Chuck Blondino – Director of Agency Capabilities and Programs at Safeco Insurance… Returns with 2019 Safeco Survey Data Insights


Chuck Blondino on the Connected Insurance Podcast presented by Agency Revolution

What the most successful agents are doing today according to the latest Safeco and Liberty Mutual agency survey

Want to know what’s working today? And you want proof?

You’ll get both in this fast-paced, data-loaded conversation with Chuck Blondino, Director of Agency Capabilities and Programs at Safeco Insurance. Chuck returns to the podcast to share the most important data from the latest Safeco and Liberty Mutual agency survey. Listen to this discussion to discover what the most successful personal and commercial lines agencies are doing to get ahead:

  • The eight marketing behaviors most reported by the fastest growing agencies in the US.
  • Precisely what personal lines agents are doing to grow 13-20% and commercial lines agents by 19-30%.
  • The central theme of “connected marketing” that drives the most successful marketing for top performers.

It’s rare that we get solid data on the levers of performance. Chuck delivers it here – and every agent & broker in North America should listen. You’ll get clarity and confidence like never before!

What are other agents & brokers doing to thrive? What are the biggest trends affecting the retail insurance agent & broker? What are the most important strategies and tactics you need to grow faster? Find out here in the Connected Insurance Podcast, where our hosts discuss the biggest issues affecting the independent insurance agent & broker with the industry’s leading figures.

Transcript

Michael Jans: Thank you so much for joining us. How are you today?

Chuck Blondino: Absolutely terrific.

Michael: As I expected. Full disclosure to our listeners, you and I have spoken about the topic that we’re going to be talking about already. I’m adding up about an hour and a half. I’m mentioning that because I’m absolutely enthralled with what you’re doing and the information that you’re presenting. While I’ve been exposed to it, I think I’m still gushing like a school girl on this. The fact that I know a fair amount about this doesn’t make me a bit blase or bored about this information at all. I think this is absolutely important. I’m excited about presenting this.

Chuck: That is great, Michael. I would simply share with you that I don’t think there’s anything more exciting as an agent than hearing what the heck is it that everybody else is doing to grow? We’re sitting at a time when the marketplace is flat. I’m excited too.

Michael: Let’s start big picture. First of all, you and I have spoken about this survey three times because I think you’ve conducted it three times since I’ve been delivering the podcast. Something like that or at least maybe reported on an early version once. This is not your first time, not the first rodeo on the survey. Listeners should know, why do I get so excited about this? Because it’s real life data. Its data about what’s working in the marketplace today, and we don’t get a lot of data. I try to seek it out like a heat seeking missile and this time, thank you Safeco for delivering it. Let’s start big picture. Tell us about this high growth agent survey, and what are the mechanics of the survey itself, and then we’ll dive into the data.

Chuck: Essentially, Michael, in the role that I’m in, this team that I lead is called agency capabilities and programs. We teach programs that work, that help agents grow. We try and study what the fastest growing agents are doing. Then we build programs off of that to make it easy, so people don’t have to recreate the wheel. I really think that it starts from a position of one thing. That is, I absolutely believe every independent agent can grow and should be growing because I simply believe they’re a better way of purchasing insurance or a client that has multiple needs and needs someone’s advice.

I totally believe in the independent agent channel. Now, I go to, “Okay, how do we all grow together?” With this survey, we’ve been conducting it, we were doing it every other year. Now, we’re doing it every year. The difference this year is that we’re including both business lines and personal lines. It’s no longer just a Safeco surveys and Safeco’s only selling personal lines. It is a Safeco personalize as well as Liberty Mutual business lines survey of our high growth agents.

Michael: As I recall, you are discovering some similarities about behaviors that lead to success on both sides, personal and commercial, yes?

Chuck: Oh yeah, It’s amazing to see. Yep.

Michael: It’s the modern age of insurance. I think one of the conclusions if agencies act like it’s a modern age and behave like that, then they’ll be connecting with the customer the way that pleases the customer. You said something the last time we talked that still resonates in my mind when you said the independent agency channel should be winning.

Chuck: Absolutely.

