Independent agencies boast a long history and culture of beinghighly effective at sales. However, that competency isn't alwaysmatched in their marketing efforts or the agency-technologydecisions that are made.

To remain competitive, agencies must now do two things. One,they need to leverage the data they are already collecting viatheir agency management systems and turn them into newopportunities by using the right marketing software; and two, theyneed to take a hard look at the technology they're using—includingtheir agency portal, the hardware (and software) producers use, andthe tools that streamline the agency's processes.

Is your agency website a few years old? If so, it's probablytime for an upgrade. Do you have a mobile app? If so, what does itoffer? And are you using e-signatures? What is your marketingstrategy? These often-uncomfortable questions are among those thatmust be asked by agencies of varying size. The marketing-strategyquestion, in particular, is one that can no longer be ignored.

"For decades, we've relied on the inherent characteristics ofthe independent channel to add value to the customer experience.Customers are less convinced," says Michael Jans, CEO of AgencyRevolution, a Bend, Ore.-based firm that specializes in marketingplatforms for insurance agencies. "Agents can't simply rely on thecarrier segment to create value. They have to vigorously find waysto add value at the agency level."

With the independent agent channel's struggles with market shareand rivals entering the marketplace, a written marketing plan isvital, adds Jans: "This is urgent. There are serious competitorsgunning for business. The complacency that the independent-agentchannel enjoyed in the past is dangerous in this environment."

In most agencies, he explains, marketing is haphazard andchaotic. In order for marketing to be effective, it must besystematic, "and the only way you can systematize communicationsthat deliver the right message to the right people—thousands ofcustomers and prospects—at the right time is throughtechnology."

"What I hear from our customers is that they like to be with anagent and an agency that is spending the money to be relevant tothem," says Stanley G. Logan Jr., an agency principal at LoganLavelle Hunt Insurance Agency LLC in Louisville, Ky., and a memberof the PIA National board of directors, representing PIA ofKentucky. Logan's firm is in an ongoing "aggressive growth phase";he'll tell you he doesn't know any other way to characterize hisbusiness. But he echoes a sentiment familiar to many an agent.

"When I talk to my insurance company partners, they areinterested in sales. That's still the No. 1 game in town, and theywant more and more from us," he says. Having the right tools to dothat job is the edge that forward-looking agencies can enjoy, ifthey're willing to do the homework.

Keith Savino, a principal with the insurance agency WarwickResource Group LLC in Warwick, N.Y., is another big believer inputting the right solutions in agency hands. "Our industry needs toembrace these tools to buoy itself in a changing market," hesays.

Savino's agency received the 2014 Excellence in Social MediaAward from the National Association of Professional InsuranceAgents. He sits on numerous industry boards engaged in technology,such as ACORD and NetVU, and has long been ahead of the curve whenit comes to experimenting with new solutions. Warwick is on itsthird customer portal in the last 13 years, with a new one slatedto roll out in a few months.

"I have to provide for someone the experience they're used to inretail or professional services," says Savino. "I want to make surethat what we can do in a brick-and-mortar world we can extend toother forms of media." That includes providing e-signaturecapability on all documents (a huge time saver, he notes); anagency portal through which customers can, among other things, signin and view all of their policies across multiple carriers; amobile-enabled site and/or app for smartphone and tablet users;advanced CRM systems for client nurturing; and videophone VoIPtechnology for use by its staffers at locations in New York, NewJersey, Connecticut and its West Coast offices.

Yet, for Savino, the word "tech" is almost anathema. He drawsparallels to the "ice box generation" of his grandparents, who oncesaw the refrigerator as a technological advancement; today, it's anappliance to which no one gives any thought. "These are justcommunications tools. I don't see them as 'technology,'" heexplains. "Some people don't even view smartphones as 'tech'anymore. I see it as a required part of business; I don't think ofit as an advantage as much as a requirement. I challenge people tothink differently about that." Think it's too late to change? Thinkagain. This philosophy is from a firm celebrating 150 years.

"The big challenge is communicating your value to your clients,"he continues. "The minute you stop offering a service because youwill not implement new business tools, you're intentionally puttingup a roadblock to a good customer experience."

However, no agency can simply build a new system and then assumethe game is won. "If you don't continue to invest money on yourinfrastructure every day, it's going to get outdated reallyquickly," Savino adds. "If you never did any maintenance on yourhouse for 30 years, never reset the pavers, never cleaned out thegutters, what do you think is going to happen? Technology wears outmuch faster than your roof."

Those using old agency management systems definitely need toupgrade, says Brian S. Cohen, an operating partner with AltamontCapital Partners in Palo Alto, Calif., and the former head of salesand distribution and chief marketing officer at Farmers InsuranceGroup. The "if it works don't fix it" strategy, he says, fails intoday's insurance-distribution market.

