the product development challenge
Download
Skip this Video
Download Presentation
The Product Development Challenge

Loading in 2 Seconds...

play fullscreen
1 / 24

The Product Development Challenge - PowerPoint PPT Presentation


  • 60 Views
  • Uploaded on

The Product Development Challenge. A Personal Lines Perspective. Session COM-42. Product Development. Personal Lines Brand new program New Direct Auto New Home Warranty Improvement current program New Auto/Home discount Expanded Rental Car coverage. Product Development.

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'The Product Development Challenge' - mirra


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
the product development challenge

The Product DevelopmentChallenge

A Personal Lines Perspective

Session COM-42

product development
Product Development

Personal Lines

  • Brand new program
    • New Direct Auto
    • New Home Warranty
  • Improvement current program
    • New Auto/Home discount
    • Expanded Rental Car coverage
product development1
Product Development
  • Product Development is one of the most powerful but difficult activities in business
  • A dynamic time when new technical concepts create new opportunities and new threats
product development2
Product Development

Years of change in:

  • Technology
  • Customer requirements
  • Channels of distribution
  • Competitors
  • Structure of the industry
changing times
Changing Times
  • Time when new demands are emerging from customers
  • Time when competitors are making new unexpected moves
  • Time when new ways of competing are emerging
the new economy
The New Economy
  • We are in the age of the new economy
  • Give customers what they want or someone else will.
  • Quality at a competitive price
product development3
Product Development
  • No one “best” approach
  • Some fundamental principles involved for success
  • Company management needs to foster environment that:
    • encourages creativity
    • promotes communications
      • within company
      • between company and customers
product development4
Product Development
  • Chief element of success is top management commitment
    • Give control to those responsible
    • Good working relationship
    • Careful, constant attention to the marketplace
product development5
Product Development
  • Risk and rewards of well-conceived and executed new products can be great
  • Risk of inadequate programs, or no program at all, can be high
  • You innovate or you disintegrate
product development6
Product Development

First-To-Market-Myth:

Pioneers can target the largest,

lucrative segments and get a

head start on developing customer

loyalty, thus ensuring success

product development7
Product Development

Years back, a stock broker touted:

    • World’s biggest chain of highway restaurants
    • Pioneer in restaurant franchising and strongly entrenched
    • Highest quality investment
  • What Company was he talking about?

Howard Johnson’s Restaurants, not McDonald’s

product development8
Product Development

Another Example:

  • RC Cola was first with diet cola
  • Coca-Cola came out later with Diet Coke, was able to take leadership away from RC Cola
  • Late entrants can leverage brand name and distribution for successful market entry
product development9
Product Development
  • Some basic principles
    • Customer data is key to customer relationships
      • Who is buying that stinky cheese?
      • Identify/Target niche groups
      • Data warehousing
      • Data mining
    • Outside market research
product development10
Product Development
  • Some basic principles
    • Loyal customers are profitable customers
      • Tracking retention rates
    • How do you get and keep customer loyalty?
product development11
Product Development
  • What is customer loyalty worth?
    • Acquisition cost: How much will it cost to get the customer?
    • Revenue stream: How much revenue will customer generate over time?
    • Cost stream: How much does it cost to serve the customer continuously?
    • Duration: How long is the customer expected to generate profit?
product development12
Product Development
  • Insurance product is intangible, harder to sell than many other consumer products
  • Insurance product design faces many of the same problems of other new commercial products
    • Will it sell?
    • Will it make money?
sport utes of the future
Sport Utes Of The Future
  • Ford, GM bet on SUV hybrids-Intersection of a Pickup Truck and SUV

Lincoln Blackwood Hybrid

elements for success
Elements for Success
  • Need Strong Product Development Team
    • Actuary, Agency, Claims, Forms/Filing Unit, Legal, Marketing, Statistical, Systems, Underwriting
  • Most important member of team is the customer
elements for success1
Elements for Success
  • Need top management support
  • Need vision, think out of the box
  • Need good communication
  • Need organization and leadership
elements for success2
Elements for Success
  • Need knowledge of the customer
  • Need knowledge of industry
  • Need knowledge of own company
  • Need field testing of product
product development13
Product Development
  • How is Personal Lines different from Commercial Lines?
    • B2C vs B2B
    • Price-sensitive
    • Coverages/Forms more similar
        • Not as individualized
    • More highly regulated
product development14
Product Development
  • What is role of the Actuary?
    • Help focus market research
    • Analyze market/customer data
    • Help with product design
    • Evaluate the cost of customer loyalty
    • Provide estimate of costs
product development15
Product Development
  • What is role of the Actuary?
    • Evaluate underwriting
    • Develop rates/rules/forms
    • Filing preparation
    • Develop pro-forma
    • Monitor/Track results
product development16
Product Development
  • For company to serve customers, and distinguish itself from its competitors, itneeds an efficient product development team
  • Actuary plays vital role on the product development team
  • Create loyal customers
ad