OT-How much cheaper would phone plans and insurance be if they didn’t waste so much money on stupid commercials?!!?
- Thread starter Roy L Fuchs
- Start date
I haven't bought a car in 4 years and only one this past decade. I wonder how many car commercials I've endured since.
That's kind of stupid. Why would anyone advertise if it did not make a difference in the bottom line? Clearly they have data that shows that it does. Every company makes a certain amount of profit on anything they sell. If they determine that the amount of new customers they get from advertising and the profit they get from those new customers is greater than what they spent on the advertising for those customers, then the money it takes from premiums is negligible. Some of you need to understand business before you start bashing it.
And if they didn’t spend billions on advertising each year, then they need less of my money each month to insure the risk. Also, they spend less, keep more and the bottom line improves. And I never have to see freakin’ Jamie, Flo or Jake from State Farm ever again (both the black Jake and the white Jake).
Not if the ads generate billions in additional revenue.
As Todd said, if it didn’t make them money, they wouldn’t do it. Although there is a caveat to that… Some companies, such as Coca-Cola, do not make additional money on their advertising. But they do it to keep the ridiculous value of their brand intact.
You don’t understand how sales and marketing works in a capitalist system I take it? Could consider a move to North Korea and have one state controlled option for everything. Would cure some of your free market ills.
Might not be quite as much as you would expect. In 2019, Progressive's "policy acquisition costs" were about 8% of premium. But policy acquisition costs include advertising, agent commissions, other marketing support services (including a fair amount of salary and employee benefit costs), a portion of the rent, and premium taxes. I wouldn't be surprised if the cost of the TV ads were only about 2 to 3% of total premium.
