formulation of an ideal mix for insurance business is the main focus of Insurance marketing. The core and peripheral services can be improved by following an appropriate service mix. The marketing concept enables the insurance business to expand business in the best interest of society as well as the insurance organization.

Price competition does not automatically mean better value for the customer. Customer interactions have become short-term and transaction focused while long-term value creation for the customer and engagement declined.

When taking the perspective of the insurance provider, we encounter a different problem. Decision making within the current organizational structure of many insurers is not optimally designed to offer a competitive premium and control for both volume and a healthy combined ratio.

This is caused by conflicting interests between departments, in this case the marketing and the actuarial department. The marketing department is mainly focused on volume. Their objective is to attract as many new clients as possible and to let the insurer’s portfolio grow. The objective of the actuarial is to control for a healthy portfolio in which claim expsenses does not exceed premium income. These two deviating objectives have brought the insurer into a vicious circle. The marketing department is mass targeting with the premiums they receive from the actuarial department, not able to pay attention to differences in risk profiles and thereby attracting customers with high risk profiles which are jeopardizing the state of combined ratios. In reaction to this the actuarial department is compelled to increase premiums on a general level, which in turn makes it even harder for the marketing department to attract profitable customers, as these profiles will get better offers from competitors who take risk profiles into account and are able to set lower premiums for low-risk profiles. This process fueled by different department incentives is not beneficial to the organization as a whole.

Tear Down Those Silos

To become profitable again and at the same time increase the volume of portfolios, insurers have to start thinking outside the existing silos and optimize business decisions on an organization level. Decisions need to be taken from the perspective of the customer based on all information within the organization, not by separate silos. By doing this the insurer can become truly customer-centric and the vicious circle will be broken.

Market Segmentation in Insurance

So how should the actuarial and marketing departments join forces to attract the right customers? Which customers are contributing to the profitability of the portfolio and are willing to form long-term relationships? Based on the available data in the organization, profitable customer segments can be discovered by segmenting the portfolio on predicted Customer Lifetime Value. Data Science & Machine Learning techniques can be used to identify new customers in the market which are valuable over their lifetime based on learnings from the existing portfolio. Algorithms analyzing the current portfolio distill characteristics of customers that bare high and low risks. The marketing department then has the relevant knowledge to attract similar customers having low risk characteristics, improving combined ratios. Premiums can therefore be lowered, increasing the competitive edge of premiums in the market. On top of that, marketing propositions can be adjusted to the specific segments to create a better fit between insurance product and policy holder, increasing the added value for the policy holder and thereby increasing loyalty.

Market segmentation in the insurance organization

Markets are segmented into different customer groups. Each product or services is tailored to match the needs of the customer group. The segmentation helps the insurance organization in dividing the market into small segments where the customer needs are identical.

Market for insurance is divided into segments and sub-segments. Segments include

• Household sector
• Industrial sector
• Trade sector
• Institutional sector
• Region-wise sector
• Rural sector

The household sector is a segment which is subdivided into

• Salaried class
• Self-employed
• Retired employees

The industrial sector is subdivided into

• Public sector
• Private sector

Likewise, the other segments are subdivided into appropriate sub-segments.

Significance of segmentation to the insurance business

1. Market segmentation is very important to an insurance organization. In insurance business, the prime focus is on the policyholder. Insurance marketing aims at transforming the prospects into policyholders. Market segmentation enables the insurance marketer to identify the level of expectations of the policyholders.
2. Insurance organizations capitalize on the available opportunities in market. They need to increase their market share constantly. Market segmentation in insurance business helps in informing, sensing and persuading the different segments where the potential users are available.
3. The insurance professionals can do business in all segments, such as rural and urban, men and women, agricultural or industrial and so on. Segmentation makes it possible to spread the insurance business even to the agricultural sector of the economy which is predominantly rural-based.
4. With market segmentation, the insurance organizations become aware the changing needs and requirements of the rural sector and shape their services accordingly.
5. Knowing and understanding the market is considered significant to the insurance professionals since the segmentation process helps them in scanning the changing needs and requirements of the rural sector.
6. A study of segmentation would help insurance professionals in formulating a sound marketing strategy. The product mix based on market segmentation would be competitive. All the prospects would have additional attraction in using the services.
7. The segmentation would help insurance professionals in making the promotional measures creative. It would be instrumental in sensitizing the prospects. The advertisement professionals would make advertisement appeals, messages and campaigns proactive to the receiving capacity of the target audience.
8. The pricing decision can also be rationalized and the weaker sections of the society would get substantial benefits. In view of the above, it is appropriate to say that segmentation is very important to insurance professionals. It transforms the prospects into users.

Customers Attributes

Data is everywhere, data is the buzz, the best. We’ve talked about data an endless amount of times, yet managed to cover only parts of its importance and the effect it has on our day-to-day life. But as a marketer using this data regularly, have you ever felt that it restrains you from creating the campaigns you really want?

Ideas for campaigns are halted by data limitations constantly, for various reasons: marketing technology tools allow you to add data into them, but this data is restricted to the boundaries of the tool itself, to the developers’ mind set, experience and needs at the time, and can be added only in a specific format. This means the marketer has to first re-structure the data to meet that format, and only then add it to the tool.

Furthermore, once this data is added it can’t be manipulated: Attributes that are created have a fixed predefined logic and are calculated in that fashion. Thus, many lovely ideas that marketers come up with get stuck, and more sophisticated logic simply can’t be applied.

Taking care of this exact point this “attributes wall” if you will was always one of Optimove’s main mottos. Any data is welcome, no manipulation is needed, there are no limitations whatsoever to the creativity and logic. Our data science team is dedicated to the customization of each customer’s site. The data scientists start with flattening the customer data, using the existing data format, to create a Single Customer View containing any number of customer attributes. Any desired attribute can be created (assuming the data exists) and these can be added or changed at any point, and in virtually no time at all.

A customer attribute can be used for two main purposes: to better understand customers and to better execute campaigns. Large numbers of customer attributes will improve the ability to create sophisticated campaigns, by extending segmentation capabilities and analyzing groups behaviors. Optimove’s clients can change and add attributes as they wish, as they acquire more and more data and logic about their customers. Any desire and need is taken care of, and the more creative the request, the better. This is what we call data democratization.

Customers Behavior of customer in insurance sector

Insurers have long struggled to attract and retain customers. They do business in a highly competitive marketplace, and they sell a product that many consumers consider to be a commodity. Customers often cite price as their main reason for buying an insurance policy particularly in property and casualty (P&C). Many consumers now buy insurance through aggregator sites, rarely connecting directly with the carrier or its agents.

