Market Positioning Strategies Used by Insurance Companies in Kenya

Abstract

The nature of competition in the Insurance Industry in Kenya is quite fierce with Companies competing for a limited market characterized by low Market penetration of about 3.02% by 2012. Majority of the Insurance Companies have however increasingly become conscious of the need to maintain a competitive edge in the market which has seen them employ various competitive marketing strategies. The study was conducted with the main objective of establishing the Market positioning strategies used by the Insurance Companies in the country and the extent to which they are used. A census study was conducted on the whole population comprising of all the forty six Insurance Companies, who are members of AKI.A descriptive research design was adopted and data was collected using a “drop and pick later” method with reminders through calls and email. It was then analyzed using statistical descriptive tools and results presented on tables in forms of frequencies, mean, standard deviation and percentages. From the research findings, Market positioning strategies are widely used in the Insurance Industry by companies to distinguish their offers from those of the competitors. Data analysis indicated that combinations of various Market positioning strategies were used with majority of the respondents using combinations of four, five and seven strategies. The strategies mostly used were pricing, product oriented, process, people and competition while physical evidence and place were least applied. Most of the Companies faced challenges of unfair competition, price undercutting and high staff turnover among others and it was recommended that the regulatory body (IRA) should be more vigilant in the control of unfair market practices while Insurance Companies were recommended to embrace all the market positioning strategies since they supplement one another.