lincoln financial group (a)
DESCRIPTION
Harvard case solutionTRANSCRIPT
Lincoln Financial Group (A)
Amira AthimniMeriem Ben YedderMohamed Omar ElgindiReem NassarRym Belhadj Pr. Marco Protano
-Marketing Strategy-
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Executive Summary
The strategic opportunity is to be “a standalone integrated distribution company that would house all of Lincoln’s wholesaling efforts”
Customers are the most critical C. LFG has to satisfy customer needs and wants if it wants to maximize its market penetration
The Strategic alternatives are :• Centralize distribution to its top management team.• Aggregate the individual distribution channels under a single
company• Maintain the existing strategy
• Our strategic alternative will be Aggregating the individual distribution channels under a single company, LFD.
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Protano 8 C’s
Category LFG is operating in the financial services category
High attractiveness
High risk
Distribution channel members have a wide range
of products available, thus, they will choose
the best products to offer to their
customers.
High risk
Fierce competition
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Company
• LFG was first a life insurer diversified financial services provider, through M&A.
• Core competencies: the life insurance business in 2000, 46% of earnings.
• Annuities: LFG was a market leader in the variable annuity products.
• Investment management: mutual funds and managed accounts.
Protano 8 C’s
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• Customers are the distributors of financial products
and services B2B Banks, independent brokers, wirehouse dealers and MGAs.
• LFG customers needs and wants: Eager for information about the products & services
in order to sell it the right target customer educate themselves on these products by going online.
To begin offering packages of financial products and services to their customers more coordinated approach
Customer/Consumer/Center of influence:
Protano 8 C’s
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Competition
Protano 8 C’s
Financial products and services manufacturers:
LFG has over 10% ROEAXA financial = over 20% ROENationwide and American General= over 15% ROE
Since the category is attractive, and our performance based on the ROE is average LFG has to try
harder and come up with a new strategy.
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LFD is a great concept that will achieve the customer intimacy strategy chosen by Boscia. Change the negative view of LFG distribution, since MGAs are not happy with the compensation plan offered by LFG nor the the lack of coordination between the Lincoln manufacturing companies . The wholesaling quality was not the same in the different business units The new distribution structure is a good move in order to better organize distribution.
LFD concept…
This tactic Assures a more coordinated structure
Case questions
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Deliver a superior customer value by tailoring offerings to match exactly the demand of its customers ( Distributors).
Information about the products and services offered: Financial advisors need to persuade them to invest in funds persuasion process.
help customers to identify and sell the right product to the target market.
- Medusa solution oriented sales involves:Hearing the objectives of the target audience and crafting a solution for it.Recognizing when it doesn’t have a solution and providing them with a better alternative.
A customer intimacy approach…
The solution oriented sales is all about Best customer relationship, not all customers require the same level of
service or will generate the same revenues LFG needs to empower its people to achieve it.
Case questions
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If the number of LFG touch points increases customers’ loyalty toward LFG will increase too: all of the physical, communication and human interactions that the company’s customers will experience over their relationship lifecycle with the company, will make them eager to have more LFG’s products on their shelf.
Creating and retaining customers…
Incentives are not permanent To be loyal customers need constant
involvement from LFG.
Case questions
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The actual business units’ organization led to missed opportunities:
Different quality of wholesalingNo coordination between the different
manufacturing companies
Wholesaling efforts under one umbrella…
A better coordination between the various product groups as among the MGAs better selling performance + customer satisfaction
Case questions
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“ If this is such a great idea, then why isn’t there a single other company out there doing it” If a competitor is already doing it why do we want to copy it? How will it differentiate us ?
- Managers are afraid of losing control over the sales, and not being connected to the field to have feedback from its customers Boscia should have reassured its team about the coordination that will happen between LFG and LFD, and the continual feedback that they will have.
Reactions toward Boscia’s Decision…
The negative reactions led to hiring a consulting firm to better evaluate the idea a more specified strategy that will differentiate
LFG from other competitors by giving them a unique benefit.
Case questions
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Strategic Alternatives:
Increase Profitability
Solution oriented sales
Fits better with the customer intimacy model
Centralize the distribution
Aggregate the individual distribution channels under
a single company
Continue with the existing strategy
Increase profitability
through customer intimacy
model
• Increase Profitability• Decrease costs Not innovative / Not creative
• No change • Not fulfilling customer
satisfaction Risk of loosing market share
S.I.V.A
SolutionInformation & Incentives
Value Access
Implement the
solutions-oriented
sales tactics.
Offering product
packages
*Direct communicatio
n with the customers
Increase the number of
touch points.
*Fast feedback from the
customers.
• Focus on differentiating
our products by:- Providing the best product
services
- Better quality
- High reliability on the company from customers
- Empowering MGAs improve
the compensation
plan.
Improved accessibility to products
- Availability of variety products
- Faster response to customers'
need
-Build IS
Our strategy is to build customer Intimacy.Tactics which will translate the strategy as follow…
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