The Blake Project, the brand consultancy behind Branding Strategy Insider, delivers interactive brand education workshops and keynote speeches designed to align marketers on essential concepts in brand management and empower them to release the full potential of the brands they manage.
The findings from our comprehensive brand equity study of the insurance industry has implications for many industries. Here is what we found:
•While there are over 100 insurance brands whose names people have heard of, few achieve widespread top-of-mind awareness (first recall).
•The insurance industry is highly fragmented with a low dominance of usage and preference by a few brands.
•Very few companies are aggressively claiming relevant differentiating benefits in consumer communication. The few that are, are rapidly gaining market share (witness GEICO which is claiming price/value leadership in auto insurance with substantial advertising support).
•Prices/rates are cited as one of the top differentiating benefits, suggesting that the category is commodity-like for many consumers.
•While behavioral loyalty is high, attitudinal loyalty is much lower, indicating a consumer’s propensity to switch companies when the switching becomes easier (something the Internet might facilitate).
•Emotional connection to insurance brands is very low. Less than one in five consumers say that their insurance brand has never disappointed them. (The top brand on this measure disappointed two thirds of its customers at some time. All brands below the top eight on this measure disappointed over 90% of their customers.)
•Our analysis of the most powerful differentiating benefits indicate that many of them lie with the way in which insurance agents/representatives and the claims adjusters interact with customers.
•Our data would indicate that the industry is ripe for consolidation or strong niche marketing.
Three opportunity areas emerged for insurance companies:
1.Reinventing the process by which they interact with their consumers.
2.Claiming a highly relevant, unique point of difference (focusing on a product category, a consumer benefit or both).
3.Increasing emotional connection with their consumers.
The study provides the following lessons that are applicable to other industries:
•Strong, recognizable brand names and logos are important, but the brands behind those trademarks must stand for something unique and important in consumer’s eyes. What does your brand stand for?
•When price becomes the major point of difference in an industry, consolidation will occur. The companies that are most likely to succeed in this environment (other than the acquirers) are those that aggressively take ownership of relevant points of difference and redesign themselves to consistently deliver against those points of difference.
•The importance of the customer points of contact to strong brands can not be underestimated. Aligning these with your brand’s promise is critical. This may require redesign of your hiring, training, performance management, recognition and rewards and other HR practices. It may also require a redesign of your customer service processes.
•Companies that are market driven, truly caring about their consumers and constantly changing their products and services to meet changing consumer needs, will succeed at the expense of companies that are purely sales driven.