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Well, this idea certainly flies in the face of conventional wisdom!

I’m sure that you, like me, have read and heard all your life that you must capitalize on your strengths to be successful.  Certainly, this is the accepted common-sense approach to life and usually “common sense” is correct.  While it is valuable to understand your strengths and “play to them,” I’d like to offer a different perspective.

When I was a skinny teenager afraid of bigger kids and bullies I looked for a way to not only defend myself but avoid the problem in the first place.  I discovered martial arts in the process and learned how one skinny person could reliably defeat bigger foes and many bigger foes simultaneously.  I realized I couldn’t out muscle the bullies, but I was faster than they were.  I learned I could hit them many times before they could recover, and I could use their size against them and to my advantage.  For the first time I realized my weakness had tremendous value.

In business if we don’t understand our weaknesses and only focus on our strengths we inevitably find trouble.  I find that most agency owners are excellent sales people and can sell more insurance than they can take care of.  Ultimately this leads to client dissatisfaction, defection and growth either stops or goes backwards.  If the agent understands this from the beginning, she can focus on finding people who complement her strength by bringing their own strengths to her weakness.  This is a powerful formula for never ending success.

Unfortunately, if we don’t understand this, we will focus on “systems” or “processes” or other means to deal with our weakness.  Not that there is anything wrong with this approach, but in my experience, it isn’t sufficient.

What is necessary to build and sustain success after we understand what we lack is to find the person(s) whose strengths and weaknesses complement our own.  When we do this, we move from thinking about “what” or “how” to “who”.  This is a subject Dan Sullivan explores in his book “Who Not How” available here: www.strategiccoach.com/go/whonothow.

The more I work on this idea the more I realize that I’m not equipped to backstop my weaknesses.  I need someone else to help me.  That is how I came to be in the national karate championships at the age of fourteen.  I learned to cooperate with those who had the strength of bigness to magnify my own strengths of quickness and agility.  The reliable result was winning.  It took me a long time to understand that the principle is the same in business and to build a company on that principle, but the result has been two decades of increasing growth and opportunity for us and dozens of others.

What are your weaknesses?  “Who” can make those into strengths for you?

video-iphoneWebsites have come a long way in just the last two years.  Two years ago, content was king.  No new content meant no one cared, and two years ago, the buzz was all about mobile.  Now, if you’re not mobile, you’re simply not relevant.

Today, websites without video are just not very effective compared to those with.

Insurance agencies may feel a bit overwhelmed with what is needed to keep up with all of this.  After all, we’re insurance people not internet marketers!  Or are we?  The truth lies somewhere in the middle.  The fact is that almost all commerce, including insurance purchases, takes place either directly on the web or is influenced by it.

So, like it or not, keeping up with what consumers expect in their web experiences isn’t an option, at least for today’s winners.

With that said, are there some best practices for video that can be adopted by anyone?  Yes, to begin with, web videos should be short.  The stats seem to indicate that past 30 seconds you begin to steadily lose viewership, although interestingly people will currently watch videos longer on their mobile devices.  Go figure.

Of course, videos need to be interesting.  That can be a challenge if you only think of insurance in policy terms.  But think about Progressive’s, State Farm’s, and Farmer’s ads on TV.  They manage to convey a message, with humor, in 30 seconds.  You can do the same thing with web video if you flex your creative muscles.  Or, you can put some of the videos your carriers have created on your site.  That saves time, money, and creative brain cells and leverages their brands with yours.

Make it personal.  This goes a bit against the last paragraph but where local agencies have a real opportunity is to personalize their offerings.  This is especially valuable when you share the video beyond your site into your social media posting.  You’re posting on social media, right?

Be topical.  What makes videoes go viral isn’t production values, its interest.

Turn it over frequently.  Change things up every few weeks.  Anything on your site that is a year old is, well, old.

Being a 21st century marketer is challenging, but so was being a 19th century marketer.  Try things.  Fail.  Get better.  But try.  Video is where it’s at in website marketing for now.  Who knows what will be hot and required in another two years.  Virtual reality anyone?

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.

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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?

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 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

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!

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

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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?

hayEver since the election in November, I’ve been talking to business people about the results.  Regardless of party affiliation or candidate preference in the election, one thing has been coming through loudly and clearly: excitement!

Like the coming of spring when the clouds depart and the sun shines, business people seem to be full of enthusiasm for the future in ways I haven’t heard in a long time.  Almost every business owner I have spoken to is thinking about how they plan to increase investment to take advantage of what they see as an improved climate for business.

Obviously, we insurance agency owners are probably also excited by and large.  I know that I am.  As I’ve thought about what I hear about lower taxes, perhaps the end of the death tax, less regulation, etc., I’ve also thought about how we as agents can leverage this optimism to grow our businesses.  Here are just a few ideas:

Now is the time to review with business customers their plans for increased sales, payrolls, and property values so we can make policy adjustments early.  This helps our customers plan better, may increase premiums and commissions, but certainly cements the idea that we are valuable advisors.

  • Optimism will lead business owners to purchase coverage, like higher auto limits, excess liability policies, and increased employee benefits that they may have dropped in recent years.
  • For consumers, whose measured confidence is increasing, we need to be doing coverage reviews to make sure our policies are keeping up with their spending.
  • For personal lines customers, now is the time to suggest an umbrella policy, additional life insurance, or other products that they may have been putting off until now.

It also appears that increased expensing allowances and reduced taxes are going to set up an opportunity for business owners (like you!) to make additional investments in your business with new technology or other needed items.  This news coming at Profit Sharing time means that you have the means and the motivation to consider how to invest in your business to grow even faster this year.

What do you think?  How can you leverage the new political climate and the optimism it is engendering to grow your business?