(From left to right) Paul Monacelli, CIC, CPIA, PIANJ past president; Lloyd "Skip" Daigle, vice president, enterprise development, Travelers; Peter van Aartrijk Jr., CIC, managing director, The van Aartrijk Group LLC.; and Steve Anderson, president, The Anderson Network Inc.

Independent agents and their companies had to zoom from zero to 60, as New Jersey’s personal lines market blazed white-hot. To help them cope—and not just in personal lines—PIANJ recruited nationally recognized superstars of the insurance marketing world.

For the first time, the conference was open to all PIANJ members—this opportunity was just too good to miss! But, in case you DID miss it—here are some highlights. Feel free to share these ideas with your staff, your business partners—anyone you work with to boost your sales.

Harness the talent that’s under your nose
One major take-away from the conference—sit down with, and learn from, your youngest staff members. Get their ideas on how to communicate with their peers. Tap into their prior training in sound marketing procedures.

“Significant numbers of young people are coming into independent agencies,” says Peter van Aartrijk. “Especially from the captive agency side.”

“Young producers bring discipline to the business,” Skip Daigle says. “For example, they track sources of new business—and number one is referrals.”

“Younger people, when they enter an agency, they don’t see the technology they’re used to,” Steve Anderson says. “That’s true of your customers and prospects, your staff and job candidates. It hurts you.”

• Presentation—Lloyd “Skip” Daigle, Travelers Agency Development [Web site]
• Presentation—Paul Monacelli, ADP/Statewide Insurance Agency [Web site]
• Presentation—Steve Anderson, The Anderson Network, Inc. [Web site]
• Presentation—Peter van Aartrijk Jr., The van Aartrijk Group LLC [Web site]
• Questions and answers
• PIA marketing tools for agents
• Speaker profiles

Skip’s proposition is simple—All processes at agencies and companies (and ESPECIALLY at their interfaces) should promote, not impede sales. When you identify ANY impediment—root it out and convert it to facilitate making the sale.

Skip focused on several friction points that should be reinvented as opportunities—especially the time-honored visit from the company field rep. Instead of squandering this valuable face-time on presenting data (e-mail it ahead) or sharing doughnuts, Skip wants both parties to focus on growth.

This presumes the company DOES still field a team of people to help their agents—and that those individuals are trained to do what they should be doing: helping agents grow.

[Later Peter and New Jersey agent Mike Bergstein showed off a new tool that lets agency owners pro-actively set the agenda for each field rep visit—see it here (PDF).]

Skip charged that some independent agents and companies may be “harvesters” not “growers.” Agency owners can dedicate profits to themselves and their families—or they can reinvest to support more growth, more profits in the future. Companies may look to “harvest” each other’s books. This doesn’t help agents grab market share and grow the agency marketing channel overall.

Skip also scotched the idea that companies can grow only by slashing rates—but rates do need to be competitive. Agents and companies alike aim for PROFITABLE growth.

Skip asked which is better, a small agency that’s growing or a big agency that’s stagnating or losing customers? Right now, 50-70 percent of agencies have 10 or fewer total agency staff. “Is bigger better?” Companies ignore small agencies at their peril.

Total customer count, not premium, is the honest way to evaluate your success, he said.

• Fewer independent agencies (80,000 in 1980; a projected 30,000 by 2015—Too pessimistic, Skip thinks.)
• Fewer agency-channel companies (well over 1,000 in 1990, more like 500 in 2005) (But, “A lot of companies DESERVE to go away,” according to Peter. “How many do you really need?”)
• Around half (40-60 percent) of agencies have A DECLINING NUMBER OF CUSTOMERS.

Skip said companies should help agencies diagnose barriers to growth (Are CSRs overworked? Are underwriters foiling your efforts?) Once field reps. gain the confidence of the agency owner, they can work directly with agency staff to help execute growth plans and improve sales skills, he said.

“Companies need to match their best staff with agents who want to grow,” Skip concluded.

(Skip said frankly that such conversations generate “lies” told by both sides—and what’s worse, each side KNOWS the other is lying. “Change the conversation!”)

Paul said in his agency the planning process starts in July, so by November he pretty well knows what his projections with each company will be. But what is really helpful, he said—

“Is when a company asks, 'What do I need to do to help you grow?'”

He recounted the story of one individual from a company who worked on this basis until Paul and the company had a detailed plan. The company even took his suggestion for a new product—and ran with it.

