RBC first established its insurance platform in the early 1980s where it promoted creditor and basic travel insurance, as those were the few products that can be promoted by bank employees under Canada’s Bank Act. Through the acquisitions of various insurance companies, they eventually entered the life, health, property and casualty insurance markets; demonstrating significant growth in the industry and eventually being level in the playing field among other large insurance competitors (McLaren, Babin, & Schuster).
Despite achieving nearly 20% growth annually consistently throughout the years, RBC was challenged with sustaining the growth as it competed with other financial institutions and emerging competitors breaching the Canadian market (McLaren, Babin, & Schuster). One of their other apparent issues was determining how it could leverage social media to enhance its insurance operations as well as appealing to the younger technology-driven consumer market. If their social media strategy can be executed well it can realize positive experience throughout the value chain and its customers, otherwise it could be a detriment to their brand image and a waste of financial resources. The question or issue they needed to realize is what value can be attained, which business processes can it enhance, and what effect will it have on young consumers.
An analysis of Porter’s 5 forces in reference to RBC insurance platform effectively captures the competitive forces behind the market and the external influences. Firstly, the threat of new entrants is relatively low due to the high start-up costs and other resources to logistically operate an insurance company. RBC’s long history and establishment in t...
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...ustomers. Initially, they should focus on social media as a method of engaging customers and increasing unaided brand awareness, focusing less on how it can improve a business process. Due to government regulations and the value of privacy among many people, it would pose too much risk to issue policies given on limited data or interaction through digital means; it should only be used as an initial touch point to seek the customers’ attention. Regardless as to whether permission was obtained to use social media as a means of communicating or reducing time to obtain travel insurance, the privacy concern would most likely outweigh the benefits due to the willingness to provide that much information. Questions that are asked through social media should only be answered depending on the degree of complexity; otherwise they should be referred to a customer service agent.
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