The Marketing Strategies in GEICO's Bundling Insurance Commercial

Everybody knows GEICO. We all see GEICO commercials and other advertisements for their insurance and various services. As promoted in the commercials, the “15 minutes could save you 15% or more on car insurance” slogan is well known and the quirky gecko mascot is a familiar critter to all. GEICO is one of the most prominent companies in the business world.

GEICO employs many different marketing strategies to ensure its position as a dominant insurance powerhouse. Smart use of consumer behavior strategies can be seen in their advertising. One notable example is their “Better Together” commercial. Standing on a desk in a comfortable home, the GEICO gecko discusses why GEICO is a great pick for insurance. He states that it allows you to easily combine your car insurance with your home insurance which not only saves money, but is also much easier than the alternative. He then goes on to illustrate how there are some things that are much better together, such as tea and crumpets, but other things don’t go well together, such as porcupines and balloon factories (due to porcupines not doing well in team settings). The commercial ends with a voiceover once again reiterating that GEICO allows for the bundling of home and car insurance which in turn saves users substantial amounts of money. There are many consumer behavior theories applied in this commercial, including persuasion (consisting of both the basic principles and elaboration likelihood model), decision making (consisting of prospect theory), and perception (consisting of sensory marketing).

The service advertised in GEICO’s commercial is bundled auto and home insurance. There are multiple benefits to doing this. First, as stated in the commercial, you save money by doing this. Obviously, this is a clear benefit. Also, it simplifies the insurance process. With your car and home insurance combined in one package, you do not have to research and maintain multiple insurance plans. GEICO has been known to do an effective job of advertising what is considered to be a boring subject with imagination and appealing themes. Insurance involves tedious number crunching, long forms, and boring phone calls, so by creating gimmicks and ideas to keep its advertising intriguing, they are able to get the attention of the target audience. GEICO’s continuous use of slogans (such as “15 minutes could save you 15% or more”) has been shown to work in its favor as the various slogans are catchy and grow on people, becoming well known. The company’s use of the gecko mascot has also been effective at bringing people in. People have gotten to like the gecko, and look forward to seeing him in the commercials. GEICO also uses a lot of unique ploys in their commercials to make their company look fun and interesting. Their advertisements range from crazy movie-like scenes, to humorous setups. When people watch a commercial that is interesting enough to get their attention, the product or service being advertised will not only garner attention, but it will also increase awareness of its brand.

In addition to these strategies, there are also many consumer behavior concepts used in GEICO’s marketing, particularly it’s “Better Together” advertisement. One consumer behavior concept seen in GEICO’s commercial is persuasion, particularly in the form of the elaboration likelihood model. The elaboration likelihood model is a method of persuading people to buy a product or service via the changing of attitudes. There are two main examples of using the elaboration likelihood model in GEICO advertising. One is the central route, which is defined as persuasion by the logic, merit, or strength of the arguments. An example of using the central route is a commercial that lists facts that make their product the better product and is straight to the point throughout. Companies using the central route are also more likely to elaborate on their promotions. The other is defined as the peripheral route, defined as persuasion by cues unrelated to the quality of the arguments. An example of the peripheral route is when a commercial advertises a service and uses humor to deliver product messages that connect with the consumer and get their attention. Companies using the peripheral route are less likely to elaborate on their promotions. GEICO has used both routes of the elaboration likelihood model in their many commercials. In the bundling insurance advertisement, GEICO uses the central route. This is seen where the gecko explicitly explains why bundling insurance is a better alternative, illustrating that it is both easier and less expensive. From the marketer’s standpoint, this service is explained in the form of it’s significance. From the consumer’s standpoint, we are learning why this service is better than other alternatives. It is likely that the consumer will process this advertisement carefully because it uses the central route. Because of this, an attitude change will depend on the information (as opposed to the cues). Consumer involvement will also be high in the case of this service. I would consider this strategy to be effective as far as consumer behavior theory goes. The explanation is simple, but effective. When the gecko explains why you should get the product, he is humorous and likable, which draws consumer attention. It is because of this that the strategy would likely be successful long term. However, I do have some recommendations for the way it is advertised. I would suggest that the gecko speak more. Though he does do a good job explaining why the service is feasible, the message runs by quickly and it may be easier to understand if he elaborated a bit more to emphasize why consumers should use this service. The humorous connections would succeed in a peripheral route of the elaboration likelihood model, but they are less effective when using the central route. This, in turn, would maybe draw the consumers in more, as in order to use the central route effectively, you need to make sure that you have a sufficient amount of detail on why your product or service is satisfactory.

Another example of persuasion seen in the commercial is liking (as one of the six basic principles of persuasion). This is exemplified in the GEICO gecko. The gecko, GEICO’s mascot, has become known as a friendly, funny, and likable icon. In general, people watching GEICO’s commercials will likely grow to like him, drawing them to want to watch the commercial. This is a strong demonstration of how liking is used in the six basic principles of persuasion. People are more likely to agree with and buy from companies they like. This often works in direct sales when a sales representative tries to make a sale by being likable.

