Ham Insurance Company has identified two products, life insurance and child education insurance which it seeks to offer in the global market. Identification of these two products was based on global market research. A research was done to establish what the world still requires in the field of insurance. The research focused on identifying any opportunities that still lie untapped within the sector of insurance. It was established through online research using questions such as what business opportunities are available in the global insurance market. The research established that there are still gaps in the offering of life insurance and education insurance for the children. Moreover, the online research which mainly sampled leading newspapers and blogs related to the topic of insurance business, established that the world was still in dire need of life insurance and education insurance since the two products were still inaccessible to the low and middle-class households globally.
The other method used to ascertain the need for the two products was conducting an online survey on social media networks. The online survey was an open one with respondents from across the world. The survey had only one question with two alternative choices. The respondents had to say whether they thought there was sufficient provision of life and education insurances across the earth relative to the existing demand level. The alternatives were YES or NO. Interestingly, 78% of the respondents gave a NO answer where as 22% were on the YES side.
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Keen following of news in the mainstream media was the third method used to determine the global market opportunity for the two products selected. I followed news on insurance business on CNN International, Sky News, BBC World and Bloomberg. All these mainstream media stations featured comprehensive discussions on the status of insurance globally, especially the field of healthcare insurance. Understandably, education is key factor in the development of good health for human beings. Without good education, children and families cannot have remarkable health. Without education people cannot access employment to fetch income and access healthcare. It implies that education is directly connected to health of human beings. However, mainstream media is full of stories of children who cannot access education because of lack of school fees and other resources. There are also many families across the globe that cannot access healthcare because of scarce money. Such stories gave this organization the realization of what the world now needs in the sector of health insurance.
One competitive advantage that the Ham organization will enjoy by offering the two products includes a larger market share of loyal customers. Moreover, the classes of customers targeted by the organization with the two products is comprised of many people hence this will give it the advantage of large business revenue streams. It is understandable that the low and middle class of people has the majority of consumers relative to the high-end clients.
However, there are risks associated with this business idea. The first idea is that foreign currency rate fluctuations across nations. Depending on the country in which the organization operates, there will be continued fluctuations in the value of money against the United States Dollar. Therefore, to ensure this risk is minimized, the organization will maintain its bank and cash accounts in a standard United States Dollar currency. Moreover, there will be the challenge of experiencing financial and economic crises in some markets because of developments like runaway corruption and political instability during electioneering periods. This risk will be minimized through contracting a team of risk analysis and business forecasting experts who will always be on the look-out to recommend cautionary investment strategies in new markets.
Customer Relationship Management
The work of a business system is connecting all parts of an organization and its interrelated steps for purpose of harmonious functioning. To achieve the set business strategy, a company needs to develop effective business systems. It is important to note that when defined principles and practices are applied to processes and systems aimed at creating value for clients in the market, a business system is built. In a business organization, there are different types of business systems applied in various areas. Some of the application areas where business systems are implemented include manufacturing, enterprise resource planning, customer relationship management and financial control. This paper focuses on the enterprise resource planning business system application area.
In yet another role, going concern function is often considered as an important element within any organization with various stakeholders involved with a company such as the employees, shareholders, lenders, and investors among others keen to make note of in their decision-making processes regarding the company. The decisions made by these stakeholders based on a sustainability score may either impact on the business positively or negatively. Therefore, governments at different levels in all regions of the world are beginning to recognize the importance of addressing the challenges of sustainability faced by businesses. The governments have the role to provide platforms that encourage innovative ideas. Such platforms can include funding for various research projects and setup of Research and Development Centers and business incubators to develop new ideas that might guide businesses in their sustainability path in the face of intense global competitive pressures. The government could also encourage public-private partnerships to ensure that the skills available at the private entity level are borrowed and used to improve the operations of public corporations (Bell, 2002). The government can also encourage sustainability in businesses through various market instruments and other economic measures. Market instruments such as subsidies, reduced taxes and promotion of public procurement policies will create an environment that encourages businesses to embrace sustainability initiatives. For instance, various stakeholders such as investors who would increase their investment proportions in such businesses, as a result, may view companies that are engaged in some procurement procedures with the government in favor. On ethical terms, the involvement of government in the operations of the business is important in minimizing consumer exploitation and preventing businesses from engaging in outlawed activities which have been the basis of public outcry in the recent past.
Today, many organizations are adopting the ERP systems. The cloud computing solutions that are also known as Software-as-a-Service (SaaS) continue to enable adoption of ERP systems. With the presence of the cloud-based computing solutions, the ERP software has become highly affordable to even the low-sized companies. Moreover, cloud computing has also made ER systems easier to use and manage. The ability of using ERP to perform real time reporting is brought about by cloud computing solutions. SaaS-based ERP systems are being adopted widely and the world should expect more of this trend in the foreseeable future. An example of this business system application is the case of Amazon Company, where the NetSuite Cloud ERP is used.
There are many benefits of ERP systems. The first one is that it gives a global and real-time view of data, which enables company managers to solve concerns in time and foster improvement. Importantly, the significance of data to a business company is immense. Business companies rely on data to make decisions. Moreover, global data informs a lot of operations in the company since business leaders react to news as they come. It means that any company must have access to a means, which brings it the required data and news information in real time. This need is well catered for through the use of ERP systems. Therefore, with application of the ERP systems, a company will never go wrong in terms swift adaptation to the market trends and addressing of pressing concerns.
