Geico Marketing Plan
Contents
Executive Summary
Company Profile
Market Segmentation & Targeting
Situation and Company Analysis
Ethics and Social Responsibility
Marketing Information and Research
Customer Decision-Making Profile
Positioning and Differentiation
Branding
Marketing Mix (4Ps)
Product Strategy
Pricing Strategy
Place: Distribution Strategy
Promotion: Integrated Marketing Communications Strategy
Budget
Action Plan
Risk Factors
Attributions
Executive Summary
Company Description
Geico is a major auto insurance company in the United States that offers quality coverage with some of the lowest rates. We also provide other types of insurance policies form home and life insurance to insuring your pets. Our new campaign focuses on Geicos possible savings through signing with or switching over to us, or savings through bundling more policies with their existing ones.
Target Segment
Geico’s target market is broad in all aspects of segmentation criteria as a very large percentage of the population are required to have auto insurance at the very least. The market narrows considerably as we consider who our business liability or pet insurance clients will be for instance
Competitive Advantage
Our competitive advantage is our ability to offer better or at the very least the same quality coverage as all the other major companies within the market at a lower cost.
Positioning Statement
"If you want to save money are your car, home, or motorcycle insurance, Geico saves you the most by taking every consideration into account and can adjust your policy’s coverage and rate to fit your budget."
Marketing Plan Objectives
Our marketing plan objectives are:
· Launch another successful television commercial campaign.
· Educate the audience that Geico can save them money by choosing us, switching over to us, adding and bundling more policies to their accounts, or adjusting coverages to fit their budget.
· Increase sales and market share.
· Increase profits by bundling more types of insurance in addition to just their auto insurance.
Company Profile
● Company Name: Geico
● Industry: Insurance
● Headquarters (city, state, country): Chevy Chase, Maryland, United States of America
● Year founded: 1936
● The number of employees: 40,000
● Annual revenue (estimated): $35.093 billion USD
● Major products and/or services: Automobile Insurance
● Target customers: Private Passenger Automobile Owners/Leasers
● Distribution channel(s): Field Reps; Over the Phone via Licensed Agents; Website
● Key competitors: State Farm; Progressive; Allstate; USAA; Liberty Mutual; Farmers
● Link to website: https://www.geico.com/
Market Segmentation & Targeting
● Our product satisfies both our client’s lawful obligation and additional protection when it comes to insuring their car, motorcycle/ATV, boat, RV, home (and other properties), floods and earthquakes, and business liability, malpractice, workers compensation, cyber liability, travel insurance, pets, life insurance, identity protection, and even insure your pets.
● Geico’s target market is broad in all aspects of segmentation criteria as a very large percentage of the population are required to have auto insurance at the very least. The market narrows considerably as we consider who our business liability or pet insurance clients will be for instance.
● When it comes to our main product which is auto insurance the 4 main key segments that are demographic, geographic, psychographic, and behavioral. Again, once we get into some of the more niche products/markets, those key segments will change when it comes to how we will market those products. Some may include economic segmentation, psychological segmentation, benefit segmentation, and use related segmentation.
● Geico serves drivers first and foremost, and drivers are a hugely diverse segment. An example of a narrower segment we serve would be pet owners. Another would be a company’s worker compensation plan. Each product would require an as diverse marketing campaign and the segment itself.
● The main focus of our marketing campaign and budget will be on the driver of their own personal car. This is the largest market, it is a market that does not waiver in good economies or bad, and it is a product that is required by law for our clients to have.
Situation and Company Analysis
Economic Environment
The economic environment within the automobile insurance industry is mostly inelastic when it comes to both demand and price. Rates have currently rose, but only with everything else in this economy. Currently the climate of new policies is in a growth stage as a spike in income due to pandemic tax breaks and stimulus aids that have produced more new car owners who need insurance. Consumer confidence in insurance rates is the same as it is everything else right now which is not the best, but it’s also not the worst. The rising cost of doing business is the main role in the rising policy rates which range from an average of 5%-12% (Deventer, 2022). And unfortunately, it has been more difficult than usual to hire new employees to help with the influx of new policies.
Technical Environment
The newest trend in insurance to help drivers keep their rates low is driver monitoring. Certain cars and apps can track how well you drive to help lower your rate. Geico makes getting quotes, purchasing policies, and filing claims as easy and streamlined as technology allows in today’s tech world.
Industry Environment
Bundling is the industry’s newest and largest trend. For instance, companies are giving discounts for clients who insure (& “Bundle”) their cars and homes or more. Another trend is informing current policy holders that they can lower their insurance by updating, adding, and dropping certain coverages. Also updating how much the car is driven, and how far. The newest practice in the industry in related to the tech environment and it is being able to do anything you need to do regarding all their policies from the app on their phone.
