Respect Your Prospects

[scott]

I used to call cold-calling "Dialing for Dollars." Now I call it "Begging for Business."

My phone frequently rings with calls from insurance salespeople looking for x-dates. My clients refer the salespeople to me as I manage their insurance. Really, my clients are getting rid of the agent by sending them to me.

The spiel goes something like this, "Hi this is Tony from ABC Insurance. We are a great agency with great companies offering great service at a great price."

My answer is always the same, "No thank you."

Is begging for business really that great a strategy? Maybe I'm different from most insurance buyers, but I see cold calls as an interruption and a nuisance. Isn't the agent really saying, "I don't have enough clients to refer business to me. I'm not creative in my marketing. I offer so little value to you that I have to beg for your business."

I've written about this before. Cold calling hurts you. From my perspective, your reputation is damaged every time you interrupt someone to beg for business. Look around your home and office. Look at the products and services you purchase. Look at the tools you use in your life and work that are most beneficial and enjoyable to you. Did you buy them because of a cold call?

Think of the interactions you have with peers. Do you speak highly of the people who call begging for business? Do you refer business to companies that cold-called you? Have you ever said to anyone, "I got a call from ABC trying to sell me a widget. You should call them. They sound great."

We refer friends to those businesses that have provided exceptional products or services. You recommend restaurants and entertainment that provided you with exceptional value. In short, we all refer business to people who are remarkable. By remarkable I mean, worthy of remark.

What can you do to be worthy of remark in your business? What can your agency or consultancy do to be remarkable? What can you do in your next client interaction that will lead the client to see you as a remarkable asset?

[independent guy]

I've written about this before. Cold calling hurts you. From my perspective, your reputation is damaged every time you interrupt someone to beg for business. Look around your home and office. Look at the products and services you purchase. Look at the tools you use in your life and work that are most beneficial and enjoyable to you. Did you buy them because of a cold call?

I applied for a Mastercard (that I still use) because of a cold call, but that's it. I just happen to be wanting more credit at that point in time, so that caller was really lucky. Otherwise, I hate cold callers. Recently a rep from Special Olympics wouldn't take my "NO" for an answer, and she called my office back 4 times before I finally snapped on her. I'll never donate to them again because of her tactics. It was such a turn off.

I respect others as I want to be respected. I'll never cold call. And I'll never have to. I'm not so sure that I'd be in that same position though if I were a recent start-up. They probably wouldn't have $9,000 to spend on a big lighted sign, or $12,000 a year for yellow page ads, or the referral base that we have now.

[etimer]

HM? I'm not sure how to take this post. To some point any part of the sales process is "begging for money" as you have so eloquently pointed out. Also things received in the mail can be related to "begging for dollars." TV advertisement is "begging for dollars." Now we all must eat so your proposition about restaurants and word of mouth rings a bit hollow.

It is always interesting to hear the laments from those that have arrived bemoaning those that are trying to arrive. I've been in this business from the early 1980's and feel that I am one that of the fortunate that live on referrals. But how many times I come in contact with people that say, "I didn't know you did commercial or I didn't know you did health insurance.

To grow you must market yourself. My question to you is this:

If you are starting from scratch, not with an agency that has been around for 108 years, how would you do it? Would you just sit and wait on all the referrals from a current customer base that is non-existent.

I talk with every, every person that cold calls me. In 1981 as a commodity broker I made cold calls and it stinks! It is arrogant to talk of your time being more important than their time.

I've built my business from scratch, by giving good service, going the extra 5,280 steps for clients. Eventually that will always pay off.

Are there people that are terrible at cold calling and abusive. Yes there are but there are also sincere people out there. I received a cold call from a Realtor about a small cottage he was trying to sell. It was as if it was ordained. My 85 year old mother needed a place to move to, I had the money to buy the small cottage and it was a great buy. That cold call probably saved me $25,000 because I was looking at a condo for her that would have cost much more.

Now this is taking up my time.

BTW, why would your clients refer someone to you? Isn't that wasting everyone's time?

I used to call cold-calling "Dialing for Dollars." Now I call it "Begging for Business."

My phone frequently rings with calls from insurance salespeople looking for x-dates. My clients refer the salespeople to me as I manage their insurance. Really, my clients are getting rid of the agent by sending them to me.

The spiel goes something like this, "Hi this is Tony from ABC Insurance. We are a great agency with great companies offering great service at a great price."

