(MKT 60010) - Challenges and Strategic: Old Mutual's 2-in-One Savings Product Launch in South Africa Case Study

In this case study we will discuss about old mutual faces challenges and below are the summaries point:- Old Mutual faces challenges in launching and optimizing the 2-inOne Savings product in the South African retail mass market. The report provides strategic recommendations to address budget constraints, customer perceptions, and a poor savings culture. Target market segments identified as Family Savers and Financial Strugglers, with proposed integrated marketing communication campaign plan.

MKT 60010
Assignment 3: Case Study
QUINN LIM 104206695

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Executive Summary
This report focuses on Old Mutual's challenges in launching and optimizing the 2-
One Savings product in the South African retail mass market. Despite expertise in mark
strategies, Old Mutual faced obstacles such as budget constraints, customer perception
a poor savings culture. The report provides strategic recommendations to address thes
challenges and achieve long-term success with the 2-in-One Savings product.
The PESTEL framework is used to analyze the macro-environment, highlighting
political initiatives by the government to promote savings and the poor saving culture a
South Africans. These trends present opportunities for Old Mutual to align with governm
initiatives and cater to individuals seeking a solution for both short-term and long-term
financial needs.
Based on market segmentation analysis, the report identifies two target market
segments for the 2-in-One Savings product: Family Savers and Financial Strugglers. Fam
Savers are individuals prioritizing saving for their children's education, while Financial
Strugglers face financial challenges and seek solutions to improve their financial situati
targeting these segments, Old Mutual can effectively address their specific needs and
aspirations.
An integrated marketing communication campaign plan is proposed, aiming to
increase awareness of the 2-in-One Savings product and acquire 500,000 new custome
within a six-month period. The campaign plan includes objectives, a Gantt chart, and a
budget allocation.
The report concludes with three recommendations for Old Mutual's marketing mix
strategy (7Ps): enhancing product features and flexibility, training and empowering sale
customer service representatives, and demonstrating success stories and testimonials.
recommendations align with marketing concepts and theories, emphasizing customer
satisfaction, personalized guidance, and trust-building.
By implementing these recommendations, Old Mutual can overcome challenges,
position itself as a reliable financial partner, and achieve long-term success with the 2-i
Savings product.

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Table of Contents
Executive Summary ..........................................................................................................1
Introduction .....................................................................................................................3
PESTLE Framework for Macro-environment Analysis (250 words) ......................................4
Political ................................................................................................................................... 4
Social ....................................................................................................................................... 4
Market Segmentation .......................................................................................................6
Segmentation Table ................................................................................................................. 6
Target Market Selection ........................................................................................................... 7
Integrated Marketing Communication Campaign Plan ......................................................9
Objective ................................................................................................................................. 9
IMC Gantt Chart ....................................................................................................................... 9
Recommendations .......................................................................................................... 10
Bibliography ................................................................................................................... 15

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Introduction
This case study focuses on Old Mutual's challenges in launching and optimizing t
in-One Savings product in the South African retail mass market. Despite their expertise
marketing strategies, Old Mutual faced obstacles such as budget constraints, customer
perceptions, and a poor savings culture. The product, introduced in November 2014, off
a unique bundled short- and long-term investment package, emphasizing the importanc
saving for the future while allowing access to funds in emergencies.
An in-depth market analysis is essential to ensure the long-term performance of
2-in-One Savings product. Understanding the target market's demographics, psychogra
and savings behaviours will facilitate effective marketing strategies. Additionally, consid
Old Mutual's reputation primarily as a life insurer rather than a savings company is cruc
positioning the product appropriately.
Conducting a competitive analysis will provide insights into the market landscap
help identify unique selling points and differentiation strategies. By leveraging the prod
features, such as the ability to make withdrawals without impacting long-term growth,
provision of savings boosters, premium holidays, and premium waivers, Old Mutual can
appeal to the retail mass market's needs and preferences.
The subsequent sections of this report will delve into a detailed analysis and pro
strategic recommendations based on the findings. Old Mutual's success in delivering th
marketing strategies will hinge on effectively addressing the challenges and seizing the
opportunities the retail mass market presents. By doing so, Old Mutual can establish its
a leading provider of comprehensive financial services, solidifying its reputation and ac
long-term success with the 2-in-One Savings product.

