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Q: Geico ( Answered 4 out of 5 stars,   0 Comments )
Question  
Subject: Geico
Category: Business and Money > Advertising and Marketing
Asked by: hazel27-ga
List Price: $30.00
Posted: 17 Dec 2004 20:05 PST
Expires: 16 Jan 2005 20:05 PST
Question ID: 444179
Business success story and marketing strategy  (Not advertising)
Answer  
Subject: Re: Geico
Answered By: tlspiegel-ga on 17 Dec 2004 22:11 PST
Rated:4 out of 5 stars
 
Hi hazel27,

Thank you for a very interesting question. 

Leo and Lillian Goodwin founded the Government Employees Insurance
Corporation (GEICO) in Washington, D.C. in 1936. In the beginning,
GEICO provided auto and other insurance to preferred low-risk
demographic groups. They believed they could offer low-priced
insurance and still make a profit by marketing to select customers and
using the savings in operating costs for discounts. The initial
targets were government employees and the top three grades of
non-commissioned military officers.

In order to keep premiums low and service high, GEICO doesn't use
insurance agents - instead they employ thousands of associates who
work directly with the customer. The company uses Direct Mail, Radio,
TV, and the Internet to attract customers. Recently they have begun to
sell auto insurance to high risk drivers.

GEICO is well-known for it's excellent coverage, low prices, and
outstanding customer service.

=========

GEICO - Fact Sheet - Hoover's Online
http://www.hoovers.com/geico/--ID__10616--/free-co-factsheet.xhtml

"GEICO has found that driving down costs brings drivers by the droves
into its fold. A wholly owned subsidiary of Warren Buffett's Berkshire
Hathaway, GEICO has traditionally provided auto and other insurance to
preferred low-risk demographic groups (such as government and military
employees) but has also begun to sell to nonstandard (high-risk)
drivers. In addition to auto coverage, the company's offerings include
motorcycle insurance and emergency road service. GEICO eschews agents
in favor of direct marketing through such vehicles as direct mail, TV,
radio, and the Internet."

=========

Forbes.com Best of the Web:
http://www.forbes.com/bow/b2c/review.jhtml?id=1526

"Geico offers a no frills site that happens to be quite user friendly.
The Berkshire Hathaway owned company offers instant quotes for up to
four drivers on three cars. No insurance for residents of New Jersry
or Massachusetts. The thing that may drive users crazy is the amount
of personal information required to get an instant quote: email
address, street address, social security number, etc. That takes the
no obligational feel out of the Internet."

========

News & Press
http://www.geico.com/about/press/111904.htm

"Our President and CEO Tony Nicely always says that GEICO gives back
to the community because it's the right thing to do."

[edit]

"GEICO uses television, radio, print media and direct mail to attract
customers to call its 1-800-841-3000 number and to its www.geico.com
Web site, and keeps its rates low by dealing directly with the
customer. GEICO offers sales and claim services 24 hours a day, seven
days a week."

========

DIRECT - Direct Marketing Business Intelligence - Echo Chamber: Sounds
of success reverberate from 70th annual DMA awards
http://www.directmag.com/mag/marketing_echo_chamber_sounds/ 

"...were the focus at the Direct Marketing Association's 70th
International Echo Awards, presented last month in Toronto.

The DMA diamond Echo, which goes to the top direct response campaign
among all entries, went to the gold winner for television commercial:
The Martin Agency's "The Sensible Alternative" campaign for its
longtime client, Geico Direct auto insurance of Washington, DC. This
latest pair of awards probably makes the Richmond, VA-based shop's
campaign among the winningest in marketing history. Perhaps it's time
to retire any and all parts of Martin's Geico campaign and let other
companies and agencies have a chance."

=========

Gecko - Geico Auto Insurance 
http://www.autoinsurance.ru.com/article8.html

"Synopsis: By focusing on the basics that Geico has founded itself on
and by focusing on its first customers (the military) Geico has built
a successful insurance company.

Geico insurance is more than the friendly neighborhood gecko. Geico
car insurance has been around since 1936. Leo and Lillian Goodwin,
Geico's founders, initially marketed their car insurance policies to
military and government employees."

By selecting such prime customer groups Geico was able to attain
reduced prices for car insurance. Geico passed on those savings to
their customers. Passing on the savings to the customer is what Geico
has built their success on.

