Question

Point out FIVE (5) reasons to why insurance products should use word-of-mouth (WOM) strategy in promoting their products. Explain and illustrate your answers with examples.

10 marks consumer behaviour question.

Answer 1

The main reasons for using word of mouth strategy for the promotion of insurance products are given below=

Word of mount strategy is effective in the promotion the products that need special attention and have some inherent qualities such as quick service and addressing the concerns of the customers.

Word of mouth will help to create a positive image and credibility of the insurance products as these products are under a lot of scrutiny of the customers.

The word of mouth mainly uses reliable individual such as family friends and other persons who are in direct contact so it provides create credibility

More than 72% of the customers believe that word of the mouth is the main influencer while deciding the selection of insurance products

Word of mouth is mainly provided by those people who have actually used the product or service and thus the customers believe these types of communication form the ones who have actually used the service.

Example= If I have to buy the car insurance and I am looking for the good insurance provider but I am really confused and discussed this matter with my friend and he told me that his car insurance company XYZ is quite good in addressing8 any concerns and has better customer service, it will definitely influence my decision making.