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A Customer Experience Case Study: Lemonade

RevOps , or revenue operations, is a strategy for businesses to align revenue-enhancing teams and activities while improving the customer journey. When discussing RevOps, the emphasis is usually on overcoming silos and having departments such as marketing, sales, and customer service working seamlessly. However, it's equally beneficial from the customer's point of view. The insurance company Lemonade is an instructive case study to illustrate best practices for optimizing the customer experience.

How Lemonade is Disrupting the Insurance Industry

Lemonade is an innovative insurance company, founded in 2015, that offers products such as homeowners, renters, life, and pet insurance. Lemonade has similar services as other insurance companies but has radically changed the customer experience. Here are some features that set Lemonade apart.

• • Strong branding. Lemonade has carved out a distinct niche for itself. Clearly targeted towards tech-savvy younger customers, it promises "Insurance built for the 21st century."
• • Personalized service. One of the qualities that distinguish Lemonade from other insurance companies is the level of personalized service. Maya, the company's chatbot, makes it easy for website visitors to get information and sign up. Maya takes visitors through a questionnaire that guides them to the most appropriate services and provides quick quotes. Another chatbot, named Jim, handles payouts.
• • Flat fee. Pricing is often confusing for insurance customers. Lemonade also  appeals to millennials  and other younger customers, who tend to have less experience with insurance policies. The company takes a flat fee of 20% from their customers' premiums, which is simple and straightforward. As they point out, their fee structure also eliminates a conflict of interest with customers. The flat rate, combined with their Giveback program (see below), means that Lemonade doesn't lose money by paying claims.
• • Giveback program. When customers sign up for insurance, they choose a nonprofit to support. At the end of the year, any unclaimed money from an account is donated to the nonprofit.   Lemonade Giveback   provides customers with the satisfaction that they're performing a social good, something that's extremely relevant to millennials. A  Deloitte Global Millennial Survey  revealed that 42% of millennials would start patronizing a business with a positive impact on society, while 38% would stop supporting a business with a negative impact.

A Data-Driven Approach

Source: Lemonade is disrupting insurance. The incumbents will have to respond Lemonade vs Traditional Insurance Companies: Customer Experience

Lemonade claims that it  collects 100x more data points per customer  compared to other companies. In a blog post, Lemonade describes how collecting and studying data are helping to  improve its loss ratio . This is the ratio of losses to premiums. As the article explains, a very high loss ratio isn't sustainable for an insurance company, while a very low one is profitable for the business but not good for customers. Lemonade's system of charging a flat rate and donating leftover funds to charity allows it to maintain a stable loss ratio.

One of Lemonade's taglines is to turn insurance "from a necessary evil to a social good." The Giveback program plays a big role in this. But what does this really mean for the average customer? Let's explore if (or how) the customer experience differs with Lemonade when compared to traditional insurance companies.

Do Everything Online

At a time when  73% of millennials prefer to shop online  using their phones (the figures are 2x higher for Zoomers, or Generation Z), Lemonade has perfectly tapped into this target market. The traditional process for getting insurance information requires the user to contact an agent, fill out a form, and wait for a quote. With Lemonade, the process is streamlined to be much faster and more convenient. The system's built-in AI (Maya the chatbot) provides personalized service without the user having to talk to a live agent.

What really sets Lemonade's customer service apart is the way it seamlessly transitions customers from one function to another. A new user is presented with information tailored to their buyer persona as they see comparisons of data so they can choose the best service. They can just as easily access claims processing when needed. All of this is automated, without the need to wait on hold or fill out complicated forms.

For a thorough review of the UX advantages of Lemonade's landing page, see  A UX Review of Lemonade Insurance in Less Than 5 Minutes .

Image Source: Lemonade

Fast Payments

Another distinctive customer experience feature of Lemonade is guaranteeing fast payments without any paperwork. As with the application process, customers can complete everything online. Claims are approved in seconds.

Easy to Switch

Lemonade targets customers who already have insurance as well as people buying it for the first time. Their "Check Prices and Switch" guides users through the process. As with other tasks on the site, Maya the chatbot guides users through a series of questions to highlight the advantages of switching to Lemonade.

Mobile Apps

Speed and convenience are supported by mobile apps that customers can download. Customers can set up and manage their policies on their mobile devices.

Active on Social Media

Another way Lemonade taps into its millennial customers is by providing news and policy information on social media. Their twitter account  is frequently updated. They're also active on Facebook and Instagram. Social posts aren't simply ads for insurance, but links to news items and timely blog posts.

Lemonade posts stories that are educational and helpful to its audience. For example,  a recent post addresses concerns that renters may have about eviction and suggests resources to help. This type of post isn't directly related to Lemonade's services, but it establishes them as a useful source of information.

What Lemonade Has Accomplished

Is Lemonade actually disrupting insurance and stealing customers from more established companies? The Motley Fool, in the article,  Can Lemonade Disrupt the Insurance Market?  shares some impressive facts.

• • While 50% of renters are under 30, only 37% get renter's insurance. Lemonade is targeting this largely untapped market.
• • Customers who signed up with Lemonade three years ago have increased their spending on renter's insurance by 56%.
• • Between 2017 and 2019, Lemonade increased the number of premiums sold from $9 million to $16 million.

While the article goes on to question whether Lemonade can succeed at converting older and more affluent customers, in our opinion this innovative model will prove to be a clear competitive advantage for Lemonade. 

Lessons From Lemonade

Here are some lessons that businesses in any sector can take from Lemonade.

• • Long-standing products and services can be marketed in a new and fresh way.
• • Target specific demographics (e.g. Lemonade targets millennials and renters).
• • Today's customers appreciate speed and efficiency.
• • Provide simple and personalized services. AI tools such as chatbots can help improve the customer experience.
• • Use automation tools to collect and analyze data.

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Lemonade: Smarter use of data brings the zest to insurance company's growth

About Lemonade

A leader in insurtech, Lemonade provides renters, homeowners, life, pet and car insurance to consumers in the United States and three European countries. Its digital-first business model leverages technology to streamline the process of buying and using insurance, earning it top satisfaction ratings from its customers.

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Google cloud results.

• Pioneered disruptive digital-first insurance company through smarter use of data
• Empowers users across the organization to innovate by establishing a single source of data truth to improve and accelerate decision-making
• Quickly adapts to new challenges and increasingly complex business needs as it expands product lines and geography
• Achieves industry-leading customer satisfaction with data-driven personalized experiences

Smarter use of data brings the zest to insurance company Lemonade’s growth

Urging customers to “forget everything you know about insurance,” Lemonade is a digital-first insurer that has disrupted an old-line industry. As a new kind of insurance company, Lemonade has put data at the heart of its business model and its effort to improve the overall customer experience.

Promising “instant everything, incredible prices, big heart,” Lemonade has been a hit with consumers. The company had a 150% annual compound growth rate in its first five years and hit 1 million paying customers faster than Netflix, Spotify, or Amazon. Started in 2015 in the United States with a focus on renters insurance, Lemonade’s digital first approach has allowed the company to grow to global scale and quickly evolve into new markets and insurance products.

Younger demographics have flocked to its mobile-first experience, and about 70% of Lemonade’s policyholders are under age 35. The company, which is certified as a socially responsible B Corporation, annually donates to nonprofits selected by its customers any leftover premium that exceeds claims and expenses.

"We operate like a tech company, very much at the frontier, in a traditional, data-heavy business. An advantage we believe we have is our ability to quickly query data, understand what’s going on with our customers, and analyze their policy information as agilely as we can."

Refreshing the insurance industry with agile data use

Analytics are foundational to everything Lemonade does, and maintaining data integrity and reliability is critical. As its more than 40 teams interacting with data for their specific uses, the company needs to know that there is a single source of truth, and that data definitions and metrics are consistent at every instance.

Breaking down data silos for a unified 360-degree view of the organization required a business intelligence tool that offers this flexibility.

From Lemonade’s early days, the company has used Looker , Google Cloud’s development platform for data-rich experiences like modern BI, embedded analytics, and custom applications. Looker has been an important tool in Lemonade’s effort to innovate in one of the world’s oldest industries, delight customers, and grow rapidly.

Establishing a single source of truth with data reliability

Lemonade values Looker’s ability to ensure data integrity and consistency, regardless of whether the user has technical skills.

"As we’ve expanded, we’ve been able to create and maintain data consistency. It has proven to be a good reason to choose Looker,” notes Christian Dulmaine, Business Intelligence Lead. “We have been on a hyper-growth trajectory. We wanted to make sure that, as we scaled, people were using the same consistent definitions of data to build that trust."

LookerML , Looker’s universal semantic modeling layer, ensures data is trustworthy by giving the business intelligence team a collaborative Git development environment and version control over every data definition and metric that business users interact with. This is especially important in insurance because of the industry’s multiplicity of data points that have subtle differences among them, especially at global scale.

“Without the layer within Looker to define the metrics, there would have been a lot of room for misunderstanding and dangerous interpretations of the data,” explains Dulmaine. “I’ve been really impressed with the amount of control we have in Looker. I have confidence that when someone goes in and builds their own report, the insights are consistent and trustworthy because users are leveraging the unified model of our defined business logic.”

Lemonade depends on Looker for a diversity of modern data experiences such as interactive, real-time dashboards and Slack integration. These enhance productivity by incorporating data insights into existing workflows.

