Finding and Selling to Ideal Clients

When an agency is started, most new owners will be happy to sell their products or services to anyone that is willing to buy. After all, one needs to have paying clients to stay in business!

However, this approach is not effective once the business is established. It is important to define an “ideal client” in order to focus sales, marketing and service resources. If the agency does not define an “ideal client,” then it will waste precious time and money.

The first step to defining an ideal client is to understand the resources and capabilities of one’s business. There is no sense considering Bill Gates or Exxon Mobil to be ideal clients and not have anything to offer to them.

An agency selling personal lines insurance needs to take an inventory of the markets they have and the products they can sell. Also, it is important to understand the technical and sales skills of the staff. Some agencies might be better off focusing on selling auto, whereas others have the resources to cross sell accounts with auto, homeowners, umbrella, as well as life.

The next step is to understand the environment that the business operates in. Is the agency located in an urban area or a rural area? What are the local demographics? Is the area growing or contracting?

Define the Ideal Client

The basic definition of an ideal client will be based on the following:

• A person or business that needs what the agency offers;
• A person or business that has the resources to pay for what the agency offers;
• A person or business that sees the value in what the agency offers.

The agency can then review the demographics of the region to create a criterion on defining the groups of people or businesses that fall under the ideal client. This might be types of businesses, like auto dealers or lifestyles such as married couples with kids or income levels.

An ideal client is not an automatic sale. The agency still needs to differentiate itself from its competitors. There are lots of agencies that sell insurance. A sale happens when one agency meets the needs and expectations of that ideal client. However, by defining the ideal client, the agency is able to create an effective sales and marketing campaign that will attract likely prospects and convert them into clients.

How to Sell to an Ideal Client

In order to guarantee a sale, it is best for producers to make sure the ideal client they are trying to insure has pain. This means determining what that pain is. If they don’t have pain then it is probably best to move onto another prospect.

If they don’t have pain, it can be a big waste of time to gather information, market the account and try to sell the quote. Often prospects also tell the incumbent agent what was recommended by the new producer and just have them make the changes, being loyal to the incumbent.

It is best to determine what is important to the prospect, if they are happy with their agent, and if not, why. Also, it is good to also know the price the ideal client needs to move their business to your agency (i.e., what is their budget?). It is also good to know which carrier they are insured with for the various lines of coverage, if they will disclose it. The agency’s program may not be competitive and knowing that helps both parties save time.

Summary

Defining the firm’s ideal client and knowing how to sell to them, is the key to assisting the agency in attaining organic growth while focusing on what’s best for the firm.