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Change starts at the beginning

The problems with commodity selling

The insurance agent owning the company sold the business to a larger company several years ago. The personal touch quickly went away; we could not tell you the name of anyone working at the new company. It was the opportunity to look for a new insurance agent.

The search online for local companies produced a sizable list of possibilities. Expectedly, there would little expectation of contacting an agent over the weekend. Each of the local agents had varying ways of being contacted; complete online forms, call and leave a voice mail or write an email.

Of the several that were contacted, the most memorable (for the wrong reason) was the agent who responded by email within an hour. The message was simple; fill out the attached three pages about your current policy and the agent would call after you return the form.

Instead of completing the form, the email that we sent stated that we were looking for an agent; not just a quote. The agent responded in his email that he also preferred a “customer relationship”. He further stated that unfortunately Progressive, Geico and General insurance had ruined the industry and turned everything into commodity buying.

To narrow down the inquiries of those just looking for a quick price quote, the agent resorted to requiring completing of the form. Further disappointment occurred when he then asked to see our current policy. Instead of asking questions about us and what we thought we would need in an insurance policy, the agent just wanted to look at what we had previously purchased.

We see the agent’s attempt to get past a quick quote. However, it also appears this agent is willing to get into the commodity game, and only hopes that a potential customer that is wanting a relationship will find him. I am not sure how completing the form would get someone to a relationship as the form seems like a contradiction to what he wants to be.

The lesson learned from this personal experience is one that is appropriate for our businesses. If we are going to build a business based upon a relationship with our customer, the relationship should start at the very beginning. It is not up to the customer to prove themselves to us; it is our responsibility to prove ourselves to our customers.

So, what would a relationship be? The relationship would start with learning about the customer; understanding about their business and listening to the buyer. There is often a sizable difference between what the customer wants and what the customer needs.

This is where we come in as a customer centric business. The item a customer is currently buying may be the best choice for them, but we have to make the effort to investigate its usage and see if we can offer the customer something more in tune with their needs. It may be something with a different cost as well as it could be something that better serves their needs.

Unfortunately for us, if everything the customer buys from us is the same as what they last bought we can be thrown into a price competition. We then have to find something that will distinguish us from a competitor; be it a competitor that has a salesperson or a faceless online business.

We must have hours, services, return policies, delivery services or other points of distinction for our customer to see us as different from any and all competitions. These distinctive differences must be present and visible from the beginning of the interaction with each customer.

Our industry has not been relegated to being a commodity as much as the insurance industry has. However, commodity continues to encroach on many aspects of our businesses and lives.

Borrowing a phrase that should be a reminder to all of us; he who becomes a commodity last is the winner.

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This article is copyrighted by Tom Shay and Profits Plus Solutions, who can be reached at: PO Box 128, Dardanelle, AR. 72834. Phone 727-823-7205. It may be printed for an individual to read, but not duplicated or distributed without expressed written consent of the copyright owner.

MAY 2024
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Small Business

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The article of the month shares an old Southern rhyming couplet about business; "The bertter you niche, the more you get rich."


Book of the Month

Lean Startup by Eric Reis is our suggested book for May.

 

As the title suggests, the reader of the book would be someone that is starting their business. However, we see more value than just that.

 

Perhaps you have been in business for many years. We think this book could give insight to items, and methods, that a small business owner should think about with their business today.

BOOK US

With over 25 years of frontline experience Tom Shay is America's leading Small Business Management Expert. He's a "Must Have" for your next event.

Small Business

Advisories

The May Small Business Advisory is titled "Planning for a successful accountant" and is appropriate for many with the April 15 tax deadline having passed.

 

Did you work with your accountant? Or, did you just give them a bunch of papers and wait to receive a completed tax return?

 

Successfully working with an accountant requires a partnership. This month's Small Business Advisory gives suggestions of how to make this happen in 2024.

Small Business

News

 

Top Story

We see that many small business owners have too much of a focus on the "top line" of their income statement.

 

Increasing revenue is great, but it is not a cure all for any challenges your business is facing. And sometimes, incresing revenue can create a challenge.


Article of the Month

Who is your customer? Some small businesses have no focus. Their customer is whoever calls or walks in the door.

 

And some small businesses have determined which customers, in sufficient numbers, they should spend their efforts to attract.

 

The article of the month shares an old Southern rhyming couplet about business; "The bertter you niche, the more you get rich."


Book of the Month

Lean Startup by Eric Reis is our suggested book for May.

 

As the title suggests, the reader of the book would be someone that is starting their business. However, we see more value than just that.

 

Perhaps you have been in business for many years. We think this book could give insight to items, and methods, that a small business owner should think about with their business today.