There are 1.8 million homes in New Zealand, with 91 percent in population centres large enough to make AA’s Home Response service viable.
This was also a good chance for AA to broaden its relationship with its members and introduce new customers to the brand, talking to those who may not value AA’s existing motoring-focused membership proposition. AA Insurance could then enhance its brand credentials and create a competitive advantage for its home insurance, leveraging this to significantly boost sales.
But, while AA and AA Insurance were pleased with the idea of the joint venture, that doesn’t mean it was easy.
Pricing the AA Home Response Plus (six free call outs) product and tradespeople’s rates (for base AA Home Response product) at a rate that seemed reasonable was immensely difficult and consumers’ perceptions of the cost of calling a tradesperson varied widely.
AA Home Response offered a ‘come within the hour’ service, which had a significant cost, but in research, many consumers baulked at the cost, so it created more customer choice by offering cheaper rates for customers who were happy to wait for scheduled attendance on the next available business day.
As a new service in the market, it was also a difficult concept to communicate. Customers would want to know how it worked and what kind of home emergencies it could be used for.
So, AA and AA Insurance identified the 10 most common household emergencies and created a graphic device to communicate these clearly.
Another challenge was recruiting tradespeople. It needed skilled and qualified plumbers, builders, electricians and locksmiths. Recruiting experienced operators who could meet AA’s brand standards was critical if it was to meet its service promise. But, New Zealand has a major shortage of tradespeople, with MBIE reporting in February that New Zealand needs 51,000 more construction workers.
AA and AA Insurance engaged a master subcontractor to convince tradespeople to commit to accepting jobs from AA Home Response, on the expectation that the product would be a success and would be able to give them significant job volume. They had to commit to getting to jobs within the hour when required, and to deliver their service with the trustworthiness and friendliness people expected from AA.
Along with this, marketing needed to sit comfortably within both AA and AA Insurance communications styles, which meant working with two marketing teams to adapt tone, voice and branding that met both organisations’ requirements and was able to articulate the AA Home Response promise to prospective customers.
It launched on 5 March this year.
The move was huge for AA and AA Insurance, but worth it. By May this year, it had already surpassed its target number of subscriptions by 24 percent.
Though still being rolled out, AA Home Response is on track to achieve its goal of 100,000 subscriptions in its first 12 months.
AA Insurance’s home sales have also improved with the launch, with AA Home Response proving to be an effective differentiator.
The launch has successfully extended the AA brand beyond motoring and into the home. Even with a limited budget, the marketing launch garnered attention in the NZ Herald, Newstalk ZB, RNZ, Radio
Live, and many regional, daily and community newspapers.
Traffic to the AA website also increased by over 12,000 new visitors per month and anecdotal evidence and feedback from its network indicated high product awareness.
AA Home Response is also receiving strong interest from tradespeople, receiving over 10 enquiries per week for people wanting to work for the venture. This means it’s able to get better quality service providers and secure more competitive rates for its customers.
AA can now sit confidently that its future is secured, proving technological disruption doesn’t always mean doomsday, but can force a brand to think outside the box.
Supreme Award; Consumer Products & Services; Best Brand Extension/Innovation; Best Collaboration
AA Home Response
“AA's award entry demonstrated a high level of strategic marketing nous. There was a clear line of sight on the business problem at hand, that if left unresolved, had the potential to be a showstopper in the future. The team demonstrated excellence in end-to-end execution of the marketing value chain - where the customer is very much at the heart. It was a complex project that disrupted BAU thinking. Marketing has clearly led this to drive impact, extending the AA's trusted brand position into a new category - tapping into existing customers and recruiting new blood. We look forward to seeing how this plays out in the future. Solid foundations have been set.”
Rainger & Rolfe
Supreme Award: Air New Zealand, Auckland Council, Fly Buys, FMG, Genesis, Health Promotion Agency, Movember Foundation, New Zealand King Salmon, NZME, Samsung Electronics NZ, The Warehouse
Consumer Products & Services: BP Oil New Zealand, New Zealand Racing Board (TAB)
Best Brand Extension/Innovation: BP Oil New Zealand
Best Collaboration: Air New Zealand, New Zealand Trade and Enterprise, Vector and Auckland Council