Increasing liberty insurances brand awareness in order to bee in the top 5 of non life insurers in vietnam by 2014

LE THUY KIM LOAN INCREASING LIBERTY INSURANCE’S BRAND AWARENESS IN ORDER TO BE IN THE TOP 5 OF NON- LIFE INSURERS IN VIETNAM BY 2014 MASTER PROJECT MASTER IN BUSINESS & MARKETING MANAGE

LE THUY KIM LOAN

INCREASING LIBERTY INSURANCE’S BRAND AWARENESS IN ORDER TO BE IN THE TOP 5 OF NON-

LIFE INSURERS IN VIETNAM BY 2014

MASTER PROJECT MASTER IN BUSINESS & MARKETING MANAGEMENT

Tutor’s Name: Dr Le Thanh Long

Ho Chi Minh City

2012

COMMITMENT

I commit that I researched, collected materials, synthesized, analyzed and wrote this dissertation by myself under directive professors’ help All information and figures which are used in this dissertation originate from clear, honest and publishable sources

ACKNOWLEDGEMENTS

Firstly, I would like to express heartfelt thanks to Doctor Le Thanh Long who encouraged and directed me with all his heart on the way of this project, and helped me

to finish this dissertation

I would like to express my deep acknowledge to Mr Pham Truong Khanh - Marketing Director of Liberty Insurance Company With valuable advices, relevant information and recommendations, he support me a lot during this study

I would also like to express my deep gratitude to Professors, Coordinators in Open University for their guide

I would also like to thank to friends and colleagues in insurance companies and universities, who provided me with abundant relevant information for this dissertation

My special thanks go to my family and relatives, who have continuously given me the inspiration to complete this dissertation

Thank you very much!