Redesigning the insurance value chain around data

Lemonade has successfully innovated on the traditional insurance business model by structuring its operations like a technology company. As they would at a technology company, product heads manage each business line vertically, rather than having each function, such as underwriting, operate across product lines.

Looker enables product managers to monitor already defined KPIs and ask new questions about customer behavior to improve both the product and customer experience. Additionally, new product opportunities have been discovered through these insights, expanding Lemonade’s overall offerings and market presence.

For example, how many customers are adding optional coverage for expensive items like wedding rings? Or what are the average claim values of customers who carry coverage within a specific dollar range? What’s the loss ratio and growth rate of certain customer segments? Product managers use this information to define coverage options, identify features that will be attractive to existing and new customer segments, while increasing efficiency.

When Lemonade was ready to expand into the car insurance market, they were able to incorporate new datasets and sources, such as auto body shop data to strategically develop a plan for a new insurance product. Looker played a central role as the single source of truth as the strategy was developed and launched. Insurance product managers had the agility of their technology industry counterparts to closely monitor, track and adjust different parts of their offering and product for a superior insurance customer experience.

“We operate like a tech company, very much at the frontier, in a traditional, data-heavy business,” says Dulmaine. "An advantage we believe we have is our ability to quickly query data, understand what’s going on with our customers, and analyze their policy information as agilely as we can. And that’s because it’s in our DNA to be a tech company, not just an insurance business that’s trying to be technologically savvy."

He continues, “Analytics are used across the full value chain of building the product, designing the product, figuring out the pricing, as well as all the more traditional tech company use cases around how a different product initiative's performing, what's going on with our sales, etc. We must have visibility for every team across the value chain, because it really is a data-based product.”

"I've been really impressed with the amount of control we have in Looker. I have total confidence that if someone goes in and builds their own report, the insights are consistent and trustworthy because users are leveraging the unified model of our defined business logic."

Leveraging analytics for happier customers

Lemonade is relentlessly focused on customer happiness. It uses analytics to make sure its customer experience and claims process delivers satisfaction and quick resolutions. The company relies on Looker to track efficiency, performance, and trends in customer service so it can make continual improvements.

"Across the customer journey, we use Looker for monitoring the source of truth about what's actually going on. When we launched in a new European market, we wanted to know how many customers we have there and where exactly they are. That's on a Looker dashboard," Dulmaine explains.

Traditionally, the claims process can be a pain point and disappointment for insurance consumers. Lemonade has turned it into a source of customer delight and a competitive differentiator. Claims are filed on the Lemonade app with no paperwork and often no phone calls, and 30% of claims are handled instantly. The company’s fastest claim was paid in 3 seconds. Lemonade’s insurance for renters was rated no. 1 for customer satisfaction by J.D. Power for two years in a row.

Lemonade has thrilled its customers with simplicity through hard work and diligent tracking of metrics that matter, not vanity metrics. It uses analytics to identify trends in customer experience, prevent traditional processing bottlenecks, and continually find ways to improve their service and offerings

Using data to create the future of insurance

In little more than five years, Lemonade has built a leading digital first insurance business and product model, which included using Looker for the smarter use of data, to become a disruptive power in the insurance marketplace. The company has scaled globally, turning traditional challenges into ripe business opportunities with a data-driven product and business strategies in service of a superior customer experience with an insurance company.

As it expands further into the domain of legacy insurers, Lemonade will apply these data-driven strategies to guide product innovation and market expansion while exceeding customer expectations. Wherever this future leads, Lemonade will use Looker to ask new questions with agility and track critical organizational metrics, driving the company’s competitive advantage.

"As we’ve expanded, we’ve been able to create and maintain data consistency. It has proven to be a good reason to choose Looker."

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Lemonade: Disrupting Insurance with Instant Everything, Killer Prices, and a Big Heart

• Format: Print
• | Language: English
• | Pages: 24

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• January 2020
• Faculty Research
• Lemonade: Disrupting Insurance with Instant Everything, Killer Prices, and a Big Heart  By: Elie Ofek
• Lemonade: Disrupting Insurance with Instant Everything, Killer Prices, and a Big Heart  By: Elie Ofek and Danielle Golan

Feb 11, 2020 | 7 min read

What We Can Learn From Lemonade: an InsurTech Case Study

Insurance operators have been the slowest in adopting information technology and digital transformation. All the while the fintech space is bustling with innovative ideas and insurance development companies. Lemonade is one such new kid on the blog that has taken a technology-first approach in its business model. Something that older players lack. What exactly makes Lemonade so notably? Let’s have a look.

A recent McKinsey financial services overview shows that insurtechs are moulding a new look at how traditional insurance companies. Such technology-driven companies have the upper hand and steadily capturing market share. Operators of insurance services are being forced to adapt new approaches or face the imminent threat of becoming obsolete in the face of a digital revolution. 

What is Lemonade and how does it work?

Lemonade’s domain is renter and homeowner insurance, meaning it supplies everything from reconstruction costs, personal property damage, personal property theft, loss of use and legal liability.

So Lemonade is an insurance company. Or is it? As Shai Wininger, the company’s co-founder, himself states , “Lemonade is a tech company doing insurance, not an insurer doing an app”.

Subscribers use a mobile up in order to register and sign up to the service. Claims are filed with an in-app chatbot. There’s no paperwork involved whatsoever. The software behind the application is powered by AI. It processes the claim in as little as 3 minutes or less, notifying the user of the result. Some claims have gone through in under 3 seconds.

The company, founded in 2015, made its market debut in 2016 on Product Hunt, an atypical choice for a company that operates insurance claims. It went live with a peer-to-peer insurance provider model, wherein claims would be paid from a pool of all the premiums paid. It’s monthly subscription plan and P2P model allowed it to keep premiums low, all the while making its offer very attractive for insurance seekers.

The financial services review website, DoughRoller , cites a Millennial Approach is part of the explanation for Lemonade’s success. Everything from its color palette, choice of words and mobile-first, chatbot-based service speaks to a generation Z audience. 

At the same time, it does little to deter the traditional insurance consumer. Not only the app, but also the company’s website seeks to level with its users and make insurance available for all by offering a concise FAQ and how-to section.

A technology-first approach

Being an insurance software development company, rather than a traditional insurer, the team at Lemonade have made sure that technology is at the heart of the business. Consumers do not have to talk to company reps, file paper claims, receive rate hike ups, or limit their purchases.

Chatbots and AI 

The sophisticated chat feature is responsible for automated claims processing. This means that whatever the case, the conversation flow will take you through the process in a breeze.

By never having to interact with a human the chatbot approach also brings misunderstandings to a minimum. The streamlined and automated process makes sure everything is no more complicated than it has to be at every step of the way.

No to paper filing

In the interim of filing a claim, a Lemonade user will be given the opportunity to forego filing out a detailed paper claim. This is substituted in favour of a faster and more convenient video recording that is sealed with the users e-signature upon recording. 

Not only does this save time for both parties, it also avoids the red tape of traditional insurers and eliminates paper waste altogether.

Adjustable deductible rate and premiums

Lemonade insurance users provide details according to several criteria that lets the AI determine the initial premium rates. Policyholders can also move their premiums up to reduce deductibles (the sum that will be subtracted from their filed claim amount) or the other way around. This flexibility gives not only allows users to select a plan that works for them, but also reassures them that they are, in fact, in control of their money.  

What is more, lemonade charges a 25% flat free from premiums to cover costs. The rest goes towards paying claims and purchasing reinsurance. Sometimes this can imply that a remainder is left. 

Like many SaaS companies, but unlike many insurance companies, Lemonade offers an API. 

In commerce, online shoppers can insure valuable purchases at check-out. Modern property and real estate agencies can integrate the service into their website to automatically cover tenants. IoT platforms, like smart home security systems, can track valuables and offer full protection of personal property.

These are just a few use-cases of where the API can be applied. If and when Lemonade decides to expand its business or its partner network, you can expect to see the company logo pop up on more sites.  

Social good initiative

The company’s blog is where it upholds its Transparency and Honesty policy. Using technology to power its entire service means the company gathers enough data to make actionable conclusions and develop the business further. One way it does the latter is by sharing that data directly with its audience via its Transparency Chronicles blog section.

Where the company’s initiatives truly shine is perhaps its Giveback programme. Once it underwrites profit from premiums, the rest goes towards charity. A multitude of charities are available for support. Users get to choose a cohort, for which the company forms a Giveback pool.

Not only does it appeal by presenting a handy and convenient mobile application, but also by putting a human face on it.

There’s always money in the lemonade stand

Lemonade is but one example of how insurance technology can develop. Even though it currently holds around 10% of the entire real estate insurance market, it can stand its ground. It has even become an A-Exceptional rated insurance company with what is considered to be an up and coming insurance market.

Other insurers such as Geico, State Farm and Liberty Mutual have been leaning more and more towards technology to power their insurance solutions in recent years, but the market has yet to experience a genuine revolution.  

Other startups in the fintech sector like AfrikaLoan , for which Smart IT developed the backend and mobile API have relied on similar technological solutions to power their business, albeit in the sphere of microfinance. Chatbots have also become a staple of most modern solutions. From online doctor appointments to messenger-based or online sign-ups to fitness coaching sessions .

Many opportunities remain untouched, despite being ripe for the taking. If there is anything that Lemonade proves is that even complex services can be made easy and accessible through the use of technology. Just imagine how auto insurance, something that’s not part of Lemonade’s coverage, or P&C insurance for select groups of people could benefit from an automated service.

