BUSINESS, PAGE C2
The Free Press Wayzata company
keeping seniors healthy
Jobs, Rentals & Wheels
January 8, 2007
FORMER MSU GRAD, FRIEND START ALERT SYSTEM
The Associated Press
Did this ad work for you?
The Associated Press
A talking gecko. Angry cavemen.
The guy who played Mini-Me, doing
the birthday dance.
Geico’s eye-catching TV ads have
spawned a loyal following and even
some imitators, with spots populating
video-sharing sites like YouTube.
But what does any of this have to
do with selling car insurance?
Geico is in some ways turning con-
ventional advertising strategy on its
head by running an array of diverse
campaigns all at the same time, rather
than coming up with one strong sto-
ryline and hammering it home. The
By Tim Krohn al people each call a central number to be gecko is still everywhere even as the
Free Press Staff Writer “We wanted to do connected to a conference call, the company cavemen spots are becoming a narra-
something that calls a list of people automatically. tive. Meanwhile, the celebrity testi-
MANKATO — When former Mankato resi- “One person calls our system and it auto- monials have tapped everyone from
dent and Hubbard Milling executive Alan would make a matically calls everyone at once and they’re “Austin Powers” actor Verne Troyer
Larson and a business school friend began difference, that we
all connected as they pick up. It’s good for to Little Richard.
tossing around ideas for a start-up business a could really be sports teams when your game is rained out or The firm says the ad blitz has
couple of years ago, they decided they wanted a business group that wants to have a confer- helped turn it into the nation’s fastest-
to do something with a social good. passionate about.”ence call,” Larson said. growing insurance company.
“We wanted to do something that would Carol Reis of Madison Lake is also a found- “Being a company that’s primarily
make a difference, that we could really be pas- ALAN LARSON, ing management team member of the Push 5 a direct-response company, we don’t
sionate about. There were three or four Co-owner of Push 5 company. Reis — also a MSU grad — and have agents pounding the pavement
abduction-murders of little girls at that time Larson worked together at Hubbard Milling. drumming up business,” says Ted
and we thought, there should be something kind of trouble they’re in, with the messages The Push 5 company has no home base. Ward, Geico’s vice president for mar-
high tech that would help,” going to their contact lists. “We’re virtual based. We have people in nine keting.
Larson said. If the person in trouble can stay on the states, the majority of them in Silicon Valley. “We sort of let our advertising dol-
The idea turned into a com- line, it connects them to everyone who picks Being virtual is challenging in ways but it lars be our agents for us.”
pany called Push 5, a tele- up their phone and turns it into a conference also saves a lot in office and overhead costs,”
phone-based urgent alert sys- call. Larson said. The critics
tem. Larson said the system, which is just end- Larson, who grew up on a dairy farm in But, big bucks don’t mean a coher-
“We turn any phone into a ing its beta test mode, has been very popular Iowa, graduated from Mankato State ent message, says branding expert
personal panic button.” with college-aged women and with elderly University in 1978 with accounting and busi- Rob Frankel, author of “The Revenge
People using the system people who could use it in cases of medical ness degrees. He worked for a CPA firm in of Brand X.”
load the companies’ number emergencies. Fairmont for two years then spent eight years In his view, advertisers have forgot-
into their No. 5 speed-dial. Larson said that as more Global at Hubbard Milling, where he ten how to use ads to craft a market-
The 5 button was chosen Positioning System technology is included in became corporate controller ing strategy that builds a business and
because most cell phones have a cell phones, the system may be able to be and a member of the senior its brand.
dimple on the 5 that can be located by a user integrated to allow for the location of the per- management committee. “Sadly, the last two generations of
even if they aren’t able to look at the pad. son in trouble to be tracked. Larson won a Bush advertising have focused way more on
Users then register online and include up The service sells for $24 a year. Leadership Fellowship. He entertainment and media than on the
to three phone numbers each for up to 12 The company is working in cooperation used the full scholarship to actual purpose of advertising, which
people. with the National Center for Missing and get his MBA at Stanford, is to communicate a compelling mes-
“If you push 5 and do a speed dial to us Exploited Children on tying the Push 5 sys- where he graduated in 1990. sage quickly to prospects in the short-
and you have to disconnect or can’t talk, the tem in with their call center. He worked for healthcare est period of time,” he says.
system will send a silent alarm to everyone They’re also working on a school-based startup company until a cou- It’s a trend that started in the mid-
on your contact list. It also sends out text alert system that could be used in cases of ple of years ago when he 1970s and has accelerated in our mul-
and e-mail messages to everyone that says hostile intruders entering a school. and his friend, Ken Tam, timedia age, he adds.
