6/14/2011 - Colonial Penn: A Bid to Lure Younger Customers with Annuities and Low-Cost Auto Coverage
Colonial Penn: A Bid to Lure Younger Customers with Annuities and Low-Cost Auto Coverage[/title]
Colonial Penn Group Inc. still is overly dependent on older customers, with retirees and over-50 age group members accounting for 90% of sales. Chairman and chief executive John J. MacWilliams wants to change marketing strategy to have an equal balance in premiums between policyholders over and under 50. To do so, the firm will introduce low-cost automobile insurance and variable annuities to lure younger customers. This strategy will take the company into fiercely competitive fields; however, the mass desertion Colonial Penn suffered in 1981, which resulted in a $23.4 million loss, has forced action to be taken. The firm has gone into reinsurance, but the profits realized have not been enough to solve the overall profitability problems. Colonial Penn will rely on its expertise in direct mail, radio, and television advertising to appeal to the designated new market segments. The firm's traditional customers will not be forgotten in the move toward a younger market, though, with expanded services planned for older clients. Colonial Penn still faces unsettled lawsuits concerning its relationship with 2 senior-citizen groups.
Full text: Business Week, Aug 8, 1983Internet Marketing Tools
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