Michael: I think that maybe a direct Chuck Blondino quote that made a Blondino-ism. I think if I can interpret that, you’re not just saying that because you’re an agent advocate. You’re saying that because you know that if agents follow certain behaviors, they will win and there’s proof.

Chuck: Yes. That comes from serving these high growth agents. What you realize, is that everything they’re doing is both teachable and repeatable. There’s no secret. There are a few agents that are out there that are doing things that are unique. I will tell you up front Michael, I am not here ever during our surveys to give away secret people’s secret sauce. What I’m looking for are the behaviors that a majority of these high growth agents are doing and share those things. Then once you get the basics down and you got the revenue coming in and the retention goes up three to six points, now you got all the money that you want to go test and trial the new things to go be unique.

The challenge is, most of them are out there selling and servicing and telling everyone, “I love that class. That information I learned and all these different conferences was terrific.” Then they go back and they don’t do it because they’re too busy, and they don’t know how to get out of the loop. [crosstalk] how to get out of the loop.

Michael: Let’s talk about just the basic fundamentals. As I recall, you identified 700 fast growth agencies on the personalized side and 700 fast growth agencies on the commercial. Am I right?

Chuck: Yes, correct.

Michael: How are you defining fast growth? What got them in the cat, not the behaviors, the results?

Chuck: Michael, I’m so glad you started with this because sometimes agents say, “Those are just agencies that were doing book transfers or [crosstalk] they purchased a location–

Michael: You and I are pure organic growth guys.

Chuck: It’s all about organic growth because for us both to grow together, if an agent buys a book of business, that’s great. The agency grows, but I don’t. Whereas, if we do a book transfer with an agency, “Hey, I just grew, but the agent didn’t.” There are good reasons to do both of those things. I’m not saying don’t do that. I’m simply saying, “I want to know about organic growth and how do I find what’s teachable, repeatable there?” I do start by saying policies in force growth is what matters. On the personal line side, I do measure a combination of both written premium and policies enforced growth on the business line side.

If you buy a book of business, let’s just say it’s just as large as the book you currently have, your base that we measure your organic growth by just doubled.

It makes it harder to grow organically.

Michael: [laughs] Got it. All right.

Chuck: You can still be in it, if you bought a book of business, but your base of which you have to grow to qualify to get in is tougher

Michael: Organic growth. The track record of reliable growth consistently for some years has a magical influence on valuation. I’m going to leave it at that, but that’s a little soapbox I’ll get on some other time, but there are multiple reasons for agencies to be interested in organic growth. Obviously, increased income as one. Also ultimately, when an acquirer can see agency A, same size as agency B, but it has a track record of growth, obviously it’s a better investment they’ll pay a premium for. Enough on that one. Now, let’s start to drill down. If you don’t mind, let’s drill down into what are the big findings or conclusions that you drew from your analysis of fast growth agencies?

Chuck: Yes, so for years we also did a study of- just grouped everyone together. In addition to doing both personal and business lines, we also split these into large or a million dollar plus in personal lines, in business lines large as 1.25 million or more with liberty. Then the medium range, we also surveyed riches in personal lines 250, up to a million and in business lines 500,000 up to 1.25. What I’m to try to avoid, Michael, is the small ones because they’re numbers fluctuate so dramatically on growth, so we just try and even it out a little bit, be a little more conservative with the growth numbers.

Michael: As I recall, I think I know these numbers by heart because this is stuff that sticks with me. Correct me if I’m wrong, you had the fast growth agencies on the personal line side grew 13% to 20%. Am I right?

Chuck: It is true, but let me pull you back one step from that and that is to show what’s happening today in the marketplace. The marketplace is growing 0.2% on the personal line side. This is an AM Best number for the entire market. This is not a Safeco number. Essentially they’re flat.

Michael: It grew how much? 0.2?

Chuck: About 0.2. In business lines, the marketplace, that grew 0.03 even smaller. Again, really flat. In fact from our view of AB Best on both personal and business lines. The percentage has not moved more than one half of one point up or down for a decade. Now, you know. As an industry it’s not growing.

Michael: Let me ask you a question about that. Is that industry wide or is that an independent agency channel wide?

Chuck: That’s independent agent channel wide.

Michael: Flat, 10 years.

