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10 Steps To Overcome Competition
Remember the first time you experienced a Chinese box set? As each box opened to reveal a smaller box, you wondered with childlike curiosity whether it would ever end. Lately, competition in business seems like a set of Chinese boxes-in reverse. It often feels as if we are in the smallest of boxes trying to fight our way through larger ones. As we overcome a competitive hurdle, we find ourselves faced with another, larger competitive force. The small local agency fights a larger local agency, which in turn fights a small regional agency, which fights a larger regional agency, which fights a small national agency fighting a larger national agency. And now, here come the banks! I've heard many agency owners say that the answer is to become larger than the competition through mergers and clusters. I'm not averse to either mergers or clusters, unless the reason for the change is to become more competitive. You see, mergers and clusters serve not to help you beat the competition but to move you to a different competitive level. Here are 10 steps to beat the competition through effective planning and marketing: 1. Define your agency. Most businesses send out confusing messages. There is neither consistency nor continuity in their marketing or advertising because they've never taken the time to define who they are and what they do. Even worse, the owner may dictate his definition of the business-usually a far cry from how the employees and customers perceive it. Meet with your employees and some of your key customers for a brainstorming session on the definition of your agency. What are your strengths and weaknesses? Do your customers view your agency as a partner, consultant, friend, expert, or simply a vendor of insurance? Do your employees see the agency as a service organization, a sales organization, or a place to draw a paycheck? Although many definitions are based on in-house perceptions, I prefer to see an agency define itself as its best customers do. What are the reasons your best customers do business with you? Even if their perceptions vary from yours, I'd rather adapt to what's working than continue to force a square peg into a round hole. 2. Focus On Your Employees. Yep, that says employees-not customers! Satisfied customers do not create satisfied employees, but satisfied employees do create satisfied customers. Whether your agency is large or small, how frequently do you show a positive interest in the personal and work lives of your employees? Is your primary contact a simple 'Good morning' as you past their desks on the way to your office-womb? Or do you make a point of strolling through the facility regularly just to chat with the troops? Do you jot them positive notes on a job well done, or relegate your commendations to annual appraisals? When was the last time the agency provided a birthday cake for an employee's anniversary, or simply convened the entire staff for a social hour to celebrate a big or small success? The simple act of communicating with your employees will open the door to job satisfaction and pride in performance, which in turn leads to a book of satisfied clients and increased retention. 3. Focus On Your Customers. Billions of words have been written on this topic, so let me pose just one simple question: What would happen if, in each and every contact, you treated the customer as if he or she were a potentially new and large account? 4. Focus On Your Niche. Every agency has a niche, sometimes two or three. If it is not a specific risk, it may be a geographical area. If this niche falls within your agency definition (Step 1), stick to it. Too many businesses fail from 'the grass is greener' syndrome: Just as you're beginning to make headway within a certain market segment or niche, you become obsessed with the opportunity presented by a new niche. This is not to recommend against expanding into new markets or niches; but do it wisely. If your agency can handle one new market per year, limit your expansion to that. New niches should always be in the research and review pipeline, but make sure that you are solidly entrenched in your current niche marketing before expanding your efforts. 5. Study And Emulate Success. As an IMMS member, you are already ahead of the game in this respect, depending on how much you use the materials. Learn from the experiences of your peers. Imitate their successes and avoid their failures. As with any relationship, this is a two-way street: You have to give as well as take. Interact with fellow agency owners and share your experiences. This develops a camaraderie and support system that has proven to be a mainstay in the most successful agencies. 6. Become Involved. Every business operates within a community: local, regional, or national. Most of the truly successful enterprises I have known maintain a corporate philosophy of giving back to the community. Do you? I'm not just talking about membership in the Rotary. I mean getting involved on a hands-on basis: perhaps fundraising for an orphanage or hospital, or providing assistance in the schools. Don't forget to support and promote such participation by your employees. 