To be in step with the times, insurance operators and coverage providers will need to make better use of modern technology. With more and more technology-oriented companies that are slowly pouring into the insurance space, traditional companies will have to initiate change by either upgrading legacy systems or pivoting their business around proprietary platforms to accommodate for a new era of insurance technology services.

Disclaimer: Smart IT is in no way affiliated with Lemonade Insurance Company and has produced this post for informative purposes.

11 February 2020

Pavel Kaplunou, Marketing Communications

Pavel is Smart IT's Marketing Communication Manager. He oversees content creation and is in charge of the official Smart IT blog. Contact Pavel to learn about potential media and content collaborations. [email protected]

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Lemonade: the ultimate insurance marketing case study

6 years ago

On the pages of this blog we’re always encouraging brands to be “different” and “brave” and “customer-centric”. Today we present the ultimate insurance marketing case study.

Lemonade is a New York City-based online insurance company offering low-cost renters’ and homeowners’ insurance. They’re a self-proclaimed “purpose-built, technology-first, vertically-integrated and legacy-free insurance carrier” with a product and mission molded entirely around their audience.

They created quite a PR stir when they launched in 2016. Here are 6 ways they do things differently, bravely, and millennial-y. They are pretty unique, so we strongly recommend you read to the end.

1. The name

Giving a newborn company a name like Lemonade was a risk, as Lemonade founder-CEO Daniel Schreiber admitted in a January 2018 blog post . Would they be seen as “juvenile”? Who would trust them if they didn’t sound – or look, important?

Lots of folks it seems. Their results for calendar year 2017 show $10 million in sales, with more than 100,000 homes insured.

While the boys at the big end of town like to project financial might, Lemonade believe that in the minds of their millennial audience members, conspicuous extravagance in your insurer doesn’t get your claims paid. Extravagance, if anything, sends the wrong signal.

2. The transparency

What other insurance brand would have the chutzpah to publish a blog post with the headline:

We suck, sometimes The highs and lows of Lemonade’s first half of 2018

What insurance brand would publish multiple examples of negative feedback from its customers to illustrate a point, or admit that “our underwriting was pretty shoddy in our early days”?

No others, we’d be guessing. Transparency and trust are so central to Lemonade’s DNA that they have a blog series called ‘Lemonade Transparency Review’ that talks openly about the performance of the business, ways they’re improving and goals they haven’t hit, as well as ones they have. They discuss restructures and staffing and the internal KPIs of their claims team. As a customer reading this, it’s easy to see how you’d feel like you’re part of the Lemonade community. Go team.

What insurance brand would publish multiple examples of negative feedback from its customers to illustrate a point?

3. the “social good” agenda.

Lemonade is incorporated as a Public Benefit Corporation and the business is also a “certified B Corporation” which means it meets “the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose.”

At the core of this social good mission is their Giveback scheme . When you join Lemonade, you choose a non-profit from Lemonade’s list. Then you and everyone else who’s chosen the same non-profit form a community of peers. Lemonade takes a flat 20% fee of all your premiums. In each community, claims are then paid out from the remainder of the premiums paid by the group. If there are underwriting profits still in the community pot at the end of June, they go to the chosen cause.

We know that doing social good is important to millennials. For Lemonade, social good is baked into its business model.

4. The stand on ‘gun worship’

As of October 2017, Lemonade has limited the amount they’ll pay out for the damage or theft of firearms to $2,500, and they have more plans for adding protection around firearms, like excluding assault rifles altogether .

As they say, “We’re under no illusion that our industry, let alone our company, can solve gun violence. But being unable to change much doesn’t give us license to change nothing.”

5. The service

Acknowledging from the get-go that insurers use painful claims processes to discourage claims, Lemonade pride themselves on instant claims, with a mostly-digital process. When you experience a loss, you can upload a video of yourself talking and showing your damages via the app. Users can elect to receive claim payments directly to their debit cards.

Not content with re-writing the rules of claims processing, they also re-wrote the traditional 40+ page insurance policy document because “it wasn’t written with human customers in mind” – and instead created an open source “collaborative” policy.

All of this customer centricity is reflected in Lemonade’s Net Promoter Score. To give you some context, the highest NPS score any US insurer gets is around 20. Lemonade has an NPS rating of 70.

Lemonade takes one day on average to process claims. 19% of support requests are handled by a bot from start to finish, with the ones it can’t handle sent to the claims team.

One member tweeted that she’d “Paid for renters insurance in 3 min, with my thumb. Receipt with gif. @Lemonade_Inc onboarding flow = pure magic and pure millennial.” When another customer had his claim handled in 3 seconds, Lemonade announced that they set a new world record .

7. The behavioural economics

The fact they have renowned behavioral economist Dan Ariely on staff is an indication of how seriously they’ve considered behavioural economics in their model.

The way they see it is: the old-school insurance model is based on an adversarial relationship with the interests of the insurance company as opposed to its clients’ interests. Providers seek to minimise payouts to their clients to maximise profits for shareholders. This creates an incentive to deny claims.

Because Lemonade take a flat fee and any leftover money from each community goes to their prescribed cause, Lemonade’s mostly millennial customers know that if they make fraudulent claims, the money is taken from their chosen charity, not from Lemonade. Which encourages the best in human nature, not the worst.

And because Lemonade doesn’t get paid any more if they deny more claims, there’s no incentive for them to make the claims process difficult.

It’s a clever long-term strategy. For Lemonade, renters’ and owners’ insurance is no doubt just the first step in a long-term relationship with millennials as their insurance needs become more complex.

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Case Study: How the Insurer Lemonade Built a Powerful Online Sales Process with Psychology at Its Core

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In this case study, you’ll discover:

• How Lemonade — the insurance company — closes the trust gap between the client and the company;
• How Lemonade eliminates barriers to insurance purchase decisions by eliminating uncertainty, making the process faster while also making it surprisingly more human with AI; and
• How Lemonade uses the behavioral design principles of salience and chunking in their user Interface to spare the users’ of their cognitive energy.

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Award winner: Lemonade: Delighting Insurance Customers with AI and Behavioural Economics

This case won the Marketing  category at The Case Centre Awards and Competitions 2023 .  #CaseAwards2023

View photos and videos from the awards presentation on 11 May 2023 .

Author perspective

Instructor viewpoint, who – the protagonist s.

Daniel Schreiber and Shai Wininger , co-founders and CEOs of insurtech start-up, Lemonade . 

Lemonade was founded in April 2015 as a disrupter in the insurance industry. The company provided quick and affordable home, contents and rental insurance with its ground-breaking use of artificial intelligence (AI).

By early 2020, Lemonade covered half of the United States and had expanded into Germany and The Netherlands. Revenues had reached $100 million by year-end 2019 and, in June 2020, the company filed for an initial public offering (IPO) at a valuation of $2 billion.

Schreiber and Wininger aimed to make Lemonade a “loveable brand” with its use of AI providing a higher level of customer satisfaction than incumbent insurers. Their mission was to provide a “shockingly great” customer experience through empathy, transparency, availability and speed. Customers could obtain insurance coverage in 90 seconds. AI was also used to manage customer interaction and claims handling, with a third of claims instantly approved and paid within seconds. Customer satisfaction and renewal rates were high.

Social impact was also an important part of the company’s mission and business model. Lemonade gifted unpaid claims to charities of the customers’ choosing via the Giveback programme. These included UNICEF, the Trevor Project and the American Red Cross.  

Lemonade was headquarted in New York City but, by 2020, covered half of the United States. It had also expanded into Germany in 2019 and The Netherlands in 2020.

The case is set in 2020, five years after Lemonade was founded, as the company filed for an IPO.

Although Lemonade had been successful in disrupting the insurance industry thus far, it faced new challenges. Competitive pressure was mounting from both their insurtech peers and incumbents emulating their business models, leading Schreiber and Wininger to question, how solid was their business model, and how easy was it to copy?

The company also needed to assess where growth would come from next, from existing products or new ones? From expanding to other US states or from international expansion?

AUTHOR PERSPECTIVE 

This is the first award win for Ziv and Laura and the third win for Wolfgang (following his wins in Marketing in 2015 and Outstanding Case Writer: Hot Topic in 2016). INSEAD have won the Marketing category award for a record tenth time in the history of this award.

Winning the award

Wolfgang said: “My co-authors and I are delighted to see that our case resonates so well with instructors, students, and executives around the globe.”

Case popularity 

He continued: “Everyone has an opinion about insurance - good or bad. Case discussions quickly become heated, participants are deeply engaged, which sets a nice stage for taking a deep dive into the case and discussing how Lemonade takes a customer experience ‘from good to great’, while keeping ‘costs-to-serve’ in check. Finally, I believe the breadth and depth of our teaching note and accompanying material helps a lot when it comes to case adoption.”

Writing the case

Wolfgang reflected: “Our biggest challenge was to write a very compact case despite the vast amount of material available, both in print and in video format. We specifically aimed at writing a very thorough teaching note; guiding instructors to feel comfortable teaching the case and providing multiple avenues for case facilitation.”

Teaching the case

Wolfgang explained: “Our case is extremely versatile. Instructors may focus on end-to-end digital customer experiences, changing consumer behavior and tech-savvy millennials, journey mapping and service blueprinting, understanding business model innovation, principles of service marketing, leveraging Artificial Intelligence (AI) and data as the next source of competitive advantage and cost-effective service excellence.”