Insurers find it challenging to differentiate themselves in the eyes of their customers, especially when they interact so irregularly with them. In an era when consumers across markets expect high-touch, personalized service, insurance, by its very nature, remains a low-touch industry. Worldwide in the product categories of home, auto, life and health insurance, most customers purchase an insurance product only every three to six years. In developed markets, just half of the customers have had any contact with their insurers for any reason in the past 12 months.

Customers Behavior

Consumer behaviour is the study of individuals, groups, or organizations and all the activities associated with the purchase, use and disposal of goods and services, and how the consumer’s emotions, attitudes and preferences affect buying behaviour. Consumer behaviour emerged in the 1940s and 50s as a distinct sub-discipline of marketing, but has become an inter-disciplinary social science that blends elements from psychology, sociology, social anthropology, anthropology, ethnography, marketing and economics (especially behavioural economics).

The study of consumer behaviour formally investigates individual qualities such as demographics, personality lifestyles, and behavioural variables (such as usage rates, usage occasion, loyalty, brand advocacy, and willingness to provide referrals), in an attempt to understand people’s wants and consumption. Also investigated are the influences on the consumer, from groups such as family, friends, sports, and reference groups, to society in general, including brand-influencers and opinion leaders.

Research has shown that consumer behaviour is difficult to predict, even for experts in the field; however, new research methods, such as ethnography and consumer neuroscience, are shedding new light on how consumers make decisions. In addition, customer relationship management (CRM) databases have become an asset for the analysis of customer behaviour. The voluminous data produced by these databases enables detailed examination of behavioural factors that contribute to customer re-purchase intentions, consumer retention, loyalty and other behavioural intentions such as the willingness to provide positive referrals, become brand advocates or engage in customer citizenship activities. Databases also assist in market segmentation, especially behavioural segmentation such as developing loyalty segments, which can be used to develop tightly targeted, customized marketing strategies on a one-to-one basis.

The better a business can manage the relationships it has with its customers the more successful it will become. Therefore IT systems that specifically address the problems of dealing with customers on a day-to-day basis are growing in popularity.

Customer relationship management (CRM) is not just the application of technology, but is a strategy to learn more about customers’ needs and behaviours in order to develop stronger relationships with them. As such it is more of a business philosophy than a technical solution to assist in dealing with customers effectively and efficiently. Nevertheless, successful CRM relies on the use of technology.

This guide outlines the business benefits and the potential drawbacks of implementing CRM. It also offers help on the types of solution you could choose and how to implement them.

CRM

In the commercial world the importance of retaining existing customers and expanding business is paramount. The costs associated with finding new customers mean that every existing customer could be important.

The more opportunities that a customer has to conduct business with your company the better, and one way of achieving this is by opening up channels such as direct sales, online sales, franchises, use of agents, etc. However, the more channels you have, the greater the need to manage your interaction with your customer base.

Customer relationship management (CRM) helps businesses to gain an insight into the behaviour of their customers and modify their business operations to ensure that customers are served in the best possible way. In essence, CRM helps a business to recognise the value of its customers and to capitalise on improved customer relations. The better you understand your customers, the more responsive you can be to their needs.

CRM can be achieved by:

• Finding out about your customers’ purchasing habits, opinions and preferences
• Profiling individuals and groups to market more effectively and increase sales
• Changing the way you operate to improve customer service and marketing

Benefiting from CRM is not just a question of buying the right software. You must also adapt your business to the needs of your customers.

Business benefits of CRM

Implementing a customer relationship management (CRM) solution might involve considerable time and expense. However, there are many potential benefits.

A major benefit can be the development of better relations with your existing customers, which can lead to:

• Increased sales through better timing due to anticipating needs based on historic trends
• Identifying needs more effectively by understanding specific customer requirements
• Cross-selling of other products by highlighting and suggesting alternatives or enhancements
• Identifying which of your customers are profitable and which are not

This can lead to better marketing of your products or services by focusing on:

• Effective targeted marketing communications aimed specifically at customer needs
• A more personal approach and the development of new or improved products and services in order to win more business in the future

Ultimately this could lead to:

• Enhanced customer satisfaction and retention, ensuring that your good reputation in the marketplace continues to grow
• Increased value from your existing customers and reduced cost associated with supporting and servicing them, increasing your overall efficiency and reducing total cost of sales
• Improved profitability by focusing on the most profitable customers and dealing with the unprofitable in more cost effective ways

Once your business starts to look after its existing customers effectively, efforts can be concentrated on finding new customers and expanding your market. The more you know about your customers, the easier it is to identify new prospects and increase your customer base.

Even with years of accumulated knowledge, there’s always room for improvement. Customer needs change over time, and technology can make it easier to find out more about customers and ensure that everyone in an organization can exploit this information.

Types of CRM solution

Customer relationship management (CRM) is important in running a successful business. The better the relationship, the easier it is to conduct business and generate revenue. Therefore using technology to improve CRM makes good business sense.

CRM solutions fall into the following four broad categories.

1. Outsourced solutions

Application service providers can provide web-based CRM solutions for your business. This approach is ideal if you need to implement a solution quickly and your company does not have the in-house skills necessary to tackle the job from scratch. It is also a good solution if you are already geared towards online e-commerce.

2. Off-the-shelf solutions

Several software companies offer CRM applications that integrate with existing packages. Cut-down versions of such software may be suitable for smaller businesses. This approach is generally the cheapest option as you are investing in standard software components. The downside is that the software may not always do precisely what you want and you may have to trade off functionality for convenience and price. The key to success is to be flexible without compromising too much.

3. Custom software

For the ultimate in tailored CRM solutions, consultants and software engineers will customise or create a CRM system and integrate it with your existing software.

However, this can be expensive and time consuming. If you choose this option, make sure you carefully specify exactly what you want. This will usually be the most expensive option and costs will vary depending on what your software designer quotes.

4. Managed solutions

A half-way house between custom and outsourced solutions, this involves renting a customised suite of CRM applications as a tailored package. This can be cost effective but it may mean that you have to compromise in terms of functionality.

How to implement CRM?

The implementation of a customer relationship management (CRM) solution is best treated as a six-stage process, moving from collecting information about your customers and processing it to using that information to improve your marketing and the customer experience.

Stage 1: Collecting information

The priority should be to capture the information you need to identify your customers and categorise their behaviour. Those businesses with a website and online customer service have an advantage as customers can enter and maintain their own details when they buy.

Stage 2: Storing information

The most effective way to store and manage your customer information is in a relational database – a centralised customer database that will allow you to run all your systems from the same source, ensuring that everyone uses up-to-date information.