7. Focus On Your Marketing. Most marketing and advertising is very helter-skelter, due to the reasons pointed out in Step 1. If you haven't defined who you are and what you do, how can you market your business? Conduct a top-to-bottom analysis of all your current marketing, from Yellow Pages and newspaper advertising to public relations. As you review each element of marketing, ask yourself these questions: * Does it convey our definition of the agency determined in Step 1? Does it coordinate with all of our other marketing activities? Does it specifically cultivate our defined niche(s)? Are the results of this marketing element measurable? If so, can a cost-to-benefit assessment be made? Should we keep it as is, change it, or discard it? The answers to these questions will undoubtedly prompt the need for changes in your marketing. Change can induce fear, but you can overcome the fear by treating the change as an opportunity for growth. 8. Plan, Plan, Plan. Marketing is often the poor stepchild of the agency planning process. Caught up in the operational numbers of management, marketing tends to be minimized as another grouping (relatively small) of line items in the agency's business plan. That's OK if the line items are based on an autonomous marketing plan that covers all the bases. Granted, there is always the chicken vs. egg argument, but without effective marketing to generate business, you won't need to worry about any budgetary line items. In recent years, a lot of energy has been invested in teaching agency owners how to manage their business, and some have lost sight of the fact that an agency is based on sales generation. 9. Maximize Existing Business. It's the same old story: The easiest-and least expensive-sale is to an existing client. Still, agency after agency devotes 99% of its sales energy to generating business from new clients. Why? Is it fear? Are we afraid to rock the boat? Is some genetic mutation forcing producers to think that customers might jump ship if we try to sell them something else? This problem is not unique to insurance. Every business faces it. The successful businesses in every industry are the ones that maximize their business with every client. Most Commercial Lines agencies could grow by leaps and bounds if they went after all the potential business available from existing clients. For instance, let's say one client is a manufacturing concern with 45 employees. You currently write their Property and Casualty, Workers' Comp, Medical and other exposures intrinsic to that business. Each year after renewal, you breath a sigh of relief and pocket the revenue generated from their premium. A job well done? Maybe, maybe not! Have you considered the individual insurance needs from Auto and Home to Life and Disability for each of those 45 employees, from the president on down, and their families? Making some general assumptions, that account might have a potential for 45 Auto policies covering about 100 vehicles, 20 Homeowners policies, 25 apartment dweller policies, 50 or more Life insurance policies, a few Boat and Recreational vehicle policies, and probably several more Commercial accounts from employees (or their spouses) who own or run businesses on the side. Each of the employees that you add to your book of business brings another element of growth by way of referrals -- if you ask for them! This is a simplified scenario, but I think you have the idea. Maximizing goes well beyond account rounding or cross-selling. It means that you position yourself to take advantage of every opportunity existing within the overall scope of a client relationship. 10. Be Positive. Any business owner is surely familiar with the night tremors. You know what I mean: The brain wakes us up at about 3 a.m. and says, 'Lets have a meeting! There are some problems that need to be discussed, molehills that need to be built into mountains.' Although I haven't found a total answer for quelling these middle-of-the-night wakeup calls, it helps a lot to read positive, motivational material before bed. As an agency owner or manager, you need to engender a positive spirit before arriving at the office. If you normally arrive with a dour look and a sour attitude, you might as well sell the business. Nothing is more contagious than attitude. If you're negative and constantly grumbling about problems, your employees will soon mimic your demeanor, and the business will head toward despair. Similarly, a positive attitude about the daily opportunities for growth, learning, and change will spread like wildfire among your employees. Henry Ford once said, 'Competition is the keen cutting edge of business.' Yet many of us consider competition the enemy. Generally speaking, it is we who are our own enemies, while the competition spurs us to achieve.