Chuck: That might mean that the actual– Certainly, as premiums go up, the available premium is larger. That’s true, but the percentage that the independent agencies hold is remaining steady. It’s not shrinking, that’s the good news.

Michael: I think some people would say, “Oh gosh,” with the growth of, let’s say, Progressive and GEICO, they got to be taking it from us, but I think your premise is that our industry right now, our channel in the industry is flat.

Chuck: Yes.

Michael: Yet, we have agencies that are not flat. Clearly, they’re doing something different, so that’s a lot of what you uncovered from this survey.

Chuck: Yes, so as you just stated those that are over a million, among those larger agents in the 700 that we surveyed, 13% is the growth rate for the large and 20% is the growth rate for the medium range, and on business line side, it’s 19% and 30% for the large and 30% for the medium size group. Both of those sets of numbers are stunning when you look at a marketplace that is flat. Somebody’s doing something right out there. What are they doing that I can teach other people? That’s what we’re starting to find out.

Michael: That’s what we’re going to dive into. I do want to call attention to a one point here. Let’s say $1 million, you’re talking about $1 million of business with Safeco, we’re not analyzing their entire book.

Chuck: Definitely. I’m not analyzing their entire book to qualify to be surveyed. We are analyzing their responses to their entire book once we get to asking them the questions about how they’re growing.

Michael: Indeed.

Chuck: About $1 million agency with Safeco or a $1.5 million agency with Liberty could be $10 million agencies or $20 million agencies. Yes, we just start there at the large.

Michael: What did you find out?

Chuck: [chuckles] The first thing I want to tell you is, let’s start with hiring producers. 49% of the personal lines agencies hired a producer, and 38% of the business lines high growth agencies hired a producer. Among the agencies that hired to replace in personal lines, only 13% of those were replacement producers, and in business lines only 7%. What’s really happening here is these agencies have a totally different mindset from the rest of the group that says, “Oh my gosh, nothing’s moving. The marketplace is flat. There’s not a lot of new opportunity.” These guys are thinking there is abundance everywhere, there are totally new opportunities, there are opportunities other people aren’t taking because they’re too busy. “Let’s hire someone now and get them out into the salesforce.”

Michael: That’s huge. I love to hear that. Personal lines as well as commercial lines.

Chuck: That’s correct. Even more on the personal line in fact-

Michael: Even more so.

Chuck: – which is fascinating.

Michael: Moving on, what else did you discover?

Chuck: Second key before I get into more detail about what are some of the specifics. This one, I know, Michael, is near and dear to your heart, but when we asked them, “How many of you have someone on staff doing the marketing?” 62% of the personal lines agencies said yes. 48% of the business lines agencies said yes. Then we say, “Okay, among those who have someone on staff, what percent of them are internal where your marketing is all being handled internally?” 81% of the personal lines people that said, “Yes, we have someone on staff,” 81% of them said, “It’s all being handled internally.” 72% said, “It’s all on a internal on the business line side.”

When I asked them, “Do you have just an external vendor? How many of you have just an external vendor and no one on staff?” Just 6% of the personal lines folks and zero of the business line side. What they’re learning is, “Look, I can hire someone to help.” There are some that do that, but I’m still going to have somebody on staff that can tell my story that can be out with us when we’re doing our community service events. Take photos when we have a parade. That can take photos when we’re doing our bike walk or our food drive or a blanket drive, and get that kind of stuff in our communications out to our clients. It is so much more effective based on what we see here from these high growth agents.

Michael: In fact you are right that it is near and dear to my heart. I knew you were going to bring this one out. Chuck, I think you and I met in 2004, something like that.

Chuck: Yes.

Michael: It was at an event where there were probably some several hundred insurance agents at one of our old boot camps and indeed, I was teaching marketing and I realized, “Gosh, in this industry who does it?” My most aggressive clients who had that available time, the agency principal would frequently do it, but I think what we’ve seen is, this is my perspective, a maturing of the industry and we’ve seen it in other industries as well, other small businesses in industries as well, where the traditional structure in our case of the independent insurance agency is now morphing.