Stage 3: Accessing information

With information collected and stored centrally, the next stage is to make this information available to staff in the most useful format.

Stage 4: Analysing customer behaviour

Using data mining tools in spreadsheet programs, which analyse data to identify patterns or relationships, you can begin to profile customers and develop sales strategies.

Stage 5: Marketing more effectively

Many businesses find that a small percentage of their customers generate a high percentage of their profits. Using CRM to gain a better understanding of your customers’ needs, desires and self-perception, you can reward and target your most valuable customers.

Stage 6: Enhancing the customer experience

Just as a small group of customers are the most profitable, a small number of complaining customers often take up a disproportionate amount of staff time. If their problems can be identified and resolved quickly, your staff will have more time for other customers.

Potential drawbacks of CRM

There are several reasons why implementing a customer relationship management (CRM) solution might not have the desired results.

There could be a lack of commitment from people within the company to the implementation of a CRM solution. Adapting to a customer-focused approach may require a cultural change. There is a danger that relationships with customers will break down somewhere along the line, unless everyone in the business is committed to viewing their operations from the customers’ perspective. The result is customer dissatisfaction and eventual loss of revenue.

Poor communication can prevent buy-in. In order to make CRM work, all the relevant people in your business must know what information you need and how to use it.

Weak leadership could cause problems for any CRM implementation plan. The onus is on management to lead by example and push for a customer focus on every project. If a proposed plan isn’t right for your customers, don’t do it. Send your teams back to the drawing board to come up with a solution that will work.

Trying to implement CRM as a complete solution in one go is a tempting but risky strategy. It is better to break your CRM project down into manageable pieces by setting up pilot programs and short-term milestones. Consider starting with a pilot project that incorporates all the necessary departments and groups but is small and flexible enough to allow adjustments along the way.

Competitive research is the backbone of a strong marketing strategy. After all, if you can’t identify your competitors and their marketing tactics, you’ll struggle to differentiate yourself and your product from the crowd.

But how do marketers identify their primary competitors and their strategies? Here is our five-step strategy for how to identify your competitors, research your competition, and channel it into powerful marketing that meets your customers needs.

Finding your competitors doesn’t have to be taxing or complicated. The first step to finding your competitors is to differentiate between your direct and indirect competition.

Direct Competition

Direct competition is a term that refers to the companies or publishers who sell or market the same products as your business. Your customers will often evaluate both you and your direct competitors before making a purchase decision or converting.

Indirect Competition

Indirect competition is a term that refers to the companies or publishers that don’t sell or market the same products, but are in competition with your business digitally. They may write the same type of content as you and be competing for the same keywords. In short, they are competing for your customers’ attention.

How to Identify Direct Competitors?

When identifying competitors who are in direct competition to your business, you’ll want to start with your product. A thorough understanding of your product and the value it provides to your audience or customers is crucial to identifying your direct competition.

If you work for a sneaker brand, for example, you are not simply in competition with other sneaker brands. You’re also in competition with large shoe retailers, and any other brands and business that are creating footwear. Only by looking at your product and evaluating its value (you need to know not just that your sneakers cover and protect feet, for example, but also that people might evaluate them for durability, athletic use, and style), will you realize the full scope of your competition.

A few effective techniques for identifying direct competitors:

1. Market Research

Take a look at the market for your product and evaluate which other companies are selling a product that would compete with yours. Talk to your sales team and find out which competitors they see come up often in their sales process. From there, you’ll be able to take a closer look at those companies, their product and marketing efforts, and create strategies to outperform them.

2. Solicit Customer Feedback

Again, your customers are the key to unlocking your direct competitors. Once they’ve decided on your business and product, you can ask them which other businesses/products they were evaluating. Customers often reveal unexpected competitors that aren’t even on your radar.

In addition, during the sales process your sales team can also ask your potential customers which businesses they are considering. If they haven’t decided on your product yet, your team will be able to speak to their needs better if you know which businesses or products they are considering.

3. Check Online Communities on Social Media or Community Forums

In this day and age, your potential customers will often seek out advice and recommendations on social media sites and apps, or on community forums like Quora or Reddit. By investigating the conversations your customers have on these websites, you’ll be able to further identify your competitors.

This is especially true for any marketers speaking to millennial audiences. Research by Deloitte shows that 50% of millennials report that a recommendation from a friend or family member has a high influence on their buying decision. And 27% of both millennials and Gen Z feel an online recommendation from someone in their social media circle has a high influence on their buying decisions.

How to Identify Indirect Competitors?

Your indirect competitors have just as much influence on your selling process as your direct competitors. In fact, because your indirect competitors are often writing content that competes with yours, they have an even greater effect on potential customers in the early stages of the buyer’s journey. So how do you discover them?

1. Keyword Research

Keyword research is the best way to identify your indirect competition. By conducting a competitive SEO analysis, you can determine which businesses or publishers are competing for space on Google. After all, many of your customers are looking for your products and solutions by typing them into search engines. For today’s marketer, that means that you’re in competition not only with your direct competitors but with every other website competing for keywords important for your business.

If you are currently using an SEO platform or technology, you may find that your SEO technology can help you identify competitors with data and insights. For example, Conductor Searchlight can provide a high-level look at the keywords your direct competition is targeting. It also can tell you which websites are ranking for a keyword important your business. These represent your indirect competitors.

Keyword research can really help you when looking to identify your competitors in business.

If you’re working manually, check out our guide to scoping out your competition through keyword research, A Step-By-Step Guide to Competitive Analysis.

2. Analyzing Google’s Search Engine Results Page

When it comes down to it, many of your indirect competitors are writing about topics close to your value proposition. If you examine the value proposition of your product, you’ll be able to identify keywords that are central to your product or offering. From there, type the keywords into Google and see who is competing with your content on search engines. Anyone writing content around your value proposition, represents a person, blog, business, publication, or organization that is the indirect competition of your business.

3. Take a Look at Paid Data

If you’ve taken the first two steps on this list, step three should be a breeze. Head into AdWords and scan those keywords that are important to your business. Is there a lot of competition for any of those keywords? If there is, check out which businesses or websites are purchasing ads for those keywords. If websites are paying for paid space on the search engine results page for a keyword, they’re competing with your content for space on Google.

How to Identify Marketing Opportunities Based on Competitor Research?

After you’ve identified your competitors, you’ll want to identify marketing opportunities so you can start outperforming them.

Again, at this stage, keyword research can really help you decide where to put your efforts. If your competitors are targeting specific keywords with their content, where is there opportunity to outperform them? Are they implementing a particularly strong keyword strategy? What insights can you glean from that?

