The plan is the answer

By Roger Sitkins

At the end of every day, week, month, quarter or year, it all boils down to one thing: Results. Regardless of whether a specific result is great, good, insignificant or terrible, it’s still a result. In fact, at Sitkins International, our members’ results have created a whole new focus for us: “SITKINS = RESULTS.

Everyone says they want to grow and that they truly want “organic growth.” That’s a good thing! They also say that they really want to increase actual sales, which is also a good thing.

Then why can’t they?

Challenges to growth

Usually, agencies that aren’t growing are challenged by one or more of the following common obstacles.

No overall sales and marketing strategy. If I were to walk into your office right now, would you be able to show me your Marketing Calendar (i.e., what you’ll be doing over the next 12 months to expose and promote your firm to prospects and clients)? Most agencies don’t have a 12-month plan. There’s no calendar of events, no social media calendar or blog with a list of upcoming events; there are no sales campaigns in the works and no blast emails going out—in short, there’s nothing lined up.

Remember, a true marketing campaign is not a one-time event. It’s a series of events that lead to a sale. Marketing is a constant, ongoing activity. It’s a matter of getting in front of your prospects repeatedly because, as we’ve discussed before, every great account will one day leave their current agent. When that day arrives, you want to be positioned as that account’s logical next choice. But how is that possible if you don’t have a marketing strategy? It’s not.

Island producers. These are the producers that work alone. They very rarely team up with other agents because they’re focused on doing their own thing. Ultimately, many of them will do okay, but none of them will do great.

Plateaued producers. They get to an acceptable income level and then they begin to plateau. We often refer to them as RIP (Retired in Place).

Sporadic team selling. Today’s best agencies have formalized their team selling approach and are getting phenomenal results. While the concept remains unpopular with many of the senior producers at some of the more traditional agencies, it’s gaining traction in agencies with younger producers who are used to working together, particularly among millennials and recent college graduates. In the purest form of team selling, there’s a senior producer, a junior producer, an account executive and an account manager who work together and there are at least two team members on every sales call.

No sales culture. Culture, as we’ve defined it in the past, is “the language and behaviors that are normal.” Listen to the language that’s spoken in your agency. Does it sound like a sales organization? What are people talking about? Do they complain that they’re far behind on their paperwork? That they’re back-logged and that their automation system isn’t working right? Or that nothing’s working properly because they just moved everything over to the cloud? Those aren’t the kinds of things you want to be hearing.

Instead, you should be hearing your producers saying positive things about their work and the company they work for. Are they talking about the fantastic pipelines they’re building? The recent Blitz Day that created dozens of new hot prospects? How all the producers are now asking for referrals and networking with their centers of influence? Now that’s a sales organization!

No CRM for prospects. You can’t expect your business to grow without some sort of Client Relationship Management program. Where will you manage your prospects without it? When asked, most people will claim to have a list “someplace” or that everyone has their own program. But they don’t have an automated program like Pipe Drive or Sugar.

Organic growth

Why is organic growth so crucial? Because it supports the future of the agency. It allows for successful perpetuation and drives profitability, with a concomitant increase in the EBITDA multiple when the agency is sold to the next generation. When an agency sells, it all comes down to growth and profits. A profitable, growing agency might be worth eight times EBITDA, and a flat-growth company might be worth six times EBITDA. That’s a big difference!

If you’re like most agency owners, your agency is the largest personal asset you have. As with any asset, proper management is the key to value growth. Much like owning stocks and bonds, you want the value of your asset to go up. Why wouldn’t you put the same time and energy into growing your own business?

The plan

Here’s what’s needed to ensure organic growth at your agency.

A sales and marketing plan. This plan should focus on where you will have the best results. Most agencies get the best results wherever they have the best areas of specialty. (Remember, specialists always make more money than general practitioners.) Where do you have unfair advantages in the marketplace? This could be based on in-house expertise, your existing book of business or where you live. Is it a target-rich environment? For example, if I wanted to specialize in restaurants but there were only a couple within 20 miles of my house, I would look for another type of business as my specialty. Whatever it is, I would make that the focus of my marketing plan.

