Lemonade for the Younger Demographic – a sweet Experience indeed!

Published: July 10, 2023

min read

Lemonade has released its first brand campaign with three 30-second spots in a bid to position itself as a smarter and a more modern option compared to traditional insurance companies. Some of its competition includes the much bigger and larger Progressive, State Farm and Geico.

Lemonade was founded in 2015 in New York and has used artificial intelligence much before other businesses and companies. It uses AI to run a specialized risk-assessment model and also has an AI-powered Chat-bot. Lemonade offers renters, pet, car, life and homeowners insurance. They have bundled offers as well.

Each of the three 30-second spots has a focus on different pain points that customers face. The first one highlights the pain of sorting out issues with an insurer’s customer service team, and contrasts the easy and effective customer service that Lemonade offers instead. The other is about the time it takes to file a claim traditionally, as opposed to Lemonade’s quick filing. The third is about the jargon that insurance usually entails and highlights Lemonade’s jargon-free rhetoric.

It’s 2023. We think insurance companies should act like it’s 2023, starting with the customer experience.

Liron Smadia,

Head of Brand Marketing, Lemonade

These three spots and their shorter versions will run on connected TV and several digital channels including YouTube. There will also be some direct mail and email marketing.

The campaign is built with creatives that deviate from the usual showing of a nuclear family unit of parents and children. On the other hand, it targets DINKWADs – the dual income, no kids, with a dog segment. The target group is the younger group of customers that includes Gen Zs and Millennials – those that fall into the ’20 to 41’ years bracket.

In the first quarter of this year, Lemonade reported revenues of $95.2 million, exceeding analyst expectations. This is a 115% increase over the year-earlier period. But the brand is not profitable and reported a net loss of $65.8 million.

Customer Experiences and the Young Demographic

It is not surprising that Lemonade is going after the younger customer – this is the demographic that doesn’t even feel the need for insurance. So it is only right that they are made aware of the fact that insurance is a good thing – and a necessary thing for their future. And to top this off, the cost of claims is rising. And this young customer base would see it as an unnecessary expense.

And while going after this group of younger customers, it is but natural that the brand chooses to place an emphasis on customer experience – something that is so integral to any encounter this demographic has with a brand.

Gen Z does not know life without a smartphone. They know digital ads, social networks, and mobile everything since they were practically born with a mobile device in their hands. Convenience is paramount. But they are influenced by their peers and what is trending on social media. But most importantly they are known to value a customer experience that is digital-first, responsive, empowering, and transparent, when they engage with brands.

The young customer is used to the convenience that smart phones have brought to their lives – so it is very important that for them to certify an encounter with a brand as one that was a great experience, convenience is key. Lemonade is going in the right direction, highlighting the fact that they will experience convenience and ease when they work with Lemonade as their insurance provider. One focuses on the easy and effective customer service that Lemonade offers, one about Lemonade’s quick filing of claims and the third about Lemonade’s jargon-free rhetoric.

More and more brands are starting to realize the importance of great experiences in a customer’s journey with them. Customers are already used to a high level of satisfaction in their encounters with some brands and they expect it of others. And they are ruthless in their moving away from brands that don’t offer them that.

So while the spots focus on Lemonade’s offerings of great customer experiences, the brand has to follow through by implementing what they have promised. Then, and only then, will things turn around for Lemonade and they will start converting young individuals into customers, and the profits will roll in.


Grace Wang

Grace is an advertising professional who keeps abreast of the latest and greatest in the marketing and advertising space. She is a traditionalist in lifestyle and modernist in her profession. Outside of marketing and advertising, she helps younger generation try and adapt traditional lifestyle for a healthy living.


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