My answer is always the same, "No thank you."

Is begging for business really that great a strategy? Maybe I'm different from most insurance buyers, but I see cold calls as an interruption and a nuisance. Isn't the agent really saying, "I don't have enough clients to refer business to me. I'm not creative in my marketing. I offer so little value to you that I have to beg for your business."

I've written about this before. Cold calling hurts you. From my perspective, your reputation is damaged every time you interrupt someone to beg for business. Look around your home and office. Look at the products and services you purchase. Look at the tools you use in your life and work that are most beneficial and enjoyable to you. Did you buy them because of a cold call?

Think of the interactions you have with peers. Do you speak highly of the people who call begging for business? Do you refer business to companies that cold-called you? Have you ever said to anyone, "I got a call from ABC trying to sell me a widget. You should call them. They sound great."

We refer friends to those businesses that have provided exceptional products or services. You recommend restaurants and entertainment that provided you with exceptional value. In short, we all refer business to people who are remarkable. By remarkable I mean, worthy of remark.

What can you do to be worthy of remark in your business? What can your agency or consultancy do to be remarkable? What can you do in your next client interaction that will lead the client to see you as a remarkable asset?

[etimer]

Back when I was one of those Stockbroker types there was that big cat fight with the Advisor's and Stock Brokers. The Advisor's were so much more moral because they didn't charge, dare I say the word, commission. I did several years as a State Registered Investment Adviser. Between the people I met as a Stockbroker and the people that I met as an RIA...there was little difference. The only real difference was that Adviser's get a constant stream of money from fees and charged by the hour. As an RIA $150 an hour was on the low end of the charge scale.

The current trend is to be called a Benefit Adviser, the term broker is old school. A benefit adviser sounds so much more, um....better. In 2005 I lost a $450 a month account to a (clearing my throat) "benefit adviser." In January of 2006 I got that account back because the HR person was so PO'd at the Adviser. The adviser promised all the bells and whistles. When the HR person found out that the bells and whistles cost an arm and a leg, that the bells and whistles weren't even in the Advisor's own office, that all the bells and whistles were in a third party office in another State. That HR person flipped out crazy on that adviser. Five years ago that adviser was calling himself a broker.

The current trend with the insurance adviser is the same as it was with investment advisers. The main thrust is to get assets under management.

Is there any scientific proof that by changing a title makes a person's advice become unbiased? If my doctor was a family physician and now he is a practitioner/consultant does that mean that he is now telling me the truth but before he was not telling the truth?

All the titles and alphabets will not change the fact that a person either has integrity or doesn't have integrity.

[independent guy]

It is arrogant to talk of your time being more important than their time.

Its very easy to be selfish when someone imposes themselves on you like that though. You have a telephone at home so that you can get in touch with your friends and family, and so that you can take important calls. NOT so that you can get calls from people begging you to buy something and pulling out every emotional trick in the book to try and keep you on the line. Your damn right I value my time more than I do theirs, but I also realize that they are also human beings trying to make a living. That doesn't mean I have to appreciate the calls.

[etimer]

God gave us each time on this earth and your time / my time really is no more valuable than the person on the other end of the line. That's the way I look at it.

At the moment we have a society that far too many people consider "their" time more valuable than the next person's time. For that we get, people talking loudly on cell phones in restaurants, people driving as if they are the only person on the road, people deciding that the red light was on long enough so I'll just run through it, it is a me...me...me view of the world.

In the end all the time in the world will not matter because we are gone from this planet. Dead --- gone and there will be another person using our time slots. My time is no more valuable than the man that picks up my trash, the paper delivery person or the leader of the free world. I don't own time and it can disappear from me at any moment.

So remove those horns and consider that by the grace of someone it's not you that must make those cold calls to make a living. It's not you that's picking up trash cans in the city at 4 AM, raining, temps near 30 degrees, while someone screams out the window at you to keep the noise down.

Today I talked with a Pitney Bowes person. I felt very bad for her because she is selling an item, the postage meter, that is being killed my e-mail. She may have been a single mother trying to make a living and feed her kids. Who knows but she deserved respect. It would be an easier living if she accepted welfare.

Call me weird but I'll buy lunch for that 85 year old, lonely looking lady that's eating lunch by me at Panera Bread. I'll turn my car around and go back to Starbucks to buy that homeless guy a cup of hot coffee. Meanwhile someone in their high torque little car cuts me off because he is in a hurry.

