The battle between Allstate and Geico over ads now appears to be cooling down.
There has been an insurance marketing war going on between Allstate and Geico in terms of spending on ads, but now after two years of increases that have been in the double digits, it is now being reported that the later of those insurers had boosted its ad spend by only 5 percent in 2013, to reach $1.75 billion.
At the same time, Allstate Corp. is also slowing its rate of spending on the ads that it is producing.
This, according to SNL Kagan, a research firm. According to the data that was released in recent news, last year, Allstate’s spending rose by 7 percent, bringing it to $887.3 million. This was notably lower than the increases in 2012, which were of 11.3 percent. This seems to be the insurance marketing trend, at the moment, particularly when it comes to the auto coverage sector. State Farm Mutual Automobile, which has traditionally been a big spender when it comes to advertising, showed that its spend rose by only 3.2 percent over the last year. In the two years previous, it had been posting large increases.
The insurance marketing data used for this report was gathered from the American statutory annual P&C statement filings.
The slowing in the growth of spending for insurance advertising isn’t necessarily good news for large media companies. Television networks are especially dependent on this industry for building their ad revenues. For most of the last ten years, the P&C insurance market has been taking part in an all out advertising war that has helped to bring the industry into the top 10 ad spenders in the United States. This, according to Kantar Media figures.
Geico has been a leader in ad spending. This is among Warren Buffett’s Berkshire Hathaway insurance companies. Equally, though, SNL Kagan’s report pointed out that while it has been spending heavily for its marketing campaigns, it has also used this to its full potential, spiking its portion of the market share.
As the insurance marketing spending rose, so did the creativity in the ads, replacing what was once a drab category with one that is much more dramatic and makes a notably larger splash.