How Are Your Clients Keeping Score? Winning Retention & Referrals the Right Way

Welcome to the Agent Leader Podcast. This is the podcast for insurance agency leaders to learn, to grow, to develop, and ultimately aspire to become their best version possible. My name is Brent Kelly. I am your host. I am delighted to be with you on this episode. And if you're a regular listener of the Agent Leader podcast, you may have realized that there has been a bit of a gap in the release of podcasts. In fact, typically I do these weekly, but it's been about a month since the last podcast released, and there's a couple different reasons why. Number one, well, it was summertime and we had other projects and this was not my main focus, so I didn't record many podcasts. That makes perfect sense, right? The second thing is we are preparing for some very exciting updates on this podcast. And I can't say too much now, but be on the lookout in the next couple months here as you move forward of some pretty incredible announcements and upgrades to the podcast and what it's going to be all about. So, again, stay tuned. We love these conversations we've had on this podcast and I love doing episodes like I'm doing today where I can share some, some nuggets with you, the Agent Leader, hopefully give you an idea or two you can take back to your agency, but be on the lookout for some pretty awesome upgrades as we move forward. So. So the title, the theme of today's podcast is how are your clients keeping score? How are your clients keeping score? Are your clients keeping score? Well, what many agencies or producers could say is, well, if my client continues to renew with me, well, then apparently we're winning, right? We're winning that game. But is that enough? Are we going deep enough? Is there more of how we can truly understand if we're winning with our clients? And so we're going to talk about that today in depth and what that means. In fact, give you a bit of a silly example, but it's a real example. This summer, I was the coach for my youngest daughter's instructional baseball team. These are little kids. In fact, my daughter's 7 years old, and the instructional baseball is basically just a step up from tee ball. So instead of hitting off the tee, you pitch underhand, actually overhand to some of the kids if they want. But their bottom line is this, they don't keep score. Every kid comes to bat each inning, and every kid goes from base to base to base, and the last batter runs all around the bases and everybody scores. And I remember, you know, even as little kids, six and seven year olds, that they still want to win, which is a good thing, right? I think overall. But in this case, they're just learning the fundamentals of the game and we're having fun. And for six and seven year olds, I'm all good with that. But I remember little kids coming to me and going, hey, coach, did we win? Did we win? I'm like, well, you know what? We played great and everybody scored, so we both win. Everybody wins. Well, that's great for six and seven year olds in instructional baseball, but obviously playing in the, quote, real world, certainly in the business world, there's absolutely winners and losers. In fact, you think about this from agencies, you think about this with producers. Second place doesn't pay well in this business. You notice that, like, boy, you were really, really good. We really, really liked you, but we're not going to go with you. And they don't, they don't say, I tell you what, we're going to give 40% of commission to them, 30% for second place and 30% for third place or whatever. The breakdown is now, like, one agency gets everything. That's the way the game works. And you know that. So we're going to talk about this today of how you keep score and some things that we could do and you could do as an agency, your production team can do as an agency to better track the score. Are we winning or are we not? Because as I'm going to talk about today, sometimes we don't even know. We think we are, but we don't really know. Now, before I get into three specific things that are going to help you as an agency, or if you're a producer listening or your production team to help you keep score. I want to remind you of the power of focus and clarity because what I'm going to talk about today may not be the right thing for every single client that you work with. Why? Well, as I've talked about in this podcast before, there is a reality called the 8020 rule. And if you haven't done this yet or you haven't listened this podcast, look at the 8020 rule. There's a very good chance that 20% of your clients produce 80% of your total revenue. Right? 20% of your clients produce about 80% of your revenue. If you break it down further, the top 5% of most producers or agencies, books represents about half of your revenue. Think about that. 5% of your clients produces half your revenue. If you want to go to the top 2%, we typically see that it's about a third of your revenue. So we know there's a predictable imbalance. So what I'm going to share with you today and the process that I'm going to share with you today may not be a good fit for every single one of your clients. Why? Because it probably isn't needed, necessary, or even functional to do this for every one of your clients because there is some time and energy involved. However, if we get very specific and let's just, for example, talk about the top 5%, which represent 50% of your revenue, well, I think the top 5% of your clients should all go through the process that I'm going to talk about today. Now, to go a little bit deeper and to give you a little idea of what's coming down the pipe, we have created a new white paper based on something called the Sitkins Principle Analysis. And we've taken the 80, 20. We've gone even deeper. We've done a deep dive. We've gotten data from our current members who work with. We've gotten some data from other agencies that have participated, and we begin to look at agencies in different ways. In fact, we look at four specific tiers. So here's the exciting news. If you would like to take a look at this white paper, download this white paper, go to sitkins.com whitepaper There you go. Sitkins S I T k I n s.com