As the result the attract not target segment by marketing campaigns, cashbacks, negative options, and boxes the costs only $10
It leads to low loyalty, clients turnover.
Client turnover, lack " the elasticity of demand to price " (In 2014 40% of clients from top 10 insurance company sad that they want to move to another company in case of increasingly price by 5 % without changing conditions)
In same time according to survey segment #1 is ready to pay 30% more for higher service. Due to it we changed our marketing campaign for this segment. Detailed description of the most important transformations you can read
here.
As the result:
Target profitable segment grew from 10% to 48% in the company's portfolio.
Negative financial result declined from - $100 mln to - $45mln.
Profitability of car insurance grew from -13% to +5% ( the average figure for marker -4-6%)