Rod Brooks VP & Chief Marketing Officer, PEMCO Insurance

President: Word of Mouth Marketing Association

Evening Magazine

Seeing The Edge Differentiating in an

undifferentiated industry

Who is PEMCO?

• Leads with relationship

• Integrity

• Responsibility

• Courage

World-Class

Customer Experience PEMCO BUSINESS MODEL

Our vision

PEMCO is the Northwest insurance company

that “gets it.” An organization that’s great to do business with,

one that shares the values of those who live here, one that’s

genuinely likeable. It’s the first choice of responsible people.

PEMCO’s “WHY”

We enable and

protect the dreams

of responsible

Northwest people

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Why? Why? Why? Why?

Our BHAG: Big Hairy Audacious Goal

PEMCO customers

can’t stand the thought

of friends & family

doing business with

anyone else.

“Never have to advertise

for a lead again”

PEMCO’s winning approach

Differentiate on hyper local

Deliver world class customer experience

Achieve meaningful interaction

Different because we live, work, learn

and play in the same communities.

Grow and evolve tools to reach and

connect with broad consumer base

Invest in long-term relationships with

consumers through consistent

engagement

Our situation in 2007

$55 Million 2005-2006

PEMCO

3% Nationally,

GEICO Insurance spent

approximately. . .

$1 Billion 2009

Share of

advertising

voice was less

than 3% in the

prior 2 years

Our situation in 2007

Insert a slide depicting the erosion of brand awareness (similar to slide #4)

Brand Awareness

100

80

60

40

20

00

Geico State

Farm AllState Farmers PEMCO

Our situation in 2007

Market Share

20

15

10

05

00 6.7 7.1 7.2 7.1 7.4 7.9 8.3 6.4

Employee moral

Insert a slide here showing internal employee and agency moral going down (Exceed)

(The big green downward arrow animation?)

GOING IN THE WRONG

DIRECTION

Market oportunity

Insurance is …

The law

Not valued

Not trusted

Not well understood

Can only

“win” by

“losing”

ALWAYS SHOPPING

See very little product

differentiation

ALWAYS SHOPPING

PO 2

PISSED OFF or PRICED OUT

Challenges: old and new

• Highly regulated industry

• Product perceived as a commodity

• Insurance is an unsought product

Industry 1

Environment

2

• Consumers heavily influenced by peers, friends, strangers online

• New & unfamiliar channels are sustaining brand conversations

Be likeable When all you have is rocks,

you need a better plan.

Be likeable

• Challenge Status Quo

• Highly Nimble

• Innovative & Creative

• Well Defined Strategies

• Leverages Partnerships

• Capitalizes on WOM of

loyal customers

• Builds Fierce Advocates

Extensive research initiative

• 100 In-home Ethnographic Interviews

• Important aspects of consideration

• Key influences of decisions they make

Consumer Research

• Cross Functional & Multi-level Conversations

• Culture, Values, and Challenges

• Strengths and Opportunities

Internal Reviews

• Studied Top Twelve Companies – S.W.O.T.

• Product, Price and Brand Positioning

• Advertising, Messaging, Distribution and P.R.

Competitive Assessment

Some of the people we talked to!

Leaders in innovation – Proud!

Incredibly GREEN

LOVE THE LOCAL GUY

Hometown Heros

Local Trumps Large

Personal Trumps Price

Unique, Quirky and COLORFUL

Jerry McGuire Syndrome

Four billion dollars is like brand magic!

• Car insurance is anything but

conservative when it comes to

marketing these days!

• Doling out dollars once reserved for

categories like beer and travel.

• 2009 Spending - $4.15 B – more

than twice industry spending in 2000.

• Industry growth – all lines – up 2.7%

in same time period.

Four billion dollars is like brand magic!

Warren Buffet

- GEICO

“Everything is working. The one thing I don’t want to have

stand in your way is money. That’s what I’ve got.”

“...we’re not slowing down

until we get the job done. And our job is to capture the hearts and minds

[of potential customers].”

Pam El, Marketing V.P.

- State Farm Insurance

“We wanted to kick Flo’s ass!”

Nobody wants to sit around and talk about car insurance… We needed to entertain…

Get people’s attention.”

Nina Abnee – Leo Burnett

- Agency for Allstate

Four billion dollars is like brand magic!

Four billion dollars is like brand magic!

Top 5 Carriers Spent $2.39 Billion Dollars

In 2009

And the trend continues

Advertising

spending

topped

$5 BILLION in 2010

PEMCO’s success depends on the positive opinion of people like me.

They listen, participate, encourage and enable me to share with others.

Listen

Participate

Encourage

Enable +

Partnership

“I know you”

Initial: “I Know You” – Low Engagement

1) Familiar 2) Assessing & Evaluating 3) Consideration

“I like you”

Transaction: “I Like You” – Moderate Engagement

1) Functional 2) Transactional 3) Expectations met

“I love you”

Mature: “I Love You” – Active Engagement

1) Loyal 2) Relationship based 3) Recommendation behavior

“I defend you”

Mature: “I Defend You” – Active Engagement

1) Affinity 2) Proactive defender 3) Collaborative

Awareness To Advocacy

Closing the loop on

end-to-end engagement:

Listen: What is being said about

your brand and brands of your agents

Participate: Join the conversation

with great content, relevant resources

for customers AND agencies.

Encourage: Foster connections

between customers, agencies, carrier.

Enable: Provide customers and

agents a place to tell their stories.

Tools in the toolbox

Tools in the toolbox

Keeping it real – focus on people

Act Local - To Be Local! Where they live, work, learn and play.

Act Local - To Be Local! Where they live, work, learn and play.

PEMCO brand ambassadors

In 2011, PEMCO will sponsor

and participate in more than

100 Northwest events!

WALLY on the road

Serving community & neighbors

Celebrate Northwest

Empower employees

Support health & education

Local retailers

Celebrate a shared audience

Local services

Leverage shared interests

Local franchises & fans

Know your talkers!

Facilitate engagement

Give them something to share

Community agent partners

Amplify hyper-local community initiatives

Connect with community

Service-oriented activities create conversation

Spark conversation

Integrate “talkable” campaign elements into events

YOUR EDGE