The second value of ERP systems is that it enables a company to improve its financial compliance level with the set regulatory standards. It is also possible for an organization to minimize financial risks. There are regulatory rules supposed to be followed by companies. Many companies fail to observe and comply with the financial regulatory because lack of full knowledge about the specific demands. The ERP systems enable company managers to easily identify compliance requirements for full adherence to them.
The efficiency achieved through the use of ERP systems benefits the customers of a business entity in the end. Automatic operations like order-to-fulfillment and procure-to-pay enable a company to make timely production and delivery of the demanded goods by customers in the market. Timely delivery of goods and services is a major factor, which brings satisfaction to customers of a company. It is important to emphasize that integrating ERP into customer relationship management processes leads to effectiveness and efficiency. ERP systems should be adopted by companies interested in high business performance.
Distribution Channel
In choosing the method for distribution in the global market, a number of considerations will be done. For instance, the business team of the organization will consider the effectiveness of regional trade agreements present. Countries all over the world enter regional trade blocs through which they transact their businesses. In this case, countries have opened boarders for businesses within the bloc. Therefore, countries considered for entry will be those that have established regional trading blocs since they offer the advantage of a large single market for the two new products. The other factors which will be considered include the environmental issues like political stability. The organization will ensure it enters countries that enjoy peace and stability since it is the only factor which supports good business.
The chosen distribution strategy is acquisitions. The Ham organization will be contacting various local companies operating in the insurance industry with a view of acquiring them. Acquisitions will give the company the advantage of full control over its business and ability to make quick business decisions. It is also important to propose that the organization uses the digital commerce platforms and social media as a distribution channel to expedite its market penetration rate.
Major Pricing Strategy
The pricing approach selected in global market entry is quite important since it determines the success of a company. Considering the fact the target market of this insurance company is low and middle class, affordably lower prices in terms of insurance premiums will be set. The company targets customers from the rural villages of nations hence it will be focusing on cost-minimization to enable lower prices . Therefore, his organization will always target to be the choice of budget-sensitive customers relative to the rivals in the market. Prices set by competitors matter in such an industry that is filled with many buyers and sellers making an almost perfectly competitive market structure. Therefore, the major pricing strategy will be setting lower prices affordable to low and middle class people relative to the ones set by other rivals.
Costs Associated with Development and Launch
This product will involve costs related to its development and launch. The development process will include research costs. There will be researchers whose function will be investigating the market structure for the product and its level of demand as well as supply within the market. Launching costs will entail building headquarter office premises and lease expenses for branch offices. The launch ceremony will also involve celebrities called upon for entertainment purpose. They will be paid fees for their performance. Moreover, the launching ceremony will include food which will be bought at an expense of the business.
Consumer Acceptance of Price
It is expected that the consumers in the market will have huge acceptance for this product once it is launched. Considering the fact that the prices set are targeted at the budget-sensitive clients, the business expects many potential consumers to readily accept it. Moreover, the price will be significantly lower than what they can find in the market from competitors. Therefore, consumer price acceptance will be at a high degree.
Competitor Prices
The pricing strategy will also entail the benchmarking of own prices against the ones offered by competitors. The aim of the business will be to ensure that the prices offered by the organization are better than those given by competitors.
Promotion Strategy
The energy of the insurance company will be put on raising brand awareness in every new country entered. There will be various activities aimed at popularizing the Ham brand. Activities that are digital-based such as social media marketing and online video advertisements will be used to popularize the two products. Finally, mainstream media advertisements daily should be used to endear the new products to the potential customers in the market . The main social media channels to use will be Twitter and Facebook. Twitter and Facebook are the most popular social networking platforms where many people across the world spend time socializing. They are a justified means of promotion because of being cost-effective. The company will cut-down huge marketing costs when it uses social media for advertising. It is an opportunity for the organization to save costs in marketing and use it as a leverage over rivals in terms of low-pricing.
Justification of Media Channels
The mainstream media channel is highly justified for use as a means of brand promotion because it will help the company to reach out to a vast market base at once. Many people now access televisions and radios daily. When the product is advertized through the mainstream media, it will grow in popularity at a high rate. Moreover, social media networks will help the company to access the youthful generation easily and at a low cost. In this case, mass media preferable for advertising include television stations and radio. Mass media is a justified means of advertising and popularizing a brand because it offers an opportunity for direct communication with potential customers in the market. Moreover, mass media offers the chance for the business to verbally explain to viewers the benefits of a product with use of all figures of speech. It is, thus, easy to convince the potential to buy a given product when mass media is used as a channel for advertising. It is also vital to mention that mass media affords the business a chance to reach out to a vast market base at once.
Sales Promotion Activities
Moreover, the organization should use insurance business expositions, conferences and events to promote the two products launched. Use of renowned celebrities in the entertainment industry as brand ambassadors will also be a promotional strategy to be considered and adopted. Expositions, conferences and events are justified because they offer a rare opportunity of direct live physical interaction between the business sellers and potential customers in the market. It is easy to convince the potential clients when met physically on ground. Moreover, customers have the chance of asking questions for clarification.