“Success depends on having a written plan,” said Paul, an ex-military man who has led complex, sensitive missions on this basis. “It’s all about implementation.”

“Do YOU have a written plan?” Paul challenged. “Do you look at it at least once a week?

"If not, you don’t know what is going on in your agency.”

Paul said agents aren’t always good at evaluating what they are doing. “We hate our companies’ alternative distribution channels,” he said. “But why do they have them? Because agents are not giving them the growth they need. Who runs companies? Wall Street analysts do—and THEY focus on growth. Companies are not the bad guys here. But, we need to re-evaluate everything we’re doing with this in mind.”

“What are your customers like?” Steve asked. He cited common online transactions, for example comparing air fares, where customers’ expectations are shaped. “They want cheap prices,” Steve said. “They want access through the Internet.”

If you meet their expectations, you can fulfill the 80/20 rule—you’ll get a lot more of each customer’s business by fulfilling their needs, Steve said.

Industries such as banks provide online services “that actually get the customer doing a lot of the work,” Steve pointed out. But, customers like the convenience and control. “Why do you think they don’t want to do the same with you?” Steve asked.

“Agents are great salespeople, but they’re not good at marketing.”

Steve defines marketing as the activities geared to identifying prospects and getting the opportunity to close a sale with them. Successful marketing requires understanding the preferences of each generation, he said.

Regarding technology, no generation is a total monolith. A minority of seniors use online technology, and a fraction even of the youngest buyers don’t. But increasingly, generational habits of purchasing and communicating are different from those of the typical agency owner demographic. Here’s a snapshot:

For seniors, the key is—make it easy. They have to work more at technology, even if they use it frequently. For younger customers, technology is a natural extension of themselves, a means of communicating they use constantly.

Steve encouraged attendees to familiarize themselves with some sites that Gen X and Gen Y use to communicate and get information. These include YouTube, where people can post and view video clips, photos and comments; and social networking sites like MySpace and Facebook, where people stay in constant touch with groups of friends and coworkers.

“You can’t assume that you think like your prospect does,” especially if that prospect is from a different generation, Steve points out. And the implications of that difference are enormous for successful marketing.

While baby boomers “live to work,” younger people “work to live,” Steve said.

“Text messaging and instant messaging—that’s how younger people connect,” he said. “How are you going to handle IM-ing in YOUR office?”

At this point the audience and panel broke into a lively exchange prompted by the gap between those who felt uneasy about staff messaging during work hours, and those who have managed to “let go” of this anxiety.

“We let producers validate themselves through performance. They work when and where they want,” Paul said.

“Agency owners feel like they’re paying for time,” Steve empathized. “So naturally they feel uncomfortable if they can’t tell whether an activity is work-related.” Then he related a new management strategy by Best Buy. In this move, Best Buy did away with work hours in favor of a “results-only work environment.”

“You’ll have to find out what contact means” to younger people, Steve said. “It doesn’t mean face-to-face anymore.” This goes for both customers and business partners. He pointed out “collaboration sites” like WebEx and suggested in-office video to conduct meetings with people off-site.

Steve said that adapting to the preferences of younger customers means, “Don’t get rid of what you are doing now—add to it.” The key is to deliver VALUE, he said.

Agencies should be collecting people’s e-mail addresses and using them to provide service.

• deliver policies by e-mail, not in fancy binders;
• use technology to integrate your agency with your clients’, for example in generating certificates of insurance
  generate “alerts” to customers via e-mail or text messaging to let customers know of events like posting their premium payments;
• enable customers’ Real Time look-up at the agency Web site for such things as billing inquiries.

“Remember, expectations are being shaped by other industries. I can order flowers for my wife and get a message when they are delivered,” Steve said.

“Your client should always come to your Web site, NOT the company’s,” Steve said. “But some companies aren’t letting that happen. Maybe they’re reluctant to let the agency site ‘authenticate’ their customer. That’s got to change.”

[Take a look at ProgressiveDirect’s Manage Your Policy page if you haven’t already.—ed.]

Speaking of agency Web sites, most leave a lot to be desired. “They’re just brochures—not marketing tools.” But a few agencies have figured out how to provide rich content on their Web sites. One strategy is creating “micro-sites”—a sub-unit of your main site which delivers value geared to a specific niche customer.

“A Web site overcomes geography and expands your marketing area,” Steve said. “People search online now. But a challenge for independent agents is ‘search engine maximization.’ Have you searched your town plus ‘insurance’? Who comes up at the very top? The big direct sellers, that’s who.”

