By George W. Nordhaus

From AA&B April 1963 

"Our agency has a volume of only $50,000 a year. How can we possibly advertise on TV?" That was the question I heard time and again on my travels around Tennessee, attempting to help agents with their advertising programs.

For the smaller agent  (up to $250,000), spending any portion of his budget for television advertising usually is like pouring a cup of water into the ocean-it just doesn't have much effect.

As a general rule, advertising, to be worthwhile, has to be hard-hitting for a continuous period of time. Buying television time for advertising over any length of time is almost more than the average insurance agency can stand.

Buying TV Time

Television time is purchased in one of two basic ways, with variations of each method. Spot announcements are available, with as little as one 10-second commercial spot available for purchase, or additional commercial time up to 60 seconds per announcement. It also is possible to buy entire programs, from five minutes to one hour or more, thereby gaining the normal commercial time permitted under Federal Trade Commission regulations during those programs. Variations and combinations of commercial spots and program time are available, with only the imagination of the TV sales staff and budgetary limitations as drawbacks.

As an example of television costs: An agency in Nashville can buy a 60-second spot announcement on one of the major stations for $80. If he buys five of them the price drops to $56 each, but the total is $280. For 10 one-minute spots, the price per spot falls to $48, but the total cost rises to $480. This $480 is well above the total advertising budget of even the larger agencies. It is apparent that any kind of continuous-impact TV advertising, in a good time segment, would be financially disastrous for the average independent insurance agent.

Yet the agent who cares enough to spend the money should not overlook the possibilities of advertising on TV. National averages show that between 65 and 70% of all TV sets are tuned in each evening between 6 and 10 p.m. Considering that over 90% of America's homes now boast television sets, the percentage of the insurance-buying public viewing the "tube" is nothing less than staggering.

Co-operative Ad Fund

In Nashville, the local association, the Insurors of Nashville, looked into the problem of proper expenditure of the joint advertising fund established voluntarily by the 60-member group. Since each member invests $5 per month in the fund, a total of $3,600 was available each year to convince the public that the best way to buy insurance was through an independent agent.

With these figures in mind, it is obvious that the entire budget could be spent on TV without noticeable impact on the public. We decided, therefore, that the medium of TV could best be used in a co-operative endeavor, wherein the local association and a number of individual agencies would split the costs.

With the co-operation of the CBS affiliate station in Nashville, WLAC-TV, an available time segment was picked out and a sports program, featuring top sports news from across the nation, was chosen for its appeal to the male insurance-buying public. 

Our first year's endeavors on the co-operative advertising attempt were modest when compared with the programs we now sponsor on television. In 1959, we felt that we had accomplished a great deal by having one 15-minute program each week for 13 weeks during the year. By 1962, after four years of trial and effort, we had built an annual series of 30 half-hour programs and additional spot-announcement purchases during special promotional periods, such as the National Association of Insurance Agents' Protection Week.

During the first year of our pro-gram, we found 13 agents who were willing to invest $200 each for their share of the 13-week program. When this $2,600 was added to the $1,000 invested in the program by the local association's advertising budget, the total amount gave us enough money to make our initial television debut. Because we could sandwich in four 30-second commercials each week, the participating agencies got four individualized commercials during the 13-week segment of the show.

The local association got identification through the name of the show, "Insuror Scoreboard," as well as through local promotion of the show and the use of the Big "I" seal before and after the show each week. The Big "I" also was displayed on the set used for the program.

By "panning down" on a blown-up copy of the telephone book Yellow-Page display at the opening and close of the show, each member of the local association had his name seen by the viewing public at least once each week.

Each of these agencies is given an opportunity to become one of the more active, participating members of the TV show, as well as offered numerous opportunities to use newspaper and other tie-in advertising to promote the show.

Features Interviews

Our current program features football scores at 3:30 and 6 p.m. each Saturday afternoon during the fall, and "Basketball Standings" is shown each Sunday afternoon at 1 p.m., January through March.

A complete round-up of scores from across the nation, plus the colorful details of these games, is bolstered by weekly interviews with top sports personalities from across the nation.

During 1962 we had personal visits from such sports figures as New York Yankee catcher Elston Howard; Harlem Magicians dribbling star Marques Haynes; Chicago Bears quarterback Bill Wade; New York Giants halfback-fullback Phil King, to name just a few. Together with sports results from the area's 50 high schools, this half-hour seems, to those of us doing it, more like three hours of sports.

To illustrate the popularity of the shows, we can proudly point to the television ratings taken during the past football season. They showed that more than 240,000 people watched our show each Saturday. Translated into insurance prospects, that certainly is a high percentage of the market that our agents are trying to reach. 

Each of our agency-advertisers, then, becomes a part-sponsor of the show and, we like to think, his insureds and prospects soon come to feel that the entire show is "his."

Agencies Note Increase

Each agency that co-operates with the local association in sponsoring the programs gets its name mentioned each week, plus a commercial every other week during the football shows and every third week during the basketball season. The advantage of this co-operative advertising program is that the cost to the sponsoring individual agencies is only $330 for the entire program.

Some of our sponsoring agencies write over $1,000,000 in volume each year. At least two of our sponsors write less than $50,000 in premiums each year. For these smaller agencies, this television advertising is probably the bulk of their advertising budgets for the year. Yet, they seem to feel that it is money well spent and appear to be grateful to the local association for making such a good advertising medium available to them
           
To the million-dollar agency men, and the even larger percentage of our advertisers who write from $150,000 to $500,000 in volume, this kind of advertising (while not the major part of their over-all programs) gives them a central point from which to develop well-rounded advertising campaigns.
           
Our agencies use a "Duke's mixture" of advertising methods to get their money's worth. Some of our smaller agencies try the hard-hitting "price" angle. By quoting actual dollars and cents, two of our advertisers report that they completely paid for the year's advertising within the first month of the program. Our larger-agency advertisers seem to follow the trend toward the "soft-sell" or quality approach to hawk their wares.

This institutional type of promotion seems to tie in well with the entire format of the show, since each show opens and closes with a plug for the "independent agent-qualified Insuror who displays the Big ‘I.’”

If we have been able to prove nothing else during the past four years, the one accomplishment that stands out in our co-operative advertising endeavor is that independent agents, even those with smaller agencies, can use television successfully as an advertising medium. These independent agents in middle Tennessee have proved that so much more can be done by working together than by working separately.