Marketing Leads to an Overabundant Number Of Prospects

To be successful in marketing commercial lines requires a detailed plan. The first step in any process is to assess where you are right now. As Yogi Berra once said, “If you don’t know where you’re going, you’ll probably end up somewhere else.” Let us examine the preliminary steps that an agency should take.

Assess your opportunities
Matrix of book of business. Determine the classes of business that the agency now writes. You may be surprised at how many different classes of business the agency produces. Try to determine if you have knowingly or unknowingly written a large number of a certain class. This makes you an expert. You can then take advantage of this expertise to expand your writing in this class.

Review the agency’s book of business for account development opportunities. Most agencies’ marketing plans are reactive not proactive. In other words, without a plan agency CSRs and producers react to unsolicited phone calls as opposed to implementing a plan of marketing and sales. Reacting to those phone calls as opposed to contacting your existing accounts to develop those accounts, is like fishing for minnows off the back of a whale.

The agency should review all accounts to determine the exact lines of business that are not currently written. On renewal you should review with the clients their exposure to loss and their need for additional coverages such as: umbrellas or excess liability, employment practices liability, health insurance, key man life, long term disability, long term care, etc.

An important fact to remember is that the more policies you write for a client, the longer you will retain that account. Also, an agency’s hit ratio is much higher when making proposals to an existing customer as opposed to an unknown prospect.

Review company programs and products. Companies have become very selective on the classes of business they are interested in insuring. While creating the agency’s matrix of the book of business, care should be given to determine which carriers are writing that type of business. Special care should be given to only solicit the type of business that your companies are interested in writing. Combining niche marketing with your companies’ appetites will lead to higher hit ratios, greater retention and a stronger relationship with your carriers.

Select markets to pursue. Selecting a proper market is the key to a successful marketing and sales plan. The most successful agencies are those that concentrate in areas where they have expertise, a large number of prospects, and companies willing to write those types of accounts. Once you have selected the niche that you wish to pursue, you can begin to strategize your marketing plan.

Determine your marketing approach
Direct mail. If you plan to use direct mail as your marketing strategy, you must be prepared to create a marketing letter or flyer that will generate immediate interest on the part of the prospect. I would suggest that you engage a person or company that specializes in direct mail pieces to create your letter or flyer. You should also be prepared to mail to the same prospects every six to eight weeks. Direct mail is most effective when received by the prospect when they are ready to buy. One of the only time-sensitive products insurance agents sell is an IRA. This type of mailing should be done repeatedly beginning 90 days prior to the need.

Telemarketing. If you decide to use telemarketing to solicit new prospects, you must also decide whether you are going to do this in-house or outsource it. If you decide to do in-house telemarketing, you must be prepared to staff, train and manage that department. Very few small and midsize agencies have the capabilities of properly performing these tasks. If you decide to outsource, it is important that you select a reputable company that is familiar with insurance telemarketing. They should have the capability of not only contacting the prospect for X-dates, but also will provide you with a list of the prospects to be called, ask pre-qualifying questions, send follow-up letters to qualified prospects and, if requested, set an appointment for the producer. Telemarketing is not cheap and you should embark on this venture only if you’re prepared to sustain this approach for at least two years.

Referral marketing. Eighty-six percent of surveyed customers would refer their broker to friends, yet only 12 percent have ever been asked. Another study found a referral is up to 15 times more likely to do business with you than a cold prospect.

There are a variety of ways to use referral marketing and selling. For example:
• Get a name from someone and contact them.
• Have someone else contact a prospect and let them know you will call.
• Have someone else refer prospects to you who could use what you sell.
• The ideal situation would be to have someone else contact a prospect and sell for you.

Ask the right people, at the right time. Common sense and experience tells me it’s someone who just bought from you, or complimented you on your products or services. They’re in a frame of mind where they’re thinking about how good you are and how they gained from what you provide. Be on the lookout for this, and seize the opportunities.