And when it comes to sales, do you have a true sales process? What is the process you take people through when you meet with them? If you’re still working the traditional way—taking copies of existing policies and giving quotes—you do not have an unfair advantage!

Pipelines. I know we talk about this all the time, but I can’t overemphasize the importance of having pipelines. This is a non-negotiable point. It’s really a matter of knowing versus guessing and knowing versus doing. You know you should develop them but are you actually doing it? Each producer should have a pipeline that includes future ideal client profiles, his or her top 20 list, his or her top 10 centers of influence, and the reverse referral list. The latter is a list of people that they want their best clients and centers of influence to refer them to. List in hand, the producer can broach the subject as follows: “Just like in your business, the best way for my business to grow is to be introduced or referred to people. Here’s a list of people I’m thinking about calling on—whom do you know and what can you tell me about them?” What’s so hard about that?! Nothing! But most producers don’t have the list and, more important, they don’t practice asking!

Prospecting. Do you know how to prospect? If so, you’ll be able to answer “yes” to the following:

• Do you have a 30-second commercial? If so, I want you to stop reading right now and recite yours. If you can’t do it, you don’t have one.
• Do you know how to ask for referrals? Every single producer knows the best prospects are referrals. Recently, during several open-to-the-public seminars I asked the attendees how many of them asked for referrals. Only a few hands went up. If asking for referrals is the best way to grow our business, then why aren’t more people asking for them? Because they don’t practice!
• Can you explain your process? When you’re out in public, talking to people about what you do, could you, in two minutes or less, explain the unique process you take people through that helps improve their business results? Most producers can’t. After working so hard to meet people at networking and business events, what do you say when you finally get in front of them and they ask you what you do? If you say, “Insurance,” they’re going to run the other way! A better approach would be to say something like, “We help businesses deal with emerging risk,” or “We help business owners control their total cost of risk,” or “We help individuals deal with the three types of risk: strategic risk, business risk and hazard risk.” And, be prepared to explain it. Can you? Most people can’t.
• Do you know how to network? Most people have no idea how to behave at networking events. After you arrive, do you stand in the corner and look stupid? Hang out with the few people you know? Or do you just walk around handing out business cards? Those are all great ways to make a terrible first impression! Instead, prior to the next event, try to find out who will be there and target the two or three people whom you really want to meet. Next, Google them to learn something about them so that you can approach them with confidence and initiate a conversation.
• Do you follow up? When you finally get to meet and talk with someone at a networking event, what do you do to cultivate the relationship after the fact? Do you follow up with a handwritten note or an email that references something you discussed? You could also follow up with a phone call. The key is to use the event as a reason to contact them again.
• Do you use social media? Getting your name before the public has always been vital to business growth and these days, it’s easier than ever, thanks to social networking sites. Besides being excellent ways to advertise your business and promote your professional expertise, these sites are great ways to network.
• Do you give seminars? We’re huge proponents of presenting educational seminars for clients and prospects. Some of our best agencies do two a month. There are always opportunities to promote your business with seminars on safety, disaster recovery, risk management and other timeless topics. Seminars provide more value for your clients and prove to your prospects that there’s more to insurance than just the insurance policy.
• Do you have sales competitions? If you’re a sales organization, shouldn’t you compete with each other, too? The ones that are growing the most have a lot of fun with in-house competitions and contests. Team selling competitions are a great way to get producers involved, particularly if they last no more than 90 days and offer an interesting prize at the end. For instance, one of our agencies had a two-team competition in which the losing team had to take the winning team to a steak and lobster dinner.

The Bottom Line

Ultimately, you’re either growing or you’re dying. Which one is it? It’s your choice.

The author

Roger Sitkins is founder and chairman of Sitkins International, a private client group and membership program for some of the top independent insurance agencies and brokerages in the United States, Canada, and Latin America. Members participate in training, advising and networking opportunities focused around innovation, sales, growth, profitability and value. Sitkins International is inventing the future of the independent insurance system by providing intellectual property that empowers agents and brokers to become the innovators.

© The Rough Notes Company. Reprinted with permission.