Dylan McCaugherty 03/29/11. Background Research

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1 Progressive Auto Insurance: Flo s Superstore Ad Campaign A. Situation Analysis Background Research Joseph Lewis and Jack Green founded Progressive Auto Insurance in 1937 ("Progressive history," 2011). This company originally began as an investmentstartup began by the two lawyers called Progressive Mutual Insurance Company. Progressive is known for many firsts in the industry. They we re first to offer drive-in claims, installation payments on premiums, and comparative quotes via their website. By 1951 Progressive was experiencing substantial growth and expanded into larger offices in Cleveland, OH. Continued growth and expansion led to the formation of The Progressive Corporation in the 1960s. Today Progressive insures all types of drivers and vehicle. Strengths, Weaknesses, Opportunities, Threats Progressive has been very successful since their beginning in As mentioned before, the company had been seeing tremendous growth since it s beginning. However times changed and companies like Geico, Esurance, Allstate, and State Farm we re stealing the spotlight. Geico, perhaps Progressive s largest competitor, introduced the Geico Gecko in a new series of ads. The Gecko was unlike any other insurance campaign at its time and Progressive had to counteract fast to remain competitive in the market. Thus Flo, the cashier with sizzle and pizazz, and her superstore were born. Her character, as well as the concept of the Superstore for insurance policies, is a fun take on a serious subject ("Progressive's 'help flo'," 2010). The commercials are bright, loud, fun, and enthusiastic. Nobody has ever had a sales associate quite like her but we all know if we did we d want to buy what she was selling. Progressive also took this opportunity to push their side by side direct quotes and name your price options. You can see both of these promoted in the Superstore and Progressive is still the only one to offer them. Throw interactions with her customers Flo shows just how fun and easy the two services are. Companies like Allstate are attempting to compete with commercials Like Mayhem and State Farm with Good Hands. While entertaining none of them have solved our fears and concerns about insurance like Flo has. Flo became more than a friendly face, she became an icon one of the biggest in the business (Arnold Worldwide). ADVT 251 1

2 Key Advertising Problems to be Solved Progressive needed to raise brand awareness and separate themselves from Geico, Statefarm and everyone else. As the economy was getting tough Progressive needed to increase their marketing budget to obtain this goal. Another problem, shopping for auto insurance is usually associated as a long and dreadful process that customers are caught up in for hours or even days. With the launch of this campaign Progressive saw this as a key time to spend money on advertising when others were not. B. Key Strategic Campaign Decisions Objectives Along with intensifying advertising presence and raising brand awareness Progressive also wanted to show how easy it could be to shop for auto insurance. They wanted to make this time consuming and confusing task simple. Progressive also wanted to ease the process of comparing quotes with other companies. By providing this service themselves, Progressive ensures that their website will be the first stop for the consumer when they begin shopping for insurance (Grillo, 2008). Target Audience Through Progressives advertising campaign it s easy to tell that the company has a pretty wide Target Audience. Their current lineup of 22 Flo ads features ads mostly targeted at single to middle-aged young adults and couples. Several other ads target senior citizens who don t want to deal with a lot of flibbity flab or mumbo jumbo. Another ad, featuring two men with a watch, has been noted for targeting the gay audience. Progressive even promotes their high corporate rating with the Human Rights Campaign on their website. Campaign Strategy As stated before, Progressives main strategy was to ease the process of shopping for and using insurance. Getting people to love their insurance, that s no small hurdle. That s a mountain to climb. Because, when you think about it, you only deal with your insurance company when you owe them money or after you ve been in an accident. And how friendly can you make that? (Arnold Worldwide). Arnold Worldwide, the campaign creator, wanted to create a loveable character that could show consumers that working with Progressive was actually a pretty enjoyable process that would even save you a lot of money. ADVT 251 2

3 C. Media Strategy Media Objectives and Selection The campaign began on TV with Flo only selling Progressives auto insurance. Flo caught on quickly and worked so well that she soon began selling all of Progressives products available. Soon After the release of the TV ads Flo began popping up online in banner ads and full home page takeovers. Whenever a new TV spot or banner ad was created it was posted to Flo s YouTube and/or Facebook page. As Flo expanded to target motorcycle drivers, boat owners, and RV owners she was introduced in Superstore Print (Arnold Worldwide). These prints included magazine ads, statement stuffers, and direct mailings. Again, everything is all tied back and copied onto Flo s social media pages. Along with heavy TV advertising Progressive has also made a large investment in digital/social media marketing. The TV ads and online campaign are largely intertwined encouraging customers to interact between both mediums. Progressive s YouTube channel continues on from the TV ads with Flo- TV. It even hosted the contest for Flo s Helper which selected one lucky fan to be in one of the TV spots. Additionally, Flo s Facebook pages have a combined total of 454,168 fans (as of 3/19/10). This is almost 600% more fans than the next nearest competitor in the category (Arnold Worldwide). D. Creative Message Strategy Since Progressive was already known for high customer satisfaction they weren t too concerned about specifically promoting it. Progressive was aware of the huge hassle customers feared when it came time to shop for insurance though. Flo and her Superstore make the concept of shopping car insurance look simple and friendly for consumers, by equating it with the retail shopping experience they are very familiar with. (Grillo, 2008) These ads work to remove the anxiety that people normally experience when shopping for a highly technical and rather expensive product such as auto insurance. The different 30-second spots address each of these issues by mentioning that you can name your own price, compare your quote, and avoid all the mumbo jumbo. The main focus in most of the ads is the ability to compare Progressive with other top competitors. Progressive knows customers like to shop around and this is how they re reassuring that its okay to do so. ADVT 251 3

4 These way customers can feel comfortable with their purchase and avoids buyer s remorse. E. Effectiveness of the Campaign Part of Progressives goal was to increase brand awareness. Flo and her tricked out nametag did just that. When the campaign originally launched in 2008 awareness initially grew by 5%. Their brand impression increased by 18% during those same first few months ("Progressive's 'help flo'," 2010). Between quarter 4, 2007 and quarter 4, 2009 Progressives already high view of caring for customers increased by an additional 6.7%. Ratings for making the process easier increased by 12% and value for the money increased by 19%. Changing how people think about auto insurance? Now That s progressive (Arnold Worldwide). F. References Arnold Worldwide, Initials. (n.d.). I love insurance. Retrieved from Grillo, R. (2008). Progressive's clever marketing strategy. Seeking Alpha, Retrieved from progressive- s- clever- marketing- strategy Malki, B. (n.d.). Everyone loves flo. Your Brand is Showing, Retrieved from loves- flo Progressive's 'help flo' campaign aims for engagement, brand building. (2010). Marketing VOX, Retrieved from help- flo- campaign- aims- for- engagement- brand- building / Progressive history. (2011, March 12). Retrieved from insurance/history.aspx Three reasons why the new progressive insurance campaign works like gangbusters. (2009). 60 Second Marketer, Retrieved from reasons- why- the- new- progressive- insurance- campaign- works- like- gangbusters/ ADVT 251 4

5 G. Samples of Ads You can see all of Progressive s Flo ads on their website here: commercials.aspx ADVT 251 5