Nationwide CMO Says Insurance Ad 'Arms Race' to Continue

Watch the Spot: Insurer Uses Giant Baby as Metaphor for Passion People Have for Their Cars

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Proving there is a day for everything, Oct. 2 is "National Name Your Car Day." And Nationwide Insurance is trying to make the most of it.

In the latest installment of the marketer's one-year-old "Join the Nation" campaign, Nationwide on Sunday will debut a TV spot featuring an oversized baby as a metaphor for the passion people have for their cars. On social media, the insurer is running a "meet my baby contest" in which car owners will be asked to submit pictures of their "baby" (i.e. their car) along with the nickname they have given it. Prizes include $2,500 in free gas and a grand prize award of $5,000, so that the winner can take a road trip with their "baby."

The campaign, by McKinney of Durham, N.C., comes as Nationwide makes larger marketing adjustments in an effort to stay competitive in the cut-throat car insurance category. For instance, the company recently said it would end its title sponsorship of Nascar's Nationwide Series, shifting resources into the more high-profile Sprint Cup Series, where it sponsors individual drivers Dale Earnhardt Jr., Danica Patrick and Ricky Stenhouse Jr.

Meanwhile, Nationwide has begun increasing its ad spending after keeping it fairly flat, said Chief Marketing Officer Matt Jauchius. The company is projecting a 15% increase in ad spending for 2013, on top of an 11.8% increase in 2012, when it spent $309.6 million on advertising. It bumped up its spending by about 1% the year prior to that, according to business-data company SNL Financial.

The reason for the spending hike is that the insurer has high hopes for its "Join the Nation" campaign, which launched in the summer of 2012 and features voiceovers by actress Julia Roberts. The campaign has boosted Nationwide's "total unaided brand awareness" by about 5% this year compared with 2012, the company said.

Ad Age talked with Mr. Jauchius about Nationwide's marketing strategy and broader category trends.

Ad Age: Will advertising spending continue to accelerate in the car insurance category?

Mr. Jauchius: I don't see any sign of it slowing down. … We are planning on a 10% to 15% category-level increase as far as the eye can see.

Ad Age: Why?

Mr. Jauchius: Local agent presence is still very important. But over 80% of [people] start their shopping process online. … So the ability to attract people to the direct channels and to have a brand that is relevant will only become increasingly important. And that will drive this arms race in advertising spend.

Ad Age: How will Nationwide use the data it is collecting from the "baby" social media contest?

Mr. Jauchius: You are not going to get some direct marketing communication from us as a result of that. … If you mix in that blatantly commercial aspect with social media it completely defeats the purpose and turns people off. If you give them an authentic and fun experience that is consistent with your brand, that increases their consideration. And that's actually the point.

Ad Age: Are you worried about losing exposure by dropping your sponsorship of the Nascar Nationwide series?

Mr. Jauchius: It's been good to us, and we value it. [But] instead of the dollars that I spend on calling it the Nascar Nationwide series, I will have more Dale Earnhardt Jr. television ads and more Ricky Stenhouse Jr. in Sprint Cup races. … And we think that now that we are known among Nascar [fans] that will give us even more visibility than the Saturday series sponsorship.

Ad Age: Nationwide has taken a more serious tone with the "Join the Nation" campaign, compared with what some of your competitors have done in recent years. But you are using humor, too, as evidenced by new ad. How do you strike a balance?

Mr. Jauchius: We find humor to be a highly relevant way to connect with consumers. However, I would characterize the tone of the humor in our category as edgy and sometimes irreverent. … It will kind of go for a hard laugh. Whereas the type of humor we are going for in "Join the Nation" is different in tonality. We think it is more empathetic. We think it provokes more of an empathetic chuckle and a warm smile.

Ad Age: But babies in advertising are hardly new. Do you worry it is a bit of a cliché?

Mr. Jauchius: It's an original, c'mon man. It's a wink. … It's an obvious metaphor. … If it had been a regular-sized baby then that would have been taking ourselves too seriously.

Ad Age: In recent months we've seen Allstate and Progressive add more serious, aspirational ads to their mix. Is the category starting to get more serious after years of over-the-top humor, and why?

Mr. Jauchius: People are tired of edgy and irreverent and goofy spokespeople and animals that give you a yuk and a quote. … I think it's become wallpaper.

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