TABLE OF CONTENTS

COMMITMENT 1

ACKNOWLEDGMENTS 2

LISTS OF TABLES AND FIGURES 5

APPENDIX 1 LIBERTY BRAND AWARENESS RESEARCH 42

APPENDIX 2 NON-LIFE INSURERS IN THE MARKET IN 2011 43

APPENDIX 3 BRAND AWARENESS OF NON- LIFE INSURERS IN 2011 46

APPENDIX 4 ADVERTISING PICTURES 47

REFERENCES 56

CHAPTER 1: INTRODUCTION 1.1 Background of project 6

1.2 Objectives of project 7

1.3 Scope of the project 7

1.4 Methodology 7

CHAPTER 2: LITERATURE REVIEW 2.1 Brand awareness 8

2.1.1 Definition 8

2.1.2 Brand awareness establishing 8

2.1.3 Brand awareness components 8

2.1.4 Brand awareness building steps 8

2.2 Brand awareness through audience tool of communication 9

CHAPTER 3: OVERVIEW OF NON-LIFE INSURANCE INDUSTRY

3.1 Overview of non- life insurance industry 11

3.1.1 The concept of non-life insurance 11

3.1.2 Insurance purpose 11

3.1.3 Non-life insurance market in 2011 12

3.2 Overview of Liberty insurance company 15

3.2.1 Introduction of Liberty insurance company 15

3.2.2 Brand awareness of Liberty insurance company 18

3.2.3 Brand strategy of Liberty insurance company 19

3.3 Overview of competitors in non-life insurance market in Vietnam 20

3.3.1 Major competitors in the market 20

3.3.2 Brand awareness of competitors 21

3.3.3 Brand strategies of competitors 22

CHAPTER 4: SOLUTION AND IMPLEMENTATION 4.1 Brand awareness analysis 28

4.2 Solution 28

4.2.1 Stage 1 plan 33

4.2.2 Stage 2 plan 36

CHAPTER 5: CONCLUSIONS 5.1 Conclusion 40

5.2 Limitations of the projects 40

5.3 Recommendation 41

LIST OF TABLES & FIGURES

Number Page

1 Table 1 Gross Written Premium 13

2 Table 2 Top 5 companies in awareness 21

3 Table 3 Budget on communication plan 37

4 Table 4 Communication plan schedule 37

5 Figure 1 Gross Written Premium 14

6 Figure 2 Top 15 insurers on gross written premium 15

7 Figure 3 Product classification 17

8 Figure 4 Brand Awareness of Liberty in 2008, 2009, 2010, 2011 18

9 Figure 5 Brand awareness of competitors 21

10 Figure 6 Buyer readiness stages 29

11 Figure 7 Audience response in communication 30

12 Figure 8 The Liberty logo 30

13 Figure 9 Audience tool for building brand awareness 32

Liberty is the insurance company 100% owned by the U.S enter the Vietnam market in

2007, after 4 years of Liberty has achieved a certain success and is considered the company with fast growth quickly in the market for non-life insurance Of the 28 companies for non-life insurance, the Liberty is ranked 13th in revenue premium (over

175 billion USD), up 2 levels compared to 2010 and the objectives of Liberty is beyond the top 5 in 2014 Compared to the veteran company operating for over 15 years as Bao Vietnam, Bao Minh, PVI is a foreign company operating a new 4 years is not easy To

do this, the Liberty need a lot of efforts, from increased service quality, product improvement process to invest heavily in the sales team, expanding markets, distribution channels…

Besides the rival companies are moving, constantly for increased market share should rise to the need to lead Liberty to increase the level of effort to identify the highest possible brand, which has increased market share The main reason that the level of brand awareness is considered key objectives to be achieved to contribute to the success

of the company

In that situation, I choose this project to study the state of the communication activities of the company brand in the transition period this analysis of brand communication

activities that are conducting business from which to apply marketing knowledge learned indicate the business has done well and not well Since then, proposed a few minor recommendations subjective opinion to help businesses better able to conduct activities

of their brand communications

1.2 OBJECTIVES OF PROJECT

This project has three major objectives:

(1) Analyze and assess brand awareness situation in non-life insurance market in Viet Nam

(2) Build plan for Liberty to improve awareness as top 5 in the market

1.3 SCOPE OF THE PROJECT

This project has been limited to studying on marketing strategy of Liberty and five competitors in the industry based on secondary data which are mostly collected in Ho Chi Minh and Ha Noi

1.4 METHODOLOGY

The project is developed on the basis of the real concerns of Liberty on the non-life insurance industry in which Liberty has a lot of advantage: the third global company in property and casualty insurer

During literature review, we see that Philip Kotler (Principal of Marketing 2008, page 376) has proposed an effective way to build brand awareness

We first analyze and assess the brand awareness of Liberty then we use Philip Kotler process to build brand awareness

CHAPTER 2: LITERATURE REVIEW

2.1 BRAND AWARENESS

2.1.1 DEFINITION

First, accordingly to Cornell Maple (Bulletin 105, 2007) brand awareness refers to how

aware customers and potential customers are of our business and its products

2.1.2 BRAND AWARENESS ESTABLISH

“The more a customer experiences the brand by seeing it, hearing it, or thinking about

it, the more likely he or she is to strongly register the brand in memory Thus anything that causes consumers to experience a brand name, symbol, logo, character, packaging,

or slogan – including advertising and promotion, sponsorship, and event marketing, publicity and public relations, and outdoor advertising – can increase brand awareness of that brand elements Keller (Strategic Brand Management, 2008)

2.1.3 BRAND AWARENESS COMPONENTS

Brand awareness consists of brand recognition and brand recall performance Brand recognition is consumers’ ability to confirm prior to exposure to the brand when given the brand as a cue Brand recall is consumers’ ability to retrieve the brand from memory when given the product category, the needs fulfilled by the category, or a purchase or usage situation as a cue Keller (Strategic Brand Management, 2008)

2.1.4 BRAND AWARENESS BUILDING STEPS

Philip Kilter (Principle of Marketing 2007) proposed these steps to build plan to maximize brand awareness:

