Insurance Marketing - Changing Focus (1,584 words)
by Don Jackson
The date: Nov. 10, 1999. The time: 16:52 Eastern Standard Time. The headline: "Allstate Announces New Business Approach Including Direct and Internet Sales."
Now in the world of insurance marketing, and insurance direct marketing specifically, this qualifies as a momentous strategic initiative. After all, Allstate Corp. is the nation's largest publicly held personal lines insurance company. With the exception of State Farm Mutual Insurance Co., it writes more property and casualty (P&C) business than any other company in the United States.
Allstate is number two, and apparently it is going to "try harder."
"Try harder" to capture an increased share of market from arch rival number one—State Farm. Sort of reminds one of the Hertz-Avis rivalry.
Allstate's move to a multiple distribution channel strategy began early in 1999. Historically the company has distributed its products through 15,600 captive agents. Next it added an independent agent initiative (State Farm's primary distribution channel) by acquiring CNA Personal Lines. And now it is adding direct to its distribution channel strategy. (Keep in mind, the Internet is a medium, not a distribution channel.)
Also, the company has supported its agents with a terrific direct mail lead generation system, "Prime," for more than a decade.
Allstate is positioning itself for the 21st century world of consumer demand by delivering products and services the way the consumer wants them delivered, when the consumer wants them delivered at a price the consumer wants to pay. This is a significant business change for the insurance industry.
Here's the thing:
In response to Allstate's forward-looking strategy, State Farm Mutual reaffirmed its total commitment to its old business model, and the independent agent distribution channel. After all, why change the way you're doing business just because consumers want you to change?
What Does Allstate's Strategy Really Mean?