WHAT IS A SALESPERSON’S JOB?
Is selling the same as prospecting? Is selling the same as quoting?
No to both questions. In the insurance business, selling is comprised of two components, but neither of them involves prospecting or quoting. Selling insurance requires building relationships and closing sales. If producers can perform these two functions, they will be successful. But what about prospecting and quoting? Knocking on doors, making telephone calls, and sending out mass mailings are certainly legitimate ways to spend time and money, but not necessarily to make sales. If you have producers -- whether on salary, draw, or commission --their competence will be judged by the number of long-term clients they bring to the agency. Wouldn’t it make sense to concentrate your employees’ efforts on those areas that will provide the highest payoff?
When did the Independent Agency System determine that producers were responsible not only for sales but for bringing in prospects? Most other industries have marketing and advertising functions that attract potential customers, leaving the sales staff to develop relationships and close the sale. The job of marketing and advertising the agency should belong to a dedicated marketing manager or, in smaller agencies, the owner. The success of any individual in a job correlates directly to the risks involved, the focus of responsibility, and the ability to measure results. A marketing manager in a larger agency centers on drawing potential customers. The measurements of success are evident: how many prospects are brought to the agency’s door? In smaller agencies this responsibility should fall to the owners simply because both the risks and the rewards accrue to them. They bear the costs of marketing and advertising and also enjoy the asset value that results from growth.
It makes sense that the producer on the account, as the primary contact with the customer, should be responsible for collecting the data necessary to provide a quote. In far too many cases, however, the producer is responsible for developing the quote, talking to the company underwriters, and generating a proposal. The time needed for these tasks would be better spent by the producer contacting other prospects. In fact, most producers aren’t the most competent people in the agency to develop the quote itself. They’re also far too involved and subjective to deal objectively with company underwriters. They’re often perceived as being pushy, seeking favors and special dispensations. If producers do their job properly, they’ll know what’s needed to close the sale and will pass this information along to the staff responsible for marketing the product to the carriers.
The most successful producers focus on building and maintaining relationships with prospects and clients, off-loading all other responsibilities to different agency staff. Sometimes this is seen as “glad-handing.” However, if the salesperson’s talent lies in building relationships and closing sales, this is their greatest asset. Don’t turn salespeople into clerks, telephone solicitors, or telemarketers.
Unfortunately, most producers make better underwriters than they do salespeople. They might be technically competent, but the only thing they have to sell is price. They get into prospects’ doors by convincing them that they can write cheaper insurance. Even if they can deliver on this promise, they stand only a moderate chance of winning the account. You see, the customer probably has a relationship with the incumbent agent and will give them a last chance to meet the quote. If the new producer can’t provide a less expensive insurance package, the prospect’s decision to stay with the current agent is confirmed. If you have producers who either don’t have a sales personality and/or don’t spend their time building relationships and closing sales, calling them producers and giving them sales responsibilities is self defeating. They’ll become frustrated by their lack of ability, and you’ll never achieve your sales goals.
We recommend giving prospective and existing producers aptitude tests. Only one in seven people have the right characteristics to become a salesperson. A person’s ability to hit or catch a baseball doesn’t mean that they will become a major-league player. Even people with the potential to become salespeople might not have other skills needed to succeed. As agency owners, you already know which of your producers are successful and which are not. You know who’s good at building relationships and who has difficulty closing sales. Testing can only help confirm this.
Whether you choose to test or just follow your instincts, if you know that some of your staff will never be successful salespeople, it’s your responsibility to do something about it. If you have a young person with the right personality but without the skills, invest in training them. On the other hand, if you have producers who shouldn’t be in that capacity, don’t wait any longer -- give them the opportunity to develop their careers in a different direction. A producer who can’t sell insurance unless his price is 20% below that of the lowest competitor will live a long and unsatisfying life in sales. Whether or not you have a job for those people, their interests would best be served in another field. Your agency is better off actively pursuing new sources of salespeople than expending time and money supporting producers who will never succeed.