I think I'm going to back out of this discussion because I have adjectives for those that think their time is more valuable than another person's and it is a flame war in the making. We just agree to disagree. It is just my opinion that what is needed are more people that don't consider their time more valuable than another persons time. Humility is a dying word in this brave new century.

It is arrogant to talk of your time being more important than their time.

Its very easy to be selfish when someone imposes themselves on you like that though. You have a telephone at home so that you can get in touch with your friends and family, and so that you can take important calls. NOT so that you can get calls from people begging you to buy something and pulling out every emotional trick in the book to try and keep you on the line. Your damn right I value my time more than I do theirs, but I also realize that they are also human beings trying to make a living. That doesn't mean I have to appreciate the calls.

[d's insurance store]

I think we're all in the middle of a major systemic change in the way we both buy and sell our services.

First off, the market of available prospects has changed. In the world of individual insurance buyers, web based, on line purchases are becomming more ingrained, especially in the younger marketplace. Although positioned as such, I believe the value that individuals place in the 'trusted insurance advisor' is fast going the way of the buggy whip. There are no longer discussions about 'do you need 25/50/25 or 50/100/25...people tend to gravitate either to minimum limits or perceive assest protection at much higher limits.

Secondly, the commercial market has undergone a major change insofar as the death of a 'main street' retail kind of market. Big boxes and consolidation have taken many of the 'easy' BOP small risks out of service. Sure, there are lots and lots of boutique small businesses, but how are you going to make a living off of $500 minimum premium office contents policies for the consultant needing to satisfy a lease requirement for $1million CGL.

And, thirdly, the economics of running an agency have changed. I'm convinced one has to either be very small with the built in limitations of that size, or very large, to take advantage of the economies of scale. The mid market agency trying to be all things to all comers just can't net out the return on investment to make it worthwhile financially.

Sadly, the managers of agencies still default to the old school methods of training and selling for their producers. There is still the environment that you can suceed by using the tool from the past, cold calling from the phone book, yellow pages, direct mail, newspaper, etc. As demonstrated by the reluctance of even politely field an incoming cold call or even list your phone number, potential buyers tend to feel these unwanted contacts are gross intrusions into an already shrunken personal life.

The future probably lies where Scott thinks it does...with a targeted, specialized market that allows enough flexibility to zig and zag as market forces demand, while all the while, having a small enough target to become an expert in the chosen marketplace and adding value that goes far beyond soliciting information for the blanks on an Acord form and the presentation of a quote and renewal docs every year.

It is through this method that true referrals will come about and allow for a growth in business.

The alternative is to hunker down in whatever mode and model you're now in, and wait for your current clients to die off or fade away, and hope that the trickle of new business from those old, trusted sources is enough to at least partially balance out the exodus of premium that comes from clients not putting much value in what you do.

[Porter]

I have to admit when I was new to this business I did a lot of cold calling and it worked for me. I had more time then money and I actually enjoyed it. I would pick the exact type of customer I wanted to insure and built a prospect list. When I was cold calling I would be looking for a client who was interested in getting a quote because their current policy was renewing. It was a timing thing. If they were not interested I would not waste my time selling them. I would just say thanks anyway and move on. Once I built up a book of business I started getting referrals and had money to advertise. I soon stopped the cold calling.

[JSJAG]

You are correct about the big box corporations. The mom and pops get fewer by the day. Large franchises and big boxes don't buy their insurance from that home town insurance advisor.

Eventually the insurance companies will have their sales and call centers in India. Insurance is a commodity and the web will make it more of a commodity. The new younger buyers want cheap not service.

We are a society that is watching the death of the middle class and we don't know what to do about it. We don't interact with each other on a level of commerce.

Today I heard that last year American's had the worst savings rate since the Great Depression. In fact the savings rate was in the negative column. People borrowed more than they saved.

You are right on about either small, using gorilla type selling or big using economies of scale. I am of the small scale. I'll use my legs and mind to run circles around the big box agencies. I'll provide more service and bend backward more than that big box agency can endure and in the end I can win accounts.

In the 1990's, in my town, there was an agency that went about buying up many, many mom and pop agencies. I placed business with two of those agencies. The big box shop said this, either you sell us your book or we just take it. So I sold them my book of business. That's the way American business has gone in the past decade. Main street is gone.

