How Unique is Your Sales Approach? - Trap #2

What is your agency's set offense? Can you clearly articulate the differences of your agency versus everybody else? Are your pipelines overflowing with more opportunities with future ideal clients? In the time that you have and do your best, clients not only stay with you, but actively refer new business your way? If any of those answers are no or I'm not sure, you may be falling in good results trap number two, which I'll be talking about on today's Agent Leader podcast. Welcome to the Agent Leader podcast. This is the podcast for insurance agency leaders to become their best version possible. My name is Brent Kelly. I am your host. It's a pleasure to be with you on this episode. And this episode is part two of a seven part series series around escaping the good results traps in your agency. And as a reminder, these are good results traps. So what does that mean? Well, it means there are certain things in your agency that we see in working with hundreds of agencies that you may be thinking or saying to yourself, we're doing pretty good in this area and you don't even know what's possible. This best version possible, or maybe simply it's a blind spot, there's an area that you haven't thought about or considered. And. And as I discuss these traps one by one, you may go, gosh, that's something we should consider, something we should look at. And of course, this podcast is designed to give you and your agency clarity in certain areas. Now, last episode, the first trap that I talked about was no strategic or financial model. So if you haven't heard that episode, obviously go back to the podcast. Wherever you listen, find that episode and take a listen. It's certainly hugely important and impactful for your agency. Are we being intentional and strategic with our business plan, with our business model? And that's both by strategies and with our financial perspective of the agency. So go back and take a listen to that. Now, before I get into today's trap, trap number two, I do want to mention I said this on the first episode. We have a unique opportunity for agency leaders that listen to this podcast and what we want to do is make things as simple and easy for you as an agency to get those best results version possible results. So we're offering a best version possible assessment for your agency. And there's no cost, no obligation to this. It's super simple. Here's what you do. Step one, you go to sitkins.com bookacall sitkins.coms I t k-I n s.com bookacall and you go on there and schedule a call. We then if it qualifies, we'll do a assessment for your agency and then give you that assessment. We will review this assessment with you, review your report and at that point you can make a decision on what's the best next step for your agency. So we're excited to do this. Again, super simple. Go to sitkins.com bookacall the only thing it's gonna cost you is time. And here's what I will tell you and promise you that by doing this, it'll be the best investment of time that you can possibly imagine. So go to sitkins.com/book a call. Now let's get into trap number two. First session, first week we talked about trap number one. No strategic or financial model. Trap number two is this no unique sales approach. There's no unique sales approach. Now I'm going to, I'm going to get into four specific aspects of this. I'm going to talk about four different areas for you to consider. But I think this is especially important in talking about the good results trap because let's face it, when we think about a unique selling approach or sales approach to your agency, agencies and probably yours right now in terms of your current results are doing pretty good. In fact, 2023 was a record breaking year in organic growth percentage across the board. This was reported by our friends at Reagan Consulting. The number was 10.3% organic growth. Again, this was record organic growth. So 10.3. Now I will say quarter one, the most recent report that came out that dropped down to 8.4%. So if you look historically, 10.3 and 8.4 are tremendous. Right? They're really good outside in the marketplace. However, these organic growth numbers are driven very much by market conditions. They're driven very much by inflation that we're seeing. And there are other certain factors as well. I'm not going to get into all those factors today. But bottom line, from an overall approach, the numbers themselves are still pretty good at 8.4. I mean, very good. Those are still very good numbers. And you think historically the last couple years have been phenomenal. Now what I do want to share with you is this. There's a quote that I shared a few times on this podcast from Warren Buffett and here's what Warren says. He said, when the tide rolls out, we'll know who's been swimming naked. When the tide rolls out, we'll know who's been swimming naked. And I think why this is such a significant trap, a good results trap is it's exactly that. Hey, we're getting pretty good results. We're doing pretty good. You know what, we've got a lot of things going on that, you know, maybe we're not happy with. We know we can improve. We know we should look at, we know we should consider, we know that this area is an area of weakness. This area is something we should improve upon. But we're getting good results. We're getting good results. So what's the big deal? Well, I'll tell you, the big deal is a gap. And you know, I have a guest on this podcast. You'll listen this, hopefully listen that episode at some point with Chance Morgan and he talked about his agency over 12 years has averaged 32.4% organic growth. Now that's pretty amazing. 