Insurers Tread a Ticklish Line Using Humor in Marketing

Humorous marketing is increasingly becoming the dominant way to nab consumers' attention, but insurers face extra concerns when it comes to offending their audience, marketing experts said.

"Humor is a very risky medium to leverage," said Punita Gandhi, director at PwC Diamond Advisory Services. "It's interesting that insurers have gone that route; they see a need to lighten up the way in which people see the industry. But it's a careful balance in terms of how far you can push the message."

Insurers are focusing on tickling the funny bone, from Allstate Insurance Group's popular "Mayhem" commercials to the ubiquitous Aflac duck and Geico's accented gecko. Warren Buffett, head of Berkshire Hathaway, which owns Geico, recently said the company "enthusiastically spent" $900 million on advertising last year...If we could spend twice that amount productively, we would happily do so though short-term results would be further penalized" (BestWire, Feb. 28, 2011).

But there's a down side. Recently, Allstate retracted a statement that linked accident rates of drivers to their zodiac signs. Aflac fired comedian Gilbert Gottfried, the voice of the Aflac duck, after he tweeted insensitive comments related to the March 11 Japan earthquake and tsunami. With about 75% of its revenue coming from Japan, Aflac was unamused.

The tongue-in-cheek Allstate release said Scorpios with their "perfectionist nature," were the safest drivers in 2010, while Virgos, who were "worried and shy," were involved in the most accidents.

Allstate had to apologize for the release, saying signs have "absolutely no role in how we base coverage and set rates."

Marik Brockman, a principal at PwC Diamond, said the danger is calling out any single group.

"You can have an ad campaign that falls flat because the message was muddy; you just pull the campaign. But if it's inappropriate -- if it is calling out a group -- that is a red flag," Brockman said.

Sergio Alvarez, the founder and chief operating officer of New York-based Ai Media Group, said there's not much humor in buying insurance, "but when the time comes, you remember what you like or what you didn't like. [Marketing] has to be memorable and funny, but to be memorable and funny and not offend someone is tough."

Insurers, a highly regulated group, should err on the side of caution, said Alvarez, who noted Allstate's zodiac press release was more of a miscommunication.

But the old adage of any publicity is good publicity could also apply. "A lot of times, a company will come up with an idea that can be misconstrued. It's still a win, because people are talking about it," Alvarez said. "If they come out and say 'it's not what we meant' they get the message out twice."

Having a spokesperson can also be tricky, because while it gives the company a face or voice, "you can have the best spokesman in the world, and don't know what's going to come out of their personal life. Look at Tiger Woods," Alvarez said.

In the case of Gottfried, the company "took the right response, and turned it around very quickly," said Mark Bilfield, an advisory partner at Pomegranate, a digital agency. Aflac made lemonade out of lemons, launching a commercial that was a take off of a silent film, with a quackless Aflac duck. In that ad, they made mention of a nationwide casting call to find the next duck voice. Thousands have tried out, with the casting website, quackaflac.com, now telling the voice-wannabes "Sorry, you're too late to be the spokesduck."

In another marketing twist, Allstate has poked fun at State Farm spokesman LeBron James, who disappointed Cleveland fans with his decision to "take my talents to South Beach."

In a radio ad, Allstate spokesman Dennis Haysbert asks, "So are you ready to take your talents to Allstate?"

"Insurance is a very dry topic, generally speaking. You have to bring it to life. Getting attention is one way to do it," Bilfield said. "Competitive sparring like that is playful. When you can use current events and turn it around fast enough, you can stimulate attention."

Insurers spent $4.15 billion on advertising in 2009, more than double what they spent in 2000, according to AdvertisingAge.

That increase was driven by companies seeking to sell directly to consumers, Brockman said. "They needed to relate to consumers, and that led to the spokesperson, the mascot and started the segue into humor," he said.

Direct sellers had a few extra bucks to spend on advertising versus paying agents commissions, Brockman said. "It was as much the business model that led to the advertising change than the other way around," he said.

Other national companies with agents lack the margins to spend as much on advertising, but didn't want to be left behind, Brockman said. "They don't rely on the 'costs less' message, but it's the 'right cost' message," Brockman said. "It started with messages that weren't quite humorless, but a straight man with a soft edge. Now the top five players have two or three different threads of advertising going."

Having more than one campaign is also a safety net should something go awry, he said.

"It allows you to recover very quickly. You can go in with more than one approach at the same time," Brockman said.

(By Meg Green, senior associate editor, BestWeek: Meg.Green@ambest.com)