Competitive Environment
There are 5 major competitors in the industry. Geico is number 2 out of the five with State Farm being number 1. Geico is followed by Progressive, Allstate, and then USAA. The spread between the 1st and 5th is $40.4 - $15.8 billion (valuepenguin.com, 2022). Fortunately, the markets demand is large enough to support all the top competing companies.
Political Environment
Insurance rates are extremely political to the point that they effect elections. Some states even elect insurance commissioners. Some drivers will falsify their addresses just to receive lower rates which will also effect elections as they cannot vote where they do live and must vote wherever their licenses say they live. Obviously, insurance companies would like to have higher rates and the public would like lower rates. There are multiple licenses that the company needs to operate as a broker, and licenses that each agent need as well.
SWOT Analysis
HELPFUL Ideas
HARMFUL Concerns
Internal
Strengths
● Geico has a strong brand presence that continues to grow.
● Imaginative and creative marketing team with stellar TV commercial and online presence.
● Extensive product line that offers clients with insurance from homes to pets.
● We offer innovative and user-friendly initiatives.
● Keep costs significantly lower than the competitors.
Weaknesses
● Current brand needs to be revamped.
● Marketing activities are old and outdated.
● We do not offer any disability or long-term care products.
● Bad faith claims/lawsuits need to be avoided, addressed, and/or settled.
● Some policies could cost less based on rate of return in comparison to other types of policies.
● Our customers are generally less satisfied with the result and/or amount of their claim/payment.
External
Opportunities
● Capitalizing on the growing market due to all the new vehicles on the road.
● Fulfilling the customers need to be educated and coached on how certain additions and subtractions will affect their policy and premium.
● There is an additional demographic of auto owners/leasers due to economic impact packages and tax breaks
● Working with health insurance companies on personal injury protection claims and the coordination of benefits with those covered by more than one plan.
● Advertising campaigns with the rental car companies with whom we insure their clients.
● Taking advantage of and adopting other foreign initiative that increase quality for both the company and the client.
Threats
● Competitor using better marketing tactics that resonate with more segments than ours.
● Most of our competitors have more experience.
● Competitors claim satisfaction is higher than ours.
● Competitors likely mimic our advertising strategies based on our success.
● The Geico Gecko campaign is losing its steam. In need of revamp.
● If passed the Prohibit Auto Insurance Discrimination (PAID) Act will limit the factors that determine premium payments to driving record history only. This will remove many factors from the long list of rate setting factors like income, credit score, previous insurer, and prior purchase of insurance etc.
Mission, Objectives & Goals
Geico's mission is to provide affordable and dependable direct auto insurance to drivers across the United States, while also representing our customers in their time of need following an accident. (comparably.com)
Geico’s objectives are to improve people’s lives and communities by keep people secured and exceeding expectations. (Mission-Statement, n.d.)
Geico’s main goal is to remain the #1 car insurance company in terms of growth through marketing objectives including increasing accessibility of car insurance services to consumers in various geographic areas, increase market share (currently 2nd at 14%), and increase advertising (valuepenguin.com, 2022).
Ethics and Social Responsibility
Current Status
Some of Geico’s current social responsibility and sustained business practices are it’s product itself to safely and effectively insure their customers; information procurement, for example in the form of educating student drivers on safe driving; focusing on the effects of employment and taking good care of their employees; and giving back to its communities through various forms of donation to charities and funds whether it is monetary or thru volunteering. (thesisleader.com, n.d.)
Recommendations
A further recommendation for our company to create a more ethical, socially responsible, and sustainable business is to create opportunities and encourage our employees to be more a part of the giving back the communities they live and work in. We can do this by organizing and volunteering at selected events and/or charities within our communities.
Marketing Information and Research
Research Question
The main question and focus of our research will revolve around the increasing and revamp of our most influential marketing tool, Martin! What can we do to revamp our lovely spokesgecko?
Information Needed
As a company we need to figure out how to cast a wider net when it comes to captivating and relating to our very diverse customer base. What do we need to do so our commercials do this? What is relatable to all, and how do we translate that through our very popular friend Martin?
Research Recommendations
Marketing will lead the effort in determining how to gather this kind of information through professionally psychological prepare surveys that can help us answer the questions we have. This may or may not be done in one round of surveys. The information we initially gather will determine the next steps. In order to have a bigger net to cast, we need to know what is more relatable to many different demographics.
Customer Decision-Making Profile
Identifying the Customer and Problem
Like the target segment itself, the primary decision maker also covers a wide demographic. This is not a problem per say, but it is the challenge. Everyone needs car insurance, and everyone wants the lowest price for the best coverage. We will help them make Geico an easy but still confident and educated choice.
