- Business and Employment
Business - Ideas to Improve Your Sales Approach - Part 1 (Create Loyal Customers)
Disclaimer: Insurance related, but highly applicable in other areas...
Anyone who has been in sales before can tell you, it's not an easy job. It is even worse for those working with pay structures which are heavily based on commission. Eight-plus hour weeks? Sure. Quotas? Expect them. The pass and fail assessment is simple for the employers: Profitable? Pass - Not Profitable? Fail. Insurance has treated me rather well over the last few years, and if the stigma doesn't bother you stick with it.
Price shoppers are the low hanging fruit out there - They close fast when you're saving them money, and they leave fast when you're not (less time invested!). The problem with this market share is that they are not long-term customers. On their renewal they are going to leave you, and if they don't leave you they are going to try (why should you have to cross your fingers every renewal?). For obvious reasons this is important for people getting a share of renewal commissions. Insurance can be fairly lucrative when you've built yourself a quality book of business. If you're only paid on the front end, this is still an important consideration for you! Why? No savvy business owner is going to keep you around if you aren't bringing in loyal customers. Most business owners are lucky to break even from a one term customer. If you're getting a 70/30 split on the front end, believe that their 30 went toward providing you a work area, marketing, customer service for that 6-12 months, etc.
1. Create Loyal Customers:
Loyal customers keep your residual income up, keep your retention levels up, and refer business to you! There is nothing stronger than a word of mouth referral. Their friend sent you, and they will listen to you, the professional. I am going to share with you some tips on creating and maintaining loyalty. These tips should be used on your entire book of business, and can be used to convert price shoppers to long-term customers.
A) Create and Maintain Value - The funny thing about creating a value is that every propsect's perception of such will be unique. Joe might prioritize his value in having higher liability coverage, whilst Sarah might perceive value in having Comprehensive and Collision coverage. There isn't a one size fits all formula, and it is up to you to help them figure things out. In reference to the discussion above, price-shoppers believe they value low prices. It is a kind a misnomer, because price is more or less indicative of value, but doesn't define it. Simply put, the Price Shoppers out there just don't know there's a difference between good coverage and bad coverage. Some examples which are not purely anecdotal, and I've experienced first hand (which will be true for all examples provided in the article):
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Example 1 - Sally: In 2008 I received a Homeowners Insurance lead for a woman who was refinancing her home. After the initial phone call, while running the quote, I discovered some conflicting issues. The calculated replacement cost for her home, from my system, was $80,000 more than her current coverage provided for her. Subsequently, my premium generated appeared to be uncompetitive. The follow-up call had it's bumps as I explained the shortfall, but this sealed the deal: "If you're going to keep your coverage at that level, then now might be a good time to choose 3 rooms in your home you don't want to rebuild if something were to happen." I closed it out the next day. Sally was resistant at first, but it was because I needed to take the time to identify the value with her. There's a certain level of naiveity as well, because people assume that every company will write them sufficient coverage for them (and so any more appears in excess). Be prepared to combat that.
I used the above example first, because I am more proud of this sale than any other. In 2010 I received a phone call from Sally on my personal cell, and she had this to say to me (paraphrasing this of course):
"I just wanted to call and thank you. Last month my house burned down, it was a total loss. If you hadn't been so persistent I'd be in real trouble right now."
This is the only total loss I've ever had with any customer on their home, and it just happened to be one I could have easily scrapped if I didn't care to fight the good fight.
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Example 2 - Alex: This case happened early this year, and was one of the toughest closes I ever brought down with a single point. It occured to me at the time quite by accident, but I've used the idea successfully on frequent occasion since then. Alex was shopping auto insurance, and my proposal was $10/month more than the closest competitor. All the coverages proposed were revised to be identical (he wanted apples-to-apples comparison). In a last ditch effort to get the business, I said the following, "Alex, you told me you have thousands of dollars worth of high quality auto tools. You paid extra for a promise of performance, when you could have gone cheaper. I'm promising you now that there isn't a better agent for you than me." I sold the policy right there. Again, sometimes you need to help the customers see the value and everything else falls together!
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B) Get Personal - Chances are your customers are not going to invite you over for their family barbeque (even if they did would you go?). It doesn't have to be an all or nothing relationship with your customers though. Ask them what they do for a living, how many kids they have, and/or their favorite restaurant in town. There aren't any useless bits of information - Take notes on everything. "Knowledge is Power" is a popular idea for good reason. Getting to know your customers is going to provide you with all you need to know for sales opportunities such as:
- Adolescents soon to be 16 - Being proactive with young drivers is the only way to establish the best value and competitive pricing.
- Near retirement age - Life changes a lot when you retire, and you want to be there to make the proper adjustments for them. Great opportunity for financial referrals.
- Parents or Friends moving into the State - When you ask questions you get information like this, and they make solid referalls.
-Profession - Always find out their profession. You'll want to know this if any favorable discounts come out for them (teachers/nurses/etc).
- Claims/Accidents/Violations - These aren't surcharges forever, keep up with when they fall off.
Notes are always good, and can save you a lot of headache, but what else can you do? The best way to start your relationship with a customer is with a face to face meeting. Schedule an appointment in the office, or (even better) meet them in their home. Closing and retention ratios are going to be better when you've met with someone in their own living room!
C) Be Accessible - I have heard over a hundred angry rants about bad agents, and the most commonly occuring theme is, "I can't ever reach my agent, and/or he won't return my calls". I know how the rush feels, believe me I do. It's easy to put off calling back a customer when you're working hard on another task. Force yourself to be on the ball, or you're going to regret it. If your customer pays 100% of the premium, you need to deliver 100% of your promise.
One way I've set myself apart from other sales persons is by letting the customer know I am available on my cell phone 24/7. I will walk them through programming me into their phones, which serves a two-fold purpose. Not only are you being accessible, but you're making sure that your number is programmed in and on the ready if their friends ever ask them about insurance. I've taken a few frantic "I just had an accident" calls outside of the 9-5, and it really helps them to talk it out with someone that they know! In instances where I can't get my cell phone number programmed in their phone, I will hand write my cell number on my business card for them (I don't have it printed). It's subtle, but makes the customer feel like you're making a special gesture (if you gave it to EVERYBODY why wouldnt it just be printed on your card).
Thank you for reading, and I will make revisions and updates on this topic accordingly.