The other five principles are listed as reciprocity (obligating the consumers to give after receiving), scarcity (showing consumers that they have to get the service now as their time is limited), authority (believing credible sources), consistency (getting a product or service as people want to be consistent with their behavior), and consensus (consumers will often do what others do and this can be used in marketing strategies). From the marketer’s standpoint, they have to make sure the consumer likes the gecko enough so that they will be willing to buy the insurance. From the consumer’s standpoint, they are to assess whether or not the commercial with a character they enjoy seeing will be enough to pull them in and make it so that they are willing to buy the advertised service. The best strategies the marketers can use in this context is showing the gecko and having him do what he usually does, which is promote the product. I think this is effective. People do like the gecko and he will likely increase sales for GEICO’s insurance, particularly in this campaign. If I had to make any recommendations, I would suggest that they could add more likable characters related to and/or similar to the GEICO to make sure the message stays fresh and interesting. in addition to the gecko. I do understand that this somewhat goes against the liking marketing strategy. However, if there were a few more elements, the commercials might be even more interesting due to potentially larger variety.

Another consumer behavior concept seen in the commercial is decision making. Decision making is a crucial element of consumer behavior, extending to prospect theory and the endowment effect. Prospect theory is the element of decision making seen in this commercial. The prospect theory is an ideology that states that people love gain and hate loss. As a result, people are risk averse in the subject of gain and are risk seeking in the loss domain. Consumers often prefer to segregate gains and combine losses. If someone gains $50, they would be more likely to be happier if they gain $40 and then $10, rather than just gaining $50. If someone is to lose money, he or she would be more upset if the loss was transcribed as $40 and $10, as opposed to $50. It is likely that people, when seeing multiple gains or multiple losses, often associate that with a larger quantity than there really is. In consumer behavior, marketers often take this idea and use it to market products or services to consumers. It is done in the form of sales, money off of prices, subscriptions, etc. In the case of this campaign, the product itself embodies prospect theory. The gains from bundled car and home insurance are segregated. This lets the consumers know that they can get multiple benefits from using this service, thus potentially raising sales. This will likely attract people who are more likely to segregate their losses when spending money. From the marketer’s standpoint, there needs to be emphasis on all values of the service to make sure that these are understood by the consumer. Much like in prospect theory, there should be a full accounting of the savings the consumer receives. From the consumer standpoint, the service looks better because it is simplified and the losses are minimized, which is fitting for the prospect theory of combining losses. When considering consumer behavior theory, I think this is an effective strategy and I do believe it will be successful in the long term. It is a fighting strategy demonstrating the many benefits of the service (as the whole theme of the product is saving money by combining your losses). I do have one recommendation, however. I think that the commercial could have had just a little bit more emphasis on the benefits of combining the losses. The gecko could have talked more on how it simplifies the process of insurance, which is often long and tedious. Also, perhaps there could have been a visual of some sort illustrating the process on how losses are combined and ultimately minimized. However, I overall consider the decision making to be effective in this area of promotion.

One final concept of consumer behavior seen in the commercial is sensory marketing. Sensory marketing is a theory of consumer behavior where marketers advertise to consumers by appealing to the senses, more specifically vision, sound, scent, touch, and taste. The marketers use those sensations to influence the consumers feelings and behaviors, and ultimately push them to buy their product or service. Examples of this include visual bias, scent marketing, and the usage of sounds to market products. Visual bias is a situation where people will consider one thing to look different than another. This is often used in restaurants where people assume there is more food on smaller plates. All-you-can-eat buffets often serve smaller plates while restaurants based on pay per order tend to serve larger plates. In scent marketing, marketers use scents to try to get consumers to buy. This often occurs in promotion for products such as air freshener, perfume, and food. Sound is also used in sensory marketing. Some advertisements may use ambient background songs to set a certain mood, while some stores may play music to help motivate customers. While there are many different senses used in sensory marketing, GEICO’s commercial uses vision to promote their service. This is portrayed in the way GEICO is trying to initiate financial security, fitting for its insurance service. In the background, there is a comfortable but large, office-like room in what looks to be a very nice, expensive house. This is supposed to make the consumers feel calm and happy by implying that a service like this will allow them to retain a comfortable lifestyle as they would be saving more money. According to the color emotion guide, consumers will feel calm and balanced when they see colors such as white and gray, which colors the majority of the background of the commercial. With this, the marketer is hoping to convince consumers to buy the service by garnering a specific response with the look of the background and the way it appeals to the senses. The consumers would be expected to react to the commercial by feeling calmer and considering the commercial to be a manifestation of a better, richer life. I consider this to be an effective consumer behavior strategy and I believe it to be successful long term. On the other hand, if I had to include a recommendation, I would suggest that the colors seem a bit mismatched and inconsistent. The color of the room on the far right is somewhat darker than the rest of the room. Also, it is much brighter towards the left. I believe that the commercial may be a bit more appealing to consumers if the entire room had more consistency in its brightness giving it more of a natural feeling.

Reference: https://www.youtube.com/watch?v=rixJDLlcKPQ. Accessed 4 Dec. 2021.