Similarly, by looking at your competitor’s social media presence, you can evaluate where they’re focusing their attention and efforts. From there, you can look toward opportunities to either compete with them directly for attention around specific topics or questions, or differentiate your approach by looking for gaps in their content or new angles to approach questions your audience is posing.

Lastly, you can always go back to paid data. If your indirect or direct competitors are putting money behind ads, you can be sure those keywords represent important business initiatives. This will also provide insight into where your competition is placing their efforts and money. From there, it’s up to you to craft marketing strategies to compete.

In today’s financial marketplace, a well-maintained portfolio is vital to any investor’s success. As an individual investor, you need to know how to determine an asset allocation that best conforms to your personal investment goals and risk tolerance. In other words, your portfolio should meet your future capital requirements and give you peace of mind while doing so. Investors can construct portfolios aligned to investment strategies by following a systematic approach. Here are some essential steps for taking such an approach.

Step 1: Determining Your Appropriate Asset Allocation

Ascertaining your individual financial situation and goals is the first task in constructing a portfolio. Important items to consider are age and how much time you have to grow your investments, as well as the amount of capital to invest and future income needs. An unmarried, 22-year-old college graduate just beginning his or her career needs a different investment strategy than a 55-year-old married person expecting to help pay for a child’s college education and retire in the next decade.

A second factor to consider is your personality and risk tolerance. Are you willing to hazard the potential loss of some money for the possibility of greater returns? Everyone would like to reap high returns year after year, but if you can’t sleep at night when your investments take a short-term drop, chances are the high returns from those kinds of assets are not worth the stress.

Clarifying your current situation, your future needs for capital, and your risk tolerance will determine how your investments should be allocated among different asset classes. The possibility of greater returns comes at the expense of greater risk of losses (a principle known as the risk/return tradeoff). You don’t want to eliminate risk so much as optimize it for your individual situation and lifestyle. For example, the young person who won’t have to depend on his or her investments for income can afford to take greater risks in the quest for high returns. On the other hand, the person nearing retirement needs to focus on protecting his or her assets and drawing income from these assets in a tax-efficient manner.

Conservative vs. Aggressive Investors

Generally, the more risk you can bear, the more aggressive your portfolio will be, devoting a larger portion to equities and less to bonds and other fixed-income securities. Conversely, the less risk you can assume, the more conservative your portfolio will be. Here are two examples, one for a conservative investor and one for the moderately aggressive investor.

Step 2: Achieving the Portfolio

Once you’ve determined the right asset allocation, you need to divide your capital between the appropriate asset classes. On a basic level, this is not difficult: equities are equities and bonds are bonds.

But you can further break down the different asset classes into subclasses, which also have different risks and potential returns. For example, an investor might divide the portfolio’s equity portion between different industrial sectors and companies of different market capitalizations, and between domestic and foreign stocks. The bond portion might be allocated between those that are short-term and long-term, government debt versus corporate debt and so forth.

There are several ways you can go about choosing the assets and securities to fulfill your asset allocation strategy (remember to analyze the quality and potential of each asset you invest in):

• Stock Picking: Choose stocks that satisfy the level of risk you want to carry in the equity portion of your portfolio; sector, market cap, and stock type are factors to consider. Analyze the companies using stock screeners to shortlist potential picks, then carry out more in-depth analysis on each potential purchase to determine its opportunities and risks going forward. This is the most work-intensive means of adding securities to your portfolio, and requires you to regularly monitor price changes in your holdings and stay current on company and industry news.
• Bond Picking: When choosing bonds, there are several factors to consider including the coupon, maturity, the bond type, and the credit rating, as well as the general interest-rate environment.
• Mutual Funds: Mutual funds are available for a wide range of asset classes and allow you to hold stocks and bonds that are professionally researched and picked by fund managers. Of course, fund managers charge a fee for their services, which will detract from your returns. Index funds present another choice; they tend to have lower fees because they mirror an established index and are thus passively managed.
• Exchange-Traded Funds (ETFs): If you prefer not to invest with mutual funds, ETFs can be a viable alternative. ETFs are essentially mutual funds that trade like stocks. They’re similar to mutual funds in that they represent a large basket of stocks, usually grouped by sector, capitalization, country, and the like. But they differ in that they’re not actively managed, but instead track a chosen index or another basket of stocks. Because they’re passively managed, ETFs offer cost savings over mutual funds while providing diversification. ETFs also cover a wide range of asset classes and can be useful for rounding out your portfolio.

Step 3: Reassessing Portfolio Weightings

Once you have an established portfolio, you need to analyze and rebalance it periodically, because changes in price movements may cause your initial weightings to change. To assess your portfolio’s actual asset allocation, quantitatively categorize the investments and determine their values’ proportion to the whole.

The other factors that are likely to alter over time are your current financial situation, future needs, and risk tolerance. If these things change, you may need to adjust your portfolio accordingly. If your risk tolerance has dropped, you may need to reduce the number of equities held. Or perhaps you’re now ready to take on greater risk and your asset allocation requires that a small proportion of your assets be held in more volatile small-cap stocks.

To rebalance, determine which of your positions are overweighted and underweighted. For example, say you are holding 30% of your current assets in small-cap equities, while your asset allocation suggests you should only have 15% of your assets in that class. Rebalancing involves determining how much of this position you need to reduce and allocate to other classes.

Step 4: Rebalancing Strategically

Once you have determined which securities you need to reduce and by how much, decide which underweighted securities you will buy with the proceeds from selling the overweighted securities. To choose your securities, use the approaches discussed in Step 2.

 When rebalancing and readjusting your portfolio, take a moment to consider the tax implications of selling assets at this particular time.

Perhaps your investment in growth stocks has appreciated strongly over the past year, but if you were to sell all of your equity positions to rebalance your portfolio, you may incur significant capital gains taxes. In this case, it might be more beneficial to simply not contribute any new funds to that asset class in the future while continuing to contribute to other asset classes. This will reduce your growth stocks’ weighting in your portfolio over time without incurring capital gains taxes.

At the same time, always consider the outlook of your securities. If you suspect that those same overweighted growth stocks are ominously ready to fall, you may want to sell in spite of the tax implications. Analyst opinions and research reports can be useful tools to help gauge the outlook for your holdings. And tax-loss selling is a strategy you can apply to reduce tax implications.

Expanding into a new market is not an easy endeavour for any company, regardless of the size. It requires financial and human resources that need to be justified. In addition to that, any new market or product takes away from your existing focus which, on its own, is incredibly important.

