Lemonade insurance has stirred things up and is disrupting an industry.
Daniel Schreiber and Shai Wininger squeezed a lot of the inefficiency out of the insurance property business to make Lemonade. Lemonade is the name of their insurance company that took a radically different approach to a very established industry.
By using apps, artificial intelligence, and other advanced technology, these entrepreneurs made insurance friendly to a new generation of consumers. In its second year, they took in 57 million dollars in premium from almost a half-million customers, mostly under 35 and virtually all first-time insurance purchasers.
Today they operate in 22 states and have close to 200 employees and expect to double their revenue. They raised 300 million dollars on business valuation in the billions. Pretty cool considering they didn’t have any experience or knowledge in the insurance industry.
When Life Gives You Lemons, think Marketing
Since they didn’t have a preconceived notion of how an insurance company worked, they built it based on what they thought millennials would want. They had a clear, distinct, and narrow audience in mind – NOT EVERYONE. They wanted to serve 30 somethings who are used to Uber, Amazon, and life at the click of a smartphone button.
It had to be trustworthy and straightforward to use without all the paperwork, brokers and offices. They brought in someone experienced in the industry to help them navigate around the challenges of thinking differently and especially regarding regulatory matters.
Ty Sagalow helped them find a path forward where they didn’t use established insurers but became a licensed carrier themselves where they would own the risk. Because of this approach, claims get handled faster. Their business model was dramatically different from the industry. They pay claims at lightning speed, and their ratings are at the top of almost every satisfaction list in the industry.
The Fruits of their Marketing
Three observations:
- People often believe you have to have experience in an industry to succeed. The opposite can be true because you view the challenge from a fresh perspective. Your marketing strategy is built on alternative user experience, not what everyone else is doing. IKEA did this by selling unassembled furniture the customer put together, a disruption to the furniture industry many decades ago. Or how Drybar revolutionized the beauty salon business by eliminating haircuts and just doing blowouts.
- If you know who you are serving, you understand how to message them and to behave in ways that they will talk about and share with their friends. Building a powerful talk trigger into their model, their customers are their most significant source of new business. They go-to-market in 2019, not 1999 or 1949. They meet the needs of a new type of customer who doesn’t want to put up with all the industry nonsense.
- Find out what people hate about your category. Then, don’t do the opposite. Find a different way, a fresh approach that upends the category conventions. If everyone zigs, become a zagger. Stand out by doing things that serve your customer’s needs today. Let go of the past and embrace an aspect of the busy that others ignore.
When life hands you lemons, sell insurance.
You can set up a time to chat with me about your marketing challenges using my calendar. Email me jeffslater@themarketingsage.com Call me. 919 720 0995. Visit my website at www.themarketingsage.com The conversation is free, and we can explore working together.
Photo by Kaizen Nguyễn on Unsplash