Public Relations: An Investigation
Unfortunately, too many insurance agencies define public relations as 'sending out a story on employee promotions with photograph attached.' Hundreds of articles have been written on the how-to's and 1-2-3s of public relations (PR), but few take the time to examine the actual concept of public relations and the agency's or company's role within that context. First, let's divide PR into three very distinct categories: the general public (your Personal Lines markets), the business public (your Commercial Lines markets) and the trade public (your peers). IMMS Silver Membership predominantly deals with Commercial Lines, so it's too bad that a public relations campaign for the business public is the most difficult to develop and nurture. (Trade relations are generally the easiest, with the general public falling in the middle.) This article examines each of these categories independently, with ample cross-referencing. The Trade Public An agency or brokerage owner might ask, 'Why worry about relations within the insurance industry?' There are any number of reasons, a few of which are: 1. PERCEIVED AGENCY VALUE. Every day we are seeing agencies bought, sold, merged, and clustered. We are also seeing agencies not being bought, not being sold, not merging, and not clustering. Public relations within the industry can alter your agency's perceived value. If other agency owners continually hear about your agency, its value is psychologically enhanced -- which can translate into added dollars if you sell, an added advantage if you are trying to buy, increased leverage if you merge, and greater demand if you are being pursued by a cluster. 2. IMPROVED EMPLOYEE MORALE. The Independent Insurance Agents of America (IIAA) Commission to Enhance Agency Value has proven the importance of strong employee relations to the value of an agency. Everyone likes to be associated with a winner, and when your employees read and hear about their own agency in trade publications, they're further motivated. 3. THE LEADERSHIP FACTOR. Most successful businesses are proactive, rather than reactive. Solid public relations within your trade can position you as a leader to be emulated, rather than the weakling that is always reacting to someone else's idea or action. This positioning as a leader within your industry is an invaluable sales tool when prospecting for new clientele. Just like the employees in No. 2, your customers want to be associated with a leader. Building Relations Within Your Industry Trade publications are the primary vehicle for public relations within any industry. The insurance industry is filled with trade publications, ranging from four-page newsletters to glossy magazines. But how many of you have a list of all pertinent publications, their addresses, phone and fax numbers, and names of editors and key reporters? If you don't have these things, go through that pile of magazines in the corner of your office and begin entering all this information into a computer database. Once you've completed that task, don't pat yourself on the back too many times because there's more to do. Call each publication and talk with the publisher or editor. In many of the smaller publications, the publisher is the editor and often the writer. With larger publications, the publisher may be somewhat removed from input on specific articles or columns; in cases like this, the chief editor is a better contact. As in a cold sales call, try to find some common ground. Introduce yourself and perhaps mention a recent article and how it may have been of help to you. Tell a little bit about your agency, your specialty markets, and maybe your degree of uniqueness. Explain that you are available if they ever need any assistance on an article and that you would like to submit information for publication occasionally. Start to develop a relationship. You can give yourself a couple more strokes at this point, but don't get carried away because most people falter at the next point: After concluding the initial conversation, pencil into your calendar three more calls over the next twelve months. Only by following through with continued calls will you make an impression that can help your public relations efforts. Treat each publisher/editor/writer with the same persistence you'd apply to a potential client. It takes only a few minutes here and there during the course of a year, but it makes a vital difference in getting your articles or information into print. When deciding what to submit to trade publications, consider the following: 1. Information related to your employees-promotions, classes being attended, new hires, certifications, signing of major deals, major milestones in tenure, etc. These items are usually placed in columns about people in the industry. Most publications appreciate an accompanying photo. 2. Information related to your carriers-new signings, major awards, new market programs, success stories. Often this can be a cooperative release with the carrier or company, and their PR department will handle the story writing and releases. However, don't take a wait-and-see attitude. Ask them if they are going to do a release, and when. If they aren't planning one, do it yourself. 3. Association activities-generally applicable to owners and senior management, this can include participation in special panels or programs, election to office, etc. 4. Commentaries-ranging from letters to the editor to op-ed articles. Many publications accept in-depth commentaries on timely topics and generally position them opposite the editorial page. This type of writing not only reflects your professional opinion on topics of interest but shows you to be an expert. 