Except for discounters, insurers' funny ads not paying off
— -- Insurance is no laughing matter. It just seems that way on TV and social media.
Geico's quirky gecko, Progressive's peppy Flo, Allstate's mischievous Mayhem, Farmers Insurance Group's wry professor and Nationwide Mutual's World's Greatest Spokesperson aren't just ubiquitous but some of the most clever icons created by Madison Avenue.
While they've boosted market share for discounters Geico and Progressive by helping lure Internet-savvy consumers and comparison shoppers, the heavy emphasis on humor-based advertising appears to be generating little more than expensive chuckles for the big carriers who control 50% of the $160 billion automotive market.
Facing funny fatigue, some are about to shift gears.
Nationwide is swapping laughs for the warm-and-fuzzy approach. Beginning with Friday's opening of the Summer Olympics, World's Greatest Spokesperson is out. In: Join the Nation, a series of slice-of-life vignettes aimed at generating an emotional connection. The centerpiece of a campaign that could have a five-year run, Join the Nation has voice-overs by film star Julia Roberts.
Nationwide's fourth fresh ad campaign since 2005 is a marked departure from the swelling tide of laugh-infused TV, radio and digital ads its marketers believe is choking consumer interest. A throwback to the more sedate insurance ads that predate Geico cave men and Aflac ducks, Join the Nation is designed to break through the ad clutter of critters, cartoon characters and buffoons.
"Humor has been the name of the game in this category. But when you want to create something real and relevant, you don't do it with spokes-characters and talking animals," says Nationwide's chief marketing officer, Matt Jauchius. "We decided to zig when everyone else is zagging. The thing we're counting on is getting to who we are in a genuine manner that leads to growth."
The company's strategic shift comes amid an escalating marketing war that has propelled a 60% surge in auto insurance ad spending since 2007. Geico, Progressive, State Farm and Allstate now rank among the USA's 20-most advertised brands — outspending deep-pocketed consumer-product giants such as Budweiser, Coca-Cola and Home Depot.
While the World's Greatest Spokesperson helped boost brand awareness for the first time in over a decade, the two-year campaign couldn't stem eroding market share — off 9% since 2009 — even as Nationwide was pouring more and more money into advertising. Last year alone, Nationwide hiked annual ad spending more than 35% to more than $200 million.
"The challenge is how to stand out from the other guy," says Jon Swallen, a longtime industry observer who is chief research officer for brand tracker WPP Kantar Media. "When you have big brands all trying to stand apart, the challenge isn't just yelling louder or more often, but creating a brand personality. The fact that Nationwide is changing its approach suggests that they're attempting to carve a place where they can attempt to stand out."
Competitors tweaking strategy
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