So where does that leave us? We adapt, we change or we disappear. I'm kind of glad I'm close to retirement. My clients love me and are my best promoters.

I think we're all in the middle of a major systemic change in the way we both buy and sell our services.

First off, the market of available prospects has changed. In the world of individual insurance buyers, web based, on line purchases are becomming more ingrained, especially in the younger marketplace. Although positioned as such, I believe the value that individuals place in the 'trusted insurance advisor' is fast going the way of the buggy whip. There are no longer discussions about 'do you need 25/50/25 or 50/100/25...people tend to gravitate either to minimum limits or perceive assest protection at much higher limits.

Secondly, the commercial market has undergone a major change insofar as the death of a 'main street' retail kind of market. Big boxes and consolidation have taken many of the 'easy' BOP small risks out of service. Sure, there are lots and lots of boutique small businesses, but how are you going to make a living off of $500 minimum premium office contents policies for the consultant needing to satisfy a lease requirement for $1million CGL.

And, thirdly, the economics of running an agency have changed. I'm convinced one has to either be very small with the built in limitations of that size, or very large, to take advantage of the economies of scale. The mid market agency trying to be all things to all comers just can't net out the return on investment to make it worthwhile financially.

Sadly, the managers of agencies still default to the old school methods of training and selling for their producers. There is still the environment that you can suceed by using the tool from the past, cold calling from the phone book, yellow pages, direct mail, newspaper, etc. As demonstrated by the reluctance of even politely field an incoming cold call or even list your phone number, potential buyers tend to feel these unwanted contacts are gross intrusions into an already shrunken personal life.

The future probably lies where Scott thinks it does...with a targeted, specialized market that allows enough flexibility to zig and zag as market forces demand, while all the while, having a small enough target to become an expert in the chosen marketplace and adding value that goes far beyond soliciting information for the blanks on an Acord form and the presentation of a quote and renewal docs every year.

It is through this method that true referrals will come about and allow for a growth in business.

The alternative is to hunker down in whatever mode and model you're now in, and wait for your current clients to die off or fade away, and hope that the trickle of new business from those old, trusted sources is enough to at least partially balance out the exodus of premium that comes from clients not putting much value in what you do.

[independent guy]

The new younger buyers want cheap not service.

I would tend to disagree with you there. Of course when you're struggling you're just trying to get by. But when you get a steady income other things start to matter more than just price. I'm young, and I don't buy on price. My friends are also young and they don't buy just on price. However when it comes to insurance, they're pretty much clueless. How do you think a clueless person is going to buy insurance? By the price! My friends know I'm not a person who will put business above relationships, so they trust the advice I give them. Of course they're going to want to go through me, and they refer their friends. I rather dislike going to agent meetings though, for the companies I represent, and only seeing grey/white haired people there. If someone isn't getting out to educate the "younger buyers", then you're right, the agency systems are dead.

[JSJAG]

Hey hey go easy on that grey haired stuff!!
At least I still have my hair but it is tempting to get it shaved and polished.

The new younger buyers want cheap not service.

I would tend to disagree with you there. Of course when you're struggling you're just trying to get by. But when you get a steady income other things start to matter more than just price. I'm young, and I don't buy on price. My friends are also young and they don't buy just on price. However when it comes to insurance, they're pretty much clueless. How do you think a clueless person is going to buy insurance? By the price! My friends know I'm not a person who will put business above relationships, so they trust the advice I give them. Of course they're going to want to go through me, and they refer their friends. I rather dislike going to agent meetings though, for the companies I represent, and only seeing grey/white haired people there. If someone isn't getting out to educate the "younger buyers", then you're right, the agency systems are dead.

[independent guy]

To etimer - We have a misunderstanding. You and I are not all that different.

I really dislike salespeople because most of them try too hard. Cold callers are no different. If I say no, I mean no. Most cold callers do not have any respect for that. If someone is not going to give me the same respect that I would give them, then at that point I do feel that it is a waste of time - not just for me but also for the caller. Perhaps that better sums up how I feel. Not that my time is necessarily more valuable than theirs, but that since I've already made up my mind not to accept any solicitations by phone, that its a waste of both of our time to talk about it. I actually can't believe I gave the credit card rep my personal info over the phone, because now you can't even trust that its the company doing the calling. I could have just as well had an identity-thief call me and then I'd have been a victim.