Geico has received an AAA rating from Standard and Poor's, another AAA
from Moody's and an A++ from A.M. Best. In the United States Geico
stands with only seven other insurance agencies that have earned
similar ratings.

Not only does Geico offer auto insurance, but the nation's favorite
gecko also offers motorcycle insurance, home, condo and rental
insurance, umbrella insurance and boat insurance. Geico's ability to
be a convenient one-stop shop to fill all insurance needs is one
reason its clients have repeatedly recommended them to others.

What contributes most to Geico's success is the company's ability to
stay true to its roots: the military. On the web site there is a full
section dedicated to assisting military personnel with their specific
needs. Geico even has its own SEAL team. SEAL is an acronym for
SEa-Air-Land.

The Assistant Vice President of the Geico military department is a
former Sergeant Major of the Army, Richard Kidd. The rest of the team
is filled with retired military personnel. Within Geico SEAL's site
there are prior to deployment check lists and other helpful resources
for military personnel."

=========

GEICO History Highlights
http://www.geico.com/about/background/geicoHistory.htm

"GEICO associates who know their company well know the names of Leo
and Lillian Goodwin.

It was the Goodwins who in the mid-1930s - while the Great Depression
was still in full fury -took a calculated risk to start up what has
become one of the most successful and highly respected companies in
the nation - the Government Employees Insurance Company - GEICO.

Leo Goodwin hammered out the basic business plan during his early
career days in Texas. He believed that if he lowered costs in the
company by marketing directly to carefully targeted customer groups,
he?d be able to pass along lower premiums and still earn a profit. He
was right. The business began its upward climb and, in 1936, Goodwin
established GEICO operations in Washington, D.C.

Lillian Goodwin worked alongside her husband to launch the company and
took an active role in virtually all aspects of the early operation.
Lillian, a bookkeeper by profession, took on the accounting tasks but
also worked to underwrite policies, set rates, issue policies and
market auto insurance to GEICO?s target customers, federal employees
and the top three grades of non-commissioned Military officers. By the
end of 1936, there were 3,700 GEICO policies in force and a total
staff of 12 people.

In 1948, a pivotal figure joined the company. Lorimer Davidson, an
investment banker and a friend of the Goodwins, helped them find new
investors when the original investors chose other opportunities. Among
those new investors was Benjamin Graham, a business professor at
Columbia University in New York, who would one day find Warren Buffett
in his class. The link between GEICO and Warren Buffett was thereby
established, and in 1951 Buffett made his first official appearance in
GEICO?s history.

That year, Buffett recounts that he took the train to Washington on a
Saturday to learn more about GEICO and found that the office was
closed. A janitor directed him to Davidson and that conversation
echoed through the years. On the basis of that impromptu meeting,
Buffett learned enough to make his first purchase of GEICO stock.

When Leo Goodwin chose to retire in 1958, he named Davidson to be his
successor. It was Davidson who would preside at the opening of GEICO?s
new headquarters in Chevy Chase, Md., in 1959 after more than 20 years
of steady growth.

The 1960s proved to be similarly successful and GEICO experienced
virtually unbroken growth. GEICO passed the 1 million policyholder
mark in 1964. Insurance premiums reached $150 million in 1965. Net
earnings doubled to $13 million in 1966. GEICO opened a number of
sales and service offices for walk-in customers and its first drive-in
claims office in 1965.

The 1970s were not nearly so good to the company. While in retirement,
first Lillian Goodwin passed away in 1970, followed by Leo Goodwin the
following year. By the mid-70s, the years of aggressive expansion were
starting to show some weaknesses in the company?s loss reserves. It
led to a difficult period for the company.

GEICO used the experience to strengthen its underwriting and reserving
activities which helped build the company?s current reputation as a
fiscally superior organization. Warren Buffett made another appearance
in 1976 for a second purchase of GEICO stock, reported to total 1
million shares. Lou Simpson joined the company in 1979 as GEICO?s
chief investment officer.

Prudent underwriting prevailed in the 1980s and expansion was slow but
steady from then on. GEICO introduced 24-hour, 365-day telephone
service for claims, sales and service in 1981 as its emphasis on
customer service deepened.

In 1993, Olza "Tony" Nicely was named GEICO?s new chairman, president
and CEO, and worked to expand the customer base through a new
four-company strategy. Along with it came an increased advertising
budget which propelled GEICO toward much higher national visibility.

