Page 143 - Electronic Commerce

Chapter 3

To respond to the increased competition, Progressive improved its claim service and was one of

the first insurance companies to offer 24/7 service every day of the year. During the 1990s, Progres-

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sive developed a full line of auto insurance products for all types of drivers and worked hard to make
sure that it offered the lowest prices in every market. Progressive’s marketing mentions the quality of

its service, but it always emphasizes its low prices.

Progressive was the first auto insurance company to launch a Web site (in 1995) and was the

first to sell policies online (in 1997). Knowing that most potential insurance buyers shop multiple Web

sites to find the best rate, the company began showing its competitors’ rates on its Web site in 2002,

allowing potential customers to compare prices without leaving Progressive’s site. The site displays

these rates even when Progressive’s rate is higher than a competitor’s rate on a particular policy.

By providing these competitive quotes, Progressive hopes to convince shoppers that their Web

site is an important one to visit early in their search because it can save them time. The practice of

displaying competitors’ quotes also creates an impression of openness and honesty. Progressive

believes that people prefer to buy insurance from honest companies who offer the best prices. Its

Web site conveys its belief and provides a consistent corporate message to potential customers. In

2008, Progressive introduced a female character, “Flo,” who embodies openness, honesty, and a

devotion to low prices. Flo appears in the company’s television and radio ads, and is featured promi-

nently on its Web site. In fact, the character often appears in television ad vignettes that tout the price

comparison feature of the Web site. The comparative quotes feature of the Web site and its use of

the Flo character are examples of how companies can successfully integrate their Web presence

into their overall brand positioning strategy and reinforce the message they want to deliver to custom-

ers and potential customers.

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