FYI - I turn off my cell phone in restaurants, and don't talk on it while driving. My Honda CR-V doesn't have very much torque, so its pretty hard for me to drive offensively. Having been the victim of a kid who thought a red light meant go, I take very seriously my responsibility towards other people. Sorry if I offended you.

[JSJAG]

I tthink there is a difference between someone working for a telemarketing organization and someone that is trying to sell their own stuff. When I am talking to someone about insurance I am also building a relationship. The person telemarketing the credit card script today can easily be assigned to selling long distance service tomorrow. Telemarketing is not about building relationships.

I to have had bad phone salespeople. I love it when I get a call from a bank selling their accident plans. I'll tell them I am in the insurance business and if I wanted that type of insurance plan, I would sell it to myself and I would earn the commission. They are not phased and continue with their script! Finally I have to say to them, did you hear me? I said no thank you.

Yes I think Telemarketing is not really sales. A good salesperson listens to what the other person is saying, what they need and what they want. Telemarketing is about getting a hit and it has created a bad environment for all of the people that take their job of selling seriously.

To etimer - We have a misunderstanding. You and I are not all that different.

I really dislike salespeople because most of them try too hard. Cold callers are no different. If I say no, I mean no. Most cold callers do not have any respect for that. If someone is not going to give me the same respect that I would give them, then at that point I do feel that it is a waste of time - not just for me but also for the caller. Perhaps that better sums up how I feel. Not that my time is necessarily more valuable than theirs, but that since I've already made up my mind not to accept any solicitations by phone, that its a waste of both of our time to talk about it. I actually can't believe I gave the credit card rep my personal info over the phone, because now you can't even trust that its the company doing the calling. I could have just as well had an identity-thief call me and then I'd have been a victim.

FYI - I turn off my cell phone in restaurants, and don't talk on it while driving. My Honda CR-V doesn't have very much torque, so its pretty hard for me to drive offensively. Having been the victim of a kid who thought a red light meant go, I take very seriously my responsibility towards other people. Sorry if I offended you.

[independent guy]

I tthink there is a difference between someone working for a telemarketing organization and someone that is trying to sell their own stuff. When I am talking to someone about insurance I am also building a relationship. The person telemarketing the credit card script today can easily be assigned to selling long distance service tomorrow. Telemarketing is not about building relationships.

I just realized that up to now, I've equated cold calling with telemarketing, because I've NEVER had a LOCAL cold call. Since you've done local cold calling, how resistant are people to it?

[JSJAG]

I don't do what I would call cold calling.

I have a method before I call on the phone. It starts with a letter, than a few weeks some more informational pieces, then a bit more information such as info pertaining to their business, etc. Then I tell them I will be calling them.

People are very relaxed because number one, you have taken time to introduce yourself, you have shown interest in sending them interesting bits of information and then you tell them you will be calling. I have something I do in my last letter that I won't say here because I don't like giving away my little marketing ideas but it is an ice breaker.

Going through the phone book with my finger and making an immediate call isn't my style. I consider this method when I want to make some immediate marketing penetration and growth.

I don't know how well the method would work with personal lines. Most all of what I do is commercial. What I usually find is that people that own their own business appreciate the velvet glove approach and do understand the need for growth. Even if they don't need my service I talk with them about their business, the world etc. and leave them with a good smile on their face. There are quite a few times that even though they have no needs they will give me referrals of someone that does need a helping hand.

The phone is a finicky instrument and people can quickly pick up if you are genuine and sincere or are just out for a quick sale. What I like most is stopping by the smaller businesses and talking with the owner (or whoever handles the insurance). The stops take a lot longer but you get to talk, meet people and create relationships. People really do appreciate a friendly salesperson but you can not be faking it.

I have one client that owns four restaurants. He told me to sit my business cards by the cash register in each restaurant and he also introduces me to his patrons. Man if I could have 10 like him! He is one of the places I stopped by on a cold call visit (or whatever you call it).

Unlike the HR manager, or risk manager, I find that business owners understand the fundamental value of sales, marketing and building relationships.

I tthink there is a difference between someone working for a telemarketing organization and someone that is trying to sell their own stuff. When I am talking to someone about insurance I am also building a relationship. The person telemarketing the credit card script today can easily be assigned to selling long distance service tomorrow. Telemarketing is not about building relationships.

I just realized that up to now, I've equated cold calling with telemarketing, because I've NEVER had a LOCAL cold call. Since you've done local cold calling, how resistant are people to it?