Are You Making These Marketing Mistakes?

NINE HUGE INCOME BUSTERS FOR INSURANCE AGENTS

by Michael Jans

You've heard it before. You've read about it in trade magazines. Most important, you probably feel it every day in your agency. The long soft market. Commission cuts. Carrier changes. Pressure on expenses. Banks in insurance. Alternative distribution systems. The Internet. New technologies.

Insurance is not the industry it used to be.

As competition heats up, so does the rate of mergers and acquisitionS. Sadly, so does the number of agents who are not reaching their personal income goals or retirement dreams.

For savvy agents, this is good news. In this pressurized environment, they will become the 'fine, hard diamonds' with the highest value and the greatest durability. But there's a catch. To thrive today, you can't market with yesterday's techniques.

After consulting and training and consulting with more than 1,400 agents throughout North America, we've identified nine of the biggest income busters for insurance agents:

Sure, you want to make every client feel like you're serving them one at a time-but nobody gets rich prospecting one at a time. The old methods of cold calling, 'groveling for referrals,' and prospecting are far too expensive and too demeaning; they're a key factor in our industry's 80% burnout rate for producers.

Smart agents recognize that they get the big numbers in marketing, not sales. They set up high-impact marketing systems that drive qualified prospects over the threshold of their agency-by phone, mail, fax, and in person. Then they set up sales as the last step of the marketing formula, dealing only with prospects who have qualified themselves by responding to accurately targeted marketing tools.

Main Street agencies with a broad portfolio of services still have a viable future, but those that are breaking through to the next level have realized the power of specialization. In a recent seminar, we asked 57 agents to brainstorm the advantages of specialization. Within 10 minutes, they created a list of 28 different advantages-yet, fewer than 20% could really declare themselves as specialists who stood out in the marketplace.

On their list were such advantages as super-high closing ratios, higher-than-average income-per-employee ratios, more efficient marketing, more internal operating efficiencies, more expertise, reduced E&O exposure, dramatic increases in word-of-mouth marketing, and so forth.

Many traditional agencies have discovered that they don't have to throw the baby out with the bath water. They can graft one or more specialties on top of their traditional book of business for rapid jumps in income.

Even the best agents won't reach a high income goal without a steady stream of prospects and clients. But prospects don't stampede to your door because of your technical skills. Marketing brings them.

Marketing is a business skill, and like other business skills, it requires study, practice, and discipline. Many agents say, 'We tried advertising, and it didn't work,' and go on to draw the disastrous conclusion that it won't work. Tom S., from a small town in Pennsylvania, tried advertising that didn't work. Then he studied effective direct-response marketing and made several small but powerful changes in his ad. Now he runs a three-inch ad twice a month and claims that only $100,000 in new business is a 'bad month.'

Agents all over the country have had similar experiences with all forms of effective direct-response media: direct mail, display ads, radio and television commercials, and many forms of specialty advertising.

What's the biggest cause of marketing failure? Marketing that focuses on you. 'We've been in business since 1937' seems to be one of the industry's favorite selling points-but who really cares?

Some features may add credibility to your marketing message, but they won't drive herds to your phone. Don't expect them to. Prospects care about themselves and what you can do for them. Advertising guru David Ogilvy declared, 'The soul of advertising is the big promise.' You are well advised to promise something bold to your prospects-and it better be something they care about!

'We have service, integrity, excellence.' So what? Some words have been used so often that they no longer have meaning. Some words are too abstract to have any marketing pull.

If you don't immediately offer a compelling benefit to your prospects, they won't interrupt their lives to call you. Studies confirm that people are motivated by emotions first, and justify those emotions with logic later. Savvy marketers know how to communicate emotionally and get people to act quickly.

Being a bore may be the one unforgivable marketing sin. At the least, it's the shortest route from prospects' in-baskets to their wastebaskets.

The old-fashioned bag of sales tricks will never lead to long-term relationships, maximum customer value, or the massive number of referrals that some agents enjoy. What's more, it's a lousy way to make a living. In other words, it doesn't work and is bad for you, too.

Savvy marketers would rather spend time with keenly targeted people who have qualified themselves-and want to buy-rather than mentally twisting the arms of cold prospects. Powerful marketing systems should be loading up a producer's pipeline with more qualified prospects than he or she can keep up with.

Marketing is a battle not of products, but of perceptions. If you don't stand out, nobody cares and nobody remembers. Prospects quietly say to themselves, 'Why should I do business with you above all other options?' Can you answer that question in one powerful, compelling statement, devoid of platitudes and empty promises?

Most agents can't-but it's the most important question prospects want you to answer.

Sure, you promote your name-but do you do it in a way that drives people to phone you, fax you, and walk through your door? Most agency brochures, ads, and sales letters fail that test.

After all, producers don't get paid for getting your name out there. They get paid for sales. Shouldn't you hold advertising accountable for results, too?

The same message a producer delivers in person can be delivered in greater numbers through paper and electronic messages. The same psychological forces that move a prospect toward a sale in person can be unleashed first through strategically selected media. This makes the producer's job much easier-and for certain products, can eliminate producers altogether, freeing them up for more lucrative sales activities.

Unfortunately, many agents don't know how to measure advertising results. Demand that each step in the marketing process pay its way in multiples-and use proven direct marketing tools to measure the return on their investment.

Ultimately, advertising and marketing is not a line on your expense budget. It's an investment. When it proves itself, greater investments result in greater returns. Marketing may be the most lucrative investment your agency makes.

Use simple, effective controls to measure the results of your marketing. Comparing small variations of a single ad can, if closely tracked, result in massive increases in response.

As the industry changes, you must change the way you get business. Replace old-fashioned, passive marketing methods with powerful marketing systems that magnetically draw the clients you can best serve.

The agent and agency that change and put marketing to work for them will enjoy greatly increased sales, higher income per employee, smoother internal operations, and reduced expenses. What's more, as many agents report, 'Insurance is fun again.'