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PESTLE Framework for Macro-environment Analysis (250
words)
The PESTEL framework comprehensively analyses the macro environment in which a
company operates. In the case of Old Mutual and its 2-in-One Savings product, we will f
on two components of the PESTEL framework and identify macro trends within those
components, discussing how these trends present opportunities and threats for Old Mu
Political
One macro trend in the political component is the government's efforts to encourage sa
in South Africa. The government is aware of the poor saving culture in the country and
taken initiatives to promote savings (Case study, p.6).
This presents an opportunity for Old Mutual in launching the 2-in-One Saving product. B
aligning its product with the government's objectives and initiatives, Old Mutual can po
itself as a partner in promoting financial literacy and responsible saving habits. Collabo
with government programs and campaigns can enhance the product's credibility and
visibility, attracting customers who are motivated by government-driven initiatives.
However, there could also be a threat associated with this trend. More competitors mig
also be inspired by the government’s initiative and would offer similar products that satisfy
customers’ needs of saving and withdrawing.
Social
The macro trend in the social component is the poor saving culture among South Africa
highlighted by the CEO of the South African Savings Institute (Case study, p.6). The ma
of individuals in the mass market segment tend to live for the present and prioritize ins
gratification over long-term savings. This presents a significant challenge for Old Mutua

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launching the 2-in-One Saving product, as it requires a shift in mindset and behavior to
long-term savings.
However, this trend also presents an opportunity for Old Mutual to address the needs o
market segment. By offering a product that combines both long-term investment growt
short-term access to funds, Old Mutual can cater to the immediate financial needs and
desires for instant gratification while also encouraging a culture of saving for the future
2-in-One Saving product can be positioned as a solution that accommodates both short
and long-term goals, appealing to individuals who struggle with maintaining long-term
investments and who may have previously withdrawn from their savings prematurely.
Old Mutual should focus on educating and raising awareness about the benefits of long
savings and the importance of financial discipline. By leveraging its expertise and credi
a trusted financial institution, Old Mutual can position itself as a reliable partner in help
individuals overcome the challenges of poor saving habits and building a secure financi
future.

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Market Segmentation
Segmentation Table
Based on the low-income market in South Africa, a segmentation table is developed for
2-in-One Saving products using two specific segmentation methods: Psychographic and
Behavioural segmentation. Demographic factors will be used for profiling the segments
Segment Name Benefits Sought Personality Education Monthly IncomeAge Range
Young Aspirers Actively seeking ways
to improve their
financial situation,
interested in long-
term investments
Ambitious, goal-
oriented, value
education, future-
focused
High school R5,000 - R10,00018-25
Financial StrugglersFrequently withdraw
from savings, struggle
with maintaining
long-term
investments
Financially
constrained,
prioritize short-term
financial needs, lack
savings discipline
Varied R1,000 - R5,00025-35
Family Savers Looking for options
to save for education
and long-term goals,
willing to commit to
long-term savings
Family-oriented,
value stability and
security, seek ways to
save for their
children's future
High school and
above, with
children
R10,000 -
R20,000
35-50
Retirement PlannersLooking for
retirement planning
options, interested in
long-term
investments and
savings for
retirement
Concerned about
retirement, value
financial security and
independence in later
years.
High school and
above
R20,000 -
R30,000
45-60

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Target Market Selection
A target market segment is chosen for the two variants of the product: 2-in-One Saving
Education, and 2-in-One Saving 4 My Goal. Four metrics: Compatibility, Attractiveness,
Effectiveness, and Cost Efficiency, were examined for each segment to provide the mos
suitable suggestion.
1. 2-in-One Saving 4 Education: Target Segment– Family Savers
Compatibility: The Family Savers segment aligns well with the 2-in-One Saving 4 Educ
plan as it caters to individuals who prioritize saving for their children's education. These
individuals have a strong motivation and desire to secure their children's future by inve
in their education.
Attractiveness: The Family Savers segment represents a significant portion of the low
market in South Africa who are actively seeking ways to save and prepare for their child
education expenses. Education is a key priority for many families, and they are willing t
make long-term financial commitments to ensure their children's educational success.
Effectiveness: By targeting this segment, Old Mutual can effectively address the spec
needs of families who want to save for their children's education. The 2-in-One Saving 4
Education plan offers a combination of long-term growth through the smoothed bonus f
and short-term accessibility through the money market account, providing a comprehe
solution for families to accumulate funds for educational expenses.
Cost Efficiency: The Family Savers segment represents a loyal customer base that is l
maintain a long-term relationship with Old Mutual. By offering a specialized savings pla
education, Old Mutual can attract and retain customers within this segment, benefiting
their ongoing contributions and potential for additional financial products and services i
future.
Moreover, targeting the Family Savers segment aligns with Old Mutual's commitment to
financial inclusion and supporting the aspirations of families in the low-income market.
offering a dedicated savings plan for education, Old Mutual demonstrates its understan