The process I describe here is how I have approached product positioning for new markets at my current job. Whether it’s expanding products or testing new distribution channels in the UK or launching in China, both the business and sales teams can truly benefit from involving the product and marketing team from the start. Because asking the right questions, coming up with hypotheses, and testing ideas is what we do every day. We spend the time to understand our customers.

Because asking the right questions, coming up with hypotheses, and testing ideas is what product and marketing does every day.

I have divided the process into three main steps; developing a hypothesis, conducting extensive researching, and making hard decisions.

Step 1. Developing a hypothesis: what do we think we know and are we right?

There is a reason why you’ve decided to look into expanding into a new market. In this step, we need to understand what those reasons are. It’s usually not one person’s opinion that has triggered this process. Begin by asking your team members two key questions: emphasise that you’re looking for their answer and not the right answer. You want honest reasons that explain why this market is interesting to your team members.

(i) Why now?

• Why are we going to this market now? Here, try to think of more reasons other than opportunistic deals that have come our way.
• What’s going on in the market that is exciting to you? What has lured us into this new venture?

(ii) Who is our customer in this market?

• Who are the potential buyers of our products and services?
• Why do they care about our service/product?
• Why doesn’t this product already exist in this market?
• What are the top priorities of the potential partners? What are their biggest use cases?

Step 2. Researching: All that I can learn.

(i) Competitors

Don’t tell me you don’t have any competitors. If not in the more direct way, you must have some indirect competitors. What insurance companies are currently operating in this market? What products are they selling that directly or indirectly compete with what you’re selling?

Things to consider:

• Specific insurance product landscape. What are incumbents selling? Did they stop selling a product? See if you can learn about the failed products.
• Prices, premiums, and coverage. What is being covered for how much?
• How are the products being delivered and distributed? Online, brokers, agents…
• Product details. What’s included and what’s not covered. What are the products called? (This matters too, trust me.)
• What are the competitor’s USP’s and who are they targeting? Can you guess why?

(ii) The market: Insurance

This step requires you to stay curious. Feel free to go off tangent and explore. Let the information you find lead you to learn more about the market. Like an investigative journalist let the story develop as you ask more questions.

This step can begin by reading all the market reports published by the consulting firms. I wouldn’t suggest reading them all, but for some markets, especially fast-moving ones like China, it’s important to read the latest reports. Look at what the reports say about the insurance industry for the past two years and their predictions. Take it with a grain of salt. Consultants and analysts can also be wrong. Learn what you need to better understand what’s happening in that market and make notes of the trends.

Next, read about the latest insurtech and fintech activities in that country. This includes investments, M&A’s, and potential closings of companies. In addition to insurtechs which are selling the same insurance product as you, what other insurance products are being sold through online distributions in that market? What stands out? For example, for China Xian Hu Bao’s model of a membership-based supplement to conventional health insurance stood out to me. My curiosity led me to investigate this further, realizing that the speed with which the company grew doesn’t compare with any other insurance product. Why? and how did they expand in such a regulated market so fast? Well, I found out they call it a membership because it’s not an insurance product. Also, by using Alipay and Ant Financial, they have positioned their product as part of an existing ecosystem, rather than a standalone product.

Finally, what are the insurance buying behaviours in this market? Who’s buying insurance and from whom? In China, it was surprising to see that many people prefer to buy insurance from an acquaintance than a broker. Or that families decide to buy insurance together, many times a family member buys insurance for the rest of the family members. Again, I looked deeper into this topic. How are families structured in China compared to western countries? I learned a lot about the family dynamic here, and believe it or not, insurance is a very sensitive topic within the Chinese families these days.

(iii) Secondary markets: the healthcare system, automotive industry, or investment appetite

I come from the world of healthcare and am very familiar with the industry: my own Canadian company operated in the health and mental health space, but I still managed to be surprised by the many things I learned by researching the Chinese healthcare system. For example, there are people in China whose job is to go to the hospitals in the morning and take a number and wait in the queue. They then sell that number/spot to patients who want to see the doctor that day.

At this stage, speak to anyone willing to speak to you! For research, start by reading more about the industry, don’t shy away from reading popular news outlets and Buzzfeed-like websites. It’s important to see what’s being said about the system on these platforms.

• Ask personal questions. Would your family do this? Where would you go personally to search for X?
• How often do people do that?
• Can I follow up with you regarding this to see the sources of the numbers?

Step 3. Making the hard decisions: building and testing products and messaging.

(i) Product(s) check-in: Do we have something this market needs?

It’s possible that the answer to this question is no, and that’s okay. This step is a check-in to measure if you have a deep understanding of the market’s needs as well as your company and product’s capabilities.

(ii) Who will benefit most from our existing product or potential product that we will build?

This is when you go back to the hypothesis from the beginning of the process and see if you were right about whom to target.

(iii) What stands out as barriers to entry?

Is it customer behaviour, price and resources needed to educate the market or compete with the existing competitors? Keep an eye out for barriers for insurance products and your product specifically.

1. IV) What can you do with product positioning to address these barriers?

Bringing your learnings together, this final stage is all about working to define aspects of your product or marketing tactics that have a strong answer to the market’s problems.

Being a unique selling point, this will differ for each product and the company’s capabilities. At Medigo we know that our product is unique in its ability to provide high-quality medical treatments as a result of a claim. One of the major competitive advantages we have in any market is our breadth of experience providing international access to exceptional healthcare services. So when I look at our presence in the Chinese market, I can find ways to emphasise this to gain the trust of the potential buyers of our Cancer and Critical Illness product.

In summary, there is great value in adding a product positioning exercise to the market research phase of opening up new markets. The best time for this exercise is after the business and research teams have conducted initial research, spoken to some potential partners/investors, and have some first hand experience speaking with other active companies in the insurance space.

As for who should conduct this exercise of product positioning, I would say someone with experience in product development, marketing, and ideally strategy. This person needs to be neutral and very good at bringing people together. All departments including operations, sales and of course the leadership team need to be involved in developing a hypothesis and validating the product strategy.

Value chain analysis is a framework developed by Michael Porter that divides the company into primary and secondary activities related to delivering a product or service. The primary activities include inbound logistics, operations, sales and marketing, and outbound logistics. The secondary activities are supporting activities and include the firm infrastructure, human resources, information technology, and procurement.

The components of the value chain

A closely related concept is the supply chain. A supply chain is defined as the connected activities related to the creation of a product or service up through the delivery of the product to the customer. It includes upstream suppliers as well as downstream activities such as wholesalers and distribution warehouses. Figure illustrates the supply chain.