"There are many cloud-based systems that allow agencies to domore with less—and most importantly, serve their customers the waythey expect to be served in the digital age," says Cohen. "Agenciesthat have made the transition need to start aligning with insurancecarriers that will fully support a modern agency-managementsystem." If a carrier still requires faxes or other paper-basedprocessing, he adds, agents should demand they upgrade—or look forother markets.

PORTAL POTENTIAL

The one essential conversation that needs tobe had at an agency is the status of its web portal. How effectiveis it in serving customers, and how can it be used to reduce thenumber of hours spent on serving client requests that, if empoweredby the site, they can easily handle themselves?

"Almost all agency web portals today are predominantly marketingsites that don't allow people to interact with the agency. They areone-dimensional," says Cohen. "They don't give an existing clientor a potential customer a reason to stay on or navigate through thesite."

The most important elements of functionality, he says, must betools that provide value to visitors. For existing clients, Cohenexplains, functionality should exist to enable self-service such aspolicy changes, claims assistance, or obtaining certificates ofinsurance. "Done right, the web portal acts as the 24/7 agency CSRand today people want to be able to interact with a businesswhenever and wherever."

For potential customers, the web portal must provide resourcesthat will enable people to discover the agency when they are facedwith an insurance issue. These include things like weather alertsand a checklist of "what to do" to protect your property before astorm. "In other words, agencies need to adopt a strategy thatattracts or 'pulls' people to their website," says Cohen.

Jans notes that a constant stream of fresh and relevant contentis critical for search engine optimization—the process by which theowner of a website improves its ranking on search sites likeGoogle. Ideally, an agency should add new content weekly: "Thatmeans that the power to upload new content must be under thecontrol of the agency," he adds. "You can't afford to put 'changerequests' into a webmaster's queue and wait weeks for those changesto happen. You should be able to click in, make changes, and clickout and have them saved.

"If you have multiple niches, you must have pages that speakdirectly to each niche," says Jans. "That way, prospects are morelikely to find you on Google. Then, when they discover you, they'lltrust you."

For any audience, the key element for a web portal today ismobile capability. Today, it's all about the smartphone, and everysite needs to be able to provide a mobile experience.

"More and more people are using smartphones than computers oreven tablets" in their interactions with insurers, says Logan."They're so used to people going to their phones for theanswers."

Logan Lavelle Hunt started using its own branded smartphone app,designed by goinsuranceagent.com, six months ago. A customer canlog in through the app and, in the event of an accident, forexample, pull up his or her carrier's claims department and uploadclaims information and even photos. Through the app a customer alsocan access links to their carriers, make billing inquiries and evenaccess adjustors.

Jans agrees that the number of mobile visitors goes up everymonth. It's no longer a question of whether your site should beoptimized for mobile, but rather, when this can beachieved.

"Almost everyone knows how frustrating it is to view atraditional desktop site on their smartphone," he says. "If that'swhat your customers see, you're delivering a negative experience.If that's what your prospects see, they'll delete it and findsomeone else."

An effective portal also cuts down on the amount of hours yourcustomer-service reps spend servicing clients. Every agency knowsthat the many hours spent servicing clients is time that would bemuch better spent selling.

Logan's agency breakdown is 25% personal lines, 50% commercialP&C, and 25% benefits, handled by 60 employees in all: 15 arein sales (other than the five principals), and 45 are service reps.On a daily basis, half of the CSR's day is spent solving billinginquiries.

"It's astronomical how much we spend on billing issues," saysLogan. Trying to connect them right to the carrier, and not be thego-between, is his continued goal. "We're doing a multitude ofthings [in order] to spend more time on account rounding andreview. Right now, 70% of my revenue goes to service, 30% to sales.I'd like to reverse that in the next five to 10 years."

MARKETING-AUTOMATION SOFTWARE 101

Marketing-automation software provides the"human touch" for an entire agency's book of in-force business andits prospects.

"Every mature agency has a sophisticated system that manages itscustomer data: its agency management system," says Jans. Seriousmarketers will use marketing automation technologies to unlock theinformation that's in that system and turn it into thousands ofmarketing opportunities. "That's the shortest path to money," henotes. "Marketing automation is the fastest-growing category ofbusiness software in the world. The agent who integrates it withhis management system will have an advantage."

Marketing automation software helps an independent agencyattract new clients; convert prospects into customers; cross sell;and boost retention. Those results, he says, are why this new typeof software is the fastest-growing category of software in thebusiness world.

It works this way: Marketing automation software "reads" themass of data that's locked inside an agency management system andturns that information into marketing communications. It helpsagencies communicate with prospects and customers in ways thatmatter to the customer, not just to the agency (see sidebar,above).

The "human touch" is that communications are set up by theagency decision-makers, and are automatically delivered based oncertain criteria. For example, an agency can set up communicationsto people who request quotes; customers whose policies are expiringin 90 days; customers who have a birthday or policy anniversary;and/or policyholders who have Auto but not Homeowners coverage, andso on.

Marketing automation can integrate with an agency managementsystem, so data can flow back and forth from the system to themarketing automation portal (for example, an interface on thedesktop).