He finished: “Lemonade is a fun case to teach and engage students. It’s not only a ‘silver bullet’ that works in the classroom, but it also maximises participants’ learning about disruptive digital business models and fast-changing customer experiences in today’s digital world.”

Instructor VIEWPOINT 

Discover how this case works in the classroom.

“I like teaching the Lemonade Case because it is a highly engaging and timely case study. Students can draw on their own experiences and they love to explore and discuss how Lemonade has disrupted the insurance business. Along the way, you can teach a wealth of critical issues, such as business model innovation, digital customer experience, behavioral economics etc. A truly outstanding case with a great teaching note offering useful links and supplementary materials.”

“This is a multi-faceted case that was very well-received by my students. In addition to an interesting introduction to the insurance industry, there is a rich discussion of consumer behavior in this industry, and some coverage of Digital Transformation issues. This case would be well suited for courses in Consumer Behavior, Digital Business, and Marketing Management. One of the key takeaways from this case is the central role of trust in digital transactions (not just insurance).”

The authors

Laura is an INSEAD Alumnus.

The protagonists

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✏️ Case Study on Lemonade, Inc.

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Case-study of lemonade, inc. 🦉.

Table of Contents

• Introduction
• Who are the founders of Lemonade, Inc?
• Business Activities
• Recommendations

1. Introduction

• Lemonade, Inc [15]
• June 17th 2015 File Number:

2. The founders of Lemonade, Inc?

1. daniel schreiber, co-founder & ceo.

• Daniel Schreiber has served as Co-Founder, Co-Chief Executive Officer, and Chairman of the board of directors since founding in June 2015. Prior to co-founding Lemonade in 2015, Mr. Schreiber served as President and a member of the board of directors of Powermat Technologies Ltd., a wireless charging solutions and technology company, from 2011 to 2015. From 2003 to 2011, he served as Senior Vice President of Marketing and Vice President of Marketing and Business Development at SanDisk and M-Systems (which was acquired by SanDisk in 2006), respectively. In 1997, Mr. Schreiber co-founded and acted as the Chief Executive Officer of Alchemedia Inc., an internet security software company acquired by Finjan Software in 2002. Prior to that, Mr. Schreiber practiced corporate commercial law at Herzog, Fox & Neeman, and was a member of the Israeli Bar Association. He holds a Bachelor of Laws with First Class Honors from King’s College London. Lemonade believes Mr. Schreiber is qualified to serve on the board of directors due to his perspective and experience from serving as a Co-Founder and Chief Executive Officer, as well as his experience leading technology companies. [1]

2. Shai Wininger, Co-Founder, Co-CEO

• Shai Wininger has served in various roles, including as Co-Founder, Secretary, Treasurer, and Chief Technology Officer, since founding in June 2015. Mr. Wininger has served as Co-Chief Executive Officer since July 2021, and is a member of board of directors. Mr. Wininger founded Fiverr Ltd. in 2009 , and as the Chief Technology Officer, managed the engineering, design, and product departments. Prior to 2010, Mr. Wininger served in senior management capacities for companies including: from 2005 to 2010, Mobideo Aerospace, an industrial grade analytics and control platform; from 2003 to 2005, Handsmart Software, a mobile licensing platform for content driven, mobile apps; and from 1999 to 2003, Trimus Inc., a virtual reality web browser. Mr. Wininger also served as a resident faculty member of Computer Graphics at The Neri Bloomfield Academy of Design and Education from 2002 to 2007 in Haifa, Israel. Lemonade believes Mr. Wininger is qualified to serve on board of directors due to his visionary perspective, technical acumen, and experience in founding and leading technology companies. [1]
• Daniel Schreiber started Lemonade, inc. to improve the relationship between a customer and an insurance company which is often very cumbersome and slow. Schreiber did not know much about insurance. He met this problem head on by pouring funds, talents and behavioural science expertise into developing world-class chatbots that completely shatter category norms. [4]

It’s not a natural thing for a tech entrepreneur to want to go into insurance, it connotes all the wrong things. It’s perceived as being dull, as being retro-grade, heavily regulated, heavily capital intensive but myself and my co-founder Shai Wininger were a little contrarian when it comes to that. The very fact that it was so off pudding made it kind of interesting. [3]

• Lemonade has raised a total of $481.5M in funding over 14 rounds. Their latest funding was raised on Jul 2, 2020 from a Post-IPO Equity round. [2]

3. Business Activities

What specific financial problem is Lemonade, Inc trying to solve?

• As a tech company doing insurance, Lemonade is constantly updating and expanding products. Since the launch in 2015, they expanded and built a variety of packages and offerings in what they consider one of the most customizable options for pet owners. Whether it’s their preventative care package designed specifically for puppies and kittens, or their physical therapy add-on to support those that need a little extra care, various options are available so customers can have pet health insurance that is personalized to their needs.

Who is the Lemonade's intended customer? Is there any information about the market size of this set of customers?

• They also currently hold a pan-European license , which enables us to sell in 31 countries across Europe, and commenced operating in Germany in 2019, and in the Netherlands and France in 2020.
• When Lemonade launched in late 2016, Lemonade's licenses covered approximately 20 million people, compared to approximately 825 million people as of December 31, 2021.

What solution does Lemonade offer that their competitors do not or cannot offer?

• Maya , the sign-up bot , is available 24/7 and can have the average new customer signed up in under a minute.
• Jim , the claims bot , makes Maya look slow, regularly settling claims in under three seconds. This includes cross referencing the claim against the relevant policy, running over a dozen anti-fraud algorithms, approving the claim, sending wiring instructions to the appropriate bank and notifying the customer of the good news. All in under three seconds. [7]
• CX.AI is a bot platform built to understand and instantly resolve customer requests without human intervention. About 30% of all customer inquiries are currently handled this way. Customers often require assistance pre- or post-purchase, ranging from coverage questions to making changes to their policy, such as adding a spouse, updating coverage amounts, changing payment methods, or adding newly purchased items. CX.AI uses Natural Language Processing to analyze and understand customers' requests, helping them perform a growing set of tasks. [1]

Which technologies are they currently using, and how are they implementing them?

• Forensic Graph utilizes the combined power of behavioral economics, big data, and AI to predict, deter, detect, and block fraud throughout the customer engagement. The FBI estimates that insurance fraud in the United States (excluding health insurance fraud) costs more than $40 billion per year, or $400 to $700 per family, in increased premiums. It is a complicated problem to solve for traditional insurers, mostly due to data paucity . Forensic Graph tracks untold signals and analyzes relationships between things which may appear trivial or invisible to humans, but in which machine learning uncovers complex multivariate links that have helped us avoid millions of dollars' worth of potential losses. [1]
• Blender is a robust insurance management platform that Lemonade built with customer centricity and exponential efficiency in mind. This is a built-from-scratch, cutting edge backend system, designed as a single, cohesive, and streamlined management tool for customer experience, underwriting, claims, growth, marketing, finance, and risk teams. When a claims experience specialist logs in to Blender, for example, they instantly see all claims assigned to them by AI Jim . Blender then provides them with instructions for next steps, and when possible, includes coverage determinations, and alerts of suspicious activity. Critically, they will also see an extraordinary amount of information about the users' behavior patterns and their claim, background information, risk indicators, insurance history, and much more. If a vendor is needed, for example, to assess the damage, all appropriate suppliers will pop up in Blender, and can be dispatched to the field, and paid, at the push of a button. Blender brings similar integrated, customer-centric, and focused workflows to the other Lemonade teams as well. [1]
• Cooper is the internal bot (Lemonade likes to think of him as their Jarvis) who runs important parts of Lemonade. Cooper handles complex as well as repetitive tasks, from helping customer experience team handle lengthy, manual processes such as processing paper checks, to automatically running tens of thousands of tests on each release of their software. Cooper continuously analyzes spectrometry imaging beamed from NASA's satellites , identifying wildfires in real time and blocking ads and sales in the affected areas; Cooper collates and formats materials for regulatory filings; and he even handles most of the engineering task allocation, code deployment, Q&A, and more. Cooper makes the team dramatically more efficient and keeps evolving and learning with time. [1]