In general, the terms value chain and supply chain can be used interchangeably; although the value chain is rooted in the strategic planning literature, the supply chain is linked to the work in the operations management area. The key concept is that products and services have to be created and eventually delivered to consumers and the in-between activities can be referred to as the supply chain or the value chain.

The supply chain is an important visual tool because it can be used to understand where to look for processes that can be reengineered. That is, improvements can be made in connecting, coordinating, and controlling activities across linkages. It can also be used to determine what kind of information should be gathered to improve communications throughout the value chain and where value chain performance could be improved. For example, the firm can investigate where information technology can be marshaled to support the supply chain activity and where technology can be used to automate tasks. The goal, of course, is to reduce transaction costs up and down the supply chain. Transaction costs refer to the effort that goes into choosing, organizing, negotiating, and entering into agreements for products and services. Transaction costs come in a variety of flavors and there is significant overlap among the various costs.

• Search costs: In general, these costs are related to gathering information on a product or service, including the costs associated with locating a product and offering a product for sale.
• Discovery costs: These costs are involved in locating an acceptable price for a product.
• Decision costs: These costs are associated with making a decision on what product to purchase. These include personal cognitive effort and organizational decision processes related to selecting a product or service.
• Negotiation costs: These costs are related to agreeing to the terms of a contract including the price, what will be delivered, how much, and when.
• Acquisition costs: These costs are involved in transporting, receiving, infrastructure development, and managing the product in inventory.
• Enforcement costs: These are the costs that the parties in the contract incur in order to enforce the terms of the contract.
• Settlement costs: These are the costs related to paying and getting paid for a product or service.
• Social costs: These include costs that are not necessarily picked up by the buyers and the sellers. Examples include pollution costs, health costs, privacy costs, and bankruptcy costs.

Supply Chain Analysis

Supply chain analysis is the process of evaluating every stage of a supply chain starting from the time the business acquires raw materials or supplies from its suppliers to the delivery of final products to the customers. The purpose of the analysis is to determine which part of the supply chain can be improved or shortened to deliver the product more quickly and efficiently to the customers. The philosophy behind supply chain analysis is that the more flexible a business can be, the faster its growth rate will be.

Supply chain analysis helps businesses identify the suppliers and/or processes that can be bypassed, reduce inventories, schedule events and programs, and improve forecasts. This increases efficiency, reduces costs and minimizes risks. It helps businesses optimize their processes to remove redundancies in the supply chain while helping create new value-added processes.

Conducting a supply chain analysis involves the following steps:

1. Mapping the Supply Chain

This involves identifying all the organizations, people, activities, information and resources involved in the supply chain and creating a flowchart to obtain an overview of the chain, the flow of raw materials and product, the position and function of chain actors and the type of interaction between the actors.

2. Developing Economic Accounts Corresponding to Each Actor Involved in the Supply Chain

This involves quantifying the activities of each actor and contribution to the flow of materials both in physical and monetary terms. It helps the analyst assess the importance of the actor in the chain and to point out where the weaknesses lie and how they can be rectified.

To start a complete supply chain analysis, you need to collect data pertaining to every actor and every stage of the supply chain. This requires a lot of research and hard work. Most small and midsize businesses rely on manual methods of data collection and the use of spreadsheets, such as Microsoft Excel, for analysis.

A faster and easier way to conduct the analysis is to use a software program to automate the process. Such a program can extract information from all the different sources into one console removing the need for tedious and time consuming manual data collection. You can analyze shipping schedules, improve transportation and inventory planning, increase transportation management efficiency and track just-in-time delivery metrics.

Some top of the line software programs for supply chain analysis have advanced and useful features like data blending and cross-data source triggers, built-in geocoding, built-in calculation support, connectivity to external web services and support for WMS mapping services. The programs require considerable investment, but the saving on time, efficiency and accuracy amply compensates for that.

Insurance Regulatory and Development Authority of India (IRDAI), is a statutory body formed under an Act of Parliament, i.e., Insurance Regulatory and Development Authority Act, 1999 (IRDAI Act 1999) for overall supervision and development of the Insurance sector in India.

The powers and functions of the Authority are laid down in the IRDAI Act, 1999 and Insurance Act, 1938. The key objectives of the IRDAI include promotion of competition so as to enhance customer satisfaction through increased consumer choice and fair premiums, while ensuring the financial security of the Insurance market.

The Insurance Act, 1938 is the principal Act governing the Insurance sector in India. It provides the powers to IRDAI to frame regulations which lay down the regulatory framework for supervision of the entities operating in the sector. Further, there are certain other Acts which govern specific lines of Insurance business and functions such as Marine Insurance Act, 1963 and Public Liability Insurance Act, 1991.

IRDAI adopted a Mission for itself which is as follows

• To protect the interest of and secure fair treatment to policyholders;
• To bring about speedy and orderly growth of the Insurance industry (including annuity and superannuation payments), for the benefit of the common man, and to provide long term funds for accelerating growth of the economy;
• To set, promote, monitor and enforce high standards of integrity, financial soundness, fair dealing and competence of those it regulates;
• To ensure speedy settlement of genuine claims, to prevent Insurance frauds and other malpractices and put in place effective grievance redressal machinery;
• To promote fairness, transparency and orderly conduct in financial markets dealing with Insurance and build a reliable management information system to enforce high standards of financial soundness amongst market players;
• To take action where such standards are inadequate or ineffectively enforced;
• To bring about optimum amount of self-regulation in day-to-day working of the industry consistent with the requirements of prudential regulation.

Entities regulated by IRDAI

(i) Life Insurance Companies: Both public and private sector Companies

(ii) General Insurance Companies: Both public and private sector Companies. Among them, there are some standalone Health Insurance Companies which offer health Insurance policies.

(iii) Re-Insurance Companies

(iv) Agency Channel

1. Intermediaries which include the following:

• Corporate Agents
• Brokers
• Third Party Administrators
• Surveyors and Loss Assessors.

Regulation making process

• Section 26 (1) of IRDAI Act, 1999 and 114A of Insurance Act, 1938 vests power in the Authority to frame regulations, by notification.
• Section 25 of IRDAI Act, 1999 lays down for establishment of Insurance Advisory Committee consisting of not more than twenty five members excluding the ex-officio members. The Chairperson and the members of the Authority shall be the ex-officio members of the Insurance Advisory Committee.
• The objects of the Insurance Advisory Committee shall be to advise the Authority on matters relating to making of regulations under Section 26.
• Accordingly the draft regulations are first placed in the meeting of Insurance Advisory Committee and after obtaining the comments/recommendations of IAC, the draft regulations are placed before the Authority for its approval.
• Every Regulation approved by the Authority is notified in the Gazette of India.
• Every Regulation so made is submitted to the Ministry for placing the same before the Parliament.

