Progressive Case Study

Progressive Case Analysis

Progressive Insurance is an auto insurance company within the United States. While most auto insurance companies offer different kinds of insurance such as home and life, Progressive focuses on only auto, which allows them to more accurately assess the needs of their customers and offer lower prices than their competition. By only focusing on auto insurance, it was able to out-operated its competitors. By offering lower prices and better service than its rivals, they basically took their customers away. What helped Progressive to have better prices and service was innovations of use of multiple channels of distribution, and new and better ways of doing the day-to-day work of providing automobile insurance.

By applying the concept of supply chain to Progressive Insurance, we can see that they use the downstream marketing channels via the internet or by using intermediary agents. Though it is a simple process in the Auto insurance world, it is very important to the customers. Whether a customer prefers to sit face to face with an agent, or whether they prefer to use the internet to search and compare pricing between different insurance companies, Progressive recognizes the needs to have the middleman or intermediary to get the information down to their customers. Progressive found that the best way to compete with much larger companies was to actually change the rules for how to play the insurance game. The company introduced what it calls Immediate Response claims handling. By using this step in the supply chain, the customer can call an 800 number to reach a Progressive representative by phone 24 hours a day, and the representative then schedules a time when an adjuster will inspect the vehicle. Adjusters no longer work out of offices from 9 to 5 but out of mobile claims vans. Instead of taking between 7 and 10 days for an adjuster to see the vehicle, Progressive's target is now just 9 hours. The adjuster not only examines the...