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of the importance of education in breaking the cycle of poverty and provides a means f
families to proactively invest in their children's future.
2. 2-in-One Saving 4 My Goal: Target Segment– Financial Strugglers
Compatibility: The Financial Strugglers segment is compatible with the 2-in-One Savin
Goal plan as they are facing financial challenges and seeking solutions to improve their
financial situation.
Attractiveness: This segment represents a significant portion of the low-income mark
South Africa who are actively seeking ways to overcome financial difficulties and achiev
financial goals.
Effectiveness: By targeting this segment, Old Mutual can effectively address the spec
needs of individuals who are struggling financially and provide them with a comprehens
savings and investment solution to improve their financial well-being.
Cost Efficiency: The Financial Strugglers segment may have limited resources and fac
financial constraints. However, by offering them a suitable and accessible savings plan
in-One Saving 4 My Goal, Old Mutual can attract and retain customers within this segm
leveraging their potential for long-term customer loyalty and future growth.
Additionally, targeting the Financial Strugglers segment aligns with Old Mutual's objecti
serve the low-income market and address the unique financial challenges they face. By
providing a tailored savings product that offers flexibility and the opportunity to achieve
financial goals, Old Mutual can build trust and credibility among this segment, positioni
itself as a financial partner that genuinely understands and supports their needs.

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Integrated Marketing Communication Campaign Plan
Old Mutual is facing a primary marketing problem of increasing the sustainable uptake
2-in-One Saving product in the future among the target customers (Family savers and
Financial Strugglers) in the long-term future. A 6-month marketing communication cam
is designed for the 2-in-One Savings plan using the SMART framework with a 3-million Z
budget.
Objective
Old Mutual wants to increase awareness of the 2-in-One Saving product among the targ
customers and acquire 500,000 new customers for both variants within the six-month
campaign duration (July to December). (The number is estimated based on the Case stu
p.13).
IMC Gantt Chart
The goals for the execution of such a campaign are to increase product awareness and
media engagement among the target audience with a total indicative cost of 2,945,000

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Recommendations
Below presents the three recommendations concerning a marketing mix strategy (7Ps)
solve the above marketing problem, along with the justification and relevant marketing
theories and concepts.
1. Product: Enhance Product Features and Flexibility
Old Mutual should continuously develop the features and flexibility of the 2-in-1 Saving
product to better suit the demands and desires of the target clients. Product features in
providing additional perks like educational resources or toolsfor “Family Savers”, and
customising savings goalsfor “Financial Strugglers”. Product flexibility includes making
account management more accessible through digital platforms, such as enabling easy
account opening, depositing, and monitoring of savings. Old Mutual can boost its
attractiveness and long-term uptake among target customers by creating an appealing
customer-centric product.
Meeting customer needs and preferences is crucial for the success of any product. This
strategy aligns with the marketing concept, which emphasizes customer satisfaction an
value creation (Kotler et al., 2019). By continuously improving the product, Old Mutual
demonstrates its commitment to meeting customer expectations and staying responsiv
their evolving needs.
Research by Leila Agha Kasiri et al. (2017) emphasizes the importance of integrating
standardization and customization in driving customer satisfaction and loyalty. By allow
customers to personalize their savings goals and adjust their plans according to their sp
circumstances, Old Mutual can create a sense of ownership and empowerment among
target customers. This customization approach has been proven effective in various
industries, as it caters to individual preferences and increases customer engagement (P
2004).
Furthermore, providing educational resources or tools as part of the product offering ca
enhance the perceived value of the 2-in-One Saving product. According to research by

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Lusardi and Mitchell (2014), financial literacy plays a crucial role in individuals' financia
decision-making and their ability to achieve long-term goals. By offering educational
resources, Old Mutual can help its customers improve their financial knowledge and
empower them to make informed decisions about their savings. This approach not only
value to the product but also positions Old Mutual as a trusted financial partner that
genuinely cares about the financial well-being of its customers.
Additionally, leveraging digital platforms for account management can significantly imp
the customer experience and convenience. With the increasing digitalization of financia
services, customers expect easy access to their accounts and seamless interaction with
service provider. By enabling features such as easy account opening, depositing, and
monitoring of savings through user-friendly digital platforms, Old Mutual can enhance
customer satisfaction and attract tech-savvy customers who prefer convenient and acc
financial solutions (Grewal et al., 2019).
2. People: Train and Empower Sales and Customer Service Repre
Old Mutual should invest in comprehensive training programs for sales and customer se
representatives who interact with the target customers. These representatives should h
deep understanding of the 2-in-One Saving product, the needs of the target segments,
the ability to provide personalized guidance and support. By ensuring knowledgeable a
empathetic staff, Old Mutual can enhance the customer experience, build trust, and inc
the sustainable uptake of the product.
The people element of the marketing mix plays a crucial role in delivering excellent cus
service and building strong relationships with customers. Well-trained and empowered
and customer service representatives can significantly impact the customer experience
influence the decision-making process (Homburg et al., 2017). By investing in training
programs, Old Mutual can equip its representatives with the necessary knowledge and
to effectively communicate the value and benefits of the 2-in-One Saving product to the
target customers.
Training programs should focus on providing a deep understanding of the product featu
benefits, and how they align with the needs and aspirations of the target segments.