32.4% organic growth. So. So maybe that number for your agency isn't going to be that high. That's not realistic. But I will say this so often, agencies that get 5, 6, 7, 8% historically, those are good results, but nowhere near best version possible results of 10, 15, 20, 25% organic growth rate in certain areas. And of course, as I mentioned, our friends at Specialty Risk Insurance, which have been averaging 32.4% bottom line is this. Wherever your agency is today, my question to you on this podcast episode and all podcast episodes is what's possible? What's possible? And from a true financial perspective, how much money are you potentially leaving on the table? Because when good results are good results, we often forget about what's possible for agency, not just for you as an agency leader, your leadership team, your agency, but all the opportunities for your people, for your community, for the things that you want to do. So we want to continue to talk about best version possible. So as I mentioned, I want to get into four areas to consider of if this is a trap for you, are there certain things in this trap of no unique selling approach? No unique sales approach. What does that really mean? Well, let's start with the fact that too many agencies, hopefully not yours, are selling more as a commodity than as a trusted advisor or as a resource for our partners, for our clients, right? Too much commodity based selling. Now here's a question I'll ask you and I want you to consider this. What is your selling process or set offense today? What is your selling offense? If I said what is your selling approach today, today, and not just one person, your agency, but overall as an agency, as an organization, what is your set offense or selling approach? Now here's some things to consider. Does your Set, offense or selling approach have a name that you all rally around. Is it truly effective? Meaning it's actually getting results and you're debriefing those to continue to evolve and improve those results. Is it repeatable? Meaning that it's more than one person, but you've got multiple people that can use this approach for your agency, knowing there's always going to be some flexibility, that's the goal. But what often what agencies actually have and do is their approach looks like this. We're going to look at your policies, we're going to copy your policies, we're going to quote on those policies, the information that we get, and then we're going to pray that you don't take this back to your current agent. We're going to pray that we write your business. It's the look, copy, quote, prayer, selling approach. I've referenced this in other podcasts, but bottom line is when we do this, we can get caught up very much in good results. Because guess what? If you do that enough, if you look, copy, quote, pray enough, you will write some business. That's the good news. The bad news is replicating that at a high level, retain your clients at a high level, being different in the marketplace, getting some freedom and capacity around that is very, very difficult. Why? Because you're selling on price, you're selling as a commodity. You're having the same conversations because guess what, competing on price alone is easy up front, but it's very hard long term. It's easy to say we can give you a competitive rate or we're competitive in the marketplace and we can get you a bunch of quotes. That actually is pretty easy. The hard part is not only writing the business, but keeping the business and of course, replicating that type of business long term. By the way, if you've ever had anyone ask you for an Apples to Apples quote, which you probably have, let me say something that I'm very, very passionate about. Apples to Apples quoting is stupid. Apples to Apples quoting is stupid. It's honestly a waste of time and people are used to talking about it and they say it all the time. And the buyer themselves doesn't, maybe not, doesn't know any better. That's what they've heard, what they think that an agent should do. If you don't change that conversation, if you don't have a unique approach, you will get caught up in this trap very, very quickly. Again, part of the overall no selling approach trap, but this little mini trap inside of that is we are commodity based price sellers. We don't want to be there. Alright, Number two, or at least the second area I want to get into in this overall approach of no unique selling approach is that you don't know or can clearly define your point of differentiation. You don't know, you can't clearly define your points of differentiation. And something I've said for a long time to our agency partners we work with, I've said on this podcast before, to some degree or another is this. You can't have a differentiated selling process or selling approach if you don't know how you are different. And that may seem cliche. Oh, you can't have a selling approach, a differentiated selling approach if you don't know how you're different. But it does start with that. Oftentimes people will come to us and they go, well, you know, tell us about your selling process. And we can and we will, but we first need to clearly articulate what makes our agency, our department, or even by individual different, what makes us compelling, what are our true points of differentiation? And I would say this as well, knowing your points of differentiation is important also being to clearly being able to clearly articulate the impact of that differentiation, to be able to provide evidence of that differentiation and to be able to ask powerful, engaging questions that lead your client to consider these points of differentiation is ultimately what's most important. Because oftentimes agencies, producers think they're differentiated by we have really good service, we represent all the carriers or many of them right, we're independent, we're local, or we've been in business for a long time, we can save you money, there's that price thing, or we have the best people. I've talked about this previously, but these are generic. In fact, the generic 5, often agencies think they're being different, unique and compelling, but they're really saying the same thing that everyone else is saying. Now, any of those answers could be true, but you've got to go deeper. We've got to go deeper. We have to think deeper up front, otherwise we will be generic and we won't have a unique selling approach and we will fall into the good results trap. Because guess what, you can talk about these things and still, if you do it enough, get some good results. But it leads back to the same problem I indicated earlier. What else is a component of not having a selling approach? Well, typically it's dripping pipelines, or at least pipelines that aren't overflowing with more ideal opportunities than time. And I think the important thing I want to say here and stress Here is more ideal opportunities than time. That is a true overflowing pipeline. I've seen too often with agencies. In fact, in recent conversations, oh, our pipeline's super, super full. Okay, cool. That's