whitepaper I'll make sure that we have it in the description, the show notes as well on this podcast. But we're going to talk about three hidden drains in this white paper and specifically understanding the power of your agency's capacity. So an awesome resource. It's for you to go take a look at, just go to sitkins.com whitepaper so now that I've outlined the power of focus and clarity, again, whether for you as a producer or your agency, want to look at the top 2%, 5%, 10%, 20% of your clients. Understand that what I'm going to go through is going to help you better keep score, know if you're winning or if you're losing. And by the way, that does matter. If you played sports, right, and you go into halftime, for example, of a sport, it's good to know if you're up 20 points or down 20 points. Now, you still need to play hard, right? There's still things you need to execute, but it might change a little bit of your philosophy. So let's talk about this. Well, when we talk to clients and when you talk to clients, the thing you need to think about is the first thing that we have to establish, and this seems so simple, but it is missed probably 98% of the time, if not more. Because when I talk to agencies and producers about this, even those that have, those members that have gone through our programs, they still struggle with this to a degree, because it's easy to do, but it's really easy not to do. It's really easy to do, but it's also very easy not to do. And that is define what in the heck the expectations are in the first place. Remember several years ago, Roger Sitkins tells a story so well, but we were running one of our in person producer camps and the producer walks in, has a nice golf shirt and the agency logo up there and hands a business card, you know, excited, a beer, all that good stuff. And on the business card it says exceeding your expectations. It's a nice tagline. We exceed your expectations. Now, Roger, being a great coach and always looking to go deep, said, hey, I like this card. This looks great. Tell me about your best client. Oh, it's this client. What are their specific expectations? And he kind of sat there, he's like, well, you know, good service and you know, we get back to them. And the truth of it is he didn't really know. He gave a generic answer, which some of those things are probably true, but that was what he viewed as the expectation isn't what the client defined as the expectation. So here's the magical phrase. If we're going to keep score with our clients and know where we're at in this process here, you ready for this? You have to know their expectations because you can't meet and you certainly can't and won't exceed what you don't know. Let me say that again. You can't meet and you certainly can't and won't exceed what you don't know. Or another phrase I would say is what you have not yet defined. One thing that I know in relationships and communication, I certainly have been guilty of this, is that if you say it, it might be true when they say is true. And that's why defining expectations is so important. Now, there are a lot of different ways you can do this. You don't need to overcomplicate it. For most producers and their teams, as you're bringing on a new client, you probably already walk them through a sales process. The point of this podcast is not to go through the sales process, but you probably already acknowledged and defined some things that are important. So when you ask some question of what do you expect from us over the next 12 months, they may say, hey, I expect you to do exactly what it is that you've already said and we've talked about. That's great, but I think it's important to go a little bit further in this and certainly clarify that. So we title this the continuation question because it's part of a continuation process. I think average, even good agencies renew accounts. The best agencies, the ones that we work with, they continue relationships. And that's not just a statement of philosophy. There is a process built around that. And the first step of the process is to ask the client's expectations. It may sound like something like this, hey, what must happen in the next 12 months to ensure that we continue to do business together moving forward? And if you're continuing a relationship, right, or maybe you're having a conversation three months into a policy period with a client and maybe you haven't asked that before, you might ask it then, hey, one of our goals is to be a long term trusted partner with you and your firm. I'm making this up a little bit, but you get the idea. To ensure that we continue to deliver on the level of excellence that we want to. What must happen? What must occur? What do you expect? How do we ensure. And again, you can ask it a number of ways. What must happen over the next 6, 9, 12 months to ensure that we continue to do business together and allow them to answer. That's the first step. And if we don't get this step right, guess what? Everything else is kind of guessing right? We're doing stuff, it might hit, it might miss, we don't know. We hope it works. So the first part, if you're going to keep score, is know what the rules are. I don't know if you ever played a game with little kids, but sometimes they change the rules. I know with my kids, you know, I mean, for example, you could play tag. I mean, even tag, a simple game of tag. Tree is base. Okay, great. And all of a sudden you're chasing a kid around and you're the adult, so you're a little faster and you're chasing them down. And like, this tree is base too, and so is the shed, and so is this bush, right? They just make stuff up. And that can happen with your clients. So we're going to talk more about again, how this all lays out. So the first thing is to define expectations, understanding the rules of the game. How do we even know what we're trying to accomplish if the client hasn't told us? And don't assume. We all know what assume does. It makes a what out of you and me. The second thing after we define expectations is that we need to document those expectations. Why? Because you, your client, your team may not know and they may forget. One thing I've realized in working with business owners is that we are