Disruptive Marketing Plan – Final 1
Liberty University
BUSI 745
Disruptive Marketing Plan
Eric Young
10/10/2021
Disruptive Marketing Plan – Final 2
Disruptive Market Plan
A disruptive marketing blueprint is a procedure by which valuable marketing activities
take root initially in applications in a department or function in a firm and then relentlessly
moves across its internal departments, finally connecting with external firms to warrant that
market-based (Hult & Ketchen, 2017). On the other hand, disruptive technology is robotic that
impacts the overall operations of a vendor a craft (Njegomir & Bojanic, 2021). Notably,
disruptive technology displaces a new established market or technology, setting a new industry
or vend. The insurance industry is one of the industries that have experienced and might continue
to experience disruptive technologies as a marketing blueprint (Hult & Ketchen, 2017). Notably,
this paper describes a disruptive marketing plan of an American insurance company, State Farm,
using AI ad machine learning as the disruptive technology.
Disruptive Brand Plan
Because of the rise in automobile owners, which has been fueled by overall population
expansion, the insurance sector in the United States has seen consistent development. Because
auto insurance is mandated by law in many US states, it is a quasi-commoditized
product/service. As a result, customers have had more accessible access to obtaining cost-
effective insurance coverage. The success of the sector may be linked to effective marketing
techniques and new technology that has allowed this accessibility. Reduced liability coverage
rates by adopting an alternate rating system based on other criteria such as the number of
kilometers traveled are critical improvements that the business may undertake to target more
consumers. Premiums are determined by various criteria, including the geolocation, the
probability of an accident in that geolocation, the kind of vehicle used, and other general
considerations. The industry should focus on lowering rates by 10% by calculating risk based on
Disruptive Marketing Plan – Final 3
the actual danger of operating the car. This would result in a more significant number of
individuals purchasing insurance.
State Farm Insurance Company is an influential group of insurance companies
throughout the USA, and it is headquartered in Bloomington, Illinois (Statefarm.com, 2018).
Notably, it is also a substantial auto insurance provider in the USA. The company was ranked
36th in the Fortune 500 in 2019 (Statefarm.com, 2018). Significantly, Fortune 500 lists American
companies by revenue. The farm depends exclusively on captive agents to sell insurance. Solely
State Farm agents may merchandise State Farm Insurance, and their agents may sell State Farm
products (Statefarm.com, 2018) exclusively. Notably, if State Farm Insurance Company
embraces AI and machine learning in its operations, all aspects of its businesses will be
significantly enhanced (Ngejomir & Bojanoc, 2021). The information systems that make the
company’s backbone will be more effective using AI. Notably, when information is added to the
information system’s database, AI will allow the system to automatically update its predictions
and outputs by the new data (Hult & Ketchen et al., 2017). Significantly, insights into client
demands and demographics will constantly adapt to the business in real-time, allowing the
company to make swift, accurate evaluations (Eling et al., 2021).
Marketing Mix
Product
The insurance business is responsible for a wide range of services. Its goal is to provide
automobile owners in the United States with property, liability, and medical coverage. All
automobile owners are required by law to have basic auto insurance. The business also charges
varying rates for these services based on the automobile and the risks connected with the
likelihood of an accident. Liability coverage protects you from personal injury to others, while
Disruptive Marketing Plan – Final 4
property damage protects you against car theft and other physical damage. The industry will be
able to cut liability coverage costs by a certain proportion due to the modifications to the market
strategy.
The product marketing strategy element of the State Farm Insurance Company reflects
the solution to the client’s demands (Jaworski et al., 2018). Notably, it incorporates AI and
machine learning to improve service delivery to the company’s clients. Therefore, with the help
of AI in its business operations, the company should develop distinctive product design, name,
and features to stand out in the rivalry vend (Khan, 2014). There are numerous aspects that the
company’s administration needs to put in place to effectively use the AI and machine learning
technologies in developing the project blueprint. The factors include and are not limited to
standard, type, characteristic, packaging, trademark, and improved utilities (Keller &
Brexendorf, 2017). Notably, the company needs to ensure that machine learning plays an
increasingly constant role in client utilities in the industry. The customers will be happy if their
demands are met through computer-generated insurance advice (Njegomir & Bojanoic, 2021).
The utilization of AI and machine learning in service delivery within the company will
offer personalized solutions to consumers by reviewing their individual profiles and offering
recommendations for insurance products. These recommendations will be much more relevant
for any particular client, which would be excellent for them depending on a specific criterion
(Schlegelmilch, 2016).
