A systematized process takes the “grunt” out of marketing

The softening market, along with an increasingly competitive marketplace, is putting pressure on agency sales staff as they struggle to meet their production goals. Agencies are constantly asking how they can create and use a marketing and sales system, often called a customer relationship management (CRM) system. Agencies are looking for a way to systematize the marketing process so producers can be working with prospects that are ready to buy.

Before we look at what might be available to help with this process, let’s define some terms. In our vocabulary, “marketing” is the process of identifying prospects and developing a relationship so a producer can get that first appointment. “Sales” is the process of moving a prospect from an initial appointment to a purchase decision.

Successful selling takes more than natural talent. Sales success isn’t always the result of any native skill and ability as a salesperson. It is often the result of creating a marketing and sales system that provides a disciplined, organized approach to the selling process. Technology is available that allows you to put your marketing on autopilot. You can create a powerful marketing system designed with one purpose in mind—to help you increase sales!

To understand how a marketing system works, it is first necessary to understand the philosophy that undergirds your current method of marketing and selling. Whether you realize it or not, you already have a system. Almost all selling efforts can be simplified into these steps:

Step 1: Identify prospects and obtain a policy expiration date.

Step 2: Call 60 to 90 days before the expiration date to get an appointment so you can provide a proposal.

Step 3: If the prospect doesn’t want you to quote this year, put that contact into a follow-up file and call next year at about the same time.

Step 4: If you do provide a proposal, try to close the sale. If you are not successful and want to write the account, put the contact into your follow-up file and call again next year.

While this sales system can break down at any step, the most common point of failure in most agencies is in the follow-up required in steps three and four. Producers are often charged with the responsibility of performing these follow-up steps. We find that most producers don’t do well at following up on prospects that are not ready to buy. The reasons for this include:

They don’t like to. Many producers are great at prospecting, presenting, and closing, but they don’t like writing letters or making phone calls. These producers see follow-up activity as a waste of their time, so they don’t do it. They prefer to work with people who are willing to talk to them immediately. They will worry about other prospects when their expiration date gets closer.

They are too busy. Many producers are focused on short-term opportunities and believe that they can’t spend the time to cultivate long-term relationships. They move from crisis to crisis, and their time is filled with the urgent problems of the day. The important long-term activity is not carried out.

They are not well organized. Some producers allow things to simply “pile up” and have no system to remind them when it is time to get back in touch with someone. They may have a suspense or diary system, but they always seem to be days (or weeks) behind the reminders they receive.

They leave the agency and no one continues their efforts. When a new producer takes over, a transition is usually made with the “good” customers. Any prospects that the prior producer was cultivating are frequently dropped. Sometimes, when a producer leaves an agency, he or she continues to cultivate the prospects—but at another agency.

There is no formal plan. Most agencies have not developed a formal plan for marketing and sales. They leave the details of how prospects are to be cultivated over the long term to the producer—as the producer sees fit. If the agency does have a plan, it is not managed day by day to make sure it is followed.

All of this means that:

• A few prospects are well cultivated, according to the individual producer’s personal strategy.
• Most prospects are poorly cultivated, also according to the individual producer’s strategy.
• Only a small percentage of the agency’s prospects ever result in a sale or achieve their full income potential.

To create an effective marketing system, four components are required: prospect management, opportunity management, campaign management, and results management. Each of these must be present in order for an agency to gain the full benefits of a successful marketing system. Let’s take a quick look at each of these.

Prospect management
Prospect management is the process of finding the right prospects, gathering detailed information about them, and tracking that information so it can be used in your marketing efforts. This process ranges from using the Internet to identify a list of names that fits the criteria you have decided you want to target, to sitting down with the underwriter to determine what types of accounts a particular company wants to write.

Prospect management is all about information. During this process, you gather information and store it for future use. The type of information you gather will depend on the type of account you’re working on. It will also depend on whether it’s a personal lines or commercial lines account. One of the challenges is determining where to store the information you gather so that it can be retrieved quickly and easily.

Opportunity management
Opportunity management helps you answer the question: “Do I really have a prospect?” In the above process you identified a large number of prospects that fit the basic criteria you established. In opportunity management you begin asking more detailed questions about the individual prospect you identified above. These questions help you qualify the prospect to determine which ones you should work on first.

Most producers already have a set of pre-qualifying questions they use as they are working on a prospect. An opportunity management system allows the answers to these questions to be captured and maintained. Each agency (or maybe each branch or location) could have a unique set of questions to apply in the initial prospecting process. An opportunity management system should have the flexibility to allow the agency to customize these questions and the resulting scores. This information is tracked as part of the prospect information file.

Campaign management
Campaign management is the process of building an ongoing relationship with prospects by contacting them in a consistent manner over a period of time. This is an area where technology can really help reduce the amount of a producer’s “grunt” work. This frees the producer to spend time face to face with prospects as they are moved through the sales process.

The benefit of campaign management is that while the producer is concentrating on prospects in the sales process, the campaign management system is continuing to build relationships with prospects in the pipeline. This provides the producer with a steady stream of prospects in the sales process.

Results management
None of the above components will be successful without a provision to track the results. An agency should be able to easily produce a snapshot report for each producer showing his or her year-to-date results. This report would show the producer’s close ratio, the appointment to proposal ratio, the number of referrals received, the results of those referrals, etc. This also would provide the sales manager with a projection for where a producer will stand at the end of the year based on the producer’s year-to-date performance and the number of prospects that are in the pipeline. If there are problems, corrective steps can be taken immediately.

An agency should be able to see the results of every individual marketing campaign. This report would show the money spent in marketing costs vs. the commission earned. It should also project how long the client is likely to stay with the agency and show the lifetime value of that client.

Without tracking results, an agency cannot know if its marketing system is working. And by “working,” we mean generating revenue for the agency.

Each of these four components is necessary for a marketing system to be successful. In future columns we will provide more details on each of these as well as tools available to create an efficient, effective marketing system.

(originally published in Rough Notes Magazine)