Instead of having agencies that are just, let’s say, the principal and then there’s the CSRs over here, the producers over here, and the admin and with HR or accounting over here. Now, there is a new position and that position is marketer and it does seem to be getting attraction in the industry. Yes, I’m thrilled. I’m thrilled to know, and I’m thrilled to know it’s not just my clients that are involved in the activity. About that market, I know you have a really interesting insight because for a lot of people there is- like the immediate objection. “Oh my gosh, I’ve got to hire somebody,” and it’s benefits and salary, another person sitting around and so on and so forth. A lot of agents have found at least a provisional solution to that. Would you share what agents are doing in that regard?

Chuck: I hope I go in the direction that you’re thinking. From my perspective, these guys are not hiring full-time marketers. They are hiring someone to help. Generally, it is a somebody that can help them part-time. When we have a 7-person or a 21-person or a 50-person agency, I don’t know anyone that has an extra eight hours a week to go do the marketing, which is the challenge. What these guys have done is they’re hiring people part-time to get started. As revenue grows, as referral programs get billed, as welcome programs and newsletters and connecting with certain programs with agencies with different carriers, when that all starts to gel, the hours increase.

Chuck: Do you see that some are looking around the shop and saying, “I wonder who does have eight hours a week and the proclivity to do that? They’re morphing a CSR position, for example.

Chuck: Sometimes. I would say that happens more often with agencies that are moving towards service centers, so that they can offer their clients 24-hour service. The other thing that happens is the service is coming off of somebody’s desk when it moves into a service center, and they’re taking some of those hours and are moving some of those people towards marketing. You don’t have to have a marketing degree. You have to be able to write a paragraph. You should have a sense of being able to tell a story. Those are about the only requirements for somebody coming in and doing these things that are driving revenue and retention in some of these agencies.

Michael: Chuck, as a 25, 30-year professional marketer, a seasoned marketer, I do think a lot of the functions that we’re talking about that we’re going to be exploring here, they are what I would consider to be pair professional skills in early introductory beginning skills in marketing as a profession. Executing on them is not insurmountable. Let’s talk about what some of the behaviors are of these agencies that you think contributes to their growth.

Chuck: Let me start on the personal line side. We ask clients around 25 questions, and most of them are simply yes or no. It’s things like, “Do you use client referrals. mortgage referrals, real estate, cross-sell, digital advertising? Do you get referrals from captive agents? Are you cross-selling your commercial lines book? Do you do any print or TV or radio, postcards, and mailers? Do you go after unsold prospects recruiting them or do you recruit lost clients?” All that thing.

Michael: Let me just pause for a second. I’ll circle back on that. In the survey, is there an emphasis on new customer generation and lead generation, or is there also some emphasis on cross-selling, account rounding and client retention? Those things that lead to loyalty.

Chuck: Yes. We do it in two parts. One of them is how are you growing? How are you specifically targeting new business? Then secondly, we ask, “Okay, we know that there are things that you do to drive new business, but what are the supporting activities behind the new business?” I’ll just share with you, here are some of the things that we ask them. “Are you doing Facebook? Do you use staff bios with photos on your website?” Which at one point, it was less than 50%? I’m happy to say I think it’s now like over 65.

Michael: As the former CEO of Agency Revolution, I can speak to that. On our website platform, the staff bio page was after the homepage, the second most visited page ever anywhere. Why is that? I think we’ll see this come up as a theme in this conversation because the marketplace wants to connect with real people. Seems to be a sound argument.

Chuck: That is exactly it.

Michael: You asked a lot of questions. What patterns of behavior did you see?

Chuck: Let’s start on the new business side just because that’s what’s in front of me here. What I would really tell you, as far as a pattern is, generally among most of the questions that we asked except for the area of branding and advertising, radio, TV, yellow pages, print ads, postcards, and mailers. Almost everything that I just mentioned was not only below 50%, but some of them entering low single digits. With almost everything else that we asked, it’s above 50%, some reaching as high as 98% on client referrals. Let me finish this one thought…

Michael: There’s still a good yellow pages book out there somewhere? [laughs] I’m going to raise an interesting question for you for which you probably may not have the answer. It’s rhetorical. I have some clients who are running postcard campaigns and getting remarkable results. They also happen to be really good digital marketers. I think they just get marketing. I’m wondering, they’re the ones who aren’t using postcards or direct mails, that if there’s just a sense– First of all, it’s a hard skill. Secondly, I wonder if there’s a sense that it’s just not working anymore? I’m sure the answer to that one could certainly be up for debate. Of the things that were above 50%, what were the things that you found?