Factors Influencing Customer Decisions
The most detailed profile will only consist of ages 25 and older. This is because younger drivers (high school thru college 16-24 y/o) are typically not responsible for their car insurance as they are still on their parents plans. Again, that leaves us with a very broad demographic when it comes to geography, personal and demographic characteristics, and the social and psychological characteristics as well. The target segment focus based on situation characteristics will revolve around the new customer, and our B2B characteristic profile will focus on working with businesses and firms with fleets (large or small).
Reaching the Customer
The revamp of our commercial campaign will focus on the broad 25 and older demographic based of the market research we do. These commercials will also include the strategy to bring in the new customer. We will do this through education and making the quote process, transaction, and/or switch easier (or as easy) than anyone else in the market. Our B2B strategy will focus on building relationships with the businesses and firm though face to face interaction whether it is in a scheduled meeting, or some other opportunity such as a convention.
Positioning and Differentiation
Geico’s goal is to always be known as the best insurance company with the highest quality of coverage and claim satisfaction with the lowest policy costs.
Competitive Advantages
Geico offers lower rates for better coverage. Geico also offers more saving when you bundle policies. Geico is also the most tech savvy of the market making all things insurance and vehicle related easier (Norman, 2021).
Market Niche and Positioning Strategy
Again, our customer base is broad so I can’t classify our target market a niche. For this reason, segmentation is the best strategy for our companies’ goals. Also, in these times offering rewards (future discounts and lower rates) for safe driving is the industry standard so that can be offered through the tracking new automobiles offer or apps that can be downloaded on their phones.
Positioning Statement
"If you want to save money are your car, home, or motorcycle insurance, Geico saves you the most by taking every consideration into account and can adjust your policy’s coverage and rate to fit your budget."
Repositioning Considerations
We are not proposing a repositioning at this time as what we have been doing is working. We continue to have the lowest rates and are still growing faster than any of the competition.
Branding
Brand Description
Que Martin! “15 minutes could save you 15% or more”. We stand by our already existing and nationally known brand. People know it, and people like it. We are also now starting to identify the Geico name with the ease and accessibility of claims as well. Through our app for the customers phone, and adjusters available 24 hours a day.
Brand Promise
Our promise is the best coverage at the lowest price. “15 minutes could save you 15% or more”. Let’s be clear though, this is not a promise per say. Nothing in insurance is because what we can and will offer premium wise depends a lot on the drive when it comes to car insurance, or other factors when it comes to any other type of insurance being purchased. Our brand is a good fit because it gives the most accurate description of our position in the market. And it’s catchy.
Brand Voice and Personality
● Geico is the lowest cost, highest quality, premium insurance provider.
● Geico is never difficult to deal with and hassle free.
Brand Positioning and Strategy
Geico is one of the only companies that offers bundling insurance policies but does not position itself as so. In today’s market, bundling is what offers even more value to its market segment. This will contribute to even more success with its current policies holders by adding more, and by new customers bundling from the start.
Marketing Mix (4Ps)
Product Strategy
Geico’s insurance policies compete with the best when it comes to high quality coverage at a lower cost. All of Geico’s current products have been introduced to our clients and are always being evaluated to offer the best quality of coverage and customer satisfaction to uphold the consistency of what it is like to do business with us because we know that all of these things are what are most important to our policy holders.
Pricing Strategy
Geico’s products are priced based on the coverage required or desired by the client and their driving records as well. Premiums can be customized and prices can cost more or less based on the customization of those policies. Our prices are advertised and generally lower than our competitors. Our prices are also discounted when clients choose to use Geico for multiple policies. Our profit margin goal is a minimum of 5%-6% per policy. Our prices compete with the best in the industry and we hold 9+% (4th) of the policies within the entire automobile insurance market. We believe that speaks for itself when it comes to the value, quality, and prestige of Geico.
Place: Distribution Strategy
All current marketing points to our website to distribute all our policies. In today’s culture, this is the best way to do it and it is what just about everyone in the world is used to. Because we are and remain on the cutting edge of how the rest of the world does business, we do not see much missed opportunities when it comes to how we get the product to the customer. The very small percentage of customers that still want to do business face to face can as we have agents in brink and mortar locations all over the country so that no one in the United States is out of reach when it comes to being a Geico customer.
Promotion: Integrated Marketing Communications Strategy
Approach
Geico’s approach to promotion is to continue to use our television commercial campaign to steer people towards becoming a Geico customer. We will also continue to use our brand “15 minutes or less could save you 15% on your care insurance” slogan. However, we will be re-vamping Martin the Gecko’s story to help re-engage our audiences and influence them to actually go and check to see how much we can save them by choosing or switching to Geico. We will also be adding more emphasis to our multi-policy bundling feature to save people even more by having us insure more than just their cars.