4. Landscape

• The homeowners, pet, car and, to a lesser extent, the renters insurance industries in which Lemonade operate are highly competitive. While Lemonade believe they are well positioned to execute the business model and reinvent insurance, Lemonade face significant competition from traditional insurance companies such as Allstate, Farmers, Liberty Mutual, State Farm, GEICO, Progressive and Travelers. Although Lemonade are tapping into markets that their competitors have struggled to reach, the incumbent insurance companies are larger than us and have significant competitive advantages over us, including increased name recognition, higher financial ratings, greater resources, additional access to capital and more types of insurance coverage to offer, such as auto, health and life insurance, than Lemonade currently do. [1]
• Many insurtech companies noted that there can often be a benefit for technology startup companies to have staff who may not know at first the strict rules of insurance regulation in order to spur more innovation.
• One benefit of the actuarial profession to the value of insurtech companies is to work with the innovations that are occurring and help shape how they can work within the structure of insurance.
• Embedded insurance concepts bundles coverage or protections within the purchase of a product or a service itself, offered in real-time or at the point of sale.
• In addition, the definition of embedded insurance may also extend to offering distinct insurance products for sale in situations where the consumer is already engaged in purchase behavior of other goods and services.
• Cyber risks, pet insurance and other offerings have emerged to begin to broaden the types of risks covered in recent years.
• New risks, such as wildfire risks and coverage for automated vehicles lack historical data and regulatory required capital.
• Coverage gaps for many key risks can emerge in these situations, and insurtech companies are primed to provide new opportunities and innovations to cover growing risks that are faced by consumers.
• Capital management companies have quickly graduated over past years from where insurtech was noted as a growing opportunity to the place where venture capital firms are building large portfolios to fund and incubate new innovations.
• Insurtech companies are themselves moving into situations where their proof of concept has been accepted and looking more towards initial public offerings to attract public capital.
• Insurtech companies are finding new and innovative ways to be involved in the offering of group-based products and noting that a strong employee experience and problem solving, leveraging of technology, can be a more productive solution that focusing solely on distribution techniques and product features.
• With smartphone technology embedding high resolution cameras and machine learning being able to discern information, technology surrounding cameras and images was front and center. Claims for personal auto property damage using cameras was part of several concepts, as well as the growing use of satellite imagery for examining and underwriting properties, assessing roofs for underwriting and using time-lapse satellite imagery to assess claims damage during catastrophic storms.
• The world of collecting new data sources for use in insurance analytics continues to get larger all the time.
• Simpler demographic data is still important, but the addition of unstructured data such written documentation, images, audio, video and social media is quickly becoming involved in new ways to look at a customer or a risk.
• As insurance evolves with more emphasis on technology, expanding and enhancing the customer experience is a growing trend.
• Insurance distributors, the underwriting process, in force policy management and the claims experience all have technology angles that are coming further into focus.
• New entrants to the insurance industry are here, some having fully implemented and grown to be taking risk, establishing a customer base and even growing to build partnerships for the future building communities that center on Internet of Things (IoT) technology.
• These digital insurers also may tend to take different approaches in their distribution or customer engagement processes as compared to traditional insurers.
• Lemonade , Erie Insurance, American Family, Allstate, Assurant, Liberty Mutual, State Farm, Travelers, Geico and Progressive.
• Giving Back [1]

• What are some of the core metrics that companies in this domain use to measure success? How is Lemonade, inc. performing, based on these metrics?
• Lemonade (LMND) Stock . Lemonade has seen a growth in stock value since it's listing. [12]

• Taxes . The components of the net deferred tax assets are as follows ($ in millions): [1]

• Users are switching from other insurers: [15]

• Lemonade, Erie Insurance, and American Family insurance are regional carriers that offers auto, homeowners, life, renter, and pet insurance. While Lemonade, inc. doesn't rank for auto, homeowners, and life insurance, it's No.1 in renters insurance customer satisfaction. Lemonade also offers affordable pet insurance policies with discounts and short waiting periods. [9]

6. Recommendations

• This is the difference between the various auto insurance coverage types: [10]

• About 90% of Lemonade's current customers said that they were not switching to Lemonade from another carrier. Lemonade are well positioned to grow their customer base by continuing to attract first time buyers, an underserved population. This will exponentially boost Lemonade's growth as a national and global insurance competitor. Their covarage is highly attractive to new customers and those wanting to switch to a new provider. [1]
• Customer Cortex, Forensic Graph, Blender, and Cooper, together with AI Maya, AI Jim, and CX.AI atop. [1]
• While Lemonade is a legitimate insurance provider, it's important to do your own research to ensure that Lemonade is the right insurance company for you. [6]
• Sec Lemonade, Inc 10k 2021 1
• Lemonade, Inc. Crunchbase Funding rounds 2
• Interview with Daniel Schreiber, CEO and Co-Founder of Lemonade, Inc. 3
• Meet Kevin Episode 24, CEO of Lemonade, Inc. 4
• Lemonade, Inc. Open Source Policy on Github 5
• Lemonade insurance review: Easy-to-use digital insurance provider with low rates 6
• The Lemonade effect: What every business can learn from this startup’s focus on scarcity 7
• Lemonade Q&A: Pet insurance, consumer education 8
• Home Insurers Struggle with Customer Loyalty as Boomers Flock to Rental Market, J.D. Power Finds 9
• Lemonade insurance review: Easy-to-use digital insurance provider with low rates 10
• https://www.dig-in.com/news/lemonade-car-insurance-launches 11
• Lemonade on Stackshare 12
• Society of Actuaries Research Institute InsureTech Connect 2021 13
• Lemonade’s S-4: Background surrounding the Metromile acquisition 14
• Lemonade 15

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Juliette's Lemonade Stands

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Juliette's lemonade stands description.

Juliette is a young entrepreneur, and she has the idea of starting two lemonade stands for the upcoming summer and getting her younger brothers to work them. The businesses must plan for launch, operate during the season, then determine financial performance and key metrics to assess success. Which brother did a better job managing the business? The case introduces key accounting and financial statement and performance measures in an intuitive way, is interactive and engaging, and can be used with a variety of audiences, as discussion can span from basic financial statement construction and analysis to more complex issues around accrual accounting, revenue recognition, cash flow timing, and the interaction among financial statements.

Case Description Juliette's Lemonade Stands

Strategic managment tools used in case study analysis of juliette's lemonade stands, step 1. problem identification in juliette's lemonade stands case study, step 2. external environment analysis - pestel / pest / step analysis of juliette's lemonade stands case study, step 3. industry specific / porter five forces analysis of juliette's lemonade stands case study, step 4. evaluating alternatives / swot analysis of juliette's lemonade stands case study, step 5. porter value chain analysis / vrio / vrin analysis juliette's lemonade stands case study, step 6. recommendations juliette's lemonade stands case study, step 7. basis of recommendations for juliette's lemonade stands case study, quality & on time delivery.

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Case Analysis of Juliette's Lemonade Stands

Juliette's Lemonade Stands is a Harvard Business (HBR) Case Study on Finance & Accounting , Texas Business School provides HBR case study assignment help for just $9. Texas Business School(TBS) case study solution is based on HBR Case Study Method framework, TBS expertise & global insights. Juliette's Lemonade Stands is designed and drafted in a manner to allow the HBR case study reader to analyze a real-world problem by putting reader into the position of the decision maker. Juliette's Lemonade Stands case study will help professionals, MBA, EMBA, and leaders to develop a broad and clear understanding of casecategory challenges. Juliette's Lemonade Stands will also provide insight into areas such as – wordlist , strategy, leadership, sales and marketing, and negotiations.

Case Study Solutions Background Work

Juliette's Lemonade Stands case study solution is focused on solving the strategic and operational challenges the protagonist of the case is facing. The challenges involve – evaluation of strategic options, key role of Finance & Accounting, leadership qualities of the protagonist, and dynamics of the external environment. The challenge in front of the protagonist, of Juliette's Lemonade Stands, is to not only build a competitive position of the organization but also to sustain it over a period of time.

Strategic Management Tools Used in Case Study Solution

The Juliette's Lemonade Stands case study solution requires the MBA, EMBA, executive, professional to have a deep understanding of various strategic management tools such as SWOT Analysis, PESTEL Analysis / PEST Analysis / STEP Analysis, Porter Five Forces Analysis, Go To Market Strategy, BCG Matrix Analysis, Porter Value Chain Analysis, Ansoff Matrix Analysis, VRIO / VRIN and Marketing Mix Analysis.

Texas Business School Approach to Finance & Accounting Solutions

In the Texas Business School, Juliette's Lemonade Stands case study solution – following strategic tools are used - SWOT Analysis, PESTEL Analysis / PEST Analysis / STEP Analysis, Porter Five Forces Analysis, Go To Market Strategy, BCG Matrix Analysis, Porter Value Chain Analysis, Ansoff Matrix Analysis, VRIO / VRIN and Marketing Mix Analysis. We have additionally used the concept of supply chain management and leadership framework to build a comprehensive case study solution for the case – Juliette's Lemonade Stands

Step 1 – Problem Identification of Juliette's Lemonade Stands - Harvard Business School Case Study

The first step to solve HBR Juliette's Lemonade Stands case study solution is to identify the problem present in the case. The problem statement of the case is provided in the beginning of the case where the protagonist is contemplating various options in the face of numerous challenges that Lemonade Stands is facing right now. Even though the problem statement is essentially – “Finance & Accounting” challenge but it has impacted by others factors such as communication in the organization, uncertainty in the external environment, leadership in Lemonade Stands, style of leadership and organization structure, marketing and sales, organizational behavior, strategy, internal politics, stakeholders priorities and more.

Step 2 – External Environment Analysis

Texas Business School approach of case study analysis – Conclusion, Reasons, Evidences - provides a framework to analyze every HBR case study. It requires conducting robust external environmental analysis to decipher evidences for the reasons presented in the Juliette's Lemonade Stands. The external environment analysis of Juliette's Lemonade Stands will ensure that we are keeping a tab on the macro-environment factors that are directly and indirectly impacting the business of the firm.

What is PESTEL Analysis? Briefly Explained

PESTEL stands for political, economic, social, technological, environmental and legal factors that impact the external environment of firm in Juliette's Lemonade Stands case study. PESTEL analysis of " Juliette's Lemonade Stands" can help us understand why the organization is performing badly, what are the factors in the external environment that are impacting the performance of the organization, and how the organization can either manage or mitigate the impact of these external factors.

How to do PESTEL / PEST / STEP Analysis? What are the components of PESTEL Analysis?

As mentioned above PESTEL Analysis has six elements – political, economic, social, technological, environmental, and legal. All the six elements are explained in context with Juliette's Lemonade Stands macro-environment and how it impacts the businesses of the firm.