The Authority has issued regulations and circulars on various aspects of operations of the Insurance companies and other entities covering:

• Protection of policyholders’ interest
• Procedures for registration of insurers or licensing of intermediaries, agents, surveyors and Third Party Administrators;
• Fit and proper assessment of the promoters and the management
• Clearance /filing of products before being introduced in the market
• Preparation of accounts and submission of accounts returns to the Authority.
• Actuarial valuation of the liabilities of life Insurance business and forms for filing of the actuarial report;
• Provisioning for liabilities in case of non-life Insurance companies
• Manner of investment of funds and periodic reports on investments
• Maintenance of solvency
• Market conduct issues

Supervisory Role

The objective of supervision as stated in the preamble to the IRDAI Act is “to protect the interests of holders of Insurance policies, to regulate, promote and ensure orderly growth of the Insurance industry”, both Insurance and Reinsurance business. The powers and functions of the Authority are laid down in the IRDAI Act, 1999 and Insurance Act, 1938 to enable the Authority to achieve its objectives.

Section 25 of IRDAI Act 1999 provides for establishment of Insurance Advisory Committee which has Representatives from commerce, industry, transport, agriculture, consume for a, surveyors agents, intermediaries, organizations engaged in safety and loss prevention, research bodies and employees’ association in the Insurance sector are represented. All the rules, regulations, guidelines that are applicable to the industry are hosted on the website of the supervisor and are available in the public domain.

Section 14 of the IRDAI Act, 1999 specifies the Duties, Powers and functions of the Authority. These include the following:

• To grant licenses to (re) Insurance companies and Insurance intermediaries
• To protect interests of policyholders,
• To regulate investment of funds by Insurance companies, professional organizations connected with the (re)Insurance business; maintenance of margin of solvency;
• To call for information from, undertaking inspection of, conducting enquiries and investigations of the entities connected with the Insurance business;
• To specify requisite qualifications, code of conduct and practical training for intermediary or Insurance intermediaries, agents and surveyors and loss assessors
• To prescribe form and manner in which books of account shall be maintained and statement of accounts shall be rendered by insurers and other Insurance intermediaries.

To create a brand, a truly great brand is one of the most powerful ways a business can differentiate it business, products or services from its competitors. Not only will a strong brand make customers sit up and take notice but it will allow your business to charge a premium over its competitor, build customer loyalty, drive sales and accelerate product differentiation in the market.

Your brand isn’t just an add-on to be considered as and when. It should be right at the centre of your business, affecting everything you do and simultaneously reflecting the sum of everything you do. It is, in essence, both the cause and effect of all your actions.

A brand is not just a logo, it’s the collective emotional response to the logo and other elements. Your branding is all geared towards generating that response.

Branding

A brand is a promise of a particular experience that has been created through the sum of various elements including the logo and tagline, the brand personality, promise, messaging and the visual elements.

The process of branding is building that brand, all the way from designing the logo, doing research into the name, working through the attributes, doing the focus group work branding is part of the business you are building.  Much like a Method actor lives and breathes his or her character, so too should a business live and breathe its brand if it wants to convince customers. Creating a brand, like an individual personality, is based on a set of behaviours and characteristics with the strength and consistency of these impacting on its effectiveness.

Advantages of branding

Branding is one of the most effective ways to separate your business from the rest of the market and build a loyal customer base but it also has many other benefits at the very least helping you to establish and grow your business among many other benefits.

Your business direction

Without the sense of purpose a brand gives you, how do you know if the direction you’re heading in is the right one for your business, or if the decisions you’re making are in keeping with the ideals of your business and customers? The decisions you make and the directions you choose can reinforce or completely undermine what your company stands for.

Nike’s co-founder, Philip Knight, once put it like this: “We wanted Nike to be the world’s best sports and fitness company. Once you say that, you have a focus. You don’t end up making wing tips or sponsoring the next Rolling Stones world tour.”

Your business growth

Every business needs to innovate its approach, products and services to grow. But a brand provides the DNA for that growth, rather than inhibiting it. Your brand is the seed that grows the plant of your growing business. The plant may have different aspects to it like products and services that change with the times. But they’re still underpinned by the DNA in that seed that is your brand. Your core values will always be visible, as will the consistent customer experience you provide. Growth without a brand in mind can see your customers desert you in their droves.

Your customer base

Your brand is the focus that keeps you building a solid, loyal customer base. Because when you consider your brand in everything you do, you’re essentially asking yourself the question: “How will this product [or service] impact on our customers’ lives? How will it make them feel differently than competitor products on the market?” These considerations are fundamental to the success of your business, which is why branding must be considered from the word go.

Your business reputation

Your brand gives you the ability to stand out from the crowd, particularly in competitive markets. How well you deliver on your brand promises and strengthen your brand through every area of your business can help make or break your business reputation. And there are few things more valuable to both maintaining existing customers and attracting new ones than a good, solid reputation.

Your customer communications

Every possible contact your business has with a new or existing customer should enforce your brand values. That doesn’t mean you need to be shoving what you stand for down your customers’ throats every time you answer the phone. It just means the way you interact with customers should be thought through and in keeping with your vision and purpose.

Every time you communicate with a customer or prospect, your brand should be felt whether this is through your advertising and promotional activities or customer-facing communications. Your brand is your DNA so make sure it works its way upwards through every layer of your organization.

What to consider when creating a brand

Coming up with a name and a logo at a minimum requires a huge amount of effort and research, the whole process of creating a brand is even more complex and time-consuming. So in order to help here’s a list of the things you should be aware of and consider when creating and building your brand.

A brand should reflect your core values

Everything you do, or what anyone working with you does, will reflect the brand. If you solve problems fast, save people money, do what you say you will listen to your customers, etc., all of this will be translated in their minds as what your business represents. When I work with any start-up, the last thing on my mind is building the brand. First, I want to know what they do differently and make sure that every form of communication and interaction with the outside world is consistent tone, messages, look and feel of the website, fact sheets, logo, etc. This is a pain and can be tricky but does not cost a fortune to do and is, in essence, how you build your brand.

Ultimately if you wish your business to mean/represent one thing and the feedback you get from the outside world is different, you have what is termed ‘brand dissonance’. In plain terms, listen up and change what needs to be changed! The devil is in the detail here, but it’s a question of making sure everything you are working on is consistent and comes across in the way you want. The next issue is to get those around you to do likewise; another challenge for another day.

