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Thursday, January 19, 2006
Insurance firm eyes C market
A global insurance company has realized the wisdom of serving the needs of the C-market, which comprises majority of the Filipinos.
In an interview, Sun Life Financial president and chief executive officer Lorenzo Tan said one of the strategies the company will employ in the next five years to sustain the business in the country is to serve those with a monthly income ranging from P15,000 to P50,000.
“This market (C-market), the consumer market, is basically the Philippine market. The business opportunity in serving this market is wider and bigger than the A and B markets,” he told Sun.Star Cebu.
Earlier Ayala Corp. president and chief executive officer Jaime Augusto Zobel de Ayala (Jaza) urged private enterprises to serve the needs of a broader base of consumers, encompassing the low-income communities, including the poor.
Impact
“Low-income communities in the aggregate represent an enormous potential revenue pool. Finding ways to tap this community not only presents viable business opportunities, but it also has a potential development impact,” he addressed delegates to the 2005 Philippine Advertising Congress held at the Waterfront Cebu City Hotel and Casino last November.
Jaza said private enterprises that seek to sustain their growth must find ways to hurdle the inherent challenges in addressing the needs of the low-income market, such as affordability issues, the level of infrastructure development, educational attainment and backgrounds by innovating and adapting their business models to penetrate the said market.
He cited the experiences of two business ventures of the Ayala group of companies—Globe Telecom and Manila Water—in their efforts to capture the consumer market.
Jaza said Globe moved more aggressively to expand into a broader consumer market as it realized the top end of the market was “too small” to support its investments in building a nationwide network.
Globe patterned its innovations after the experience of fast-moving consumer goods companies, which used “sachet marketing” to sell their products to low-income households.
Bundles
It developed small-value bundles for the low-income market in the form of scratch pre-paid cards.
With regard to Manila Water, the company introduced collective installation and billing. This has essentially allowed urban poor communities the option for collective water installation, metering and billing thus, lowering the cost of acquisition for the customer.
Meanwhile, Sun Life has hired as consultant a former sales executive of Coca-Cola Philippines, Tan said. (JBN)
For Bisaya stories from Cebu. Click here. (January 19, 2006 issue)
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