In the “good old days,” cross selling meant having the courage and persistence to ask your clients for the additional business. The legendary State Farm agent and author Cosmo Conte proved that as an effective means of building an agency’s book of business.
Although the old ways can still work and be profitable for your agency, today’s consumer needs to be treated differently. Instead of asking them, they need to be positioned to ask you. And that’s not all bad, because customer service representatives and account executives sometimes have a hard time asking someone for more business.
Even on the producer side, there’s often an unspoken fear that the client might think them too pushy or too greedy if they ask for additional business. Sometimes that fear can result in inaction — they settle for what they have, rather than going for more, even though cross selling is truly in the best interests of your client.
And it’s definitely in the best interests of the agency:
- Since the agency has already invested in onboarding the client, the costs of prospecting, relationship development, and first sale have already been incurred. The true profit lies in expanding that relationship to include additional lines of coverage. Carrier commissions are the same, so earning the same commission with less expense output becomes higher profitability.
- The more policies a client has with your agency, the higher the rate of retention – unless you really mess up on the service side of the relationship.
Years ago we placed all of our business and personal banking and investment accounts with a medium-sized regional bank. They provided excellent service, knew us by name, and even had a special account representative who handled the specific needs and circumstances of small business owners. We were more than happy with them.
Unfortunately, the bank was bought by a large national banking operation, and the personal touch quickly disappeared. Within a year, even the people that had been retained during the takeover – the people who knew us and had given us great service – left the new organization. Hardly a month went by without problems popping up. It was aggravating and frustrating, but we chose to go along with it for one simple reason: transferring every account, both personal and business, seemed like too much trouble. So despite poor service, we remained their customers. Today, we are back with a smaller, high-touch regional bank that is very much like our original bank – but it took a major faux pas on the part of the other bank to make moving worth the trouble. So always remember that retention and account penetration grow proportionally.
The question is: How do we cross sell in today’s market? The answer is a consistent policy of proactive educational nurturing. Through an effective campaign of education and information, we are positioning ourselves to enjoy the benefits of “reactive cross selling.”
This means we have to focus on content and motivation by instituting campaigns for email, electronic newsletters, seminars, community involvement, and social media. These campaigns must provide information in a non-threatening, non-selling way to our clients – in other words, helping them through a support and nurture system. This means you must constantly manage your database of contact points (some clients have many more than one) and maintain a clean database of viable prospects that could also benefit from these campaigns – particularly newsletters, email bulletins, and seminars.
Email is great for bulletins containing critical information or deadlines that clients and prospects need to know about immediately, without waiting for your next scheduled newsletter. Don’t attach a document to the email; mount it to your website and provide a link to it in your email. That drives more traffic to your website where they might spend additional time.
Use variable, randomized signatures, including your basic contact points. Have a list of maybe 10 specific signatures with different product or service-focused messages, then set up your email system to randomly pull signatures for every email sent from your office.
Everyone knows digital newsletters are important, but focus more on the content, frequency, and continuity. Don’t be overly ambitious and attempt one every month, unless you have a passionate employee who can drive and manage the content.
Content is critical; it must be informative and of value to the recipient. It may take a few newsletters, along with the analysis of your opens and click-throughs, to find the categories that mean the most to your audience. Also make sure the design reflects your website and other agency communications.
Bringing clients and prospects together in a collegial atmosphere to gain information on critically important topics to their businesses is a unique and extremely positive method of engagement. Set up tables around the room like a small tradeshow with information on the various products and services you offer to this particular audience.
Being involved with charitable activities within your community should be a no-brainer. It gets you out of the office, brands you as being a community minded and centered organization, and again offers the opportunity to engage with your prospects and clients. If appropriate to the situation, say a Chamber of Commerce event, you could select a particular line of insurance as the product of the day, put on an “ASK” button with your company logo, and wait for someone to say “Ask what?” Get the picture?
A few agencies are doing a really great job here, but most aren’t. If you are primarily a commercial lines shop, LinkedIn is probably your best bet. Personal lines might fare better with Facebook. Use it to engage, nurture, inform, and educate – not to sell. The selling happens and is reactive when people begin to trust and rely upon you. Own your space in social media; build your connections or friends. When someone replies to anything you post with a comment or a question, acknowledge them. This can take time, and some organizations have dedicated employees to managing their cyber space identity and brand.
There are other things to consider, such as the bandwidth of your back office. Does their productivity and existing workload give them time to talk with your clients and nurture a cross selling culture? Make sure they have the time before you begin any campaigns. A campaign that is not backed by performance capability is a wasted effort and can do more damage than good.
When it comes to cross selling, we need to be careful if the agency focus is on a singular product, rather than specific markets where you have particular expertise. Take Workers’ Comp. When you decide to specialize in this line, you often do not have specific market expertise and knowledge beyond a client’s Work Comp needs. For instance, if you take all comers in Work Comp and your commercial market specialty is contractors and manufacturers, you may find it difficult to upsell additional coverages to restaurants or hotels because you don’t have the understanding or the carriers to competitively position yourself as an expert.
Above all, identify and focus first on your strengths and the areas where you can truly round out the accounts with cross selling; then expand into other areas on a level and strategic basis. This insures both maximum success and maximum profitability.