A brand is more influential than we might think, even in advised sales. Rob Quayle explains.
A great brand is one of a company's most valuable assets. A memorable name is critical to that brand's success. Top brands equate to successful sales, or so most marketeers would have us believe.
But is that really the case in protection? Well, yes, according to an analysis of actual sales of protection products. Brand names - or, put more plainly, an awareness of the company - are extremely important.
The information that follows provides some insight into what providers are chosen in the direct to consumer market. In order to give greatest clarity, we are only looking at online, self-selected sale channels, as these best best highlight the importance of brand versus price.
Branding is what can differentiate a product, or consumers' propensity to use your company, from the rest of the competition out there. You only have to look at the corporate giants in the market and their possessiveness over their name/s to recognise that a good brand name equals profit.
At one stage back in the nineties, if you were a waitress or waiter in a well-known pizza establishment that only served Pepsi and your customer ordered Coca-Cola, you would always have to clarify to your rather thirsty client that they would most definitely be getting Pepsi to drink and not the soft drink from its major market competitor.
In the same vein, this analysis of the competitive positioning of providers across a number of direct sites gave up some interesting reading with regard to brand name recognition.
The research took a sample of more than 5,000 term life and decreasing term cases written in 2013 from 11 insurers. This was an attempt to establish how important name awareness and price are in consumer buying behaviour and to what extent an insurer needed to be the cheapest.
Perhaps not surprisingly, the conclusions as shown below demonstrate that if you are a less well-known company then price is most important, but if you have a strong brand, consumers may choose you regardless of whether you are cheaper or not.
However, what did perhaps come as a surprise is that the brand was important regardless of the gender or age of the respondent.
The table below looked at a cross section of companies by volume of business. It shows that Aviva, Legal & General and Zurich would win business regardless of whether they were the cheapest.
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