1 Identifying the target audience

2 Determining the communication objective

3 Designing the message

4 Choosing the Media

5 Collecting feedback

2.2 BRANDWARENESS THROUGH AUDIENCE TOOL OF COMMUNICATION

As we know from brand awareness above, “the more a customer experience the brand

by seeing it, hearing it, or thinking about it, the more likely he or she is to strongly register the brand in memory”

Through George E Belch and Michael A Belch in “Advertising and Promotion, p 24”,

we know that the various promotional mix elements are the major tools that marketers use to communicate with current and/or prospective customers as well as others relevant audience

The integrated marketing communication management involves the process of planning, executing, evaluating, and controlling the use of various promotion mix elements to effectively communicate with target audience

Brand awareness building tools include:

 Broadcast media (TV/radio)

 Print media (newspaper, magazines

 Public relationships

 Internet

 Direct marketing

 Sales promotion

CHAPTER 3: OVERVIEW OF INSURANCE INDUSTRY

3.1 OVERVIEW OF NON- LIFE INSURANCE INDUSTRY

3.1.1 THE CONCEPT OF NON-LIFE INSURANCE

Non-life insurance is still used as a general concept of meaning which contain all of the damage for insurance (property insurance, liability insurance) and human insurance not belonging to life insurance (accident insurance, sickness insurance, etc.)

According to the Insurance Business Law Vietnam, the term non-life insurance is explained: "Non-life insurance is property insurance, civil liability insurance and others not contained in life insurance.”

3.1.2 INSURANCE PURPOSE

In general, non-life insurance in particular is known as the method of effective damage transfer, an insurance buyer pays amount of money as insurance fee for an insurance company instead of facing damages that they may encounter On the other hand, the insurance company has to be responsible for damages that their customers have transferred to them One more meaning is that customers who buy life insurance want to transfer the big damages that they cannot suffer to the insurance company Therefore, non-life insurance has been and will never serve the need of enrichment, making profit from people’s idle cash In technical insurance, principles of compensation and subrogation; the method of determining the limits of liability insurance, insurance compensation; share measures of liability for the insurance duplication are valued and done thoroughly All of these issues also largely preserve the meaning: to help the insured to overcome the consequences of material and financial risk – insured event

Besides, because of some very special reasons, more many the non-life insurance contracts are signed: this thing is to meet the regulations on compulsory insurance law, the practices, the conditions required for production and business activities, professional activities and international practice To form non-life insurance up to promote his role,

as well as provide benefits to the community, the law has some quite diverse requirements for this service, but never applies to the type of life insurance Thus, the purpose of non-life insurance is also considered as a very particular characteristic of the insurance field

3.1.3 NON-LIFE INSURANCE MARKET IN 2011

In 2011, the market is potentially more objective factors of the economic - political situation of the world and Vietnam It is inclined positively that monetary policy has been operating more flexible to facilitate economic development It brings about increased demand for insurance, especially for retail insurance products and technical property

This year, the market has changed quite positive, although the status of non-technical competition has not improved much, but in terms of competition, insurers have paid more attention to the work of raising quality after-sales service, ensuring operational safety and variety of products to tap new market segments, reducing competitive pressure of traditional products In particular, online insurance sales channels have been interested and will be the new trend of insurance companies to make channels diverse and make it convenient for customers and cost savings

In 2011, revenue growth of the market in general and insurance companies in particular was moderate; this year appeared more new products, particularly products for individuals These companies will focus on researching and developing new products such as human health insurance, liability insurance, etc Financial insurance products are attended to exploit due to the growth of finance – bank markets In addition, there will

be more products for small and medium enterprises - increased potential customers in the economy

