Why is this work relevant for Direct?

Who would have thought in the age of technology that a simple sms based registering mechanism delivered through the humble postman could play such a pivotal role in generating acquisition in a category like life insurance that has almost 100% push sales face-to face? This was exactly what we did, where we broke through the barrier of life insurance aversion by getting rid of tons of complicated paperwork to deliver an affordable product, through a simple sms based process delivered through local postman. A Direct Marketing Strategy that disrupted insurance industry to drive acquisition at the bottom of the pyramid.

Background

Life Insurance Penetration in Sri Lanka Languishes at 14%. Softlogic Life has been a trailblazer in the industry and is the fastest growing life insurance company locally. In the last 5 years the company has doubled its market share and achieved a revenue growth of 33% vs an industry average growth of 12%. In 2019, 160,000 deaths reported in Sri Lanka and 2.2 Mil hospitalizations, many of who comprised of population living at the bottom of the pyramid. Only 5% of this segment have life insurance. To attract this segment we created a micro Life Insurance product with the aim of acquiring 2000 new customers by end 2020. This segment doesn’t have any affinity towards life insurance and they do not trust traditional distribution channels. We needed to adopt a disruptive direct response strategy that would educate segments on the importance of life insurance while being empathetic to their tensions.

Describe the creative idea (30% of vote)

In the age where communication resorts to storytelling and all forms of digital media, we disrupted the market with a simple creative idea. Our communication clearly stated that here is a solution to uplift the quality of life of every Sri Lankan. Together with the Sri Lanka postal department, Softlogic Life introduces the postal insurance cover for just Rs.5/= a day” Bearing in mind that this segment we were talking to was daily wage earners who were living hand to mouth. Rs 5 a day is equivalent to 2 cigarettes a month. Even the most financially challenged daily wage earner would find the pricing attractive in return for an insurance life cover equivalent to $USD 1500 annually which they could otherwise never be able to afford given their job insecurity and difficulty in earning regularly.

Describe the strategy (20% of vote)

40% of Sri Lanka’s population are daily wage earners at the bottom of the pyramid, vulnerable to disruption of their lifestyle if the breadwinner is unable to work. While they need the financial stability of insurance, they are averse to it due to lack of disposable income and complicated paperwork. Our three-pronged strategy to break through was: 1.Introduce a daily 0.03 USD premium with a loss of income benefit for each day of hospitalization plus a pay as you go benefit which prevents the policy from lapsing. We asked them to cut back on 2 cigarettes a month to afford this. 2.Uses the same reload mechanism as telco’s (149% mobile penetration with 91% using mobile reloads) to register and pay monthly premiums. 3.Delivery using the postal network who has 100% reach. A world first- A reload is used to buy insurance, and a postman sells it!

Describe the execution (20% of vote)

Traditionally a postman’s visit brings “Good News” be it exam results, news from relatives and the sound of the bicycle bell which announces his arrival is a fond memory with a lot of nostalgia associated, especially for this audience who is still dependent on post. We decided to use this sound on TV and on digital communication to create anticipation around the postman’s visit. The partnership with Sri Lanka Postal Department on a 25% profit sharing basis with 10% more given to the postman as an incentive encouraged them to educate our target audiences on the micro-insurance product Making sure the masses knew about the product, we launched a campaign across all mediums, using the iconic, ‘ring’ of the postman’s bell with a message that said ‘await the good news’. Digital video, TVC, political memes and postal affiliated POSM used during the presidential election which commanded 90%+ island wide reach.

List the results (30% of vote)

We benchmarked the 1000 policy mark we hit during the first year of operations, and despite a 3-month COVID lockdown succeeded in surpassing 6000 policies in a year Our crucial insight – people don’t believe in brand messaging, but they believe in the message if a known party conveys it. Our brand was carried to them endorsed by their trusted postman; this was a deal breaker! The postmen get a 10% commission on each reload card sold thereby making the model sustainable. We also kept aside 25% of earnings to improve the postal department IT infrastructure Impressions: 4.6Mn (Source: ISOBAR MIS System) Consideration Increase: 400bps (Source: Kantar LMRB Brand Health Report 2020) This shows how “simplicity” helped increase the dormant life insurance penetration numbers in Sri Lanka. The 100% Mobile Process is a world’s first for the category and will be crucial in enabling financial wellbeing for lower income groups.

Please tell us how disruption in your market place inspired the work

The need to disrupt was inspired by our vision of “Enhancing the Quality of All Sri Lankans”. To reach “All” meant we had to break the myth that “Insurance is Expensive”. We wanted to make people understand that insurance is a necessity, not a luxury. Accordingly, we introduced below world first solutions. 1.Usage of an insurance reload card for premium top-up 2.A 100% SMS based policy issuance which can be done on the most basic mobile device 3.A mechanism to sell insurance without the carrier NOT having insurance knowledge 4.Usage of a postal network to deliver insurance to the doorstep- doorstep delivery demands a premium but our use of a postal visit that happens daily prevented that cost addition We disrupted the place, price, process, product & people in the marketing mix, breaking through the trust barrier due to the endorsement of the trusted postman.