Posts

Websites

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As consumers continue to move online for virtually all their shopping needs, it has been stated countless times how critical it is for an insurance agency to have a website.  By now, there are few agents who can possibly survive without one.  Chances are, you have a website up and running – but have you rebuilt it in the last 24 months or so?

If you have not, you may want to take a look at your competitors, so as to understand whether or not your website is keeping up with them.  Better yet, take a look at those you frequent and ask yourself if your website is as engaging and easy to use.

Are you using video at all?  Estimates show consumers spend 88% more time on sites with video.  What is more, video increases organic search engine traffic over 150% and 300% more monthly website visitors.  Video doesn’t have to be difficult to produce.  In fact, at OAA, we have even used our iPhones to create compelling and engaging videos.  Start with something, watch your analytics to see what improvements you get, and go from there.

Get rid of as much text as you can.  We are all so busy and distracted; truthfully, we don’t want to read a lot on websites.  It is wise to go through your website and get ruthless with words.  Consider replacing words with image.

Optimize for mobile.  About 25% of Americans only access the web on mobile devices.  If one out of four of your prospects and customers have to scroll around your pages trying to read itty- bitty type, they’re not coming back!

I remember ten years ago, when we thought websites were just brochures in cyberspace we could print once and forget.  Then a few years ago, new and fresh content regularly became important. We learned that in order to be effective, regular attention must be paid to them.  Also a few years ago, we realized that we needed to create websites from scratch every two or three years.  In the same period, we learned that we needed to link them to all the online social media outlets.  Now, they need video, less writing, and mobile optimization.

I don’t know what’s next, but I do know it will come fast and that keeping up is even more important to attract and retain today’s increasingly demanding consumers.

May I Recommend Chris Burand to You?

captureChris Burand is an active consultant in the independent insurance industry specializing in financial analysis, sales, and marketing.  Chris writes a well-respected column in the “Insurance Journal,” and I find his writing to be entertaining, informative and thought provoking.  I frequently find myself quoting him to agents, or groups of agents, with whom I speak and work.

In a recent column, Chris has written one of the best defenses as well as criticisms of independent insurance agents!  Without attempting to summarize his writing here, I would just like to suggest that you read it.  If you’re not a subscriber, simply go to www.insurancejournal.com and select the April 3, 2017 issue.

Scared Spouse

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A number of my friends are entrepreneurs or business owners.  As a result, we frequently discuss issues that arise in our various businesses whenever we get together for breakfast or lunch.

One of the problems that comes up fairly often is spousal interference in the business.  In fact, I’ve been surprised how often this arises as I talk to my friends.  The common thread is either a spouse that doesn’t work at all, or is not active in the business, but who exercises some form of veto power in the business.

This is a frustrating issue because my friends hear some version of “no” when they discuss things they’d like to do in the business with their spouse.

Most people are not cut out to be an entrepreneur or even a business owner.  They don’t have the knowledge, they don’t have the experience, and they don’t have the guts.  Because of this, they are incompetent to give advice or approval to someone who does in my opinion.  Entrepreneurs are by nature risk takers.  Employees or non-working spouses are not – by definition.  So, they have no business with veto power.

The problem is that my business owner friends are married and want to stay that way!  They want to continue to grow their businesses.  They are on the horns of a dilemma.  What should they do?

I think they should limit what they tell their spouses.  I’m not suggesting they be dishonest, but I don’t believe in giving people information they aren’t prepared to handle.  That just scares them.  Why scare your spouse?   When you do, they are miserable because they’re scared, and the entrepreneur is miserable because she’s stuck.

It’s far better to share business information with your employees, your banker, and your spouse on a “need to know” basis!  What do you think?

What’s up with the Unemployment Rate?

I’ve been reading a lot of optimistic news about the future of the economy lately.  And, I count myself as one of those who are pretty optimistic.  One of the measures of optimism that economists track is hiring plans.  The more businesses who plan to add employees the more bullish businesses are seen about economic prospects.

As one of those bullish employers, I watch the “unemployment rate” carefully because it helps me understand how easy, or hard, it’s going to be to find help.  It also gives me insight into how much employees are going to cost.

As I’ve contemplated all of this recently, I’ve been a bit perplexed.  The “unemployment rate” both locally and nationally is improving.  That is it is falling, but I’ve noticed that we are receiving more responses to our advertising for new employees.  That’s counter to what I expected.  Why?

I think part of the answer lies in lies.  You see there are multiple “unemployment rates.”  The rate that is always published in the press and talked about by commentators is the “U-3” rate, but that statistic only counts people who have looked for a job in the last four weeks.  Currently, the national U-3 rate is about 5% (considered “full employment”).  There are other rates of unemployment, and they are a lot higher.  The “U-6” rate includes part time workers who want full time jobs, discouraged workers who have given up looking altogether.  That rate, at the end of the year, was close to 10%.

