As sales and marketing professionals continue conversations about increasing productivity, decreasing expenses, and boosting sales, the same comment is heard repeatedly: What this organization needs is a winner!
From an agency perspective, that comment often translates into a wish for young, aggressive salespeople who are willing to work and sacrifice to establish themselves and build the book of business that every agency/brokerage principal is looking for.
As a marketing manager, you have the biggest opportunity in the industry. Every company wants more production and fewer losses; what have you done to help?
People in the field see how various agencies and brokerages operate and, just like consultants, can gather knowledge and help others. Most principals are looking for the 'magic bullet' answer to staffing woes, but there's a problem-not many young people entering the insurance industry. This diminution is reaching epidemic proportions as many principals approach retirement age and discover their firms aren't worth what they used to be.
The industry is in a four- to seven-year glut of agencies and brokerages that need to be fine-tuned and adapted to new ways of thinking, and carriers who seize on that opportunity are the players of tomorrow. If you don't grab this particular bull by the horns, you're going to be left with an agency whose affairs you're forced to manage.
As an insurance company representative, your greatest challenge is to develop a systematic approach to helping your agents and brokers identify and hire talented salespeople. Currently a handful of carriers are working with their agents to put mentor programs and sales campaigns in niche-market areas, and assisting with interviewing, testing, and selecting future producers.
Most of us stop short of our goal. Johnny Pitts of Libscomb & Pitts, Memphis, TN, says that he hires only one out of 100 applicants, but that the commission numbers justify his care in picking the chosen few.
Companies spend hundreds of thousands of dollars on printing, marketing, and developing. The end result is an agent with a brochure all about a new program, and four more brochures from other companies telling all about their new programs. The agency response is positive, but agents and brokers don't have time to put out their current fires, much less deal with several new sales pitches.
If you want to succeed in your agency relationships, develop them productively, with a focus on increasing the agent's income. This development occurs in five key steps:
- Identify the decision-maker in each agency or brokerage, and develop a relationship with that individual.
- Identify the special needs or weaknesses in the agency's sales cycle.
- Present the products you have as solutions to problems. Illuminate step by step how the product can be sold, marketed, and underwritten.
- Select a key producer in the agency and create a sales campaign for that individual. The results will speak for themselves, and you will have earned trust and credibility, as well as opened the door for the next opportunity.
- Be careful in selecting that next step, and base your actions on the company's long-term goal. Help establish a long-term solution for the agency's sales problems, which should include identifying people who are good producer prospects.
MARKETING: AN AGENCY WEAKNESS
Amazing as it sounds, the weakest link in the agency sales chain is marketing. Agents are designed to be short-term marketers/sellers. The letters are mailed, the phone calls are made, and all of a sudden the agent has more prospects than he or she can process. Guess what happens? The marketing efforts stop until all the prospects have been gone through. This creates tremendous swings in productivity, as well as staff stress and fluctuations in agency income.
Try this on for size:
Ask yourself 'what if?' For a moment, think about redeveloping your agency ranks based on the following model:
A sales department is in place and has highly qualified salespeople ready to call on prospects identified by the agency. The burden of renewals is handled by a staff that specializes in keeping, not getting, customers. These 'keepers' and 'getters' are clearly identified at their hiring, and are kept distinct from one another.
A marketing department exists and is staffed by someone who really knows something about marketing. This department's role is to get customers in the door. Most agents chase down their prospects, and this traditional method is time-consuming and expensive. The marketing department works with carriers to identify prospects, develop pre-approach letters, and schedule mailings. The process also includes working with telemarketers to follow up with profiling the prospect based on the criteria developed by the agency and the carrier. A good producer's time is worth $100 to $200 per hour, so why have them performing tasks that don't involve revenue generation?
Agencies and brokers must understand that not all prospects are their prospects. Many agents sit on the false security of 10,000 leads or prospects that comprise their marketing audience. Very few of these individuals know much about this database, which often is outdated and useless.
An insurance placement department also exists, and is responsible for carrier negotiation and placement of business. Many agencies now call this their marketing department. Most carriers come with contractual obligations to place certain volumes of business with them. This often leaves the agent with little freedom to market, so the business is placed according to the contractual obligation.
By identifying these three areas within an agency, responsibility is clarified, new business initiative is kept alive, and the agency maximizes the abilities of its sales force. The firm establishes an ongoing marketing effort for new business and growth as well.