Insurance Market Study. Analysis of opportunity.

 Insurance Market Study. An Introduction to the Insurance Market.

By Tom Dougherty

Insurance Market Study
The insurance industry follows the leader

This insurance Market Study came about when ProAssurance selected Stealing Share to work on its brand, we uncovered a category that was perceived to lack honesty and integrity. Through our qualitative and quantitative research, a core attribute became obvious: physicians are driven by emotion when selecting an insurance company, not by the worn-out tactics seen in the marketplace. The mainstay message of “aggressive defense” was no longer emotional, but simply the ante you must have to even play in the game. (See work we did for ProAssurance)

Recognizing this, we created a unique position for ProAssurance. A position meant to align with physicians’ desire to be treated fairly by insurance companies because physicians deal with issues of fairness every day – and, therefore, are more highly sensitive to it when they aren’t treated fairly.

For this insurance market study of insurance companies we had to look at the vast landscape  for consumers. It’s a challenge to find brands that recognize the emotional desires. The advertising is trite with themes that center on extremes and, more often than not, just the ante at the table. Nobody raises the stakes.

INSURANCE MARKET STUDY:Insurance marketing campaigns are either over-the-top silly or deadly serious. All of them, though, are only about cost or protection, which are not switching triggers. You must already believe your current carrier has reasonable rates and good protection coverage’s to have picked it in the first place. You don’t switch for things you already believe what you have.

This case study will examine the marketing of the auto, health and homeowners insurance leaders. In particular, we will identify those campaigns that capitalize on the real emotional needs of the individual, and those that have fallen prey to meaninglessness.


Brandchannel reported that the “U.S. auto insurance brands spent $5.7 billion on marketing last year in the U.S., nearly double what they spent just five years earlier. But they’re not getting as much bang for their buck as they did a couple of years ago.”

No kidding. It’s a difficult process to switch auto insurance companies and the carriers have not given consumers a reason to choose. It’s bad money spent, and a lot of it. That’s the reason why the market has barely moved despite all the advertising dollars.

Many of the market leaders in auto insurance, such as GEICO and Progressive, have only gained a tiny portion of market share through frequency of advertising and the promise of offering the cheapest insurance. Sadly, these companies have spent millions of dollars on campaigns that are strictly entertainment rather than unlocking the emotional triggers for choosing a brand. Entertainment can work if you have low awareness, but who doesn’t know GEICO or Progressive?

Still, each has come to standstill according to this insurance market study, both treading water without sign of improvement.

Here’s why.


To quote Matt Damon from an episode of 30 Rock:

“Why does GEICO have three different spokesmen?” Damon asked the Tina Fey, the show’s leading lady.

Damon: “They have got the gecko, the caveman and the stack of money with the eyeballs.”

Fey: “And the fake Rod Serling guy.”

30 Rock has it right. What message is GEICO trying to convey to their audience?

Take this commercial for example:


The Gallagher references are simply not emotional and simply an inside joke for those who remember his act. Knowing that 15 minutes will save you money won’t get you to switch either, because all insurance companies say they will save you money.

Wrapping that message with humor doesn’t make it any more emotional. In fact, humor can often hide the message, even if it’s meaningful, because all viewers remember is the humor. Advertisers must tread lightly here and subtly goes a long way.

Something this spot could have used.


GEICO has become the king of bland messages within a fruitless search for market share. It tries all the various characters in its arsenal, but nothing has worked. The problem is that GEICO hasn’t realized what’s more important: Messages that are different and better than the competition (so it presents a true choice) and an emotional hook that makes consumers covet the brand.

Alas, GEICO is not alone.


Like GEICO, Progressive takes the advertising frequency and humor route and it hasn’t worked, either. Those at GEICO would not doubt point out that it uses so many characters to refresh the adverting because Progressive’s sole character, Flo, is wearing out her welcome.

But it doesn’t matter. Because even Progressive has become GEICO-lite with the same message about cost in some sort of humor blanket.


Health Pro recently reported that: “Progressive has Flo. She is … not great at explaining why people might need insurance, but she is great at conveying the message that Progressive has the flexibility to meet customers’ needs. My 9-year-old daughter looks for Flo commercials the way she looks for new episodes of iCarly. There might be some consumers who will have a warm place in their heart for Progressive in the 2070s, or even the 2100s, thanks to Flo.”