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Representatives should be trained to identify the unique financial goals and challenges
each customer and offer tailored solutions and guidance. This personalized approach
enhances customer satisfaction and increases the likelihood of long-term engagement
loyalty (Hennig-Thurau et al., 2002).
In addition to product knowledge, training programs should also emphasize empathy an
effective communication skills. The target customers, who are low-income individuals a
families, may have specific financial concerns and limitations. Empathetic representativ
who can understand and address these concerns with care and sensitivity can build tru
rapport with customers (Verhoef et al., 2009). Building trust is particularly crucial in the
financial services industry, where customers are entrusting their hard-earned money to
organization.
Moreover, empowering sales and customer service representatives with the authority t
make decisions and resolve customer issues promptly is essential. Customers value effi
and responsive service, and empowered representatives can provide timely solutions,
ensuring a positive experience and reducing customer churn (Ladhari, 2009). By giving
representatives the autonomy to address customer needs and resolve problems, Old M
can enhance customer satisfaction and create a positive perception of the organization
Furthermore, ongoing training and development programs are necessary to keep
representatives updated on the latest industry trends, regulatory changes, and custom
preferences. This ensures that representatives can adapt to evolving customer needs a
provide up-to-date information and advice. Continuous learning also enhances job
satisfaction and employee engagement, resulting in better performance and customer
interactions (Silke Astrid Eisenbeiss et al., 2008).
In conclusion, investing in comprehensive training programs for sales and customer ser
representatives is a crucial marketing strategy for Old Mutual. Knowledgeable and
empowered representatives who can provide personalized guidance, empathetic suppo
and timely solutions contribute to an enhanced customer experience, trust-building, an
long-term customer loyalty. By prioritizing the training and development of its people, O
Mutual can differentiate itself in the market and create a competitive advantage based
superior customer service.

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3. Physical Evidence: Demonstrate Success Stories and Testimon
Old Mutual should showcase success stories and testimonials from satisfied customers
have benefited from the 2-in-One Saving product. This can be done through case studie
video testimonials, or customer reviews on various marketing channels. By providing ta
evidence of the product's effectiveness and the positive outcomes experienced by real
customers, Old Mutual can overcome skepticism and build trust among potential custom
in the target segment.
Demonstrating success stories and testimonials is a powerful marketing strategy that
leverages the concept of social proof. According to Cialdini's theory of social influence
(Cialdini, 1984), people are more likely to engage in a behavior or make a decision if th
others, especially similar individuals, doing the same. By showcasing success stories an
testimonials, Old Mutual can tap into this psychological phenomenon and influence pote
customers to consider and adopt the 2-in-One Saving product.
Research by Bikhchandani et al. (1992) supports the notion that people tend to follow t
actions and recommendations of others when making decisions, particularly in situation
uncertainty or limited information. By presenting real-life examples of customers who h
achieved their financial goals, secured their children's education or improved their finan
stability through the 2-in-One Saving product, Old Mutual can provide social proof that
product is effective and trustworthy.
Moreover, testimonials and success stories help in creating an emotional connection wi
potential customers. According to the Elaboration Likelihood Model (Petty and Cacioppo
1986), emotional appeals can be influential in shaping attitudes and behaviors. By shar
stories of customers who have overcome financial struggles, achieved their dreams, or
secured their family's future through the 2-in-One Saving product, Old Mutual can evok
positive emotions and aspirations in the target segment, increasing their motivation to
action and invest in the product.
Additionally, showcasing success stories and testimonials enhances the perceived cred
and reliability of the product. According to research by Avishag Spillinger and Avi Parus
(2012), customer testimonials significantly impact perceived credibility, brand attitude,

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purchase intentions. When potential customers see others sharing their positive experi
with the 2-in-One Saving product, it instills confidence in the product's ability to deliver
promises.
To effectively implement this strategy, Old Mutual should identify and select compelling
success stories that resonate with the target segment. These stories should highlight th
specific benefits and outcomes that are relevant to the target customers' financial goal
aspirations. By utilizing various marketing channels such as the company website, socia
media platforms, and customer communication channels, Old Mutual can ensure broad
visibility and reach for success stories and testimonials.
By providing real-life examples of satisfied customers who have achieved their financia
Old Mutual can establish credibility, evoke positive emotions, and influence potential
customers' decision-making process. This strategy aligns with the principles of social pr
and emotional appeals, as supported by relevant marketing theories and research.

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