Application of Insurance Business Law’s change creates a fair business environment and more pressure on insurance companies which have to reform and go on to compete in quality In addition, the business performance of enterprises will be improved when they focus on risk management, cost savings, enabling enterprises to mobilize capital as well

as increase profit from financial investments

Table 1: Gross Written Premium

Auto Insurance 3,099,802 2,516,882 Property Insurance 2,679,933 2,038,281 Health Insurance and Presonal Accident 1,314,355 931,299 Hull and P&I Insurance 1,055,012 972,580 Cargo Insurance 839,022 576,010 Explosion and Property All Risk Insurance 618,294 725,350 Aviation Insurance 316,019 249,877 Public Liability 242,852 204,271 Business Interruption Insurance 34,674 17,322 Credit & Financial Risk Insurance 14,229 8,532 Agricultural Insurance 2,959 958 Base on that we have the chart:

Figure 1: Gross Written Premium

Source: Associations of Vietnamese Insurers, 2010 – 2011

In six months of 2011, the total premium of the whole non-life insurance market increased 23.97% over the same period in 2010

Figure 2: Top 15 insurers on gross written premium

Source: Associations of Vietnamese Insurers, 2010 – 2011

3.2 OVERVIEW OF LIBERTY INSURANCE COMPANY

3.2.1 INTRODUCTION OF LIBERTY INSURANCE COMPANY

Liberty Insurance is a 100% U.S - owned general insurer and a member of Liberty Mutual Group

"Helping people live safer, more secure lives" since 1912, Boston-based Liberty Mutual Group is a diversified global insurer and third largest property and casualty insurer in the U.S based on A.M Best Company’s report of 2010 net written premium The Company ranks 82th on the Fortune 100 list of largest corporations in the U.S based on 2010 revenue As of December 31, 2010, Liberty Mutual Group had $112.4 billion in consolidated assets, and $33.2 billion in annual consolidated revenue

0 500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 PVI

Bao Viet

Bao Minh

PJICO

PTI Aviation

BIC AAA

ABIC

MIC Samsung Vina

GIC Liberty

SVIC

Bao Long

Liberty Mutual Group offers a wide range of insurance products and services, including automobile, homeowners, workers compensation, commercial multiple peril, general liability, global specialty, group disability, and reinsurance Liberty Mutual Group (www.Libertymutualgroup.com) employs over 45,000 people in more than 900 offices throughout the world

Liberty has had a presence in Vietnam since 2003 when Liberty Mutual Group opened its first representative office in Hanoi, and was awarded the investment license in November 2006

Liberty is operating a 24/7 multi-functional call center (free) to address all clients’ specific needs and inquiries, from supplying information on products and services to receiving, guiding and following up claims requests in both Vietnamese and English languages Especially, customers using the company website can communicate with Liberty using various interactive options such as voice call, live chat, call-me-back service and email exchange

Liberty has been trusted by more and more customers because they are provided with superior products and services, and the company has also received wholehearted cooperation from its partners because of its professional business processes and advanced technological infrastructure

Figure 3: Product classification

In Jan- 2010 Insurance Company Liberty from the U.S has received many awards for brands such as "Golden Brand 2009", "Trust & Use 2009", and “Golden Dragon 2009" for his efforts in a years of operation

As a foreign business, Liberty invested heavily focused on information technology systems Especially in recent years, Liberty has successfully developed technology to support online sales (Collaborator) By connecting to the server system of Liberty, the insurance agent can print and export contracts to customers after they enter all necessary information With this advanced technology, customers save a lot of time and not have to wait long as before, especially for customers who purchase insurance for automobiles

PRODUCT

PERSONAL LINES

AUTOCARE HOMECARE

through banks and car dealers who are affiliated with Liberty In 2010, Liberty would implement stronger applications for the distribution channel as banks; car dealers have relationships with Liberty nationwide

Liberty is non-life insurance companies 100% owned by United States and a member of Liberty Mutual Insurance Group with headquartered in Boston, USA As one of the 100 largest U.S corporations with assets worth over 100 billion dollars, Liberty Mutual has more than 45,000 employees working in over 900 offices worldwide are ready to serve customers

3.2.2 BRAND AWARENESS OF LIBERTY INSURANCE COMPANY

Market research shows that Liberty’s brand perception in Vietnam is highly positive

