Building a Brand: Aflac Takes a Gamble on a Long-Term Strategy

Earlier in the week I started reviewing the insurance giant Aflac. In 2004 we start to see the growth rates of Aflac suddenly starting to climb and a new radical idea was starting to pay off for Aflac: the duck. Over 2003 and 2004, Aflac started to enjoy the fruits of an uncommon bet it placed a few years earlier. Back in 1990, the company decided to launch a name recognition campaign. After a decade of running the campaign, name recognition was still less than 10%. CEO Dan Amos figured that "At that rate … I’d be retired before we reached 25%. We had to do something dramatic." So the company invited several advertising agencies to pitch them ideas. One of these agencies, Kaplan Thaler Group, came up with the idea for the "Aflac Duck." Two stories circulate about how the idea came to be. The first is that the creative who developed it was walking in the park, wondering how he could make the name Aflac memorable, when he heard the sound of a duck and suddenly made the connection that Aflac sounded like a duck’s quacking. The other version is that one of the creatives on the account asked "What’s the name of the company account we are pitching?" His colleague replied "It’s Aflac – Aflac –Aflac-Aflac." Someone noted that he sounded like a duck leading the team along the creative path to the Aflac duck. The agency was not sure whether to pitch the idea because it diverged so starkly from the staid commercials of insurance companies, meant to communicate trustworthiness and stability. But the agency gave it a shot, and Amos and his team decided to give them a chance to see if it could work. After testing, the idea of the Aflac Duck proved powerful. It scored three times better than Aflac’s existing commercials. Picking the Duck was not easy. First, positioning an insurance company as fun and quirky cut against industry dogma. It was believed that people wanted their insurance companies to be reliable, not funny. Secondly, making it even more difficult to take on the risk was the fact that another commercial that used a TV star, rather than a make-believe duck, tested twice as effective as Aflac’s previous commercials. So Amos faced a decision - take the safer bet of a company spokesperson, which was still twice as good as the past, or he could challenge the industry norms, and transform Aflac, a family-run company with over fifty years of history, into a duck. I would not be surprised if most insurance executives, experts as they are at weighing returns and risk, would choose the safe option with a 200 percent return. But Amos is not like most executives. His company is an extension of his family so he can think long term and if you think long-term and compound the 300 percent return (remember the Duck commercial was three times as effective) over a decade, you see the Duck will guide an entirely different destination. So did the gamble work? Well, 10 years later Aflac enjoys 90 percent name recognition. Ask yourself the questions below to see how you can challenge the norm and build a stronger brand. For those of you interested in the other effective strategies that Alfac’s management has employed, then please join me and Aflac’s CEO Dan Amos on Tuesday, June 22 at 11 am EST (9 am PST) for a free executive briefing webinar. Visit https://www2.gotomeeting.com/register/638804058 to register. 1. What industry dogma – what accepted belief – have you not actually tested yourself? 2. If someone from an entirely different industry were to enter you business, how would they do it? 3. What part of your industry do you think lacks the most and how can your business transform that current perception?

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