Chuck: Just to finish your thought on postcard and mailers, my point on those is there’s a lot of people that say they’re doing a lot of things. Frankly, I don’t care. I only really want to know what I can teach, and what’s going to make the biggest impact. What are the things that are driving the most growth? I don’t want to know how many of these tactics you use. That doesn’t teach anyone anything. If they’re looking at, “How do I get growth in my agency?” Boil it down for me. What we then ask is, “Out of all these methods, which of these are top three?” Suddenly, the world becomes crystal clear.

Four things outpace everything else on the list. Four things alone. Number one, client referrals. The interesting thing about– I’ll come back to that. Number two is mortgage companies. Number three is real estate agent referrals. Number four is cross-selling my own personal lines accounts. Just cross-sell your own business. [chuckles] As I come back to the referrals, what’s fascinating to me is 85% of these agencies, these high growth agencies that are doing it differently than everyone else, 85% of them say client referrals are number one. Only 28% of them, Michael, actually have a formalized client referral program.

Michael: That’s remarkable. There’s a 67% or 57% of those who probably could see a significant uptick if they ritualize and formalize that program a little bit.

Chuck: Yes. That was fascinating in. Really, as we talked about, what is a formal referral program? I know I’m talking to the master right now about this, but a formal client referral program as we look at this across the country even in some of the states where they say, The state’s really tough to work with.” I can’t give you legal advice. You need to figure that part out for yourself as an agent. However, almost all of these agents are now using referrals with the gifts going to a chosen charity in their local community. That avoids many of the, “I can’t give my client X amount of dollars or I’m breaking the rules.” It just stays completely away from that.

We see that as agents are communicating what they’re doing in the community, the referrals are going up. It has a double boost because you’re sharing the character and the caliber of the people that are in your office and what you believe in as you’re helping some of those charities out there. That’s really fascinating. Then with mortgage company referrals, I’m going to give you this one story. In my own hometown of Seattle where I’m talking to you from today. One agent, even after I’ve been sharing stuff like this for a decade, one agent went out and said, “I’m going to hire a producer to send them out to go see mortgage companies.” They went out and sold 60. Half of that has never been seen by any–

Michael: That is remarkable. It’s not that that strategy nobody ever heard of it before. Good for him.

Chuck: It’s about taking action on the stuff. 85% is the number for client referrals, the number two method that mortgage company is at 43%. That’s a top three method of growth.

Michael: That’s outstanding.

Chuck: Yes, and even with that number, people aren’t still going out and saying hello to their local mortgage company.

Michael: Just case in point, for those who are listening thinking, “Oh gosh, that market’s already taken,” it’s not. I have a client who grew 39% last year. He’s had consistent 30% growth for six years, and that is the strategy. It’s a very big agency at $80, $90 million. He didn’t hire somebody to do that. I think he’s getting close to a hundred people that are doing it. There’s a lot of business out there if we know how to take care of it. Client referrals, mortgage referrals, at the closing obviously we got a lot. Real estate as well is a top four.

Chuck: Yes. Then cross-sell rounds it out. Micheal, I would even look at sharing with all the agents who are listening today. There’s a lot of things you can be very busy doing. Certainly, advertising is one of those, but it’s internet ads and referrals, life and health and benefits agents. All those things work for a few. I would just say just because there are some low numbers on here doesn’t mean those things don’t work for any method, any agent who uses they get a positive first year return. I’d say just keep doing it even if it’s yellow pages because normally you’re keeping quiet all the years and hopefully more.

Micheal: Hopefully more.

Chuck: Yes, let’s talk about some of the strategies that help retention and what are the supporting activities in personal like.

Micheal: Can I jump in on a point because I think it’s a segue of what you’re getting into. You know the story, agency A versus agency B. Agency A, they have similar characteristics, qualities, let’s say both represent Safeco, both in medium size towns in the mid west. One does a cross-sell campaign, it gets a really good response, whatever, “7.3% of my customers respond. Another one does the exact same thing and 2% respond or less, and they perhaps did the exact same thing. Now, an agent might say or the first one might say, “My cross-selling campaign is working really well.” %he other guy says, “It’s not working that well.” What’s the difference between the two?