How to do PESTEL Analysis for Juliette's Lemonade Stands

To do comprehensive PESTEL analysis of case study – Juliette's Lemonade Stands , we have researched numerous components under the six factors of PESTEL analysis.

Political Factors that Impact Juliette's Lemonade Stands

Political factors impact seven key decision making areas – economic environment, socio-cultural environment, rate of innovation & investment in research & development, environmental laws, legal requirements, and acceptance of new technologies.

Government policies have significant impact on the business environment of any country. The firm in “ Juliette's Lemonade Stands ” needs to navigate these policy decisions to create either an edge for itself or reduce the negative impact of the policy as far as possible.

Data safety laws – The countries in which Lemonade Stands is operating, firms are required to store customer data within the premises of the country. Lemonade Stands needs to restructure its IT policies to accommodate these changes. In the EU countries, firms are required to make special provision for privacy issues and other laws.

Competition Regulations – Numerous countries have strong competition laws both regarding the monopoly conditions and day to day fair business practices. Juliette's Lemonade Stands has numerous instances where the competition regulations aspects can be scrutinized.

Import restrictions on products – Before entering the new market, Lemonade Stands in case study Juliette's Lemonade Stands" should look into the import restrictions that may be present in the prospective market.

Export restrictions on products – Apart from direct product export restrictions in field of technology and agriculture, a number of countries also have capital controls. Lemonade Stands in case study “ Juliette's Lemonade Stands ” should look into these export restrictions policies.

Foreign Direct Investment Policies – Government policies favors local companies over international policies, Lemonade Stands in case study “ Juliette's Lemonade Stands ” should understand in minute details regarding the Foreign Direct Investment policies of the prospective market.

Corporate Taxes – The rate of taxes is often used by governments to lure foreign direct investments or increase domestic investment in a certain sector. Corporate taxation can be divided into two categories – taxes on profits and taxes on operations. Taxes on profits number is important for companies that already have a sustainable business model, while taxes on operations is far more significant for companies that are looking to set up new plants or operations.

Tariffs – Chekout how much tariffs the firm needs to pay in the “ Juliette's Lemonade Stands ” case study. The level of tariffs will determine the viability of the business model that the firm is contemplating. If the tariffs are high then it will be extremely difficult to compete with the local competitors. But if the tariffs are between 5-10% then Lemonade Stands can compete against other competitors.

Research and Development Subsidies and Policies – Governments often provide tax breaks and other incentives for companies to innovate in various sectors of priority. Managers at Juliette's Lemonade Stands case study have to assess whether their business can benefit from such government assistance and subsidies.

Consumer protection – Different countries have different consumer protection laws. Managers need to clarify not only the consumer protection laws in advance but also legal implications if the firm fails to meet any of them.

Political System and Its Implications – Different political systems have different approach to free market and entrepreneurship. Managers need to assess these factors even before entering the market.

Freedom of Press is critical for fair trade and transparency. Countries where freedom of press is not prevalent there are high chances of both political and commercial corruption.

Corruption level – Lemonade Stands needs to assess the level of corruptions both at the official level and at the market level, even before entering a new market. To tackle the menace of corruption – a firm should have a clear SOP that provides managers at each level what to do when they encounter instances of either systematic corruption or bureaucrats looking to take bribes from the firm.

Independence of judiciary – It is critical for fair business practices. If a country doesn’t have independent judiciary then there is no point entry into such a country for business.

Government attitude towards trade unions – Different political systems and government have different attitude towards trade unions and collective bargaining. The firm needs to assess – its comfort dealing with the unions and regulations regarding unions in a given market or industry. If both are on the same page then it makes sense to enter, otherwise it doesn’t.

Economic Factors that Impact Juliette's Lemonade Stands

Social factors that impact juliette's lemonade stands, technological factors that impact juliette's lemonade stands, environmental factors that impact juliette's lemonade stands, legal factors that impact juliette's lemonade stands, step 3 – industry specific analysis, what is porter five forces analysis, step 4 – swot analysis / internal environment analysis, step 5 – porter value chain / vrio / vrin analysis, step 6 – evaluating alternatives & recommendations, step 7 – basis for recommendations, references :: juliette's lemonade stands case study solution.

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• The case for open insurance: Allianz and Lemonade

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How two insurers –one traditional, one digital –are using open platforms

With this series, I introduced insurers to the benefits and necessity of open insurance. In this concluding post, I’ll examine two more case studies of carriers that are doing excellent work with open platforms.

One old, one new: both revolutionary

Allianz is an international insurer that’s been around since 1890 and has footprints on every continent. It’s an excellent example of a traditional organization that has stood the test of time and continues not only to adapt to but also create digital innovations.

Lemonade, on the other hand, is the relatively “new kid on the block” that burst onto the scene in 2016 as a digital-native property and casualty insurer that embodies the principles of technological innovation and transparency.

Both insurers are examples of how open platforms can transform insurance.

Allianz offers business system to other insurers

The insurer announced in January that it’s offering parts of its Allianz Business System (ABS) as an open-source platform-solution to other insurance companies—free of charge.

ABS is a system that can handle the challenges of digitalization and data privacy and can be used in any insurance line of business. With this move, Allianz is realizing its vision of an insurance ecosystem that connects partners and adds value to the industry and insurance customers.

In the press release , Christof Mascher, Chief Operating Officer at Allianz SE, explains what users can expect from ABS:

“Think of it as a kind of app store. It’s an open marketplace where other companies can offer things too. They might be services as simple as text scanning and recognition, printing, or even an open broker marketplace. The marketplace just provides the infrastructure to enable exchanges.”

Mascher believes that an open marketplace of ideas where businesses pool capabilities in insurance and software is a “combination that’s hard to beat”. Allianz aims to have built a network that benefits the entire industry.

Lemonade makes insurance seamless with new API

While Allianz is working towards sharing knowledge through an ecosystem of partners, Lemonade is steadily working towards making insurance as easy and convenient as watching a show on Netflix.

Lemonade launched its public API in October last year, which allows anyone to sell its policies through their apps or websites.

In an article on PR Newswire , Lemonade co-founder Shai Wininger explained the move:

“It takes years to pull together the licenses, capital and technology needed to offer insurance instantly through an app, which is why it’s almost nonexistent. Today’s API launch changes that. Anyone with a slight familiarity with coding can now include these capabilities in their app, in a matter of hours.”

And they do mean anyone—from lifestyle brands to e-commerce sites—can now offer insurance on its app using Lemonade’s API.

Lemonade offers “different options for integration with various levels of personalization”. Interested parties can even install the widget for Maya the AI bot which can help their clients navigate the process of getting insured. For more information, visit Lemonade’s API landing page .

In this series, I’ve spoken about the value of open insurance. I started by explaining what insurers can learn from open banking, and continued to provide case studies of leading insurers with open platforms and APIs.

For more information and further reading, download the open banking report as well as Accenture’s 2018 Technology Vision .

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Lemonade: Accelerating Innovation with Pulumi

Executive summary.

Lemonade is a full-stack insurance carrier that uses artificial intelligence and behavioral economics to offer homeowners and renters insurance in the US, and contents and liability insurance in Europe. Starting with legacy Hashicorp Terraform for configuring their infrastructure on AWS, Lemonade wanted to take advantage of Pulumi’s building-blocks approach to serverless computing and provide self-service tools to help their engineering teams to move faster. Pulumi helped Lemonade deploy more modern infrastructure features while empowering their workforce with scalable infrastructure libraries. With Pulumi, Lemonade’s people-first approach to insurance can now accelerate innovation — bringing disruptive products and services to a highly-competitive market.

About Lemonade

Lemonade was founded in 2015 to provide renters and homeowners with fast, affordable, and delightful insurance policies powered by AI and behavioral economics. The company reverses the traditional insurance model by charging a flat fee and giving back leftover money to charities selected by its customers. Getting a policy is fast and requires zero paperwork, as is the transparent claim process. Treating insurance as a social good, rather than a necessary evil, Lemonade has been designed to be socially responsible, donating parts of unclaimed premiums and company revenue to nonprofit charities in its annual Giveback. The startup takes its social good seriously and is registered as both a Public Benefit Corporation and a Certified B-Corp.

Challenges Faced

Originally a HashiCorp Terraform customer, Lemonade’s infrastructure demands changed rapidly — placing the infrastructure team in the critical path for new features. Their team tried to build workarounds with these legacy tools but found that each iteration increased configuration complexity and wasted finite resources. Their opportunities to scale were also impacted as the team was unable to integrate business logic into their original infrastructure due to a lack of programming language support. Lemonade developers struggled to create more sophisticated infrastructure-as-code deployments and needed a more complete solution to support both existing and new services.

Solution: Infrastructure from Repeatable Building Blocks

Lemonade chose Pulumi for its ability to deploy infrastructure with reusable libraries that could be shared between developers, using their preferred language and cloud. Pulumi also empowers its users to create and deploy serverless components like AWS Lambda and Amazon Elastic Kubernetes Service (EKS) — features Lemonade needed to scale in order to support its growing customer base.

Pulumi enabled Lemonade to centralize its processes, managing all AWS components and automating infrastructure for every environment. Embedded business logic helped ensure that resources get appropriately sized for each environment — keeping costs low and allowing maximum reuse of infrastructure code.

