Geico ads Are they successful

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					                                                                                                                                                                                    BUSINESS, PAGE C2

      The Free Press                                                                                                                                                            Wayzata company
                                                                                                                                                                             keeping seniors healthy
                                                                                                                                                                                    CLASSIFIEDS INSIDE
                                                                                                                                                                             Jobs, Rentals & Wheels
     January 8, 2007

                                FORMER MSU GRAD, FRIEND START ALERT SYSTEM

                                                                                                                                                                                                    The Associated Press
                                                                                                                                                                        Did this ad work for you?

                                                                                                                                                                        Geico’s ads:
                                                                                                                                                                        Are they
                                                                                                                                                                        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

                                panic button
                                                                                                                                                                        do with selling car insurance?
                                                                                                                                                                        The campaigns
                                                                                                                                                                           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-                                                    decisions,” he says. Consumers
                                                                                                                                                                        should instead hear “some claim why
                                                                                                                                                                        Geico should be the only choice for
                                                                                                                                                                        The fans
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.

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