Disruptive Marketing Plan – Final 5
Price
The pricing aspect of the disruptive marketing strategy needs an analysis of the value of
products for targeted clients (Tan & Sousa, 2015). Notably, the pricing strategy of State Farm
Insurance company mainly focuses on setting the list price, credit terms, payment period, and
discounts. Suppose State Farm Insurance Company resolves to utilize a price penetration strategy
when utilizing AI and machine learning in its service delivery. In that case, it will have to settle
for a bit lower price than competitors (Wenseley, 2016). Notably, the fact that the company will
be using automation to foster its business operations and meet consumer demands does not mean
that it should price its products highly compared to what competitors are pricing for their
products. Notably, the company will win vend shares based on discounted pricing (West et al.,
2015). However, the company’s administration should be aware of the possible retaliation from
the rivals in the form of an undesired price war. The choice of skimming blueprint will need clear
communication of differentiation basis and how such differentiation justifies the extra price
(Khan, 2014). Notably, today’s clients are not highly interested in knowing the pricing but total
cost sed in acquiring and utilizing the company’s utilities.
Distribution (Place)
The insurance sector in the United States includes a number of distribution methods.
Local agents and commercial brokers, who provide services to customers, are the most prevalent
technique. In this scenario, the broker’s duty is to find the best insurance for the customer. The
vehicle insurance business in the United States also expresses its worries openly. The sector has
also attempted to market its products through internet channels. This is very useful when trying
to reach a larger audience. Through the usage of internet channels, the sector can transcend
geographical barriers.
Disruptive Marketing Plan – Final 6
The State Farm Insurance Company needs to make crucial decisions when developing a
distribution channel (Zablocki et al., 2017). For instance, the company has had to resolve
whether it wants to make its services and products available to consumers through its channels or
require distribution assistants to serve the clients’ demands. The company has also had to execute
the direct and sometimes the indirect distribution of services to its clients (Dail, 2015). It has
done this by the use of intermediaries in its distribution channel. The company uses the brick-
and-mortar distribution strategy to make its services available and accessible to its customers
(Dail, 2015). This has been possible by the company having numerous offices all through the
USA. However, with AI and machine learning adoption, the company needs to combine brick-
and-mortar and online distribution (Jaworski, 2018). Notably, more consumers have shifted to
using digital platforms. The company should thus augment digital adoption and online portals
and mobile applications that create new possible touchpoints between the company and its
customers (Tan & Sousa, 2015). The company also needs to master the distribution strategies of
competitors in the market. Critically, State Farm Insurance company needs to have a
comprehensive evaluation of every channel and comparison with its resources and capacities that
will aid it in creating an effective distribution plan (Wensley, 2016).
Promotion / Communications
The success of the insurance firm is built on brand communication. To communicate their
offerings to clients, brands will mix elements such as advertising and social media. Customers
will be more accessible to the firm if it has good brand messaging and promotions. The insurance
sector promotes its services through radio ads, television commercials, newspapers, business
cards, and internet reviews. This is especially advantageous because clients are always looking
for innovative and inexpensive services.
Disruptive Marketing Plan – Final 7
Promotion is one of the essential elements in State Farm Insurance Company’s marketing
strategy (Keller & Brexendorf, 2017). The company blends the above and below-line promotion
blueprints to realize its marketing goals. The above the line promotion options for State Farm
Insurance Company include radio, television, and print advertising, while the line promotion
incorporates catalogs, tradeshows, and direct mail campaigns (Schlegelmilch, 2016). The
company needs to conduct a cost-benefit evaluation of selected promotional choices. For
instance, the selection of advertising as a promotional blueprint might enable the company to
target the mass vend, augment its trademark awareness, and brand recall (Khan, 2014). Over the
last few years, the use of social media marketing has significantly increased. Adopting a social
media marketing strategy will enable the company to reach a substantial number of customers,
considered economical (West et al., 2015). Notably, AI and machine learning will provide an
opportunity for the company to interact with clients actively, create personalized associations to
acquire improved outcomes (Eling et al., 2021).
Market Segments - Current Target Market
State Farm Insurance Company’s current target market incorporates individuals, home
buyers, auto buyers, and mutual funds investors (Dail, 2015). The company targets these persons
since it seeks to sell them individual life, health, home, auto insurance products, and mutual
funds. Notably, numerous researches have indicated that State Farm majorly targets young adults
as potential customers for its insurance products (Dail, 2015).