Now that’s a ringing endorsement in this insurance market study. What is it that Health Pro is remembering? The character or what Flo represents that serves as a self-reflection of the consumer. (Or, in this case, the self-reflection of a 9-year-old.)

Progressive does have its own unique look – the stark white – and there would be no mistaking the ads for anyone else’s. The problem is that, like GEICO, they are a representation of an ad agency gone amok. What has been forgotten is how to steal market share, not raise awareness that it already has or simply entertain us to win advertising awards.


To quote, “Allstate [has] been stuck with the task of shaking the perception of being ‘expensive and serious.’ Allstate has tried to overcome this notion by launching its ‘Mayhem’ advertising campaign in May 2010 and by beefing up its marketing budget by more than half between 2009 and 2010.”

In this insurance market study, It was reasoned that because of this perception, if true, that GEICO and Progressive decided to capitalize by focusing on price. The problem was that they oversaturated the market so the message doesn’t register and they took a route that wasn’t emotional.

Allstate, recognizing that fighting on a price is a loser’s game, went the protection route.


There are a few problems here. While edgy and unique, the emotional fear that “protection against mayhem” may play on is again couched as humor. That means it’s not really fear. It becomes a skit about someone else.

The results have not been kind to Allstate. Its CEO recently resigned and its property-liability insurance premiums have been flat, although that’s not overly unique in this market.

Earlier attempts at the protection theme have demonstrated that even outside the confines of edgy and funny, it is a non-emotional message and one that is the definition of an insurance company, not a reason to choose.


“A healthcare organization’s brand,” according to Business Exchange, “ is more critical than ever. This can mainly be attributed to the complex and highly competitive nature of the industry. Awareness with strong identity and messaging are a good start. But apart from basic marketing, successful branding goes a lot further. It must start from inside a healthcare organization’s core.”

Business Exchange highlights here what most get wrong about brand. It’s not just a logo, marketing message and tonal executions. It is those things, but it also defines the company culture so the company fulfills the brand promise. (If, like ProAssurance, you promise to treat customer fairly, then processes must be established that ensure fairness and fairness must become the mantra for all those working for ProAssurance.)

Economy Watch also reported: “Marketing health insurance is one of the most difficult jobs in insurance marketing. This is because of the perpetual conflict between the insurance companies which want to make a profit and the insured person who wants to get as much compensation as possible from the insurance company.”

It’s a delicate balance, but the way to unite those cross purposes is by marketing values that are more important to consumers than price. Such as, who they are.

Blue Cross/Blue Shield


Here, BCBS of Illinois has developed an advertising campaign that is both meaningful and memorable. First off, that’s because it is mostly about the customer (the home video footage of families that demonstrates who the customer of BCBS of Illinois is), not the company. It has a compelling soundtrack and is unique in its delivery.

The message is a bit confused, however. The imagery suggests the switching trigger is about taking care of family, which does have an emotional element, but it primary message is that BCBS of Illinois has been around a long time. While that fits into the nostalgic element of the piece, who cares how long it has been around? What matters is what does it mean to the proverbial “me.”

Interestingly, the national campaign actually gets it more right. On the surface, it seems annoying, with the tricky vibe and all. But it describes who the customer is, an active and happy person, with a little bit of goofball in them. The “health of us all” is a message that describes both the customer and the company, with an emotional sense at its core.


Emotion doesn’t have to be maudlin. In fact, it’s often stronger when it isn’t. The powerful, athletically motivated spots for Nike have revolutionized the shoe industry, for instance. In this case, the simple idea of grooving your body each day has its own emotional underpinnings and supports the message that, as Blue Cross/Blue Shield said, “you can improve your overall health, achieve a healthy weight and reduce your risk of high blood pressure, heart disease, stroke, diabetes and other illnesses.”

Health First Insurance

Unfortunately, most health insurance marketing is done on the local level. I say, unfortunately, because most of the local health insurance companies cannot afford quality production.