● Liberty’s brand name is associated with freedom, both

− Professionally

− Personally

● In combination with insurance, Liberty represents

− Comfort

− Freedom from worries

Figure 4: Brand Awareness of Liberty in 2008, 2009, 2010, 2011

3.2.3 MARKETING AND BRAND STRATEGY OF LIBERTY INSURANCE COMPANY

With marketing trends is utilize from media advertising to multiple forms of communication, from mass media to more specialized (niche) media Liberty’s marketing strategies is lower investment in traditional marketing, higher investment in internet marketing, POS advertising, sales support, and sales promotions, strong investment in direct distribution

Advertising

Liberty continuous to enhance creative designs, keeping print advertisements at the minimum, maintaining modest investment in OOH advertising (billboard, frame, LCD), maintaining office signage rental as needed, email campaigns for cross-selling to existing customers

Liberty made various types of standees to enhance brand presence at points of sales, design and contents of product brochures and production of new corporate brochures including co-branding ones, for direct marketing activities like production and delivery

of electronic X'mas &Tet cards for customers and partners, annual diaries to major partners

Memberships & Alliances

Liberty organize a lot of various co-branding events with partners such as car exhibitions, car test drive, sales seminars, motor show, etc

Participation in business groups, such as AmCham, AusCham, CanCham, InCham, Euro Cham, and Cooperation with Toyota Financial Services on product promotion

Cooperation with Ford Vietnam on customer sales promotion programs

Co-branding activities with Mercedes Benz Vietnam and Toyota Motor Vietnam

Developing relationships with other auto manufacturers and distributors, such as Thaco, Euro Auto

Besides, Liberty is sponsor of many Community Social Responsibility Programs such as Terry Fox Run, charity activity in Quang Binh, AmCham charity balls, Futsal tournament, auto forums’ offline meetings, Otofun’s birthday party

3.3 OVERVIEW OF COMPETITOR IN NON-LIFE INSURANCE MARKET IN VIETNAM

3.3.1 MAJOR COMPETITORS IN THE MARKET

Liberty want to improve brand awareness as top 5 so that we study top 5 competitors:

Table 2: Top 5 companies in awareness

Insurance Company Short name Establishment Type

BIDV Insurance Company BIC 2005 Joint-stock

Bao Viet Insurance Corporation Bao Viet 1965

owned Bao Minh Insurance Corporation Bao Minh 1994 Joint-stockPVI Insurance Corporation PVI 1996 Joint-stockAAA Assurance Corporation AAA 2005 Joint-stock

State-3.3.2 BRAND AWARENESS OF COMPETITORS

Base on secondary data, we have the chart of top 5 companies in awareness

Figure 5: Brand awareness of competitors

3.3.3 BRAND STRATEGIES OF COMPETITORS

A BRAND STRATEGIES OF BAO VIET

Advertising

Develop advertising messages on television: The objective of the message is to create awareness about the brand new Bao Vietnam, transmit to the public for news photo Vietnamese brand new Security energetic, determined strength and stature to large enterprises, broadcast to the public in a brief, brief the main business of the corporation Bao Viet

The advertising messages are shown on the color of the selected newspapers as newspapers and Consumer Marketing, Economic Times clearly aimed at the image of brand new colors, shapes and visual effects

The company promote outdoor advertising in the sales offices, branch offices LED lighting, outdoor logo, banner in public places They placed in the main roads, wide, with good visibility, no guards, at the crossroads, crossroads large, high traffic density, and time signals long wait Also can make advertising on vehicles such as buses, taxis

The company took advantage of the holidays, the anniversary of the nation or other important events to implement communication activities through funding of propaganda banner for the event

Public Relations

The company took advantage of the events of the year to communicate, such as persistence, "1000 years of Thang Long - Hanoi", 37-year struggle for national salvation, death anniversary of Hung Kings festival in Phu Tho

They organized events celebrate 45 years of established corporations These events are major events, attracting the attention of the public and media, will provide very good performance