In essence, your brand represents both who you are as an individual and what your business is as an enterprise. To start with, there is no difference between the two, but as your business grows this will come to mean different things, which in turn presents other issues. But irrespective of what you think about branding, it is ultimately a measure of your success; do things well, and its valuation will grow and with it.

The desired feeling you wish to communicate

What feeling is your product or service going to give the consumer? What is the desire or need it will fulfil? It might be the desire for freedom, safety, confidence or success, or something completely different. Understanding your audience is key their age, sex, ethnicity, income, education level and locale. What motivates them to buy? How do they think?

Once you’ve identified the purpose, define it as succinctly as you can as it will form the basis of your branding efforts. Consider this commonly used core purpose or mission: “We strive to meet or exceed expectations through exceptional service and a dedication to quality”. The problem with this is that it’s too ambiguous, it could belong to any number of businesses and so doesn’t differentiate the company from its competitors. It doesn’t tap into the hearts and minds of customers. So strive to identify exactly what does and make sure it’s something inspiring, specific and believable.

From this, you will be able to define your values which set out how you get your customers to that ‘place’ you’re taking them in their minds. This is not about your own personal values, this is your company’s values which underpin the purpose you’ve defined. They should reflect the vision, culture, and goals of the company and clarify what you stand for and why you do business the way you do. Core values focus on the “why”, more than the “how”. Why are these qualities the key to success? Leave room for these values to develop into new and exciting interpretations of possibilities later down the line, allowing your company to adjust and adapt in a changing world.

The more work you do in this area, the less you will need to spend on your branding and graphic design in the long run, as you’ll be able to approach your chosen branding or graphic design professionals with a clear outline of your core purpose and values. It costs you more in the long run if you don’t know what your brand is and can’t share it.

Create a brand message that is clear, compelling and consistent

Imagine you don’t know a thing about your company. Now tell yourself the key message you want customers to hear. Do you get a clear picture in your mind of the benefit to you as the customer? If not, why not? Have another look at your proposition and whittle it down to what distinguishes you. Is it price? Quality? Innovation? Or something else.

Use the ‘so what?’ Test to decide whether or not your USP is compelling. Read your USP to yourself. Does it warrant the response ‘so what?’ If so decide what you’re trying to say about the benefit you deliver and repeat the ‘so what?’ test until you have a truly compelling USP.

Once you’ve nailed it, be consistent, both in communication and in practice. You don’t have to be the best, just the most consistent. Few would argue that a Mr. Whippy is the best ice-cream in the world for example. But we know what it is, how it will look and taste and we can see at a glance which ice-cream vans stock it – and it’s been the same as long as we can remember. And these are the factors that sometimes make us want one, even though it’s not necessarily our most favourite ice-cream in the world! Consistency helps build trust and loyalty which are invaluable to your brand.

Understanding your customers

To create a brand that is successful requires you to understand the values of your target audience and focus your offering on these customers. Trying to be all things to all people will only dilute and confuse the strength and message of your brand.

Effective brand positioning and brand promise

The brand positioning is how the brand is perceived in the context of competitive alternatives. Brand positioning needs to remain consistent throughout all your marketing efforts, or customers will become confused. The brand promise addresses customers’ expectations about a product or service. Examples of brand promises include Coke’s, “To inspire moments of optimism and uplift” and Google’s, “To provide access to the world’s information in one click”.

Keeping your brand real

If you want people to buy into your brand, make it believable. Instead of claiming perfection, claim something more unique, justifiable and in keeping with your brand. Again, think of your company as a person. What kind of person goes around claiming perfection? More than likely someone you wouldn’t necessarily want to associate with or believe.

Creating brand elements (Logo, name…)

Creating a brand is about more than just a catchy name – it is about creating a whole identity for your business and the products or services it sells. Once you’ve answered some or all of questions above and have some clarity of what you want your brand to me its time to start creating some branding elements, not least a name, logo and visual identity.

Brand name

When choosing your name, it’s a good idea to bear in mind what a useful tool it is in getting across to customers the benefit of using your business instead of your competitors’. After all, it’s the first thing your customers are going to see, and they’ll base split second judgements on it. Which is why it’s so important that it’s memorable and gives the right first impression. The perfect recipe for success is a good name combined with good branding.

One method which can be useful for inspiring trustworthiness is to link your business’ name to the area in which you operate – customers associate such firms with strong local roots and a friendly approach. Humour or a play on words can help your business stand out, but the overriding aim is to make sure that whatever you choose is snappy, original and instantly informs the customer what the business does.

You’ll also need to bear in mind that your business name will dictate which Web domain you can register and your trademark if applicable.

Brand logo

Next, you need an eye-catching logo to be used alongside the brand indeed in some cases instead of the brand. Successful logos include the Nike ‘swoosh’, the London Underground symbol and Mcdonald’s golden arches. You know when brand identity is working when consumers can recognise your brand from the logo only they just know it.

Most successful businesses will tell you that logos matter a lot. In the early days of your new business especially, perception is everything. So investing a little money to encourage the perception that you’re professionals is pretty high up the agenda for the vast majority of new businesses.

You’ll want to work toward something smart, not just something pretty. What I mean by that is you need to begin with a thought: What is the emotional response (worked out in step one) that you want your product to elicit? What else can you think of that will help people understand not just what you do but how you’re different from your competitors?

Brand indentity & visual identity

Finally, you need to create a strong identity for your business which runs through everything you do. To do this, you need to firmly establish what your company stands for. Do you want to be seen as a funky cutting-edge high fashion business, for example, or would you rather be seen as solid, dependable and reliable? What is the core idea of the company and the message you want to project? You can come up with the most fantastic name and logo, but if you have no vision or proposition for the company, then it’s just not going to work.

Creating brand assets and marketing materials

If your website, stationery, etc. exude and reinforce your values, your brand will be strengthened. But if they don’t, your brand and your business could be seriously damaged. For example, your product could genuinely be of a high quality. You may have sourced the very best components available. But if you’ve got a naff, clip-art logo and poor quality stationery, that undermine your promises of quality, you’re fighting a losing battle with customers. You can tell them your product is superior until you’re blue in the face. If they do not see that message reflected consistently in every area of your business, they’ll head to a supplier they’re more sure of instead.

Protecting your brand

Branding isn’t a one-off event- your brand needs to be continually protected. Take out trademarks to safeguard your brand name, logo and tagline. You can also use trademarks to protect phrases and groups of words that you use as part of your brand. You can apply for trademarks online via the Intellectual Property Office website. Protect designs associated with your business by registering them under UK Design Protection, again through the Intellectual Property Office. Make sure you continually monitor your brand identity to ensure that it remains relevant. Remember that brands can be tweaked and refreshed along the way.