Marketing Introduction

Marketing Introduction

At its most basic level, every member transaction, every interaction, every connection - positive or negative - is marketing. In a strategic context, marketing drives the entire decision making process and requires research that is objective, comprehensive, and continuous. Marketing is strategic on one hand, the responsibility of everyone on the other; it is a philosophy, not a job. A way of thinking, not a department. (Goldman, 1999, p. 1). Lorraine Kern, Marketing Manager for Allstate Insurance Company, could not agree more. Lorraine says, "Marketing is the heart of the business. It is the voice to our customer and the face of our company. Companies must acquire and keep customers and marketing is the only business function that deals directly with customers."

This paper will concentrate on my conversation with Lorraine, which focused on the top three marketing challenges facing the Allstate Insurance Company today. These challenges are, brand awareness, direct marketing and advertising, and increased website usage.

Marketing Challenges

Brand Awareness

One of the top marketing challenges facing Allstate today is brand awareness. Many customers know the "You're in Good Hands with Allstate" slogan. They also know that Allstate sale property and casualty products. What they do not know is Allstate also has a financial services company. Lorraine says, "Our own customers do not know that Allstate is in the financial services business. Research suggests that the more products a household has from a provider, the better chance we'll have of retaining business and having a high lifetime value from that household."

The company plans to build brand awareness for the new Allstate Financial Company by using the following strategies (L. Kern, personal communication, April 25, 2003):

1. Advertising - Advertising campaigns will run nationally and locally. In the past, the commercials have been seen during highly public events, such as the 2002 Olympics. Ads will also run on the radio and national magazines such as Kiplinger's Retirement Guide, Smart Money and Mutual Fund magazine. Local advertising will differ based on geographic location.

2. Public Relations - Transform and evolve the perception of Allstate from an insurance company to a provider of retirement securities. Also, position the company as a consumer advocate for middle-market Baby Boomers on retirement planning issues.

3. Internet - Expand retirement and planning content on the Allstate web site. This includes information such as investment basics, education planning, financial planning calculators, and a tool to locate an Allstate Personal Financial Representative in the customer's area.

4. Field and Local Support - Help agencies communicate that Allstate is in the financial services business by increasing promotional support, holding seminars and training sessions, and supplying sales literature.

Direct Marketing and Advertising

My conversation with Lorraine, next focused on the company's direct marketing and advertising initiative. Lorraine explained that Database Marketing (DBM) provides critical support for new business development in each new state. With each campaign, the company learns more about contact strategy, consumer response, and marketing tactics.

Contact strategy consists of six campaigns: Prospecting, Winback, Auto Cross-sell, Property Cross-sell, Retention/Upgrade, and Welcome. Mailings will reach Allstate customers and prospects. The effectiveness of the campaign depends on consumer response. Test factors include (L. Kern, personal communication, April 25, 2003):

1. Registration at the Customer Care Center: To increase customer registration and use of self-service features.

2. Bilingual mail and list test: To measure a "culturally correct" package.

3. Prospecting package - format test: To test whether sales rates can be maintained or increased