There’s a difference in the nature of the relationship between the agency and its customer base. Agency A must have done something to nurture those relationships to earn the loyalty where they’re actually willing to respond to something. It’s harder for an agent to say, “My nurturing behaviors generated X% of growth,” but it double charges all of those marketing efforts that were executing every time we reach out to the market place. I have a feeling that the agency who do really well with the retention behaviors or the cross-selling behaviors with existing customers, they get the best response to stuff.

Chuck: Totally. You see it in some of these numbers. When you see that an average around 60%, the agencies are now using staff buyers. The staff buyers are no longer just saying, “Been in the industry since 2001. This CSR handles the the book of A through L in our business. She was recently awarded with or just got whatever designation,” and then stop. These guys are talking about how’s they’re grandson, has grandchildren recently took a trip to, that favorite book is the [crosstalk], it’s all about connecting.

Micheal: Yes, there’re some things that you’ve said that I think standout that- they’re just really important. That the community marketing, community activity, and sharing your contributions to the community, and the humanity, and the transparency of the real people that work in the agency. Why do you think those things matter so much to people?

Chuck: I think especially today in the age of social media, people want to connect, people want to do business with people that they like, they want to do business with people they have a relationship with, if they trust or even get to the point of really appreciate the character if they admire someone, their number of referrals goes up. They are actively seeking people to refer to you. I have an agency that said, “Chuck, I’m doing a newsletter. We’re posting weekly on social media.” I said, “That’s great, you checked the box. Now, let me see what you’re doing.” As I went in and looked at the weekly posts for the entire year, not a single photo of anyone in their office nor a story of anyone doing anything outside of work. It’s all safety news, insurance tips and there’s no connection–

Micheal: And happy Halloween. [chuckles]

Chuck: Maybe not even happy Halloween. Yes, I see where you’re going. Happy National Day or something like that.

Micheal: I got on Instagram around Halloween. Of course, a lot of agents were following me and I was following them. I got on my smartphone and I was like, “Let’s see what’s going on on Instagram” This agency, “Happy Halloween,” and the next one. At some point I’m thinking, “Okay, now we need to say happy Halloween. Can’t we have better content than that?” Part of what you’re saying is that it’s really low-hanging fruit. It’s not hard to do the stuff you’re talking about. Sharing who we are and what we do.

Chuck: I think that it is hard. Michael, if I want to be blunt, I had somebody once tell me, “The door is right there, just grab the doorknob. It’s such an easy task, just go do it.” For a lot of agents, it’s hard to even see where the door is when you have so much work that you’re coming home late. Even as one agent shared with me, “I came home a half hour later and waited for my kids to go to bed because I didn’t want them complaining to me about how late I’m coming home. That’s what’s really happening, Micheal, in our agencies lives, and we want to get them to the point where they’ve got enough help to get things done, and they’re growing, and they’re having the life style that they got into business for. That’s what we want to help them with.

Micheal: Obviously, there are time managing solutions that we need or can be introduced that we’re not going do in this particular conversation, but they’re critical. I remember a very short story at a boot camp, 10, 15 years ago, an agent coming to me after one of these two, three day event. He said, “I’ve got 11 pages of notes. I can’t wait to go back to the office.” Then I saw him three or six months later and I said, “Hey, Fred, tell me about last time I saw you, you had 11 pages of notes and all the stuff you wanted to do.” He said, “I feel so bad. I’ve been just too busy to get anything done.” At that point, I realized, “There’s a different problem we need to solve.”

Chuck: Yes. The challenge that you look at then is how do they communicate. Because, Micheal, over the last decade, the things become so apparent to me as there’s lots of great ideas but people can’t implement them. Get the marketer hired, someone-part time, you’re not paying benefits. It’s $15 to $25 an hour, you pay him for eight hours, and you start to increase the wage. At some point, they might become full-time plan. Remember 60% of these people have someone on staff helping them with the marketing. Because you can’t do these other supporting activities like gathering client testimonials, working on search engine optimization, putting a couple of posts out on Facebook, having a newsletter or an email newsletter or blogging. That’s the stuff that connects if it’s done in a personal manner, not in an overly professional insurance based manner.