This “real rate” of unemployment is probably the one we employers looking to hire should be focusing on as it’s the rate of people who are available for full time employment.  What the current rate tells me is that there are a lot of people out there who need and want jobs.  It tells me the job market, though improving, is still pretty soft.  It squares with my current experience.  Check out the U-6 rate easily found on the internet.  I think tracking it will give you more insight into how many people are looking for work when you are hiring.  I hope you are hiring – because that means you’re growing!

OAA’s Annual Success Celebration is April 12th

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OAA is gearing up for our annual Success Celebration and Conference!  This year our event will be April 12th at the Embassy Suites in Oklahoma City.  Our members, strategic company partners, and team members will get together for education, networking, and a celebration of a outstanding 2016!   OAA members will be recognized for their achievements, we will honor our Rookie of the Year, Top Producing Agencies of the Year,  Most Profitable Agent and Member of the Year.  Who will it be?   This is an exciting event where we will celebrate millions in profit sharing dollars only available to members of OAA through the incredible partnership with SIAA.  If you want to learn more about becoming a member of OAA please contact us.

Circle of Excellence – Q1

OAA hosted the first Circle of Excellence of the year at our new facility!  OAA has a new training room at 1220 N. Robinson Ave in downtown OKC.  We had lunch with our Elite OKC members and discussed Sales Forecasting.  Each member received a sales forecasting tool developed by Tony Caldwell.  We will be hosting the OKC Masters group on 3/15 and we look forward to another informative meeting.  Thank you to all our Circle of Excellence members for your  participation!logocoeteacher12

Why Do Some (So Many) Small Businesses Fail?

reason-small-business-failureIn my last post, I discussed the varying views on how many small businesses don’t make it.  There is debate on the rate of survival but not on the difficulty.  Many experts have theories, and, while I’m not an expert, I have helped over 100 people start a small business and watched some of them fail.  Here are some of my observations about why.

  • Lack of planning. I see a lot of business plans.  Most of them are too vague and nonspecific.  The ones that most often succeed are highly detailed in terms of how they will attract prospects and convert them into customers in a given period of time.
  • Lack of capital. Stories of starting a business with virtually no money are legion.  I started mine that way, but, in a small business, the founder needs to identify how he and the business will survive the inevitable financial challenges that come in a new business.  It can be spousal income, savings, investors, or other sources, but very few businesses and their owners can survive the time period required to establish regular cash flow with only the income from the business.  A realistic assessment of this is almost always lacking in failures.
  • An unrealistic marketing plan. The number one job of a founder is to create revenue, but many budding entrepreneurs way underestimate the number of prospective customers that will be required to get to a certain level of income.  In addition, they have no certain means identified to produce those prospects in necessary numbers.  Most insurance agency startups are created by sales people.  Many of those don’t understand how to make the phone ring.  Before you hang out your shingle, make sure you do.
  • No Unique Selling (value) proposition. The failures I see think that a lower price than the next guy is enough.  It isn’t.  It never has been.  It won’t ever be.  Especially in a day in which customers can easily shop many sources quickly, being cheapest isn’t enough to stay alive.  Since virtually all agencies tout “service” as their USP, that doesn’t work well either, unless it’s really true, and it usually isn’t.  What is your USP?
  • Inadequate work ethic. How much time should a founder expect to invest in their business on the way to success?  I’ve heard a lot of theories.  My answer is: all of it.  To be successful in starting a business, the founder needs to be ready to commit all of their time to it, except the time required to eat, sleep, and eliminate.  I’m not kidding.  Look at those who made it, and that’s what you see.  Yes, starting your own business should (eventually) allow you freedom of time, but it won’t for the first few years.
  • Wheel reinvention syndrome. There are many startups who invent a new product and become fabulously successful.  Legions more who don’t, but in the small business arena (like insurance agencies), usually success involves following well established paths to success.  When involved with companies like mine who have a well charted set of success strategies, follow them.

 

This is the land of entrepreneurs and the “overnight” success story that often takes many years.  There are lots of paths to success and some pitfalls.  The ones I’ve listed here are common and 100% preventable with some effort.  Good luck to you if you head down the path to independence!

AccessPlus Adds New Professionals!

OAA has gone through some changes in the last few months, not just new scenery with our recent office move, but we’ve also added several new faces!  Our AccessPlus team is member focused, and we’ve been working hard while stretched thin these last several weeks.  After an exhaustive search for the right fit for our team and yours, we are so excited to introduce our new AccessPlus professionals.  Please meet Robbie Hoffman, Sylvia Smith and Caleb Wonn.    Be sure to welcome them to the team during your next AccessPlus interaction.  They are here to help you and are training hard to do just that!

