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When to Walk Away

What happens after you’ve engaged with a prospect who just won’t sign the deal? Unless the company is ready to do business with you within the next 90 days, they aren’t a prospect. If there is no commitment after 90 days of assessment and communication then it may be time to walk away. So, how can you make sure that you aren’t leaving too early or staying too long?

These are essential steps to take before making your decision.

1) Assess whether or not this is truly a prospect. Do they have a need for what you can offer? Are your business objectives aligned? Does the client want a consultative relationship or are they only interested in the lowest price? Assessing and answering these questions can help clarify whether or not the prospect is a right-fit for your agency, and whether or not they will commit to the work necessary to improve their outcomes. If they aren’t, you may be wasting valuable time and recourses if you choose not to walk away. According to Geoffrey James, “finding out who is not a potential customer is just as valuable a discovery as finding out who is one.”

2) Dialog. Engaging in dialog with the prospect means having a conversation where both parties are exchanging and discussing ideas—it is not a presentation of products and services. It is important to try to understand the prospect in order to determine if they are a good fit. Failing to do this may cause a producer to stay in the sales process too long. Without engaging in meaningful dialog, producers will not be able to gauge the probability of entering into a mutually beneficial business relationship with the prospect.

3) Commitment from both parties. To obtain any commitments from the prospect, producers must prove that they have the ability to deliver valuable capabilities. Producers who are effective leaders should be able to guide the prospect through the sales process in order to help them self-discover risks and see the benefits of entering into a business relationship with their agency. Buyers must have confidence in the producer’s capacity to deliver.

Developing Your Value Proposition

Developing a unique value proposition to differentiate your agency is essential. Jill Konrath explains: “With today’s tight economy and overburdened decision makers, you need to have a strong value proposition to break through the clutter and get their attention.” Most agencies have one, but too often it sounds just like any other and it fails to educate employers on why establishing a relationship with the agency is beneficial to their business. For example, some common value propositions include general claims like, “we have great service”, or “we represent great insurance companies.” According to business writer, Wendy Maynard, “Crafting a value proposition requires insight on what is unique about your company”.

So, how can you develop a unique value proposition that will demonstrate your distinctive value and capture the attention of prospective clients?

Ask these questions to determine whether or not your value proposition is effective:

Does it demonstrate how you will help employers change and grow, or the loss they will experience if they don’t engage in a business relationship with your agency? Does it communicate why the prospect should use your agency over another, and the specific value your agency will bring to the relationship? Is it focused on the client? Does it include demonstrated and tangible results?

Establishing a unique value proposition positions agencies to compete on value instead of price, and it will help agencies attract the right-fit clients that will benefit from the capabilities and resources that they offer.

Making Fee-Based Relationships Successful

Developing and implementing a fee-based approach with clients and prospects can be a positive and very successful revenue diversification strategy. Often, agencies are able to assess the types of fee-based solutions they will provide, but struggle with how to enter into fee-based relationships. Here are five steps to ensure success:

Step 1: Know Your State Regulations—

Regulations for charging fees in the insurance industry vary from state to state. It is important to investigate and do research in order to protect you and your agency and understand what implications fee-based consulting will have on your agency before moving forward.

Step 2: Establish Goals—

Consider why you are adopting this approach. Is it to create new opportunities with prospects, to increase the profitability of existing accounts, or both? Many agencies consider fee-based consulting for prospective clients and fail to see the opportunity to set fees for services currently provided to increase agency profitability. Some producers would be reluctant to charge for something that they once provided for “free”, but maintaining unprofitable accounts puts the agency and producer at risk, and can prevent clients from receiving services they need to improve their business. It is very important for agencies to clearly identify which types of relationships they will be engaging in, and how the relationships will ensure agency profitability.

Step 3: Consider What to Offer—

Agencies must determine what services are going to be fee-based. Focus on the value of the outcome the prospect or client will experience when determining where there are appropriate opportunities to charge fees.

Step 4: Effectively Communicate—

Informing prospects about the types of business relationships your agency offers must be done early in the sales process. The initial process of assessing if the agency and the prospect are in alignment and are a right-fit is a great time to outline the variety of business relationships offered.  For existing clients, a conversation about what additional value the agency can bring is a good time to have the fee conversation. According to Allen Weiss, author of Value Based Fees, the goal “is to improve the client’s condition by meeting and/or exceeding mutually established project goals.”

