StateFarm Insurance firm’s marketing mix strategy
StateFarm Insurance Incl.: Distribution Strategy Considerations
An appropriate StateFarm Insurance firm's marketing mix strategy bears three major attributes in order to facilitate and enhance the entire distribution aspect of the mix. First, the right distribution approach must put into consideration the existing market conditions, data and general consumer attitude towards the service offered. Second, the approach has to be in line with StateFarm advertising tactics and the scope of market niche. Finally, the place element will only prove useful if the StateFarm insurance pays particular attention to their product line, marketing campaign as well as prevailing competition intensity.
Distribution strategies: General logistics
There are two distribution options which StateFarm may employ in order to effectively meet the consumer's needs. StateFarm may reap benefits from either selective distribution or even exclusive distribution approach. The basic logistics employed by StateFarm firm allows the firm to take its services to the client, by using quality market perspectives (Cannon et al 87). Such perspective entails practices where the StateFarm delivers coverage or policies to various market niche using either trained advisers or even agents.
Selective distribution strategy: Use of intermediary
Insurance services are normally distributed from the brokerage firm to targeted consumers through agents or selected intermediaries. By using selective distribution approach, StateFarm centers on offering insurance services to its clientele base by involving retail outlets to meet particular liability cover needs. For instance, a selected outlet is used when meeting large geographical spread need among automobile users by entrusting customer service activities on particular intermediary (Hanna and Drummond 56). In this case the insurance firm may use an agent to offer their services among consumers. An agent may be used to market policies services such as life insurance policies or at times policies covering property liability.
Basically this direct agency approach is made possible where StateFarm meets the selected independent contractors' financial consideration by paying-off commissions upon insurance product sales. This distribution will effectively bear fruits when the agents themselves possess two key selling skills.
Exclusive distribution strategy: Direct channel
Exclusive distribution approach is employed where the insurance firm wishes to productively utilize salesmen or financial advisers' personal selling services. This strategy is used in order to reach designated market segments by involving personal selling appeals. For instance, StateFarm may opt to offer their products by reaching out customers' place of work or operations. This can also be done in areas such as ideal offices or other places where the customer prefers to be attended by the firm's insurance advisers. Such customized distribution strategy will be effective as clients queries will be responded to by the sales personnel. Coupled with communication techniques such as networking, exclusive strategy will end up targeting vast consumers' base (Hanna and Drummond 58). Local perspective consumers cherish exclusive distribution strategy as it pays special attention on their insurance preferences.
Distribution strategy: Competitive advantage
Selective distribution channel offers great competitive advantage to the firm. Consumers solely depends on these selected agents for basic guidance when selecting and evaluating various benefits associated with particular insurance products combination, and identification of various gaps linked to such coverage (Cannon et al 89). Under this specification, StateFarm agents possess rich background in technical expertise more precisely in coverage and insurance principles. Again, agents have to possess valuable consumer need analysis skill. Under this distribution approach StateFarm will be able to effectively tailor insurance program in meeting diverse consumer needs via risk management approach expertise mainly associated with agents' services.