“With Pulumi, we can utilize our infrastructure much better because we have the ability to embed business logic. We’re not limited to one-size-fits-all configurations, but can actually implement environment-specific customizations for our infrastructure.” — Igor Shapiro, Principal Engineer at Lemonade

Beyond managing serverless capabilities, the Lemonade team was able to take advantage of the rich managed database features of the Amazon Relational Database Service (Amazon RDS). With RDS and Pulumi, the team was able to provision and update databases like any other service resource using Pulumi. The team was able to get up and running quickly using Amazon Aurora – enabling scale while retaining compatibility with MySQL and PostgreSQL.

In addition to providing the infrastructure features that Lemonade was looking for, Pulumi’s platform improved Lemonade’s CI/CD process via out-of-the-box integrations with Jenkins and Datadog. By empowering their service owners with the ability to self-provision and deploy resources alongside their application code, Pulumi helped Lemonade engineers be more agile when developing, testing, deploying, monitoring, and scaling new applications and services.

Pulumi provided Lemonade with the ability to provision faster and more efficiently, giving them an opportunity to introduce much-needed features to their network and support infrastructure. Since Lemonade employs only a handful of infrastructure engineers to support dozens of its service side engineers, the demands on the service side could easily exceed the infrastructure team’s capacity - leading to long wait times for new capabilities when using Terraform. With Pulumi, the infrastructure team was able to share libraries that the services engineers could understand and re-use while codifying best practices in those libraries to enforce company standards. For example, the infrastructure team used Pulumi to define organizational policies like mandating the use of AWS CloudTrail, and automated credential rotation for increased security.

“Pulumi supercharged our infrastructure team by helping us create reusable building blocks that developers can leverage to provision new resources and enforce organizational policies for logging, permissions, resource tagging, and security. This empowered our developer teams to self-provision resources and ship new capabilities faster without having to wait for the infrastructure team to deploy new resources on their behalf. At the same time, we’re able to provision/update databases managed by Amazon RDS with protection from deletion so infrastructure changes can happen on the fly - without risk to our production data.” — Igor Shapiro, Principal Engineer at Lemonade

Lemonade’s infrastructure team was able to simplify tasks like automatically computing CIDR blocks, correctly connecting their networks to the VPC transit gateway and handling production traffic differently from other environments — something that simply can’t be done with Terraform.

Finally, the team was able to leverage Pulumi’s new Automation API to further simplify deployments. The Automation API allowed Lemonade to embed the Pulumi engine directly within their application code, enabling them to programmatically run deployments at run-time. For example: customizing runners for multi-step provisioning, automating recovery for well-known errors like fixing state for interrupted jobs and managing approvals for sensitive operations like deleting old resources.

“Pulumi’s Automation API helps us to build on existing best practices and further automate our deployment process – eliminating manual tasks and exception handling.” — Igor Shapiro, Principal Engineer at Lemonade

Using Pulumi to automatically manage its infrastructure has allowed Lemonade’s leadership to rest easy about the efficiency and security of its infrastructure and ensure that automated processes are in place for disaster recovery. More than that, Pulumi gave Lemonade an automatic way to track changes and deploy new features and services at scale.

Lemonade is continuing to use Pulumi to uplevel existing infrastructure and provide new building blocks for its developers and service teams. Its next target is infrastructure optimization, including the implementation of environment-specific business logic to structure data management and infrastructure deployment. As Lemonade’s engineering team grows, they also plan to roll out policies for resource provisioning, and further automating application testing.

Pulumi Corporation

Pulumi's cloud engineering platform brings infrastructure, developer, and security teams together through a unified software engineering process that tames cloud complexity and accelerates innovation. Using the Pulumi platform, teams can build, deploy, and manage modern cloud applications faster and with more confidence, using any language, any architecture and any cloud. Pulumi lets teams build Universal Infrastructure as Code using popular programming languages (Python, JavaScript, TypeScript, Go, .NET/C#, Java) and markup languages (YAML, JSON, CUE). It enables deploying infrastructure and applications together through a unified delivery process. Finally, teams can manage cloud applications with Policy as Code, better visibility, and controls.

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Lemonade: Delighting Insurance Customers with AI and Behavioural Economics - A Disruptive InsurTech Business Model for Outstanding Customer Experience and Cost-Effective Service Excellence

Prizes & Awards

Winner of The Case Centre Awards and Competitions 2023 in the Category 'Marketing'

• Related Case Material
• Restricted Material for Instructors

This case explores InsurTech start-up Lemonade’s disruptive new business model aimed at creating and delivering a ‘shockingly great user experience’ around a ‘lovable brand’ – in an industry plagued by low customer satisfaction. The digital disruptor leverages principles of behavioural economics to address conflicts of interest and mistrust which prevail in the existing industry. It uses digital technologies to automate, accelerate and manage an impressive amount of work – with few employees – thereby reducings customer effort and , increasing customer satisfaction to achieve cost-effective service excellence. The effortless experience is aggressively priced and relies on a flexible subscription-based pricing model. Artificial intelligence (AI), data and machine learning are key in the race to achieving data parity with incumbents. The case culminates in Lemonade’s filing for an initial public offering (IPO) and asks where growth should come from next: incremental improvements, further expansion across the United States, global expansion beyond Germany and the Netherlands, or from new types of property.

This versatile case allows students to explore how digital disruption is impacting the insurance industry and understand the digital transformation of the customer experience (CX). They deep dive into the key building blocks and performance metrics of Lemonade’s innovative business model, with a special emphasis on AI, data and machine learning. It allows a discussion of how principles of behavioural economics come to life in an insurance setting and beyond, and demonstrates a hands-on approach to the design of the CX and customer-journey mapping in a digital context, such as job-to-be-done analyses, means-end laddering, and service blueprinting.

• Digital Disruption
• Digital Transformation
• Insurance Industry
• Digital Customer Experience
• Behavioural Economics
• Service Business Model Innovation
• Customer Effort
• Customer Journey Mapping
• Service Blueprinting
• Service Innovation
• Artificial Intelligence
• Machine Learning
• Cost-Effective Service Excellence

Lemonade: Delighting Insurance Customers with AI and Behavioural Economics - A Disruptive InsurTech Business Model for Outstanding Customer Experience and Cost-Effective Service Excellence (Spanish)

By   Wolfgang Ulaga ,  Ziv Carmon ,  Laura Heely

Lemonade: Delighting Insurance Customers with AI and Behavioural Economics - A Disruptive InsurTech Business Model for Outstanding Customer Experience and Cost-Effective Service Excellence (Russian)

Lemonade: Delighting Insurance Customers with AI and Behavioural Economics - A Disruptive InsurTech Business Model for Outstanding Customer Experience and Cost-Effective Service Excellence (Portuguese)

By   Laura Heely ,  Wolfgang Ulaga ,  Ziv Carmon

Laura Heely

Ziv Carmon

Wolfgang Ulaga

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Selling Insurance to Millennials: Lemonade Case Study

Selling a legacy product is tough. 

Take for example, insurance, many imagine a complicated mess fighting over payouts, being overcharged premiums and having to deal with phone calls and fax machines to interact with policyholders.

This is in complete opposition to the Millennial way of doing things .

So how do you sell a legacy product like insurance to Millennials?

First, you throw out the old model of insurance. Rework it completely, then, advertise this new model in a completely innovative way that  attracts and engages.

This is exactly how Lemonade completely disrupted the insurance industry.

Starting From Scratch

“The average big insurance company is 95 years old,” says Lemonade CEO Daniel Schreiber. “They date back to the industrial revolution and have resisted every technology and business revolution since then. It’s time to start from scratch rebuilding every part of the chain.”

What does that mean practically?

Start by building insurance you can buy from your phone, making that process instantaneous and delightful.

Most customers can be insured in less than five minutes by entering information into their beautifully intuitive (and well-designed) app.

You’ve got the app, now what does this new insurance model look like?

Instead of acting like legacy insurance carriers, where every dollar not paid out in claims is a dollar more in profit, Lemonade treats the premiums you pay like it’s your money.

So, at the end of the year, money not paid out in claims is donated to the charity of your choice.

This allows Lemonade to make another game changing innovation: a frictionless claim process.

Most claims are settled instantly through artificial intelligence and payouts in as quick as two days.

No more fighting with insurance agents and faxing reports to get your claim money.

But what are the best ways for a company like this to announce itself to the world? 

Complicated Stories, Made Simple

When Lemonade came to us, we were blown away by the thoughtful nature of their product and jumped at the chance to partner with them.

In addition to the challenge of telling the Lemonade story, a complicated one about insurance claims, premiums and AI, Lemonade also needed a video that would reach out to millennials, a generation who largely neglects the need for insurance at all.

These challenges led us to using our Illustrated Animation to make a big splashy introduction.

Basing the video around the design aesthetic of the Lemonade’s app and website, the video uses a white background to pop the pinks and blacks.

We tell the story of why millennials need insurance and how Lemonade fills that need in a way that turns all the legacy failings of insurance into advantages.

The illustrated animation video was viewed more than 1.5 million times before Lemonade launched in the US and currently has been viewed more than 10 million times.

Today this video is still used to introduce Lemonade leadership at events and television appearances.

Lemonaders of New York

Introducing the product was not enough. 

After launching in New York, Lemonade asked Colormatics to capture real Lemonade users enthusiasm for the product. 

After finding some of these amazing individuals, we put together a series called ‘Lemonaders of New York.’

Meeting with Lemonade users on the streets of New York, Colormatics constructed some great stories about all the important aspects of Lemonade: the ease of use; the charitable donations; and the no-stress claims process. 

The video series was a great success at getting potential buyers to see the true story of users and an excellent tool for re-targeting for conversion.