not the center of their universe. Yeah, but we had a great conversation for an hour. Yeah. Now they're back working with their team and they have a problem here and they're working about their own. They're dealing with their own organic growth and profitability and team issues and culture and vendors and clients. You get it. They've got a business to run. Now if you're working with personalized insurance, they've got a family, a life to run. So whatever it is, you are not the center of the universe. We've got to document those expectations. So the first, first thing is send something in writing to them based on the conversation. Here are the things that we agreed upon right now. I'm going to get back to that in a minute. But we also need to document internally to our team. Now, we're a big believer. And if you've listened to this podcast, you've heard me or Roger or someone talk about high performance teams, sales and service. If you're a producer and you're having a conversation about what the defined expectations are, I expect you to do these two or three things per our agreement. You need to document that not just to your client, but also to your team members. Hey, service team members. Just got back with XYZ Manufacturing. Great conversation. We're so excited to bring them on board. Here are the three things that were most important to them. To make sure that we continue with them moving forward and have a long term relationship. Great. We're on the same page. Do we need to schedule that? Is that part of the service calendar? Or maybe there's something on there your service team goes. I don't know how we're going to do that. If there's an issue, when do you want to know? Now is good. So document internally, document to your client. Now, if you're meeting your client on a regular basis, and for larger ones you probably are, we're going to get to one absolute conversation you need to have in a minute. But if you're having a conversation, let's say you wrote a new account, you've defined expectations, you document those expectations, you come back out of three months to do a quick update, whatever it is you. And the first thing you do is you go back and restate the defined expectations. Why? Well, because they probably don't remember. And if they do remember, it's a great reminder that we're on the same page. Has anything changed? Nope, we're good. Great. Right. So it's important that we define, we document and then ultimately, here's the pinnacle, here's how we keep score. We deliver a stewardship, or in our term at Sitkins, a promise report, typically around the six month anniversary of the policy, about halfway through a stewardship or promise report, which simply is what. Here's what you said, here's what we've done. That's the basic of a stewardship report. Now the members, private client members of the Sitkins group, we have a whole sales process outline with the continuation and we have some samples of a stewardship and promise report. All those are great. But here's the main thing I want to share in this podcast. Don't make it too complicated. It is not a transaction report. It is not that every call they made or every email they sent or every certificate, that's table stakes. These are things based on their expectations. Again, things that you've agreed upon that you would do that either we have done or we have fulfilled to this point. Right. It's in process, but we have done the things that we've agreed to do. By the way, for some of your clients, this is again going to be a reminder. Oh yeah, I forgot about that. It also makes you look really, really good. It also holds you accountable to doing the things you said you were going to do. Which by the way, that should be part of the deal. What does it take to fully earn a commission? What does it take to fully earn a renewal commission? Well, you got to do some basic things. So to me, a stewardship or promise report, if we're not doing that, we're missing a, a huge opportunity for retention and referrals, which I'm going to get to. But also, I just don't think we're doing our diligence as a consultant, as an advisor to our clients. So a stewardship or promise port. So one part of it is to look back, here's what you said, here's what we did. The other part is also looking forward. Here's what we see, here's what's happened in the market, here's what we expect, here's what we're going to do. So on one side it's we've done what you've asked and the other side is we're aware of what's coming we got it. We're on top of it. That creates confidence. When you communicate proactively, you create confidence. Now, does that mean that client will never talk to another agent again besides you? No, there's no guarantees. Does it help prevent that? Does it make the renewal, which is now six months away in this case, less of an event than it would be if we didn't have this conversation? Yeah. Now here's the super bonus. If you've listened this podcast, you know how much we love referrals. Why? Well, because they're warm introductions, because they last longer, the relationships last longer, because you close more, because your team appreciates it when you bring in warm introductions of people that know more about you. I mean, I can go positive after positive or positive on this, but the Stewardship or Promise Report is the perfect time to ask for a referral. Admittedly, if you've not done anything since you wrote the account. You wrote the account, hey, great, way to go. Woo. And then we don't talk to him for 8 months, 9 months, 10 months, and then we go, hey, renewal's coming up. You know, we're going to take a look and do some stuff. And by the way, I know we haven't talked in 10 months, but just wondered if maybe, you know, somebody to give me a referral. Well, I wouldn't want to ask that either. That's silly. But when you do the Stewardship or Promise report and you've talked about what you've done and you begin to set the tone for where we're going and market conditions and all these things, and then you say, you know, Joe, as you know, our goal is to be a long term trusted advisor and have relationships and conversations just like this. I've identified 8, 10, 12, whatever it is. I'm making up a number, but