New Primary and New Secondary Target Market
The company’s life insurance new primary target market incorporates adults aged 31-45
(Dail, 2015). Notably, this is the case since these individuals typically follow the process of
getting married, having children, and buying homes. The company’s secondary target market can
Disruptive Marketing Plan – Final 8
be achieved after effectively conducting market segmentation based on geographic,
demographic, behavioral, and psychographic factors.
New Primary Target Market
The company’s life insurance new primary target market incorporates adults aged 31-45
(Dail, 2015). Concordantly, individuals with relatively good incomes can always purchase and
pay for numerous insurance policies. The majority of them are individuals with high lifestyles
and who can even afford luxuries in their lives.
New Secondary Target Market
State Farm Insurance Company can use one of the precise segmentation blueprints to
segment the market, choose an effective secondary target market, and productive marketing
blueprint. The company can base on geographic segmentation that divides the vend as per
geographic area like cities, towns among others (Zablocki et al., 2017). On the other hand,
demographic segmentation incorporates dividing the market based on aspects such as age,
gender, income, and nationality (West et al., 2015). Behavioral segmentation also includes
dividing the market based on consumer buying patterns, usage frequency, and brand loyalty.
Psychography segmentation will group the clients based on their lifestyles, interests, attitudes,
values, and traits (Moazeni et al., 2020). After this effective segmentation, the company can
choose the best market segment for a reliable secondary target market.
Demographic and Economic Trends
Primarily, in the current world, there continue to be dramatic technological advancements
that companies need to embrace to improve their business operations (Eling et al., 2021). When
such new technologies are developed, companies in many industries adopt them to make sure
they fit into the market and gain a competitive advantage. Notably, like other insurance
Disruptive Marketing Plan – Final 9
companies offering different products to their consumers, State Farm Insurance should adopt
automation technologies like AI and machine learning. The technologies will help the company
improve its business operations and customer experience (Eling et al., 2021).
Generally, the external factors influencing the implementation of AI and machine
learning as an innovative, disruptive marketing strategy for State Farm Insurance company
include clients, rivals, and suppliers (Eling et al., 2021). The other factors also include economic,
regulatory, legal, labor market, and competitive conditions. The supply of technological and
another apprehension of value to innovation also influences the need to utilize AI and machine
learning in the company’s operations (Njegomir & Bojanic, 2021). Currently, the COVID-19
pandemic is a significant influence for the company to implement these automation technologies
s that consumers can easily access services remotely (Eling, 2021).
Analyzing the Consumer Market
Social Factors
Notably, the expectations of generation Y that ever-increasing are likely to make the use
of AI and machine learning in State Farm Insurance company possible (Eling, 2021). This
generation wants to work, engage with business and deal with insurance companies and their
products as they do in all the aspects of their lives (Jaworski, 2018). Customers also expect to
have faster, high standard, and cost-effective utilities. Clients anticipate that with the rise in
technological advances and the introduction of smartphones, they can access services remotely
and have their concerns addressed remotely without traveling to the company’s offices to have it
manage their problems (Ngejomir & Bojanoc, 2021). Notably, client anticipations are among the
aspects that will make this disruptive technology necessary for State Farm Insurance Company.
Disruptive Marketing Plan – Final 10
Psychological Factors
Psychological factors that influence innovation include resolution formulation like
innovativeness, trust, and peril perception by consumers (Eling, 2021).
Customer Needs
AI and machine learning are disruptive market technologies that will help the customers
of State Farm Insurance Company get computer-generated insurance advice (Eling, 2021). They
will acquire personalized solutions by having AI review their profiles and offer recommendations
for solely insurance products that are relevant for them and that would be best for them as per a
particular set criterion (Moazeni et al., 2020). The technologies will enable consumers to use
chatbots to work with messaging apps to resolve claims and address simple concerns. AI and
machine learning have the potential of significantly transforming the consumer experience,
whereby the company can better predict their demands and solve their issues a bit quicker (Eling,
2021).
Positioning
The new positioning statement for State Farm Insurance Company is to use automation
and technology in improving customer experience by helping individuals administrate the perils
of day-to-day existence, recover from the unanticipated and achieve their goals and ambitions
(Dail, 2015).
Competition
Criteria for
Comparison
Your BRAND Your BRAND After
This New Disruptive
Idea is Launched
Competitor # 1 – a
name that brand
Price - MSRP Range State Farm Insurance
Company
The company will
have relatively
reduced costs in
processing claims and
addressing consumer
Farmers Insurance
Disruptive Marketing Plan – Final 11
concerns.
Consequently, this
will lead to reduced
prices for the
products and services
offered to consumers.