Step 5: Measure Your Impact—

What agreements were made during the sales process? What goals were created? How are they to be measured? It’s important to establish answers to these questions with clients when determining the impact of fee-based consulting. It is critical to measure both account profitability and client outcomes in order to demonstrate value and support future fee conversations.

Introductory Phone Call

As we’ve discussed in the past, it is essential for your messaging to clearly communicate that through a business relationship with your agency, a client can measurably improve the results of their business. Communicating clearly, confidently and effectively takes practice, and it’s important for producers to take the time to prepare by writing out a script or a list of objectives to successfully navigate an introductory call.

Here are a few tips:

1)  Do your research. In today’s technology and information loaded world, there is no reason not to know several things about your prospect before you call them. The goal is to gain information that you can use to tie into your message. By demonstrating that you have done research on their business, you can confidently suggest that you have something of value to offer.
2)  Make sure to share why you are calling.
3)  Determine if you’re speaking with the right person—if you are not speaking with the right person, verify a way to reach them.
4)  Having done research on your prospect, share what you are offering and how it may benefit them—remember to keep the conversation focused on their success, and decide what the appropriate next step in the process should be. (A second, more in-depth phone conversation, or a first appointment)
5)  Pique enough curiosity to secure the next step. Why is piquing curiosity important? Jill Konrath explains: “It creates an opening for you to establish a relationship, at the same time it positions you as an invaluable resource.”

Utilizing a set of objectives will keep you productive and focused on advancing the relationship forward.

Capabilities of Sales Leaders

In today’s sales environment, employers prefer business relationships with producers who will be able to lead them through a process of improving their business and guide them towards increased profitability. We’ve discussed how the majority of prospects you meet won’t be following a successful process to buy insurance and manage risk, and we’ve addressed the importance of taking on the role of leader in business relationships with them.

Sales leadership is a skill that few have but that any willing producer can be taught. Leadership is essential to effectively and proficiently guide the prospect through the buying process. According to Tom Searcy, “customers crave tailored insight and a guide who can intelligently direct them to make the most effective decision for their company.”

So, what tools and capabilities should you possess in order to be a successful producer and sales leader?

1) The ability to help prospects self-discover threats and risks which they were previously unaware of—you can do this by asking the right questions.
2) The ability to create relationships and leverage centers of influence to increase business opportunities.
3) The ability to create a plan of action and vision for a future relationship in the sales process.
4) The ability to align agency goals and capabilities with employer goals, needs, and objectives
5) The ability to identify right-fit clients and secure business for yourself and your agency by maintaining an adequate pipeline.

Producers who are self-directed leaders, and who are accountable to themselves, their team and their agency will inspire others and amplify their own success.

Be A Specialist

In today’s highly commoditized insurance market, it’s difficult for agencies to be different when buyers are always asking, “can you just give me a quote?” So, how can you remove your agency from this dreaded bid-and-quote process and grow organically based on the value your agency has to offer prospective clients? Become a specialist—implement a consultative sales strategy that emphasizes your specialized technical knowledge and expertise.

 Agencies can choose to develop distinctive capabilities from a wide array of services to assist employers. One example that emotionally engages prospects and gives agencies the chance to deliver measurable outcomes is workers’ compensation insurance. It’s not only employers who see Workers’ Compensation as difficult to understand. Many agencies out there also share the same perspective. That’s why specialized capabilities in Workers Comp and a distinctive process for engagement can give agencies the edge and advantage needed to capture new business.

Worker’s Compensation insurance programs are often filled with overcharges and mistakes, and if agencies know how to step in to find and fix them they will be able to better quantify their value to employers. The important thing is to be better than your competition at something unique and important to the success of your client.

According to John Case, senior writer for Inc magazine, “it’s the age of the specialist- of the company whose value is knowledge.”

 

 

As a disclaimer: We (The WorkComp Advisory Group) provide independent insurance agents with the tools, training and consultative leadership they need to lead with Workers’ Compensation and attract new business.