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Pathmatics Blog

Brand Awareness: How Insurance Companies are Using Digital Ads

March 05 2020 by Sarah Fleishman

Fill in the blanks:

“Fifteen minutes could save you ___.”

“Like a good neighbor, ___.”

“Insurance that doesn’t ___.”

We are inundated with so much advertising from insurance companies that we can quote their taglines and sing their jingles without hesitation. Yet in a 2018 study on auto insurance advertising, researchers at UCLA found that ads “had no impact on the brands consumers chose to get quotes from, nor in the final step of choosing which insurer to go with.” So why are channels so saturated with insurance advertising? “[B]rand awareness is where advertising dollars are most worthwhile” for auto insurers, the study concluded, and “the advertising content that leads to consumers’ increased awareness is of non-informational nature (brand name focused and funny/entertaining content).”

The pioneer of this approach, of course, is Geico. In 1999, their glib gecko started a revolution in how insurance companies connect with customers; twenty-one years later we all know that fifteen minutes could save us 15% or more on car insurance.

You probably recognized the second tagline above as being from State Farm, but the third one, “Insurance that doesn’t suck,” is a relative newcomer. It’s the motto of Lemonade, an insurance industry disruptor that built a new business model for insurance and became the first insurance carrier to become a Certified B Corporation.

Root Insurance, another recent entrant in the business, is also trying to differentiate itself with a forward-thinking approach. They base auto insurance premiums on drivers’ behavior while driving, as monitored by smartphone, which helps their customers mitigate rising insurance premiums.

To discover how all of these companies, both old and new, are using digital to maximize brand awareness, we examined their digital advertising strategies from the past twelve months.

Geico vs. State Farm vs. Lemonade vs. Root

Do Display Ads Support Brand Awareness?

Insurance companies that devote high spend to display ads may be doing so because display improves brand awareness. A recent IAB study found that digital display advertising boosted brand awareness by 12%, while at the same time improving education by only 2% and purchase intent by only 3%. 

Geico and State Farm both show a high proportion of display ads in the past twelve months. Among Geico’s $253.3M digital spend, 63% was dedicated to desktop and mobile display; State Farm spent 52% of their $120.5M budget on desktop and mobile display. All ten of Geico’s top ten creatives are display, and seven of them feature a variation of the word “savings.” The messaging is simple, often decorated with their iconic gecko, and although each creative includes a CTA to “Get Quote Now,” there is little education happening here.

Geico brand awareness ad

Conversely, it seems that State Farm’s biggest digital impact lies not in brand awareness but in education, though they do rely fairly heavily on display. Their top ten creatives include four display, three video, and three that are sponsored content. Many of these display ads have very basic messaging that seemingly serve as brand awareness: “Save with State Farm,” and “Here to help life go right,” for example. 

Yet their highest-performing creative, with 1.3B impressions (for context: the second highest-performing creative had only 375M impressions), is sponsored content with an educational tone. “SAFETY & PREP,” it reads, “Are you ready for the next storm?” The content was linked to an informative, blog-style landing page that gave homeowners practical information on weather-proofing their houses and protecting against fire and water damage. Top sites for these ads were equally strategic. Weather.com, Trulia (aka Zillow), and Realtor.com rank among the top three — you get the picture. 

When Life Hands You Lemons… Make Videos

Lemonade made headlines in December when they hired their first CMO, Jeff Brooks, who formerly worked for the D2C whiz kid that is Casper. Lemonade’s outside-of-the-box mentality is reminiscent of a D2C brand, as is their business model of delivering insurance directly to the user without the typical broker-agent song and dance. Unsurprisingly, they spend a lot of money on Facebook ads. Their $8.4M digital spend includes only 24% allocated toward display, and 72% allocated toward Facebook. 

Lemonade insurance Facebook advertising

Root also allocates the majority of their budget toward Facebook, with 84% to the social channel and only 8% to display. Compared to Lemonade, however, Root’s overall spend for the past twelve months was much smaller – $1.4M – and one wonders if they are putting their precious ad dollars toward where they are providing the greatest ROI.

The top ten creatives for both Lemonade and Root are predominantly video, which is unsurprising for brands with such a significant Facebook presence. IAB studies aside, the videos serve a similar purpose as Geico’s display ads: simple brand awareness. Lemonade’s highest-performing creative is an animated video of a house wearing sunglasses and riding a skateboard. “Homeowners insurance that doesn’t suck,” a text overlay says. It may not be a thirty-second Super Bowl spot, but it is a quicker, cheaper way to reinforce the brand identity of the company, most likely to the millennial audience they’re targeting. 

Root’s top performers are also mostly videos, and also have a brand awareness slant. The dominant video campaign, in terms of spend and in impressions, shows Root employees reading user reviews of Root auto insurance. The videos have a playful, engaging feel, and neither educate us about the product itself nor push us toward the consideration phase of the purchase funnel.

Brand Awareness: Current Data and Future Trends

Whether using display or video, whether a titan or a disruptor, what all insurance companies have in common is that almost everyone purchases an insurance product at some point in their lives. Knowing that consumers are absorbing insurance-related marketing at high frequency, brands set out to differentiate themselves with memorable characters, catchy slogans, and, now, forward-thinking approaches to how insurance should be provided. Will the big corporations like Geico and State Farm change their ways to attract the younger generation? Our forthcoming blog post about Allstate shows how a major player is bridging the gap.

In the meantime, Pathmatics Explorer can provide information on current and past digital advertising strategies within the insurance landscape and beyond. Whether it’s understanding the mix of ad formats or seeing which creatives perform the best, this valuable data helps inform your own digital decisions. Schedule a custom insights session to learn more.   

About Author
Sarah Fleishman

With over a decade of experience across digital marketing, content, creative, and PR, Sarah is a creative and dynamic thinker who loves to delight clients with unique and relatable content. Sarah graduated from UC Berkeley with a BA in Sociology.

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