you’re in trouble,” Larson said. The company also found that its conference decided to start a business of their own. Sure, the Geico ads are funny. But,
If someone can talk, the automated system calling technology was popular and is selling The company’s Web site is: funny “is not how people make their
tells them to say where they are and what that service as well. Rather than having sever- www.push5.com decisions,” he says. Consumers
should instead hear “some claim why
Geico should be the only choice for
Real estate mutual funds, investment trusts poised to roll on Others disagree. Edward Estipona,
president of the Estipona Group in
Reno, Nev., says the ads do have a
Although residential real estate ple, Blackstone Real Estate Returns of the real estate mutual er solid income.” clear message. Like Frankel, Estipona
markets have struggled, commercial Partners, an affiliate of the funds paralleled the 2006 returns of Among individual REITs, has no connection to Geico.
real estate investments Blackstone Group, agreed the MSCI U.S. REIT Index. Traded Vinocur recommends the shares of While talking cavemen and the lot
have continued to prosper. in November to acquire bil- on exchanges like a stock, a REIT Developers Diversified Realty Corp. “may not have anything to do with
Proving an army of lionaire Sam Zell’s Equity invests in and owns properties such (DDR), Regency Centers Corp. insurance per se, I think the message
doomsayers wrong, real Office Properties Trust in as shopping centers, offices, apart- (REG) and Kimco Realty Corp. of what they’re saying is: That we are
estate mutual funds and the biggest takeover ever of ments and industrial facilities. (KIM) in shopping centers; Simon an easy alternative, that you can go on
real estate investment a real estate company. There are more than 200 publicly Property Group (SPG) in large the Internet, that it’s inexpensive, that
trusts have outperformed “Residential real estate is traded REITs that provide dividend malls; Boston Properties Inc. it can get you cheaper insurance,”
the Standard & Poor’s 500 driven by emotion and con- yields comparable to bonds. (BXP) in offices; Ventas Inc. (VTR) Estipona says.
for seven consecutive years
and could be poised to run ANDREW sumer sentiment, whileis
commercial real estate
Although REITs are the primary
holdings within real estate mutual
in health-care properties; and
Vornado Realty Trust (VNO) in
“With advertising nowadays, it’s
not like advertising from the ’60s
their winning steak to LECKEY driven by economics,” said funds, the funds also often hold widely diversified properties. when you just told it how it was,” he
eight this year. Tribune Media Alexander Goldfarb, ana- stock of companies that provide “Think about how much money adds.
The average mutual fund lyst with UBS Securities in products and services to the real is in pension funds and what would “Nowadays, you have to entertain.
investing in real estate-related New York. “Retail investors, both estate industry. happen if they increase their real Many times in a 30 second spot, you
stocks gained about 33 percent in domestic investors and foreign “For 2007, we see strong earn- estate allocation by just 1 percent, spend 20 seconds of that TV spot on
2006, topped in performance only investors from places like Dubai, ings growth and yields that should creating a huge amount of capital,” entertainment and you spend really
by emerging markets funds, accord- have been looking for yield after deliver REIT total returns to Vinocur said. “We estimate there is 10 seconds of it getting your message
ing to Lipper Inc. The three-year the collapse of the tech boom.” investors in the low- to mid-teens,” around $100 billion earmarked out.”
annualized return of 25 percent and Yet even the boldest prognostica- said Barry Vinocur, editor of Realty globally for investment in commer- Geico’s advertising firm, the
10-year annualized return of 15 per- tors acknowledge it will pay to be a Stock Review in Novato, Calif., who cial real estate.” Martin Agency in Richmond, Va.,
cent also are impressive. little careful in 2007. Despite a lack suggests that individuals keep 10 Not all REITs or real estate funds says entertainment is indeed a type of
Development of new properties of ominous signs, any segment this percent to 15 percent of their per- are alike, which makes it important strategy.
has been cautious and gradual, pen- hot for this long has to start cool- sonal assets in REITs. “There’s a to scrutinize the prospectus of any “Likability in advertising is actually
sion funds are looking to diversify ing down sometime. Expect some massive global reallocation under one you’re seriously considering. a real motivator for people to connect
their holdings, and large investors slowing during 2007, along with way of dollars moving into real Some experts believe it would make with a company,” says Steve Bassett,
are aggressively taking real estate greater volatility due to privatiza- estate as graying societies increas- a senior vice president and creative
investment firms private. For exam- tion rumors and deals. ingly focus on assets that can deliv- Please see LECKEY, Page C2 director at the agency.