Health First Insurance is not alone. The reason why the quality of production is important is because the ads don’t exist in a vacuum. Prospective customers for healthcare insurance are usually businesses (workers rarely have a choice in health insurance), which means they see high-gloss marketing materials and shiny TV ads alongside ones that have a saccharine, infomercial feel to them.

This manner of health insurance commercial is the status quo. Take MyPriority, for example:


While a small portion, these commercials represent the modus operandi in the market. The sophistication is massively lacking, especially when the target audience (decision makers at businesses) are often misidentified, messages are bland and spots are cheaply produced.


Case in point. Compared to Aflac, even if it falls into the same traps as other national brands, the local spots are simply drowned in the sea of high quality (and expensive) advertising.

Aflac, though, is kind of interesting case. A decade ago, Aflac was a virtual unknown among consumers. In 2000, according to Aflac itself, was only recognized by 12% of the target audience. Today, that number has jumped to 90%.

As stated before, the comic character in a comical situation (i.e., entertainment) only works as raising awareness, not increasing preference.


The problem it has is that it’s time for it to move on. Unlike GEICO, it has developed a long-lasting equity marker in the duck that makes the brand instantly recognizable.

But what does it mean. In the above spot, the message is clearly about price – or, at least, money back – that could be seen a relatively unique in the current landscape.

It’s a still a thing, though. Not an emotion. All brands, whether in the insurance game or not, need to understand the difference between the business of their business and the business of their brand. The business of insurance companies is to provide insurance and all that comes with it: Protection, good rates, even loyalty programs.

But the business of your brand is different. It is what you’re offering on an emotional level. Or, more importantly, who you are when you are part of that brand. For the Apple consumer, for example, you are the one who thinks different.

Who is the Aflac customer? Answer that question and Aflac can create preference.


Like its insurance brethren, home insurance marketing falls into similar traps of marketing just those things homeowners already believe they have.

Even if the most intensive message is about protection – and even that is the ante into the poker game – the tone and approach are so similar to the joke advertising of car insurance, it gets lost.


Like those advertising auto insurance, Farmer’s Insurance establishes a character (the professor) who is set into a comical situation that overshadows any message.

However, this is a better attempt at providing preference. The ad is specific (covering your home’s roof) and the humor is kept relatively low key. (That is, compared to a talking lizard and depressed cavemen.)

Farmer’s also has the benefit of having equity markers, a recognizable theme and themeline, “We are Farmers,” that has its own happy, even nostalgic emotional feel.

The problem is that it is still too expected. Considering how often insurance advertising is broadcast – including auto insurance – it blends in right with the others.


Speaking of equity markers, Travelers does the best job in the category using its equity markers, especially the umbrella. The umbrella signifies protection and its themeline of “It’s better under the umbrella” gives the brand some meaning, often lacking? in this market.

Some may say that there is confusion about what is being marketed here, but Travelers uses it equity marker and “puppy love” to get to the emotional reason why homeowner’s insurance becomes such a crucial decision: It’s one of the ways you meet change.

This is lightly humorous and lightly affecting spot – everyone is a sucker for dogs – but the message is actually organic of the spot, you know who the spot is for right from the very start and the umbrellas brings its own meaning.


In each of these categories, there is tremendous opportunity for to steal market share. The reason is because there is no differentiation between the competitors. They are the same in message, tone and attitude.

INSURANCE MARKET STUDY:That is, they are the same as brand. How is the GEICO customer any different than the one from Progressive? Only Travelers, to an extent, has a brand image and meaning that is different than others, but even it doesn’t go all the way.

The result is that most insurance companies hemorrhage their money on meaningless advertising. Insurance companies have always been a big player in the advertising landscape, but the spends have gotten so large that they are trying to buy market share – and losing.

Awareness may have once been the problem for the GEICO and Progressives of the world, but it’s not anymore. The battle now is over preference.

With each percentage of market share accounting for millions of dollars, there is a tremendous amount at stake. It’s time for insurance companies to get away from the gecko and Flo, and move into something more real.

 Our ProAssurance Case Study

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GEICO is beating the Insurance Competition

Is there opportunity in the insurance industry?

The insurance industry needs to wake up

Insurance advertising

Auto insurance companies claiming the same space

Stealing Share featured speaker at insurance gathering