Acko General Insurance Co : Digital Only Insurer

Brand: Acko
Company: Acko General Insurance Co Ltd

Brand Analysis Count: #589

This is the era of digital technologies disrupting traditional business models. The same is happening in the insurance industry in India too. Acko General Insurance Co Ltd is the first digital-only insurance startup in India. The company aims to sell its products only through online and operate only in the digital space. 

The Indian insurance industry is estimated to be around 1,20,000 crore and growing at 15-20% annually. The large population and limited penetration offer a large potential in this huge market. But the size of the market itself creates problems for the insurers. When the insurance industry opened up, a lot of global insurance players entered the Indian market but soon they found that cracking the diverse and large market is not that easy. This has led to a wave of consolidation in this space. 

Insurance in India is a highly regulated market and demands huge capital investment from the players. 

Acko is a startup which aims to disrupt this space. The company which launched its operations in 2017 is India's first digital-only insurance company. This means, unlike traditional insurance companies, Acko will not have a network of offices, rather everything will be app/web-based. This translates to lower cost and competitive pricing of the products for the consumers. Traditional insurers depend on a wide network of insurance advisors and offices to serve the customers. 

Acko launched its first product - auto insurance and claims to have reached the milestone of 20 million customers in the first year itself. 

To create awareness, Acko is running the campaign with the tagline " Full Paisa Wasool " insurance which means - complete value for money insurance. The brand is positioned as a value-for-money insurer and betting on low price as the key differentiator. 

The campaign which is humorous is also an example of using anthropomorphism in advertising. Anthropomorphism denotes the use of non-human characters in advertising for conveying human traits. 

As a consumer, there are certain issues that this brand needs to iron out. First is the awareness regarding the brand. While the advertisement is good and generates eyeballs, for a customer, building trust is vital especially in the case of insurance. Auto insurance, in particular, is a price-sensitive segment, however, the customer should first be assured that he will be taken care of by the firm. I had to search a little on the internet to find the pedigree of this company. Although it is true that this company is targeting digital-savvy customers, in the era of convenience the firm cannot entrust the trust-building task to the customer only. Further, the website of Acko also has very little information about the company.Second issue is differentiation. The idea of digital-only insurance although is new, is not protected from emulation by competition. The established firms will be ready with their own version in no time. How Acko will be able to tackle the competition will be an intersting to watch.

One of the important foundations of trust is the performance of the brand. If Acko is able to deliver the promise of its digital insurance products, this brand will create a new path for insurance startups in India.

Brand Update : Maruti Attempts Channel Differentiation using Nexa and Arena

In 2015, Maruti launched a new channel to cater to the company's foray into the premium four-wheeler segment. The new channel was branded as Nexa. Nexa catered to the premium range of cars from Maruti like Baleno, Brezza, Ciaz etc. The Nexa showrooms were designed to project a premium feel for the segment of customers that prefer premium cars.

It was a challenging move for the company because the multi-channel strategy has its share of problems like organizational challenges, differentiation challenges, channel conflict, redundancy etc. The need for a premium channel arose because Maruti started off as a maker of affordable cars. Its range of cars was never targeting the premium segment. Some of the earlier forays of Maruti into the premium segment also failed to achieve traction. 

Recently the company tasted its success with the mid-range and premium segment with some smart brand launches. Having a premium channel like Nexa enabled to company to give a different kind of experience to this segment.

In 2017, the company rebranded its traditional channel to Maruti Arena which sells the mass market brands like Alto, Wagon-R etc. The company also have a commercial channel and True Value channel for used cars. 

In theory, the company has followed a Marketing Channel Segment Differentiation strategy where the channels differ in terms of the customer segment which they cater. Another type of channel differentiation is Task Differentiation where the channel members differ in terms of the tasks they perform. 

Although the company has tried to create channel differentiation, there is still overlaps in terms of products. While some brands are exclusive to Nexa, some are available in both the outlets which can create potential channel conflict. Marketing Channel differentiation based on segments works well when there is a minimum overlap of characteristics across segments. Here in the case of automobiles, there is bound to be segment overlaps because of pricing overlaps as well as aspirational factors. We can see that the price of high-end variants of hatchbacks is equal to the price of certain mid-size entry-level variants. So the firms who have a channel differentiation strategy should ensure that these overlaps be kept a minimum.

 But with the huge market share and product sales, the channel members at this point of time may not be complaining too much about the cannibalization of sales. 

WLS : Live Natural

Brand: WLS ( Formerly Wills Lifestyle)
Company: ITC

Brand Analysis Count: 588

Wills Lifestyle was ITCs foray into Indian textile market. Launched in 2000, Wills Lifestyle initially was pioneering the premium fashion clothing market in India. The brand when it was launched was seen as an attempt by ITC to keep the equity of the cigarette brand Wills. Since cigarette brands cannot advertise, a clothing extension would be helpful in sustaining brand awareness. I viewed it as a case of surrogate advertising. 

Contrary to my assumption, ITC had other plans for the brand. Will Lifestyle quickly became successful as a premium clothing brand. The company expanded the brand franchise through retail stores across the country. In 2006, Wills Lifestyle became the principal sponsor of  India Fashion Week. Through this fashion event,  Wills Lifestyle became associated with fashion thus differentiating itself with the other clothing brands. However, the product was priced at a premium this restricting its scope into a niche brand.

Over a period of time, the clothing vertical became a laggard in the ITC portfolio and I presume that the company's foray into the FMCG segment had all the management attention. 

This year, the brand has a major restructuring. ITC has rebranded Wills Lifestyle into an acronym WLS. The brand also has a new positioning - sinless clothing which means 100% natural. 

With the rebranding, Wills Lifestyle has severed its ties with the cigarette brand. 

It is a very bold and risky move since at one stroke the brand has lost the source of its awareness. Now ITC will have to move the awareness of the older brand to the new brand name and that involves a whole lot of money. The new positioning of ' Naturalness ' is the buzz word in the FMCG space and ITC is hoping that the clothing market would also follow the trend. Also being natural is a good excuse to charge a premium!

WLS has adopted the tagline 'Live Natural ' to support the new positioning. The relaunch saw teaser ads across the print media. 

Wills is a powerful brand which has huge resonance among the male segment. Trading that powerful brand for an acronym does not make much sense in the marketing point of view. However, ITC may want to disassociate other businesses from the cigarette brand so that in future ethical questions can be avoided. 

A rebranding of this scale requires that the brand has to start afresh, right from identifying the source of brand equity to reworking all associated brand elements. With huge cash reserves, ITC does not have a financial issue in building awareness for WLS. What I am little skeptical is the " Natural " positioning platform of WLS. I don't see this as a compelling attribute, especially for a premium clothing brand. Time will tell.