Micheal: Right on. We have the top four from the personal lines agents. On that side, was there anything else that stood out on the personal line side?

Chuck: I would tell you that when you look on the supporting activities, some of the other things that were stunning to me. The number of agents that are now sending out welcome kits or have some welcoming process–

Micheal: Welcome kit is a term I don’t know if it existed more than 20 years ago. I’m thrilled to see that the industries’ adopted.

Michael: Now, maybe I should ask you to define your definition of welcome kit, and then I have a follow up question for you.

Chuck: It’s not a letter from the principal that says, “Welcome to our agency,” and basically all about how much you service your clients. It’s a multi-step mailer. It’s not only intended for a cross-sell piece for you, followed by an Ann Landers letter, so that you can then sell life. It’s about sharing who you are and getting them to trust and believe in you and admire what you do in the community. There are agents that are doing this now only by text. There are agents that are doing it by hard copy mail. There are some that do it by email, although it’s not many because you want it to be something that people hang on to. That’s our definition of what a welcome kit–

Michael: There are probably agents that are doing a little bit of a hybrid because-

Chuck: For sure, yes.

Michael: If they’ve got the technology, then–

Chuck: There’s all sorts of different methods.

Michael: Email marketing can get triggered automatically, and meanwhile things can actually show up on their kitchen table with little gimmies and tchotchkes.

Chuck: Always includes the referral program. Always includes a story of what they’re doing in the community, and always includes the history of the agency and why they are in business. Again, not about how great their service is, which is what every agency tells every client, but more defined around, really, what is our history of the business.

Michael: Should we jump to the business lines side of the biz?

Chuck: Yes, sure.

Michael: What are you finding out over there?

Chuck: The activities– Let me phrase it this way. When I put it to which of these things are the top three methods of growth, the quantity of items that were 11% or more, so double digits, was higher than the four that we saw that really worked in personal lines. The more interesting thing that I found is seven of the top nine were different kinds of referrals. I’ll quickly list them for you. Client referrals, 88%, as you’d expect. Referrals from industry or business associations at 20%. Referrals from mortgage companies, 19%. Referrals from real estate agents, again, 15%. Again, this is business lines focused now. Referrals from business networks at 15%. Referrals from captive agents for business at 14%. Referrals for life, health, and benefits agents, from those guys, 11%.

Seven of the top nine were all about referrals. What’s interesting about that? What do I teach about that? What’s interesting about that is they’re not going out and spending a ton of money on advertising and leads. They’re using their personalities. This is where independent agents win. Your one-on-one connection, your handshake, your eye-to-eye connection, and sharing who you are with someone, in business lines, is even more important than it is in personal lines. That’s where these guys are winning and growing significantly compared to the rest of the market. They’re getting out of the office, Michael.

Michael: [laughs] All right. Anything else on the commercial line side that was something people need to pay attention to?

Chuck: When you look at digital advertising, digital advertising also hit 11% in business lines, but what is digital advertising? That covers such a broad swath of answers. It could be boosting a Facebook ad. It could be paying for paid search for different key words. It could simply be doing different activities to boost your own search engine optimization, so your name comes up higher in the rankings. That’s at 11%, but compare that to printing, print ads at 5%. Post cards and mailers 4%. Internet leads, it’s 4%. Radio at 3%. TV, yellow pages at 1%. All that kind of stuff is just– That’s not where these guys are winning.

Michael: Yellow pages, back in the day I’m sure it was pretty close to a 100%, so it’s just mind boggling to see how much the world has changed. Chuck, when you look at the last– Now, you have three of these surveys. Are there trends that you think stand out?

Chuck: Several things. One, the quantity of agents that are understanding that the staff bio is the number two page on a website. They’re not going to see your quotes, guys. They’re not looking for your quote button. They’re going to your contact pages and your staff bio pages to learn about who you are, and are you the kind of person I can connect with because if you’re not, and you don’t have that stuff online, they’re just going to the next website.