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OAA’s newest team members are pictured left to right.  Below you will see their answers to these 3 questions:

  1.  How many years of experience in this industry?
  2. What is something you think you are good at that will lend itself well to helping our members?
  3. What do you enjoy doing outside of work, hobbies, interests, volunteer work etc?

Robbie Hoffman

  1. 20 years
  2. Knowledge about the industry; I really care about what I am doing; helping clients to the best of my ability
  3. Spending time with my 3 grandchildren & my family; Reading; Cooking; Being outdoors

Sylvia Smith

  1. 20 years plus
  2. I enjoy helping people and it’s important to me to exceed expectations, and give the best customer service
  3. I love to run in my spare time and I also have 2 grandchildren that I love spending time with

Caleb Wonn

  1. 7 years
  2. I love crunching the details of coverage. I think that knowledge will be beneficial to the members as a way to distinguish themselves
  3. Fishing, camping, boating, water skiing, play piano and guitar, being a husband and dad to three girls fills a lot of my time

Persistence

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How do you know when you’re going to be successful?

I remember when I started my career as an insurance agency owner and commercial insurance producer.  Each month I called on an endless succession of business owners asking for X dates and it seemed like forever before I got to actually quote.  Then I sold a few policies and could begin to see that I’d eventually have some income.  I remember going home and telling my wife we had victories to celebrate!  Nursing an infant, working full time in her own business and exhausted her question was “where’s the check?”

It’s really tough to start and build a business.  Most people can’t do it.  But those that do have something highly unusual going for them.  Persistence.  They simply won’t quit.

I saw the movie “Founder” last week about Ray Kroc and the building of McDonalds.  It was inspirational to me.  Ray was an entrepreneur who started, and apparently failed, at a lot of things.  Early in the movie we see him carting a mixer from drive in to drive in with little success.  Each night he is staying in a flea bag motel, alone with nothing more than Canadian Club whiskey for company.

He also had a record player, with a single record about persistence.  As he falls asleep each night the voice quotes Calvin Coolidge saying:

“Nothing in the world can take the place of persistence.  Talent will not; nothing is more common than unsuccessful people with talent.   Genius will not; unrewarded genius is almost a proverb.  Education will not; the world is full of educated derelicts.  Persistence and determination alone are omnipotent.”

Kroc of course goes on to build McDonald’s into the world’s largest restaurant chain and becomes fabulously wealthy.  At the end of the movie he rehearses a speech about what made him, and his company, successful.  He begins “Nothing in the world can take the place of persistence…”

How can you know you’re going to be successful?  By making the commitment to never give up!

Grow Your Growth Rate – A Lot!

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I have a very simple idea, one that everyone knows about, but my idea is so simple that no one ever does it.  Sound crazy?  Of course it does.  But stop and think – how many great ideas have you heard in your career where you think “of course!” and then go right back to not doing it?

I’ve had that experience – a bunch of times.

So, before I give you my idea, promise yourself you’ll try it!  Ok, ready?

Not so fast!  Let me ask you a question first.  What was your retention rate the last 3 years?  Subtract that from 100%.  What then was your slippage, non-retention, etc?  For the average small agency, it was about 15% per year.  This means that if you’re average you’ve lost 45% of your customers in the last 3 years.

What if you could have one third to one half of them back?

If you could do that, in a year, you’d grow by 15% to 22.5% right?  Divide your growth rate last year by that number.  The average growing agency grew about 5% last year, so if you could do this and you’re average, you’d increase your growth rate 300% to 450%.  Regardless of your actual numbers, I hope you get my point.

Ready for my idea?

It’s really simple.  Call your old lapsed customers back!  Almost ALL OF THEM will be glad to have you quote!  What’s your conversion rate?  It’ll be higher with these people because they know you, trust you already, and will be happy to come back!  I have a partner who has a department of people who focus solely on this, and they win back a huge per cent of those they call.  Here’s another great idea – do what they do and hire someone(s) to focus solely on this.

Let’s do the math.  Assume a $2 million book of business and a $2,000 average account size.  That’s 1,000 customers.  Forty five per cent of that number is 450. Assume you can resell a third of them.  That equals 150 “new” customers at $2,000 premium each or $300,000 in new business.  That’s $45,000 in “new” commission income.  For a $300,000 revenue agency, that is a LOT of new business.  Multiply or divide for your agency’s size.

This is such a simple, powerful, and profitable idea that only the most successful business growers will even try it.  Are you one of those?