Goal
● To get viewers of our commercials to check and see if we can save them money.
● Inform car owners who need new or are shopping for another car insurance policy.
● Visit geico.com today
Messages
Identify the primary message for your campaign, 2-3 message pillars, and proof points for each. Be sure to include a call to action that helps to achieve your goal. Remember that messages should align reinforce your positioning statement. Be sure to include a call to action that helps to achieve your goal.
Example:
1) Geico can save you 15% or more on your car insurance by taking 15 minutes to check by visiting geico.com.
2) Customers can also save by bundling different types (home, auto, pet) of policies together.
3) We can adjust your policy’s coverage and rate to fit your budget.
4) Visit geico.com today.
Promotional Mix and IMC Tools
Advertising
· Television Commercial Campaign: use a new series of commercials to re-engage our audience.
Digital Marketing
● Website: using it to re-iterate and emphasize the opportunities to save more by bundling and/or adjusting policies to fit their budget.
Direct Marketing
● Email marketing: used to advertise new offers and re-engage any potential new customers who have engage with our website before and didn’t purchase a policy or who has inquired about other types of policies in addition to the one/ones they already have with us.
Sales Promotion + Digital Marketing
● Referral discounts to those who refer and are referred by another Geico customer.
Sales Alignment
The new television commercial advertising campaign will support sales alignment by generating leads and building on existing relationships with current customers.
Measurement (KPIs - Key Performance Indicators)
· Number of qualified leads generated: This will show us how many people (new or existing customers) engaged due to the commercial they just saw and what they engaged about or for.
· New/incremental sales: This shows us how many new or additional policies were written to new or existing customers during the campaign.
· Net promoter score: We want to hear directly form the customer how they feel about their experience with us and how likely they are to recommend us and why.
Budget
Item
Purpose
Cost Estimate
Commercial Production
To produce commercial series
$1,500,000.00
Broadcasting Costs
To broadcast on network television (per 30 seconds)
$150k-4M
Online Development
Algorithm and coding costs (Geico employees)
$50 per hour
Estimated campaign impact: $200 million increase per year
Action Plan
Timing
Activity Type
Brief Description
Teams
Owner
2/1/2022
Martin’s Re-vamp
Martin’s new story and series ideas
Marketing
Manager
2/15/2022
Production Meeting
Meeting with production company
Marketing
Manager
5/1/2022
Production
Commercial production is wrapped
Marketing
Manager
7/1/2022
Campaign Launch
Starts running by 1st of the Fiscal Year
Marketing & Accounting
Team Managers
10/1/2022
1st Quarter Analytic
Campaign effectiveness review (per quarter)
Accounting & Upper Mngmt.
Team Managers
6/30/2023
Year End Analytic
Campaign wrap and report
Upper Management
Team Managers
Risk Factors
Even though we do not see this happening, if our commercials have lost steam all together, we may need to abandon Martin’s story and rebrand. If this is the case, we will ride out the remainder of the campaign and use that time to write our new story. We already taking some steps and have some ideas incase this does occur but we believe that Martin is our guy and that we have what it takes to stay competitive in regard to the products themselves. We are also prepared to move on if our competitors start to move in a new and more effective direction with the way they do business and/or their marketing and advertising.
Works Cited
Deventer, C. (2022, January 12). Bankrate.com. Retrieved January 18, 2022
https://www.comparably.com. (n.d.). Retrieved Febuary 1, 2022, from https://www.comparably.com/companies/geico.
Mission-Statement. (n.d.). https://mission-statement.com/geico/. Retrieved February 1, 2022, from mission-statement.com.
Norman, K. (2021, Septmeber 21). Retrieved February 2, 2022, from nerdwallet.com: https://www.nerdwallet.com/article/insurance/allstate-geico-progressive-state-farm-comparison
thesisleader.com. (n.d.). https://thesisleader.com/essays/corporate-social-responsibility-geico/. Retrieved Febuary 1, 2022, from thesisleader.com.
valuepenguin.com. (2022, January). Retrieved January 19, 2022
Attributions
CC LICENSED CONTENT, SHARED PREVIOUSLY
Flinders Business School Marketing Plan Template. Authored by David Medlow-Smith. Located at: https://archive.org/details/FlindersBusinessSchoolMarketingPlan2. License: CC BY-SA.
ORIGINAL CONTENT
SWOT and Integrated Marketing Communications Templates. Authored by Melissa Barker. License: CC BY: Attribution.
Revision and adaptation. Authored by Lumen Learning. License: CC BY-SA.
Revision and adaptation. Authored by Waymon D. “Wade” Hyde, faculty, El Centro College/Dallas County Community College District. License: CC BY-SA.