Michael: The notion that this is a relationship business is still 100% true. The manner in which relationships can be attracted, cultivated, and enhanced has changed.

Chuck: Yes. Another one, Michael, is I talk a little bit of digital. The quantity of agencies who are updating their websites quarterly or more often, and even that I think is not enough. They ought to be doing it at least monthly because it helps the search engine optimization. That’s gone from 15% to about 40%, just to say how many of you are updating your website quarterly. That’s a stunning change over the last three surveys. Another one on promoting community involvement. As far back as 10 years ago, that was around 20%. I don’t want to brag about myself. I don’t want to pat myself on the back. The last couple years, it broke 50%, and now it’s sitting at about 63%, 64% of these high-growth agencies that are promoting it. Again, that’s not what the industry is doing. That’s what the high-growth agents are doing.

Michael: That’s what the high-growth agents are doing. There’s just so much rich data in this that I think this phone call should be– If I were an agency principal, I’d probably call a staff meeting and just push the play button, and then afterwards, “Let’s talk about it.” Not to listen to me, to listen to Chuck.

Chuck: Social media is now broaching the– 75% of these agencies are using social media. The challenge with it is they’re still not doing it really well. If somebody tells you you got to have five posts a week or even one post a week, but what you’re posting about is anything other than your staff doing something fun or being engaged in the community, it’s a miss. You talk about agents who get a better response on a cross-sell program, it’s because they’re showing that they’re worthy of a referral. It’s that simple. If all you’re doing is selling every time you communicate or saying, “I’m not selling. I’m just talking about insurance because I want them to know what we do.” They know what you do, but they still don’t know who you are.

Michael: You mean the agents who jumped on LinkedIn and says, “Save money with me,” is not engaging the marketplace?

Chuck: [laughs] Yes.

Michael: Those of you who are listening, if you know who I’m talking about, then I’ll leave it at that. Chuck, next survey, are you going to do this again next year?

Chuck: Yes, we’ll do it again next year, and we’re going to be including, just an ongoing basis, both business and personal lines. Michael, I will try and put a little bit of a bow on it with this statement. I recently got a look into 10 amazing agencies across our country that are doing such different things to succeed. Some of them are doing some of these things we’ve talked about. They have mastered this, what I almost call a basic level of marketing. They’re communicating regularly. They’re using social media. They’re updating their website. Great. Their retention is going up. Their new business is going up. Now, go play. Now, go have fun. Now, go do the things you want to do.

They are testing the limits of what technology can do. They are pushing, being able to quote, and handle renewals and book business online just within the agency, so that their people have more time to go out and find new business opportunities. Some of them, using chatbots, reducing service work. They are testing different industries that have never been done before. They’re finding ways to write cyber, they’re finding ways to specialize in just different things that are– Yes, we have automated car vehicles that don’t even have a steering wheel that are coming in our future. Who’s going to handle the liability on that stuff? Yes there are challenges coming to our industry but these guys are thinking of new ways to go about growing in the industry, and it’s one of the reasons I’m so excited about the future of the independent agent.

Michael: I love to hear that. I’m going to wind it up and ask you one last question. Based on all of this that you know, if you were going to deliver a little bit of a pithy, short but hopefully kind of a poignant message to the independent insurance agency principle of today, what do you want them to hear from you?

Chuck: Michael, I used to say you can grow. What I would say right now is hire a marketer.

Michael: Okay, got it. [laughs] All right.

Chuck: We can help them with teaching, we can help to train them, you can help train them. There’s multiple companies that know the things that work like we do and can share with these agents how to make it work without recreating the wheel.

Michael: Outstanding. Chuck, hopefully, you’ll agree to another date with me in a year after next year’s survey is done. I have a feeling you and I’ll be talking to each other a number of times between now and then. Meanwhile, Chuck, first of all, thank you to you and to Safeco for supporting and promoting these efforts. I think they’re outstanding work. Thanks for the contribution that you’re making to the industry, and thanks for spending this time with us today.

Chuck: Michael, that’s awesome, I appreciate that and appreciate your good work as well. It’s always fun to get together with you.

Michael: Right on. We’ll be in touch. Thanks so much.

Chuck: Thanks.


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