5. First-hand reports-observations and information on catastrophes (fires, earthquakes, floods, storms). This is appreciated by the writers and is invaluable for helping you place articles in their publication later. Here's another suggestion about association activities that ought not to be forgotten: Become active in at least one trade association-not just as a member, but as a participant. Take part in the elected or appointed offices. Volunteer for various panels and commissions. All this activity will improve the relations of your agency within the industry, and you will become known and respected as a leader and a doer. The General Public Relations with the general public are a little more involved than relations within your industry, but well worth the effort. As mentioned, this is primarily oriented toward your Personal Lines business, although it will affect your Commercial Lines as well. Much of what is released to the trade publications can be simultaneously released for the general public, although it's less likely to be printed (because of the industry-intensive nature of trade releases). After all, you never know when an editor or a newscaster will need to fill some space and your release just happens to be handy. The best approach to the general public is to supply items of general interest to your community. Topics such as home safety, personal safety, fire prevention, insurance savings, insuring the teenage driver, and senior citizen driving tips are just a few of many, many topics that can be addressed in a press release. The trick is to get it printed! That takes us back to the basics: 1. Start a database with the address, phone, fax, editor, and writer listings for all news media in your community. Start with your daily newspapers, expanding to local radio and television stations (and don't forget cable TV operators). Then expand the list to include weekly newspapers, local or regional magazines, even newsletters put out by area merchants. (For instance, many real estate companies publish monthly newsletters of general interest.) Be sure to separate this list from your trade media listings. 2. As with the trade media, contact each of these sources to begin developing a relationship and positioning yourself as an expert to whom they can look for help. Again, pencil in your calendar a year's worth of follow-up calls and at least one personal visit. A side benefit: Each of these contacts can also be a Commercial and Personal business prospect, too! The smaller the town, the easier this is to accomplish. Many smaller markets have only one newspaper, one radio station, and maybe one TV station. The larger the population base, the more difficult it is to get a foot in the door with the various news media and develop relationships-but it's not impossible. Start small: Contact the sources that specifically address your market area. For instance, in Los Angeles, the LA Times covers all of Southern California, and developing a relationship with an editor is nearly impossible. However, this particular newspaper has satellite offices strategically located in regional areas, and it's fairly simple to contact one of these smaller offices. Moreover, competing newspapers may exist for specific areas. If you had an agency in the San Fernando Valley, to continue our example, the LA Daily News would probably be more beneficial than the LA Times. In major markets it's also a good idea to try to identify specific columnists or reporters who concentrate on financial or insurance news, as well as the life-style writers. You'll generally find their reception much warmer than that of the hard news reporters. News directors of radio stations are a good bet-particularly if you let them know you're available for interviews if they need to augment a story. Good radio reporters know that any sound bite from an expert makes the story much more interesting. The best time to send releases to most radio and television stations is toward the weekend. They generally run a skeleton staff on weekends and often need filler for their newscasts. Television stations should be treated much the same as radio stations. Keep in mind that they, too, are eager to build their list of experts who are willing to go on camera when major stories break. For instance, let's say that your state insurance commissioner issues a major press release affecting either agencies or consumers. Most news directors will immediately look to their rolodex for available insurance experts willing to comment. Are you on their list? Most midsize to larger cities have one or more magazines dedicated to life in the city. Since these magazines are more feature oriented, with less emphasis on hard news, they are ideal for longer safety or special-interest articles, which you could submit. Let's break away from the traditional PR press releases and look at some of the alternatives for general public relations: CIVIC MEMBERSHIPS. Most agency owners view their membership in the Rotary Club, Optimists, or Kiwanas (to name only a few organizations) as networking or community marketing. Although such memberships are good for marketing and networking, try to think of them more in terms of public relations. Just as with trade associations, such memberships are only as good as your level of participation. Seek out elected offices, serve as a spokesperson, take on special interest committee work. Among the personal benefits you may experience, other members will come to think of you as a mover and shaker and rely on your guidance. Not a bad persona for an insurance agent. Plus, the more active you are, the more chance you will be seen as a spokesperson for your group when local media cover your activities. CHARITY WORK. Nearly all the civic membership items just mentioned apply to charity work. One distinct advantage is that you don't have to look for a charity to join, you can start your own. Just pick a local shelter, hospice, or any other nonprofit organization that benefits your community and build your own fund-raising program for them. A Ford dealership in Southern New Jersey selected five charities to help, ranging from an orphanage to a hospital. Starting with raffles, this dealership now actually produces major concerts to raise funds. The dealership has also joined forces with one of the banks and one of the supermarkets for co-op promotion and ticket sales: You have to go to one of the three to buy your tickets. Everyone within a hundred miles knows of this dealership's philanthropy, and business is good. The list of ways you can build your agency's image through PR is endless- but most agency owners make one major mistake. In many cases, participation in various activities is limited to how much the owner or executive management can