| | What Business Are You In?
That sounds like a very strategic question, and it is. But it is also a tactical question. There are a number of railroad companies out of business today because they thought they were in the railroad business. The ones who have passed the test of time figured out early on that they were in the transportation business. If you are concerned that your revenue stream is too low or vulnerable to changes in the marketplace, it may be time to revisit this question and look at ways to maximize your opportunities. Here are some things to think about.  | Niche marketing.
Developing areas of strong expertise can mean a real competitive advantage. Market-segment specialization has a snowballing effect. The more business you write in one market segment, the more you develop reputation and contacts to increase referrals. The more accounts you write, the more knowledgeable you become. The more work of a similar type you have to process, the more efficiently you process it. Concerned about having too many eggs in one basket? You can add additional dimension to your niche marketing. | | Vertical Marketing
Your business customers also have business customers or suppliers. Knowing how your customers do business--and with whom--gives you tremendous advantage. Not only will you be able to provide a diversified portfolio of products and services to cover all their exposures, but you also have access to additional market segments. Become expert in multiple niches. This is also a way to diversify your own risk. | | Total Account Marketing
Offering a diversified portfolio of products and services has other benefits, as well. Your account retention is higher when you have more than one line of business with each customer. And being able to offer a full line of products and services helps ensure that your customers will not develop strong relationships with other agents. Be sure you are thinking beyond property casualty insurance. Even though the sale might be different (creating the need rather than filling the need), the customer is the same. | | Financial Services.
There has been much talk of banks in insurance. What looked at one point to be a very serious threat has not really materialized. There is instead an enormous opportunity for the independent insurance agent because bank managers do not know how to sell insurance. Joint-venturing with bank and other financial institutions is not as difficult as you may think. Transformation Advisors, Inc., can show you how. |
Do what you’re good at. Be good at what you do. There
is an old maxim that you do best that which you like to do. In business, it’s also true. Where you have a real business interest, business knowledge and competence, you are likely to be successful. Often it just takes paying attention. Many agencies have no interest in personal lines or small commercial insurance because they do not find it rewarding. Often you are in these business segments whether you want to be or not. It’s
where the customers are. Small commercial profitability is
not a dream however. Small commercial and personal lines can be very
profitable if you take advantage of technology and focus
on the customers’ wants
and needs. In fact, they can help you weather the ups and downs in
other areas. As you look for ways to maximize your revenue opportunities, you can improve profit and performance in
all the market segments you serve, and for all the products and
services your offer by understanding the economic factors that drive
income and expense. Before entering a new area, you’ll need to do your homework. And test the numbers for your plans. Be
prepared to make a sufficient investment and then see it through. And if you need some help, give us a call. |
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