Steve suggested using video rather than print for training staff in agency procedures. “Remember, younger people tend to be more visual learners.”

“Hire younger people and a lot of this will take care of itself,” reassured Peter as Steve yielded the floor. “Let the young folks improve your Web site. Some agents are beginning to use video to explain coverages in a fun way. Everyone has video cameras right now. Let the young people do it!”

Then he tackled another traditional agency/company venture—“co-op advertising.”

“It’s a farce,” Peter said. “It’s another subject where a lot of lies are told.”

Peter said a recent survey found only 43 percent of agents have a marketing plan, 39 percent have none, and (“here’s what’s really scary”) 18 percent are not sure.

About 50 percent of co-op ad dollars never get spent. “You should put this money into developing and optimizing search around your Web site,” Peter said. “Forget the print Yellow Pages. No one looks at them any more.”

“Keep updating your agency Web site—continuously is best,” Peter said. “Not just its look, but how well it comes up when people search.”

Record numbers of insurance professionals take part in PIANJ's annual CEO/Advantage Conference—"Maximizing your partnership: The collaborative sales process."

Peter said companies need to be more flexible about how their marketing money is spent. But, agencies need to show a plan. “Usually, no one at the agency is in charge. There’s no budget, no plan, no tracking.”

“Be sure to have someone in charge of your plan. Even if you don’t have anyone internally to do this, you as the owner can take charge and be the leader,” Peter encouraged.

Peter agreed with Steve about aiming for “a bigger piece of your customer” and about robust client contact as the key. “Don’t spend money on ads until you build a plan for increasing your contact with existing customers. Even your personal lines clients need a risk manager.

He advised agents to take a good look at all their advertising and marketing materials, and even their physical office—“it’s all part of your brand. Does it look like it goes together? Does it look like you want?” If not, hire a professional.

“The best brands are about emotion—and your people are a great strength. Showcase them,” Peter advises. But an ad should be about “you”—not you, the agent, but you, the customer.

He suggested a marketing budget of 1-3 percent of commission revenues; up to 5 percent for special circumstances.

How much is reasonable to pay for advertising?

Peter: Start with your own customers and lizard-proof them. Too many agencies are simply ignoring their own customers. It’s the number one mistake. Personal lines customers should hear from you four times a year. Commercial lines? Make it six. Next, look at your Web site and get it linked from more other sites. Look into adding a phone icon that dials your agency or leaves a call-back message. If you use a newspaper ad, picture a producer saying, “Call me.” It’s not how much you spend, it’s how smart your plan is.

Steve: A marketing system is the key. First, identify your prospects. Then, ask “do I have a realistic opportunity with this person? If not, how do I build a relationship with that person so at some point I WILL have an opportunity? Be sure to track results of your company submissions as well—so you know who’s helping you and who is not. Track you plan’s results. That will help you analyze the return on your dollars and make adjustments.

What do you think of agency newsletters?

Peter: I like newsletters—or even just plain old letters. Don’t make them hard sales pitches. Just use them to educate, and the sales will come. If you DON’T make these kinds of contacts, the only thing people will see from you is their bill. Oh, and be sure to put newsletters on your Web site too. Ask people how they want to be contacted—do they want e-mail, mail, phone?

Paul: Every company should re-think how they spend their cooperative dollars. Make sure agents have skin in the game and are held accountable. Not everyone is automatically entitled to support.

Do you think companies should do national advertising? How can we tell if a company is serious?

Skip: Most regional managers have authority to do things in their area. Companies can either invest heavily in a national branding campaign—or they can provide higher compensation.

Companies may need to discuss their hit ratio with an agency as it relates to their close ratio. If you keep hitting a wall at a company, you need to have a discussion.

It’s not always the company’s processes. It can be personalities or politics. If you discover that personalities or politics is involved, you need to push back.

Sometimes an agent’s sales enthusiasm runs into an underwriter’s negativity. Remember, underwriters are trained to say “no.” So, sometimes you have to beat up on underwriters—have a tough, honest discussion, that is.

Why can’t we have less turnover in underwriters, more chance to build relationships?

Skip: Travelers has identified this as a big issue, in fact.

Peter: Stability is the number one thing that agents want. Stability in product and underwriting and in staying in states where you come into.

• Take Back Personal Lines—Resources members can use to join the battle against direct writers
• The Master Plan—Tools and strategies to develop and implement an agency marketing plan
• PIA National branding ads—Free print ads you can customize with your agency information