Ask the right way. Far too many producers say, “Do you know anyone else I could contact?” Instead, tie your request into the problem you just solved, the pain you eased, or the result you helped them achieve.

For example, “Pat, I’m glad you were able expand your coverage and reduce your loss exposure by selecting me as your agent. By the way, who else do you know, who also is experiencing a similar problem, that might be able to also benefit from a program like I’ve put together for you?” Now you’re putting them in the position of helping a friend, instead of sending a salesperson after them.

Use reverse referrals. Often you have highly coveted prospects that you would love to soften up before contacting. Comb your customer base and ask them if they know the prospects, and if so, if they could help you. For example, “By the way, I’ve identified several members of your association as people we could likely help in much the same way we helped you. Would you happen to know Joe Jones at Jones Electric?”

Ask why they’re a good prospect. Say to your source, “Tell me about them.” They’ll give you great information, and sell you on why the prospect should buy from you.

Make it easy for people to send you referrals. Send out stacks of your cards to your sources. Ask them to put you in their contact management program.

Ask others to sell for you. Any time someone volunteers, “I know of someone who could really use you,” don’t just get the prospect’s name and number. Ask the source to contact them for you. After all, they felt strongly enough to think of the prospect, why not ask them to take it a step further?

Formalize this process. You should brainstorm a list of 25 people in your life who are in a position to make the greatest impact on your business or sales. Never be out of contact with these advocates more than 30 days at a time. Call, e-mail, mail, fax, send articles, newsletters, anything of value to keep your name in front of them, and to keep them referring.

Be creative, think big. If the 80/20 rule applies, and it usually does, 80 percent of your business comes from 20 percent of your customers. It makes sense that you want to get more customers just like your most profitable ones. So, target them for referrals.

Ask your best customer if they would mind drafting a testimonial letter, mentioning how your agency helped them, and how they highly recommend that they contact you for their insurance needs. (Even offer to write the letter to make it easier for them.)

Thank your source. As the saying goes, what gets rewarded, gets repeated. You don’t want your referral source to dry up on you, you want them sending you business. Therefore, reward your source for a referral. It can be as inexpensive as a thank you note, or something material like a Lotto ticket.

Initiating the plan
Assign responsibilities. Who is going to do what? When will it begin? When will it be completed? This I call action planning. Follow-up by management is key. Some items that you will list will depend on the completion of another task. Once tasks are assigned, management must periodically check with the appropriate person to ensure that their part is complete in accordance with the plan.

Staff training. The only thing worse than training an employee who leaves is not training one who stays. In this case, I’m specifically talking about sales training. Training should include everyone that is responsible for sales, whether it is an outside producer or a CSR. Far too many times, I find agency owners and managers assigning sales tasks to individuals without any sales training. You can imagine the results. Poor closing ratios and lots of time wasted quoting with very little to show for it.

Establish a reporting format. Once the plan is in place, responsibilities assigned and the training is complete, it is necessary to create a reporting format. All personnel have to be managed properly to ensure the success of the plan. This means regular reporting of their stewardship. Have they done what was supposed to be done, when and how it was to be done?

Accountability. All employees should be accountable for their time and assignments . I’ve used the phrase many times … Non-Optional Activities. The tasks assigned are not optional. The employee must complete the assignments properly. The person either does what is required or they don’t. There is no middle ground. It is too difficult in these competitive times to make a profit if staff members can’t or refuse to do tasks assigned to them. Without accountability, there is anarchy.

Monitor results. Sometimes the plans will work exactly as designed and sometimes they need some “tweaking.” You may try one marketing method and find it to be less than profitable. If that happens, don’t give up try another method. The important thing to remember is to continue to do what is successful and eliminate those projects that show little or no positive results.

Jack Fries has more than 39 years of experience with both companies and insurance agencies. He is a contributing writer and consultant for IMMS and P & C Plus, Insurance Journal, IIAA’s Virtual University and publisher of his own monthly newsletter, The Fries & Fries eNewsletter.