awesome. Tell me about it. Well, well, we've got lots of people that are calling in. We're getting lots of quoting opportunities now again, without going deeper. There could be some substance there. But what I often hear, and maybe this is true with someone with your agency, is the opportunities you get are making you busy, not necessarily getting you results. There are suspects, there are prospects, and then there are future ideal clients. And there is a difference. Suspects are anybody who can breathe. If you breathe, you're a suspect. Oh, we have a huge suspect list. We have lots of opportunities. We don't know how we're different. We don't have anything compelling to tell them. In fact, we don't even know if we want to write these people. But man, do we have a lot of suspects. Or maybe you go, we've got a pretty big prospect list. There's this big database of prospects. We have some names and some numbers and some emails. What's our approach? Why do we want them? How do we differentiate? I don't know. But we do have this prospect database of hope. So it makes us feel pretty good. Those are not overflowing pipelines. Those are suspects and prospect areas. So we want to move into is future ideal clients. We want to move away from the clicks, the rings, the pings, the dings, and move into a proactive approach based around future ideal clients that were proactive, not simply reactive that we know we want, why we want versus we guess along the way. Right now, by the way, there's also a litmus test to this and this is in our book, best version possible. If you want to get a copy of the book, go to sitkins.com bvp or you can go to Amazon and take a look, but you get some freebies if you go to our website. So sitkins.com bvp and in that book, in one of the pages, we talk about this, about pipeline and too often agencies don't really know. Producers go, yeah, I think my pipeline's pretty full and it's very, very subjective. Or they look at a bunch and again back to the prospect, this database and go, oh, if you add all these together, I've got look at all these opportunities. We don't know when. We don't know if we're going to convert or close any of these. We don't know if We've even done anything on them, but gosh, we've got a big pipeline. So here's an indicator, here's a litmus test you can look at and it's mvp, an acronym mvp, not most Valuable player, though. I like that one. It's monetized value of the pipeline. What is our monetized value of the pipeline? So here's a way that you could do this. First and foremost, we need to define future ideal clients. Now, I don't want to make this confusing, but I will say this. If a producer, for example, were to say this potential client, future client is in my pipeline, I would want to know more about it, right? I would want to know what our opportunity is. Obviously some basic information on that client itself, as much as I can know. Why is this a targeted opportunity? What is our plan or process? I think all of those. I mean, nothing's guaranteed, but we need some form of a plan so that to me would qualify this. In fact, with our members, we've got a page, a target account strategy plan that producers complete to give them some idea. It gives them advantage, right, in the marketplace, but it also ensures that it fits into the future ideal client pipeline. So, so we do that. I'm going to give you some numbers here to give you an example of this. So let's say that a producer on your, in your agency would say, based on this list of target account strategies that I want, and I've got a plan around it, I've got $400,000 in my overall pipeline of revenue, of potential. Right, Potential revenue at this point, $400,000. See, most people right there would go up. There's your pipeline. Your pipeline is $400,000 of revenue. But see, that doesn't really tell the story of our pipeline and opportunity because there are two other steps that a lot of agencies don't consider. Step one is, what is this producer's conversion rate? Meaning that when we have a first appointment, an initial appointment with a future ideal client, what based on our history, is our conversion rate that A, we told the story well, B, that this is a future ideal client that we actually going to qualify. It fits that we're not going to talk to everybody. How many of those first appointments become next appointments or second appointments? That's a conversion rate because not every first appointment converts to a second appointment. And so often agencies miss this. You may have a high closing ratio, but you can't figure out why we're not hitting our goal. Well, there's a missing link there potentially in A conversion rate. So based on that, and by the way, if you haven't tracked this in the past, you can give it a subjective guess, but I would challenge you to start tracking your producers. Well, what, how many first appointments become second appointments? So let's just say in this scenario that we're going to use 40%. That's a pretty low number. But let's just, just to throw this at 40% conversion rate. So if you had a $400,000 revenue pipeline, your actual pipeline now you're monetized would now go to 160,000. So 400,000 times point four. Now there it is. 160,000 is our pipeline. That's what it is. Then, no, there's one more step. It's your closing ratio, which most agencies, most producers do have an idea of this or certainly should be tracking this, which is how many presentations become clients. Right. How many do we actually close? Now using the same formula, we're currently at 160,000. Based on this formula, let's say on average we're closing 50% of our opportunities. So 50% of our opportunities are closed. So that 160,000 is now becomes 80,000. So that ultimately is your monetized value of the pipeline. First of all, it's qualified at the top. We had $400,000. We times that by conversion ratio and then we times it by our closing ratio. Ultimately we get a number. In this case, the number, my made up number is $80,000 of revenue. 