Product Unique
Attributes
State Farm Insurance
Company
Customers will have
their concerns about
insurance products
addressed efficiently.
They will have
computer-generated
insurance advice. The
company will have
swift and effective
transactions and
claims processing.
There will also be
effective
communication with
customers, thus
saving time and
augmenting the
quality of service.
Farmers Insurance
Placement – points
of distribution
State Farm Insurance
Company
The company’s
customers will be
able to get services
online. They will
have chatbots that
work with messaging
apps that will address
their concerns.
Farmers Insurance
Promotion – where /
how do they
advertise
State Farm Insurance
Company
Social media
advertising will
enable the company
to reach a substantial
number of customers,
considered
economical. AI and
machine learning will
allow the company to
interact with clients
actively and create
personalized
associations to
acquire improved
Farmers Insurance
Disruptive Marketing Plan – Final 12
outcomes.
Competitive
advantage
State Farm Insurance
Company
The company can
adopt a
differentiation-based
competitive
advantage that pays
great attention to
creating brand loyalty
and providing
premium products.
State Farm Insurance
Company may realize
competitive
advantage by
embracing product,
utility, standard,
image, or innovation
differentiation.
Farmers Insurance
State Farm Insurance Company needs to set a clear differentiation basis that can offer an
edge against the company’s competitors (Keller & Brexendorf, 2017). Importantly, this will
guarantee the company’s survival in the increasingly competitive vend. The company’s
marketing blueprint should pay attention to identifying distinctive selling propositions which
include the highest quality, lowest cost, or distinctiveness of ideology (Khan, 2014). Remarkably,
recognizing selling requests is not sufficient as the efficacy of the marketing blueprint of the
company will directly rely on the administration’s capacity to convey the identified distinctive
selling propositions (Tan & Sousa, 2015). The company can also set a competitive advantage
based on cost or differentiation.
The cost leadership blueprint will be practical. State Farm Insurance Company has
developed capacities to minimize the cost below the craft average and realize the economies of
scale (Wensley, 2016). Additionally, it will need the company to create close collaboration
between different functional areas. The differentiation blueprint focuses on developing trademark
loyalty by providing premium products (West et al., 2015).
Disruptive Marketing Plan – Final 13
Market Research Plans
Importantly, it would be essential to conduct market research on AI and machine learning
to foster more business operations such as finance. The study would provide insight into how to
effectively implement AI and machine learning in finance and even risk management. The
research would incorporate technological experts who would give direction on what strategies to
implement to achieve this.
Promotion Plans
After successfully implementing AI and machine learning in the business operations of
the company to improve customer experience, the leading promotional plan is to create more
awareness of the company’s insurance products and enlighten customers on how they can use the
elements of AI to get the company’s services (Moazeni et al., 2020). The company’s promotional
plans include coming up with ways to make the public and specifically the target market aware
of the improvement of service delivery by the company to attract more clients and make those
who already exist loyal to the brand (Dail, 2015). The company also intends to use the pull
blueprint. As such, it has to create a prestigious trademark and image that could attract clients
towards the products that it offers (Zablocki et al., 2017). The company will continue using
social media marketing to reach the mass targeted vend economically.
Social Marketing
State Farm Insurance Company uses various social media platforms and handles to reach
its target market. For instance, the company publishes specific content on its YouTube channel to
engage with numerous and distinctive audiences (Dail, 2015). The company always shares
promotional messages on its Facebook and Twitter pages, thus reaching many people
simultaneously. Impressively, this is incredibly economical. The company also has numerous
Disruptive Marketing Plan – Final 14
websites where individuals can access information about it, business operations, and its products
(Moazeni et al., 2020). However, the company can improve its social marketing by turning the
audiences’ engagement in sharing their narratives into a social media contest. For instance, this
will enable State Farm to foster its trademark awareness, steer traffic to their domains, increase
involvement, referrals, and even prospective leads (Shlegelmilch, 2016).
Public Relations
The company can use various techniques to gain free publicity. For instance, it may
address Quora’s concerns about the insurance industry, generate intruding information and
combine offers and audiences (Tan & Sousa, 2015). The company can also build a loyal
following on its Facebook, Twitter, Instagram, and LinkedIn platforms so that the followers can
help spread the word about the company. The company should also aim at viral marketing, a
strategy that will make its pots on social media and even vises on YouTube viral, thus reaching
many people (Dail, 2015). This aspect helps in spreading the word about the helps company and
developing its brand visibility and awareness. State Farm Insurance Company can also publish
client reviews on its website that can help convert browsers into buyers. The company can also
get involved with a charity to augment its standing in society (Dail, 2015). Social media
accounts are prone to security breaches, breaches of customer confidentiality, leaks of
intellectual property, and at times violation of the company’s codes of conduct (Njegomir &
Bojanic, 2021). Despite all these risks, the company gets to promote its brand, increase its
visibility and awareness, and acquire more clients, all that help it boost its dividends and returns.