Warren Buffett liked what he saw. In 1995, his Berkshire Hathaway
investment firm made a generous bid for the remaining shares of
GEICO?s outstanding stock, and by 1996, GEICO was a subsidiary of one
of the most profitable organizations in the country.

That led to national advertising on an enormous scale. GEICO?s ads and
direct mail pieces flooded the airwaves and filled mailboxes around
the country and the company?s growth shot upward. The GEICO Gecko made
its first appearance during the 2000 television season and has quickly
become an advertising icon.

In 2001, Leo Goodwin was named to the International Insurance Society
Hall of Fame. His ideas have endured and helped GEICO grow into a
national favorite.

In 2003, GEICO passed the 5 million policyholder mark. That year,
GEICO also opened operations in Tucson, Arizona, and company officials
gathered in December in Buffalo, New York, to announce the opening of
a new service center there.

Yet another big announcement came in 2004, when GEICO declared the
"good news" about its reentering the New Jersey auto market at a press
conference that made local, regional and national news.

Today GEICO celebrates its founders and leaders Leo and Lillian
Goodwin who would be proud of the organization?s success and its
return to New Jersey. Celebrating with them are the company?s 22,000
associates in 12 major locations around the country.

And the future looks equally as bright. Tony Nicely has said that the
company?s growth will only be limited by the time it takes to hire
knowledgeable associates committed to GEICO?s way of thinking, which
can be summed up in these words: excellent coverage, low prices, and
outstanding customer service."

=========

More on Direct Mail programs:
http://findmorebuyers.com/page.cfm/176

"Repeatedly mail the same letter or direct mail package to the same people 

If your sales letter or direct mail package is generating an
acceptable number of orders or leads, don't hesitate to mail it again
and again to the same direct mail list. The basic premise for
recommending this strategy can best be summed up in five words:
"People quickly forget," and "Things change."

A good reason this strategy works is change. Your prospects' lives are
constantly evolving. Many highly successful direct marketing
organizations such as Dow Jones & Co. and Geico Corporation routinely
practice this strategy of repeatedly mailing the same message to the
same people."


=========

Founders of The Law Center of Nova Southeastern University is named
after Shepard Broad. Background and Commitment to the Community

Leo Goodwin Sr. 
http://www.nsulaw.nova.edu/alumni/founders.cfm

"The Law Center is housed in the Leo Goodwin Sr. Hall, which is named
for a generous entrepreneur and visionary who was committed to the
advancement of education and research.

Leo Goodwin Sr. was born in 1886 in Lowndes, Missouri, just south of
St. Louis, the son of a country doctor who traveled by horse and buggy
to treat his patients.

Educated as an accountant, Leo Goodwin Sr. entered the insurance
business in San Antonio, Texas. As he became more experienced in the
field, Mr. Goodwin came to the remarkable insight that the industry
could better serve its customers and reduce costs by eliminating sales
commissions to producers of premiums and dealing directly with
policyholders. With this precedent-setting vision in mind, he founded
the Government Employees Insurance Company (GEICO) in 1936.

With his wife, Lillian, Mr. Goodwin worked 12 hours a day for little
or no salary for several years to implement his business dream. In
1940, after operating in the red for several years, the company
realized its first profit. In 1948, GEICO became publicly owned and
today has assets of nearly $7.3 billion."

[edit]

"Although highly idealistic, Mr. Goodwin brought a steady, common
sense approach to his business and personal life. He believed in
simple virtues like honesty, responsibility in keeping a promise, and
the necessity of constant self-improvement and hard work.

Mr. Goodwin took much from life, and he always succeeded in giving a
little more than he received. Leo Goodwin Sr. died in 1971 at the age
of 84. He will be remembered in the hearts of all those he touched by
his vision, warmth, and generosity."

=========

GEICO Military Program
http://www.geico.com/military/

=========

GEICO & Government Employees
http://www.geico.com/about/background/geicoGovEmployees.htm

=========

GEICO & The Military
http://www.geico.com/about/background/geicoMilitary.htm

=========

How Does GEICO Stack-up against the Competition?
http://www.geico.com/about/background/comparisonchart7.htm

=========

GEICO in the Community
http://www.directmag.com/mag/marketing_echo_chamber_sounds/ 

Ensuring a Better Community for the People We Insure

========

More on Warren Buffet:
http://www.amazon.com/exec/obidos/tg/detail/-/0385484917/qid=1103346113/sr=8-1/ref=sr_8_xs_ap_i1_xgl14/103-9028385-5288614?v=glance&s=books&n=507846

"At first he ran a partnership for some friends and family. He
dissolved the partnership in 1969, when he felt the market was
overvalued and he could not find many attractive stocks. At this point
he bought Berkshire Hathaway and used the cash this firm generated to
buy National Indemnity, primarily to get hold of its cash flow. He
then used these funds for other significant investments in undervalued
securities. He later continued to make successful investments in other
insurers, including GEICO and General Reinsurance."