80,000. Well, what's the goal? What should the number be? Well, here's what we look at at sidkids, that number and this is an ongoing number, right? Things will come in the pipeline. You'll write, some new things will come in, some will go out. Number should be 2x your annual goal. So whatever that producer's annual goal is, it needs to be two times that amount. There's a very good chance that on my scenario here, this producer thinks that they have a full pipeline and honestly isn't able to get to their goal. Because this will lead you to your goal. If I can keep the pipeline full, have enough at bats, understand my conversion ratio, understand my closing ratio, right? Those will lead to me. Am I on track to hit my annual goal? So this is something that so often agencies and producers overlook and they wonder why they don't hit it. Well, this is one of the reasons why. It's also one of the reasons that holds agencies back in this good results trap. Right? It's part of this no unique selling approach. Right? Or sales process. Now let me get me, let me get to one to one more of these because this leads to, this is a bit of an outcome, but also part of this no unique sales approach is so often that we don't have, or at least we don't haven't generated very many referrals. We have a low referral rate. Right. Nothing unique in your selling approach will lead to very good to average customer experience or client experience. If we don't have a unique selling approach going in, oftentimes the experience itself is not unique, very average, maybe it's good. And by the way, let's have some fun with this. Have you ever gone to a restaurant that was average or maybe above average, slightly sort of good, or gone to a movie that was okay? It's pretty good. Have you ever cheered on your favorite team and they were average or kind of good and then bragged other people? So you probably don't go to an average restaurant or an average movie and talk to a bunch of people about it. You won't believe this. Yesterday I went to this restaurant. It was totally average. Actually, it was maybe a little above average, but I want to tell you all about it. Right, of course. It's kind of silly. Oh, let me brag about my amazing team that I follow. And they've had a really average year. I think they were just above 500. Of course not. The same is true in your approach. If your approach for an agency isn't unique or compelling, typically experience isn't unique and compelling. Thus people don't want to talk about you very much, certainly to other future clients. Now let's get back to the basics. This is a great business, right? This is an amazing business. Why? Well, for many reasons. But one of the reasons what makes it great financially is that on average, if you are average, if you're just above average, you're probably renewing 90ish percent of your clients. Even if you're above average, slightly above average, that's pretty good. This is where the good results trap sets in. Because we'll see with these agencies that even though they may be renewing about 90%, oftentimes, the referral percentage certainly with their best clients is 10% or less. So 90% of clients renew 10% if you actually track it, or less actively refer. See, your best clients want to help you, but you've got to have a unique approach, a differentiated approach. Be able to communicate that differentiated approach to allow them to help you at the highest level with nothing unique, your story gets washed out. Right. And it becomes much, much harder to do your business. And by the way, referrals, this is probably goes without saying, but I'd be curious with you. With your agency, we often see that referred, actively referred in business, intentional, active referred business based around a unique approach generates about an 80% plus close ratio. 80% plus close ratio. So let me give an overall concept of this because again, oftentimes when I ask agencies, hey, are you different? Are you unique in the marketplace, do you have a unique approach? Oh, yeah, you know, we do some things pretty well. I would ask you to look at, look and listen to all the things that I talked about and go, hmm, where are we really? In fact, from what I just stated, if you had to rank yourself on a scale from 1 to 10, 1 being it is totally generic, 10 being that it's completely differentiated, how would you rate your agency today? If you're being honest, and please be honest, no one's asking for your answer here, only you. This is for your use. But this is a significant trap that holds agencies back from their best version possible. And I think this is another reason why this is a big trap. I heard years ago, and this has been out there in the marketplace for years. I think first time I heard this on a webinar, I attended it, it was called Differentiate or Die. Differentiate or die. I think with agencies, in fact, I will say I'll be honest, I believe, and I really believe I know with agencies, I work with enough of them that it's not Differentiate or die. If you don't differentiate, you are not going to die. You will survive for a while, some of you more than others, but you will absolutely be caught in the good results trap. Oh, we're doing pretty good. We're hanging in there. I don't think it's differentiate or die. I think it's something more like this. If you don't differentiate, you dissolve. What I mean is it's very slow. You don't even notice it. You don't even feel it necessarily right off the bat. But over a period of time, it dissolves more, dissolves more dissolves more dissolves. And eventually back to my very initial quote from Warren Buffett, when the tide rolls out, we'll know who's been swimming naked. Listen, I hope this podcast, trap number two, provided some value to think about. Your selling approach, Your sales approach, is it differentiated? Is it unique? What are potential blind spots we have? What are some areas we should consider? If you want to go deeper in this, as I mentioned earlier, go to sipkins.com bookacall sitkins.com bookacall super simple again. No obligation but investment of your time. To learn more about your agency we will do a qualification call and then do a complete assessment for your agency and provide you a report for you to review. At that point you can decide what works best for your agency. But bottom line is this. Avoid escape the good results trap. Become that best version possible. Thanks so much for listening. I wish you all the best in your success. Take care. 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. Rough Notes Advantage plus provides the tools to help your agency grow, providing authoritative information on complex coverage issues. Visit them and learn more@roughnotes.com.