One of the main radio advertisers, GEICO, is reviewing its media account after making cuts to its marketing department. Recently installed CEO Damon Burrell is reportedly looking for proposals for his media business, which is worth more than $1 billion a year.
According Ad age, MediaLink manages the review. Horizon Media has represented the insurance giant for 25 years.
GEICO was the 13th largest radio advertiser, based on spot volume, for the first six months of 2022. It aired 546,753 spots on AM/FM radio during the period, according to Media Monitors.
The media agency’s review comes as the company faces multiple business challenges, some of which were prompted by the pandemic and are continuing due to record inflation.
In March, the insurance company, which is owned by Berkshire Hathaway Inc., raised its average auto insurance rates by 6% in Illinois, on top of a 6% increase the previous December. The company also struggles with the rising cost of replacing and repairing cars.
The company closed 38 offices in California and stopped selling insurance over the phone in the state and faces a movement by employees to unionize.
“Like most large companies, we continue to review and adjust our workforce to meet changing customer and business priorities,” GEICO said in a statement, adding that it had “not ended its relationship with any of our partner media or marketing agencies”.
Regarding layoffs within its marketing department, the company will offer associate positions in other departments when possible and will also provide severance and outplacement services.
Ad Age says it would be a blow to Horizon Media if GEICO signed on for another media marketing partner. The company recently lost US accounts for Burger King, Popeyes and Tim Hortons. However, he recently secured the media accounts of Kohl’s, Lionsgate, Slimfast and Bluetriton.