A Millennial Success Story

Lemonade targeted the millennial market by creating not only a product focused on millennials, but  video advertising that appeals to millennials.

Based on their data, 87% of customers are first-time insurance buyers, meaning Lemonade successfully appeals to an underserved market of millennial users. 

We were able to create simple, aesthetically pleasing advertising that cut out the complicated stuff, in the same way that Lemonade created their product.

Simple. Efficient. Beautiful. Colormatics and Lemonade.

Updates: Gen Z and Lemonade Insurance

Gen Z, a generation characterized by their digital savvy and focus on social issues , has found a strong connection with Lemonade Insurance. This innovative company has tapped into the preferences of Gen Z by offering a seamless, user-friendly digital platform for insurance services that caters to their on-demand mindset. Moreover, Lemonade Insurance's commitment to social good and transparency resonates with the values held by Gen Z. By incorporating a giveback program that donates a portion of unclaimed premiums to charitable causes chosen by policyholders, Lemonade fosters a sense of social responsibility and empowerment that aligns with the desires of this generation. Consequently, Lemonade Insurance has managed to establish itself as an appealing option for Gen Z, who seek convenience, technological advancements, and a positive impact on the world through the services they use.

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Insurance Innovator Lemonade Goes from 0 to 100% Cloud Visibility with Orca Security

North America

Jonathan Jaffe, CISO

Cloud Security Challenges

• Get complete visibility for the entire cloud estate
• Quickly prioritize important issues into “digestible bites”
• Minimize the impact on DevOps

Cloud Security Results

• 100% coverage of cloud accounts with full visibility and prioritized remediation all with zero impact to DevOps and the production environment
• Able to meet compliance mandates and demonstrate controls to auditors
• Orca dashboard shows actionable insights of prioritized issues
• Peace of mind that there are no gaps in coverage

“Anything that impacts development is going to be met with resistance. But with Orca SideScanning there is zero impact on systems. It’s also easy to use.”

Jonathan Jaffe CISO

Lemonade Is Revolutionizing the Insurance Market

Lemonade provides insurance in the US and Europe. It’s part of the “insurtech” market, whereby insurance providers use advanced technology to offer innovative products and services that traditional entities can’t match.

As a relatively young company, Lemonade has a cloud-native technology stack that lets it operate 100% online. This makes Lemonade an agile competitor in the insurance market. For example, Lemonade delivers policy quotes by an artificial intelligence bot over the web and through its mobile apps. At the same time, Lemonade is A-rated, fully regulated, and reinsured by the most trusted names in insurance.

CISO’s Prior Orca Experience Leads the Way

Lemonade’s infrastructure is entirely in the AWS cloud, where it can be a challenge to get real-time insights about vulnerabilities and security risks. Even Amazon’s native tools don’t provide all the information that security and DevOps practitioners need.

Jonathan Jaffe joined Lemonade as its CISO in 2020. He immediately sought to get complete visibility for the entire cloud estate to better assess security risks. “When I came on board, there wasn’t an adequate solution in place telling me about our vulnerabilities,” he says. “I wanted much more visibility into cloud vulnerability issues than what we had.”

Source: facebook.com/Lemonade

Orca Beats Agent-Based Competitors Lacework and Palo Alto Prisma Cloud

“We assessed Orca Security, as well as Palo Alto Prisma Cloud, and Lacework,” says Jaffe. “At my last company, we used Lacework for over a year. In the last four months of my time there, we also ran Orca in a PoC, so it was easy to do the Orca comparison side-by-side. And, we evaluated Prisma Cloud, extensively.”

At Lemonade, the evaluation team had to rely on product demos for Prisma Cloud and Lacework, though Jaffe was already intimately familiar with both Orca and Lacework. “Unlike Orca, the others require agents. DevOps wasn’t excited about installing and maintaining agents. DevOps also feared the performance hit agents could have on our systems, especially production. And, based on my prior experiences with Laceworks, I knew I’d be fighting with missing visibility because of missing agents.”

Orca took half an hour to set up and fully deploy for the POC. “It was nothing to get it going,” Jaffe says. “We saw results immediately. In under 24 hours, we could see all the resources and the environment in all of our AWS accounts. Moreover, we could quickly and easily see the issues that Orca found, which, fortunately, were small and manageable.”

“Anything that impacts development is going to be met with resistance. But with Orca SideScanning there is zero impact on systems. It’s also easy to use.” Jonathan Jaffe CISO

100% Cloud Visibility and Prioritization of Security Issues

Jaffe sought several important features in a security solution. “The first is 100% coverage, which is something we’d never get from anything that requires agents to be installed. I have to feel comfortable that we don’t have gaps in coverage.”

Another must-have feature is the ability to prioritize what needs fixing. “Lacework provides loads of information, but we didn’t find it useful; To the contrary, we found it impaired our ability to remediate issues. Having too much diluted the value of the few gems it might have surfaced. Moreover, it doesn’t prioritize information in a useful way. When we used Lacework, our security analyst spent most of his time struggling to understand which problems he should spend his time to solve. If he could get past this problem and choose an issue to chase, he’d run into the next problem: was there really an intrusion, or is it yet another false positive?—All of this had to occur before he could get to remediation. Before Orca, we’d give up seeing an issue to resolution because the information was organized so poorly.

“Orca is the opposite. With the information presented in a matrix, we can look at it by threat type, vulnerability, account, affected resource, and so on. We can view the top five items by categories, such as neglected assets or vulnerabilities. This puts problems into small bites we can chew through, one at a time, instead of being overwhelmed, which is how many other products make you feel. We can quickly address prioritized issues, putting off or altogether dismissing those of lesser importance.” For Jaffe and his team, the Orca dashboard provides a calming effect because it doesn’t overwhelm them by providing too much information. He says, “Orca’s real value is in covering a huge amount of my cloud security, notifying us about vulnerabilities and—by a highly reduced degree—actual threats.”

“Orca alleviates our number one pain: where are our cloud-related security risks? Before Orca, we simply didn’t have the visibility I needed.” Jonathan Jaffe CISO

Evidence of Controls for Audits

With its headquarters being in New York, that state’s Department of Financial Services (NYDFS) regulates Lemonade’s business. In addition, the company is subject to various EU regulations and has its own SOC 2 audits. Orca’s reports help Jaffe provide evidence for controls for the various regulations and audits. “Orca has helped reduce my audit effort; for example, I can run reports that show we maintain least privilege controls and that we use multi-factor authentication.”

Orca also alerts Jaffe if there are potential data loss issues or if personal data is exposed in risky areas. The Lemonade team can remediate such issues long before they become a problem that would show up in audit reports. “Orca is great at detecting potential exposure of credit card data, email addresses, and social security numbers or other national IDs,” says Jaffe. “These are priority issues that we can quickly remediate.”

At-Risk Items Have Been Vastly Reduced

Lemonade has significantly reduced its at-risk items. “We cut them down to one-sixth of what they were, and now we can keep that under control by monitoring them,” says Jaffe. “Orca lets us shine a light on things so we know what to fix and what we don’t have to worry about.”

What Jaffe likes most about Orca is the way it lists prioritized issues. “You can see the top five items by categories, such as neglected assets or vulnerabilities. That puts problems into digestible amounts so we can chew through them one at a time, instead of being overwhelmed, like a lot of other products make you feel.”

He also loves the interface, stating that the dashboard provides a calming effect because it doesn’t overwhelm him by providing too much information. Jaffe says, “Orca’s real value is in covering a huge amount of my cloud security—notifying me about vulnerabilities, and to a lesser degree, actual threats.”

“With Orca, we have our AWS configuration under control. We have over 12,000 assets. Currently—right at this moment—only three of them are listed as a priority to fix. That’s fantastic, particularly when you consider how frequently cloud environments change.” Jonathan Jaffe CISO

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The Morning

Biden’s polling progress.

The president has narrowed the gap with Donald Trump, but Trump still holds a small lead.

By David Leonhardt

President Biden has narrowed the gap with Donald Trump in the past few months, but Trump still holds a small lead in the race for the presidency.

That’s perhaps the most succinct way to summarize the race two days before the candidates’ first debate — a debate unlike any other in U.S. history. It will occur more than four months before Election Day and before either candidate has received his party’s formal nomination. All previous general-election presidential debates, dating to the first, in 1960, took place in October or late September.

We’re devoting today’s newsletter to the campaign both because of the debate and because of the release this morning of The Times’s 2024 polling averages . Those averages combine survey results from many pollsters, both for the U.S. as a whole and for seven battleground states. I recommend reading my colleague Nate Cohn’s description of the averages in this article .

As Nate explains, Biden began to rise in the polls around the time of his State of the Union address in March. He then rose further after Trump’s felony conviction last month. The two are now essentially tied in the national polls, around 46 percent, when Robert F. Kennedy is excluded from the question. With Kennedy included, Trump leads Biden, 41 percent to 40 percent, with Kennedy at 8 percent and the remaining electorate undecided.

In both the two-way and three-way race, Trump leads in the states likely to decide the outcome. “While he often leads by only a point or two, he does nonetheless hold the edge in Pennsylvania, Wisconsin, Michigan, Nevada, Arizona and Georgia — states that would be enough for Mr. Trump to win the Electoral College and therefore the presidency,” Nate writes. “Of course, the election will not be held today and the polls will not be exactly right.”

Who’s Leading the Polls in the Battleground States

Pennsylvania

North Carolina

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