=========

GEICO billing practices:
http://www.echomail.com/solutions/industry/insurance/geico.asp

=========

GEICO's Transit Incentive Program - Retaining Skilled Employees:
http://www.commuterpage.com/atp/suc-retain.cfm

(Scroll to GEICO DIRECT about 1/2 way down the page)

========

GEICO Motorcycle Insurance:
http://www.bnet.com/abstract.aspx?&scid=1560&docid=50566

"GEICO Insurance was seeking an effective way to promote their
motorcycle insurance. They need innovative marketing ideas to get the
word out to a highly targeted audience. The campaign has been so
successful that the trucks are part of GEICO's annual campaign. GEICO
uses the trucks to keep the party atmosphere going and deliver the
GEICO message with pinpoint accuracy. Motorcyclists have contacted
GEICO indicating they were not even aware they offered insurance for
their vehicles."

=========

An excellent article written by Roop Khanna can be found at:

Geico Insurance Company and Auto Insuranc - A Insurance Article 
http://www.digits.com/articles/insurance--geico-insurance-company-and-auto-insurance.htm

=========

DM News - The Online Newspaper of Record for Direct Marketers
http://dmnews.com/cgi-bin/artprevbot.cgi?article_id=31204

"In other news, database marketing agency Merkle, Lanham, MD, has
received a new contract from Geico to provide database marketing
services and solutions, the company said yesterday. Financial terms of
the contract were not disclosed.

Merkle will oversee day-to-day operations involving Geico?s data and
direct mail programs, including strategic campaign management,
modeling and analytics and content management. Geico is the fifth
largest private passenger auto insurer in the United States.

Since 2002, Merkle has helped Geico enhance and augment its overall
mass marketing strategy through the use of coordinated direct mail
campaigns."

=========

George Washington University Professional MBA Programs
http://www2.gwu.edu/~sbpm/pmba/prospective/fin.htm

"Two scholarships are available through the School of Business for
part-time students pursuing an MBA: The Washington Gas Light
Fellowship and the Leo and Lillian Goodwin Fellowship."
  
=========

(The following link is a PDF file that wouldn't open for me... it
appeared to be a dead link.)
http://www.niagarainsurance.com/eyeonniagara/press/geico_6_27_2004.pdf

Please copy and paste this link for the cached version of the page. 
http://66.102.7.104/search?q=cache:658XvaFo8u8J:www.niagarainsurance.com/eyeonniagara/press/geico_6_27_2004.pdf+Leo+and+Lillian+Goodwin&hl=en

"Founded in 1936 Geico - originally Government Employees Insurance Co.
- was founded in Washington in 1936 by Leo and Lillian Goodwin, who
believed they could offer low-priced insurance and still make a profit
by marketing directly to select customers and using the savings in
operating costs for discounts. The initial targets were government
employees and the top three grades of non-commissioned military
officers.

Today, under CEO Olza M."Tony" Nicely, the company has 5.5 million
policy holders and insures 8.6 million vehicles. It has $13.7 billion
in assets, 22,000 employees and 12 major offices nationwide. Since
1995, it has been owned by Berkshire Hathaway, which also owns The
Buffalo News.

And the company continues to grow at double-digit rates, supported by
aggressive marketing, Zinno said. He acknowledges the heightened
competition, but says he's not worried. "You see more advertising out
there than ever from our competitors. That in no way will stop us," he
said. "We know we've been doing it longer. We think we can do it
better."

=========

Keywords:

GEICO
GEICO success story
GEICO marketing strategy
GEICO agressive marketing
GEICO Direct Marketing
GEICO direct mail
Leo and Lillian Goodwin

=========


Best regards,
tlspiegel
hazel27-ga rated this answer:4 out of 5 stars
Thank you so much
you have reinforced my belief in google.  I did find most of this but
wanted to be sure of my search skills.  I will use the service again
-- for sure.

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