The $4 billion insurance industry advertising brawl

Could there possibly be a more staid and conservative business than insurance?

That’s the way things used to be until the big auto insurers and the discount brands started duking it out with expensive national TV ad campaigns. Advertising Age magazine recently officiated the melee with an article on the battle for consumer mindshare (How the insurance industry got into a $4 billion ad brawl).

You know the players. Among others there are:

• The Geico gecko
• Flo, the perky and retro-styled sales clerk for Progressive Insurance
• Mayhem, the destructive Allstate menace
• “The World’s Greatest Spokesman” from Nationwide
• The State Farm agents who magically appear at accident scenes

Nina Abnee, the Leo Burnett executive who oversees the Mayhem campaign for Allstate, put it bluntly in the Advertising Age story: “We wanted to kick Flo’s ass.”

Mayhem has been gaining traction by wrecking people’s vehicles, and then telling TV viewers the discount auto insurance policies they bought probably won’t cover the damage he has wrought.

There’s a lot at stake. Auto insurance is a $161 billion industry.

Two big lessons have emerged from the advertising showdown.

One, being staid and conservative just doesn’t get the attention required to gain market share – even for an old-line business like insurance. As Abnee observed, “Nobody wants to talk about car insurance. In order to combat that, we needed to entertain.”

Two, the creation and development of original characters – whether human or animal – rules the day.

When an Ad Age survey asked people to match brands to the advertising “spokespeople” they recognized, the lovable green Geico gecko took the prize. Ninety-eight percent of respondents connected Geico with its long-running character. Flo, of Progressive Insurance, was second at 92 percent. Mayhem, a relative newcomer to the scene, has already achieved 63 percent name recognition with Allstate.

Indeed, Mayhem has already become such a fixture in pop culture some kids were dressed as him for Halloween.

The insurance-industry characters join a long and successful line of characters and narratives that have become the power players of advertising campaigns. Think…

• I’m a Mac, I’m a PC
• The Most Interesting Man in the World
• The AFLAC duck
• The Verizon “can you hear me now” guy

Repetition is key, of course, and that costs serious money if you’re going to play the national TV ad game. And the auto insurers have certainly upped the ante, collectively spending more than $4 billion annually for their ad campaigns, which is more than double what they were spending in 2000, according to J.D. Power and Associates.

It remains to be seen who flinches first.

 

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