There were many economic events annually happening in Vietnam This was a good opportunity for them to conduct their promoters in the region and to create a good impression with the world Bao Vietnam made good use of their relationships with government and other incentives for domestic enterprises of the Government to be able

to participate in funding for such important events

Bao Vietnam continued to participate in community activities, but to a wide range of activities and subjects of these activities more Business communications made for these activities better by highlighting the activities, media coverage on television Necessary

to carry out these activities in time, take advantage of the hot events Enterprises should make brand communication activities for the very first employees of the business Urgent need to build a short-term courses for employees, staff training consultants work in which the brand is the official notification to employees about the significance of the logo and brand Encourage employees to use the new logo image as

desktop wallpaper of business and personal computer or mobile phone

Brand communication was done through direct sales activities of the consultants This activity was very effective communication and direct, can calculate the effective communication They invested activities through active communication channels because they recognized that the function of this channel was not just for sales but also features a channel of communication, especially media brand The first thing to do is training, training for counselors the basics about the company’s brand, so they understand and accurately communicate to the customer and then teach them the basic

skills to build corporate brand image through their own good – the consultants of the company – how Contents of courses to help consultants get the soft skills in behavior, dress, use the color of the uniform, how to use the tool to support media brands such as brochures, pens, textbooks and materials in brand image, as well as with customers to explain the meaning of the brand image of the logo, colors, logo

B BRAND STRATEGIES OF BAO MINH

Do Market research, advice the Executive Board to develop and expand markets Develop brand strategy, product strategy, pricing strategy, and development strategy and distribution channels Develop policies and management development agents, customer care policy Depending on the type of product that companies use marketing strategies to suit individual to raise the most competitive Monitoring the changes of market analysis

to make the product fit the needs and changes of the integration period held regularly refer clients consult a basis

TV, newspapers, websites, it helps businesses reach customers, providing customers with product information, helping consumers choose for themselves the right product Regular implementation of the program: giving gifts, discounts … for the long-term loyalty

Outdoor Advertising: On the road we can easily see the type of advertising outside This can mainly created first exposure to this particular message Company should coordinate with advertising on television

Advertising on the Internet: In addition to the ads on their official website, the company has done ads on sites with high traffic and, depending on each product

C BRAND STRATEGIES OF PVI

To improve the image of the first business enterprises should pay attention to improving business efficiency, with all stages of product supply, mining contracts, and provide business operators give customers the best products with the best service attitude, attention to customer care process, guiding customers to choose the right product, to answer any customer queries after signing the same Also frequent attention, create rapport with customers, either by phone calls or send greeting cards on holidays and guiding clients the best way to prevent risks

Regular innovation-stage complaints and settlement of compensation, this stage is often

a huge concern for customers, the settlement will be quick and easy to understand why most customers appreciate the company and become the best promotional tool for the company

To attach importance to building a staff of professional work, and serious attitude of customer service the most dedicated

The activities in the newspaper ads, media also contributed to the reputation of the company's image to customers create trust for clients

PR activities create the relationship "the two-dimensional information", to get feedback from customers, from which businesses can get the changes and new strategies appropriately, better meet customer needs

D BRAND STRATEGIES OF AAA

Advertising in the mass media (newspapers, television, internet, radio, brochure )

Event (event) as the days of childhood, on safe driving, inaugurated or started a project with the presence of the senior leadership, launching new products and services with the emergence the artist's reputation introduce products

PR (public relation) to create a good relationship with their media agencies to introduce

an objective product or service to customers

Participating in organizing many community programs such as charitable activities, training sessions, sponsored scholarships and from which the image of the company's customer base

E BRAND STRATEGIES OF BIC

Organizing various charity programs, occasional gift card free insurance for the poor and orphans in order to bring value to the community and promote the image of BIC to the customer

Invite customers and prospects to attend annual seminars and conferences to introduce new products

Open of the training program, training for distributors, sales people and employees of the company's products and Services Company

Attending and sponsoring the events to good effect to the company's reputation

Strengthen promotion and advertising company's image on a large scale in various forms such as website, newspaper, television