Find the telemarketing system that will work for your agency.
A few years ago I wrote an article entitled Telemarketing Is Alive and Well featuring comments by agencies that found that this tried and true method still worked well for them — despite the then-building levels of consumer revolt against any form of telemarketing.
As a consumer, I, too, hate the evening calls and have added my home phone number to the federal “Do Not Call” list. Although I sometimes find telemarketing calls distracting at work, I’ve also found value in them. In my earlier article, the agency owners felt that the leads and appointments garnered by telemarketing were quite effective, with reasonable closing ratios. All indicated that much of the value depended on the quality of the telemarketing company they used. One agent said that he was only experiencing a 6% closing ratio with his leads until he switched to National Marketing Services (NMS), where he nearly tripled his closing rate to 18%.
The IIBA of New York also believes in telemarketing. As NMS President Larry Neilson pointed out, “We feel very privileged to have been selected by the Big I to promote membership in Trusted Choice for the New York area. We’ve got many major vendors and companies that utilize our services, but it’s always nice when the premier agent association selects us to help them get the word out to their agency members.”
So telemarketing does work, but can it work better? My theory is that most producers don’t know what to do with a lead (or an appointment) when they get one. Granted that the a hit ratio of 18% isn’t too bad, why can’t telemarketing leads result in 30%, 40, or even 50% closing ratios?
I remember a conversation with a long-time sales executive at a very successful agency in Northern California. During a visit to the agency, where we were structuring a marketing program, he asked if I would have lunch with him. To make a long story short, he was afraid of the new marketing campaign because he didn’t know how to sell. I was amazed at his comment and pointed out that he had been earning a six-figure income as a producer for a good many years — of course he could sell. “No I can’t!” he replied. “Every week the owner comes in and gives me a list of names to go write their insurance. All I’ve been doing is the paperwork on clients that he generates through his activities.”
In retrospect, I don’t think he was an anomaly. After talking with sales trainers nationwide, I found that many agencies have a lot of producers who don’t really know how to sell. So I decided to do a little investigating.
Larry Neilson confirmed some of my fears. He explained that NMS has invested substantial amounts of money in their computer programs and personnel to dramatically improve the quality of telemarketing leads. They aren’t just x-dates any more! Leads and/or appointments include information on the incumbent agent, difficulties being experienced, and details about the company size, revenue, and so forth. Also their clients can go online to monitor and manage the leads they receive. However, Larry went on to say, “Regardless of the lead quality, information, script tweaking, and management tools, some agencies do well with the leads and others don’t. The final success of any marketing program, including telemarketing, rests in the hands of the producers and their managers.”
Randy Schwantz, a consummate sales trainer and author of “The Wedge” says that, although the quality of the lead is important, producers need a track to run on. As Randy told me, “The lead is only the starting point for those who use the selling philosophy of The Wedge. The producer must then determine the best approach to take with the prospect based on the incumbent agent and carrier. Where are their weaknesses, compared to the producer’s strength? Proper research and handling by the producer, combined with viable management, can dramatically improve closing ratios of any type of lead.” Randy also pointed out that the greater the information provided with the lead, the easier it is for producers to determine how best to position their approach.
John McDaniel is the Virginia Regional Coordinator and Richmond Profit Center Manager for Brown & Brown of Virginia, which has eight offices throughout the area with more than 100 employees. He has used telemarketing companies to generate leads since April of 2001. Although one of the offices maintains internal telemarketing, National Marketing Services currently provides lead generation for the other seven. In July of 2002, B&B put the Wedge concept of selling into practice.
According to John, successful implementation of telemarketing leads has been a process of change for his operation. At first, telemarketers set appointments, which were somewhat problematic due to the large geographical area and the multiple offices. Their closing ratio of 2% wasn’t much to brag about. But as John told me, “We didn’t give up on telemarketing, but we realized that there had to be some changes in the methodology.”
Two critical changes undertaken by Brown & Brown were to use telemarketing for leads, rather than appointments, and to implement The Wedge. Today the leads are fed to producers in the appropriate office and it’s up to them to make the appointments. Using the techniques learned from Randy, producers are able to sift through the leads and further qualify the prospects. Based on the information in the lead, the producers can determine the best approach to take in making the initial call and setting the appointment for the subsequent sales visit with the prospect. Asked about the success of this current method, John said, “We’re now closing 35%-40% of the leads, sometimes even hitting as high as 50%.”
The moral to this story is that telemarketing (or any type of marketing, for that matter) is only as successful as you want it to be. It isn’t a magic bullet to cure all your ills. First you must make a commitment to work through the process until you find the combination that works best for your agency. Then make sure to give the leads to producers who have been trained to use them effectively.
The formula for success is simple: Agency Commitment + Quality Leads + Trained Producers = $$$.