a targeted number. I've identified 10 businesses that we're thinking about calling on because I think would be a really good fit in how we do business. Looking at this list, who do you know? How could you best help us connect? Is there anybody on this list that shouldn't be? Maybe there isn't a good fit there. Someone you should let me know? Is there anybody that's not on this list that maybe should be on this list? So we talk and work a lot with our teams on how to do that effectively. That was my spitball approach. But you get the idea. If you don't have a plan or you have a practice, referrals are awkward. If you do have a plan and you practice, referrals are Seamless. It's a conversation from your heart. Now, we stated many times in this podcast, and I'll state again, that your best clients want to help you. They do. But they're also busy with other stuff. If you don't make it easy for them, systematic for them, conversational for them, they're not. They may like you, but they don't know how to best help you. And they don't. They've got enough going on in their life or business. Then just sit around and go, gosh, how do I help Brent today? Even if they like you. So make it systematic and part of the normal conversation. So you talk about how do you keep score? How do you know if you're winning? Well, those three steps I gave you will allow you to do that. Define expectations, document those expectations, deliver on those expectations. We've agreed on how we win. We agreed on the rules of the game, we've put it in writing, and then we've delivered on what we said we're going to do. And let's just face it, if you do all those things, and as I said at the beginning, why this is important, maybe it's not every one of your clients, maybe they don't need that level. It's a separate conversation. But I would say Certainly your top 20%, your top 10%, your top 5%, it should be standard operating procedure. These clients must go through this process. Why we owe it to them, and it gives our best opportunity for retention and growth. Other than that, don't do it. Right. Don't do it. So that's what I want to share today again. Hopefully you got a nugget or two out of this. I'd love to take about, again, about 20 minutes or so on this podcast and keep this one pretty short because it is something that we hear all the time. Now, here's what I want to share, though. See, if you do none of what I just said, you're probably still going to renew 90% plus of your clients. Because people ask all the time, why don't people do this? Well, because it takes a little more work. You've got a little more accountability. Right. There's some things in there that need to happen. Sometimes people get overwhelmed because there's too many clients. But if you get focused on the right clients, which I've already talked about, and you begin to instill this process, you're not only going to increase your effective retention, which, by the way, we look at effective retention, the goal is 99% effective retention. Effective retention means the clients that you can keep, meaning they didn't go out of business or get bought out. That happens. You don't have any control of that or you simply don't want to work with them. Again, you don't want to keep. They're a caustic relationship. So outside of those that you simply have zero control over or those you don't want, the rest of them should be 99% effective retention. And on top of this, if you effectively did this and you can and our clients do this and you go through reverse referral process, which I gave you an example of, that it is very likely you'll at least get one referral from all your top clients. You're going to replicate something in your business. What type of clients do you want to replicate? And because you've targeted your clients, you're getting systematic targeted referrals versus oh yeah, I know this one man contractor. And maybe you don't want to work with them, but here's this number. Give them a call. Not trying to pick on the contractor, but that may not be the client that you want, right? So being really intentional is the key to this and ultimately is you begin to establish and understand together with your client the rules of the game. And you've got a systematic way to keep score, to know that you're on the right track, they're on the right track and long term you're winning together. So that's the cut topic today. I'm so glad I got to share this. If you have any questions, always reach out again. You can reach out to our company@sitkins.com we'd love to talk to agencies looking to take that next level of growth and and as I mentioned earlier on this podcast, if you'd like to download our brand new white paper was talking about the three hidden drains in your agency. Most importantly understanding and establishing the four tiers of your client book of business. It is super impactful. Go to sitkins.com whitepaper sitkins.com whitepaper with that, I wish you all the best and your success. Thanks for listening. The Agent Leader Podcast is brought to you by the fine folks of the Rough Notes company. They are publishers of the insurance industry's leading magazine and technical insurance content Roughness Magazine Profile Successful agencies plus keen insights from respected experts on a host of must know topics. RoughNotes Advantage plus provides the tools to help your agency grow, providing authoritative information on complex coverage issues. Visit them and learn more@roughnotes.com Wait, you're still here? Hey Agent Leader podcast listeners. Brent Kelly Again, I want to first of all, thank you for listening to the Agent Leader Podcast and your continued support. If you would like to have more content come your way, please help us by sharing the podcast, subscribing to the podcast, telling people about the podcast, and if you, as an Agent Leader, are truly ready to take that next next step in your agency, you're committed and want to be that best version possible. Agency, don't wait. Go to sitkins.com bookacall sitkins.com bookacall we want to provide the blueprint for your agency to help you create more impact with less effort. And it all starts by going to sitkins.com bookacall all right, now you can actually go. Thanks.