Traditional Marketing
The company will have advertisements playing on local televisions and even radio
(Khan, 2014). The ad might be about the company and its products, where its offices are located,
Disruptive Marketing Plan – Final 15
its social media handles. The advertisements can also include the benefits of having the
company’s products and several clients’ reviews about their experience with the company (Tan &
Sousa, 2015). Importantly, this is one way of economically reaching the great masses.
Financial Viability of Plan
AI and machine learning are used to improve customer experience through efficient,
effective, and high-quality services. Technology also helps in changing how companies interact
with money (Eling et al., 2021). AI has great potential of helping the company’s financial
department to optimize and streamline procedures ranging from credit resolutions to qualitative
trading and financial peril administration (Ngojemir & Bojanoc, 2021). AI also brings the power
of advanced data analytics to combat fraudulent transactions and improve compliance within the
company’s financial department (Eling et al., 2021. If the disruptive technology is not launched,
the company might continue to foster security and integrity in payment fraud detection and
prevention systems.
Relationship Marketing
AI and machine learning, just like other technologies, can help State Farm Insurance
Company streamline its operations, minimize staff and procedures and cut costs internally (Eling
et al., 2021). Notably, this can be passed on to the client in terms of lower prices. Many clients
are always seeking value pricing. Therefore, this blueprint is a powerful technique for creating
client relations (Eling et al., 2021).
Socially Responsible Marketing
State Farm Insurance Company publishes specific content on its YouTube channel to
engage with numerous and distinctive audiences (Dail, 2015). The company also allows
Disruptive Marketing Plan – Final 16
customers to give their views on their experience with the company via its online platforms
(Jowarski, 2018). Importantly, this enables the company to note any commendable service
offered to customers and instances where it did not meet customer expectations. All these are
meant to ensure that State Farm Insurance Company puts in efforts and comes up with blueprints
to meet all consumer anticipations and make them content with its products and services.
Christian Integration for Brand
Remarkably, to make the company a Christian brand, it is essential to make all people
within the business, the community, and even the client aware of its Christian values that must be
executed when working with the organization. Some Christian values include generosity,
whereby the organization can have this stated some herein its statements. Charity is meant to
encourage all people associated with the organization to be kind and unselfish, particularly with
their time and money. Another value is courage, where people can be encouraged to be bold and
confident. Love is also another Christian value that the organization should strive to embrace.
The organization can also have respect among its core values whereby it respects all individuals
regardless of the existing differences. Peace and hope are also other essential Christian values.
By adopting automation and technologies that enable the client to have their concerns addressed
remotely, the organization makes it easy to have it closed on particular days, mainly on Sundays,
to allow all people to attend church services.
Recommendations
Technology and automation are essential aspects in fostering business operations.
Technology such as AI and machine learning is critical to the mismanagement and processing of
claims. It makes it easier to process claims, thus saving on time and cost. Chatbots are
increasingly crucial and should be significantly embraced since chatbots work with messaging
Disruptive Marketing Plan – Final 17
apps to address consumers’ insurance concerns. As much as all other marketing strategies are
essential in creating brand awareness, improving brand visibility, and gaining the company more
customers, being philanthropic and participating in charity is also an important strategy to enable
the company to gain free publicity.
Conclusion
In summary, disruptive technology as a marketing strategy is essential for State Farm
Insurance Company. Importantly, this is because the technology will enable the company to
improve consumer experiences with the company. Technologies such as AI and machine learning
will allow the company to transform its business operations. The technologies are likely to
enable the company to make timely and accurate assessments and process claims at all times.
Clients are also able to acquire computer-generated insurance advice through the use of chatbots
and messaging apps. State Farm Insurance Company needs to have an effective marketing
strategy and marketing plan. For instance, the company can offer services to clients at prices
lower than the industry average to attract more clients. Notably, State Farm Insurance Company
can continue using its social media platforms for marketing. The company can also publish
customers’ reviews on its website to spread the word about its products and services, enabling it
to gain more customers and effectively compete in the market.
Disruptive Marketing Plan – Final 18
References
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