do. They forget about the impact they could produce if every employee participated in at least one group or program. Offer to pay employees' membership fees and add civic-mindedness to their evaluation criteria in annual reviews. Everyone wins! The employees feel good about themselves, the agency becomes more visible within the community in a very positive manner, and the community in which you live and work is all the better for it. The Business Public Much of your effort with the general public and the trade public will pay off with the business public. The general public also happens to include the owners of businesses that buy insurance, and trade stories can definitely enhance your sales presentations. However, even allowing for this, you've got to roll up your sleeves and get to work on your PR efforts aimed at businesses. Add a third category to your media database that includes all the information for local business newspapers, business editors of regular newspapers, and trade publications that cater to niche markets you serve. For example, if you insure dentists, make sure that all their publications are on your press release mailing list. You may already know many of the publications, but it is a good idea to check with several clients within each niche category to find out which periodicals they tend to read. Large markets may also have a radio station or two that cater strictly to business and financial news, and don't forget the cable companies. Build your relationships with each of these free publicity sources in the same manner we've already discussed. Unlike the other two categories, you must rely more heavily on press releases, since there usually aren't organizations or associations you can join. However, some of the associations catering to niche markets have auxiliary memberships available for vendors and suppliers to their members. It's worth investigating and possibly joining, but don't expect the involvement and exposure found in the other areas. Most such memberships are primarily designed to market exhibitor space in their annual conventions. Speaking of conventions, there's gold to be mined if you can get scheduled as a speaker. Not only will you have a captive audience, but you might also get picked up by the reporters covering such conventions for their trade papers. Whenever you have a speaking engagement (this applies to the other categories as well), send a press release indicating that you were a speaker at such and such a group, and then add a brief synopsis of your speech. A good way to open the release is with a quote attributed to yourself. Always include a picture. Another great method of building your Commercial public relations is with value-added seminars. Every year there are several hot topics within the insurance industry that apply to your Commercial accounts. Workers' Compensation, the Americans With Disabilities Act, and Employer Trip Reduction Programs (carpooling mandates) are but a few of the current hot topics. Arrange a seminar for clients and prospects to enlighten them on these topics and how your agency can help meet their insurance requirements. Your local IIAA or PIA chapters can usually help you find speakers or material for such presentations. But don't stop with just the seminar. Put out a press release and invite the media to attend. They may or may not attend, and they may or may not print the release-but then again, they just might do both. In either case, you'll never know unless you make the effort. If you've developed a relationship with the editors and reporters, you can follow up on the invitation with a personal call. Get Your Companies Involved Most every company you represent has a public relations department or, at the very least, an assigned individual within the marketing department. Can you name these people? As with the news media, call the designated PR person for each of your companies. Introduce yourself and explain that you want to build ongoing PR programs within each of our three categories. Ask if they would quote you (or allude to you) on press releases they're issuing. You can personalize them to your agency and re-release them to your media database. Ask them if there is any way you can help them. Many of their press releases cite activities within specific agencies; maybe you can become one of the agencies they mention in their releases. Ask them to provide you with copies of various brochures or flyers they've written on generic insurance topics, such as safety, or the results of consumer or commercial studies they've compiled. Again, these can be rewritten into a press release from your agency. Hertz, the car rental leader, gets millions of dollars of free publicity every year when it issues its annual 'Cost of Car Ownership Study.' Although this benefits every Hertz location, corporate or franchised, the smart operators contact the local media and offer statements that enable the media to personalize the story with a local slant. You could be doing this with every release issued by each of your companies. A national release from a company stands a pretty good chance of making the papers, and by offering the local perspective, you can come along for the ride. This article is more of an investigation into public relations theory than a how-to manual. However, in 'Insurance Agency Promotion and Advertising,' George and Jeffrey Nordhaus offer a list of possible press-release subjects, including: Accident Prevention Anniversaries (Business) Anything Unusual (Hobbies, Human Interest, Office Events, Trips) Automation Advances Awards Company Appointments Community Service Convention Attendance Disabled Workers Fire Prevention Foreign Trainees Honors Insurance Laws & Regulations Local Disaster programs Mergers New Anything (Address, Employees, Officers, Offices, Techniques) Promotions Public Service Work Rate Revisions Remodeling Resignations Retirements Scholarships School Work Social Events Sports Sponsorship Trade Press Articles Training Courses Taken Unusual Claims Payments Unusual Coverage Written This article should stimulate your imagination about how to begin or improve your public relations efforts. For more information on public relations, simply access the topic on your CD-ROM.