Constant outreach that doesn't have to be completely initiatedby agency employees is critical, says Logan. The customer has toknow the agency remembers who they are.

"They appreciate being asked, even if a sale doesn't happen," headds. "You often hear agents who say, 'The best customer is the oneI don't hear from.' And then they wonder why they lose thatperson."

WANTED: A NEW MINDSET

The greatest enemy of technological advancement in agencies isthe one thing agents don't have enough of: time. The agencyprincipal has long been the salesperson, and then became thebenefits guy, and now they're the tech guy, says Logan: "They don'thave time to do the research, and implement it. It takes a lot ofthought and time and planning to do it." His suggestion: Considerhiring an office manager who can take responsibility for many ofthese kinds of tasks.

"So many times, we take the top salesman and now we're makinghim manage as well," adds Logan. "It's no wonder you see so manyagencies hit the wall. There are only so many hours in theday."

Savino says that agencies would do well to look at technologyinvestments as a sales expense, and budget it that way— requiring ashift in mindset from the traditional model. "The right tech helpsyou acquire a client. If you're not apportioning any of theseexpenses to sales, you have to rethink that [equation]."

It's important, however, for agency owners to know why they'reinvesting in new systems and tools, because what looks good to theprincipal might not be so appealing to the troops. Staffs can pushback on new implementations. Know why you're doing it, andcommunicate that clearly.

Growing agencies have many moving parts; some are strategic, andsome are tactical and task-oriented. All of those moving parts needto be synchronized. "It's one thing to be disconnected from thetasks," he says, "but don't be disconnected from the strategy."

One helpful tip Savino offers: Negotiate ongoing training foryour staff, as part of the deal with the vendor, and take advantageof your user group. Then reward the team for attending them.

"What works for me, might not work for you," he stresses. Spendthe time to decide which is the right vendor for you, don't justbuy what someone else has. "Think about what you need, and you'llfind the right vendor. There are a lot of creative people in thisspace, and the landscape is constantly changing.

"Foresight is very important in the insurance industry right nowaround operations," adds Savino. "If you keep your eye on thefuture, it lends some clarity on what you need to do today."

The Digital 'John Hancock'

The future of document delivery is going to bethrough customer portals and e-doc delivery, says Keith Savino, aprincipal with Warwick Resource Group LLC in Warwick N.Y., and ahuge proponent of e-sign. The solutions he is implementing are forboth internal and external business needs, and not always forinsurance documentation.

Savino says most agencies hesitate to implement electronicsignatures into their agency workflows because they either don'tunderstand what an e-signature is or because certain carriers havepushed back or are bullish with the ones that they do use, and pushthem on agencies.

Using this mechanism has several practical advantages, however.It provides quick turnaround and digital confirmation that thecustomer really did receive a document, and that the client signedoff on it.

As his agency has done for years, Warwick shares its experiencewith other agencies looking to try new tools. "Folks that told metwo years ago that they would never use e-sign, now they're askingabout it."

The value, Savino explains, is in the productive hours that aresaved: "When someone spends 20 minutes on completing documentationor chasing a client, that's not productive time. Productive time istime spent interacting with the client. The more we get rid of theminutiae administrative tasks, the more time agency professionalscan spend with clients. That's our goal: To increase the percentageof purely productive time."

Digital Marketing: A New Twist on a ProvenMethod

"Insurance was the fastest-growing industry after World War II.This was a sweet place to be, and if you could reasonably run abusiness, your agency would grow," says Michael Jans, CEO of AgencyRevolution. "But those days are over. Competition is more fierce,and rivals are well-funded. You have to be a dedicatedentrepreneur."

One such way to grow an agency is through marketing automation—atechnology that is not new, but has been largely unavailable oruseless to the insurance industry because data has been siloed inagency management systems.

But more recently, software is available to read the informationin an AMS and automatically trigger marketing campaigns toindividuals at the right point in time.

For an agency that has 10,000 clients, Agency Revolutionidentified 141 scenarios that can take place on any given day. Andeach of these scenarios requires specific marketing materials, withdetailed language tailored just to the client's event.

Through data collection, the Agency Revolution platform triggersits marketing campaign. It's a pretty simple process, says Jans:Install the software, continue using your AMS through normalbusiness operations, data is collected, the platform detectslife-cycle changes and then automatically launches a campaign.Users are able to opt out or change any campaigns.

In this way, agencies can use technology to multiply value andmeaning to clients, Jans advises. "Good marketing automation makespeople feel that you care about them and represent the values ofyour agency," he stresses.

He recommends marketing automation for agencies that have $1million in revenue and 10 or more employees. Such operations havethe time and capital to invest in and adopt new technologies, hesays.

Chris Dik, vice president at Knight-Dik Insurance Agency inWorcester, Mass., understands the value of digital marketing. Thisstrategy has helped the agency grow its Workers' Compensation linefrom practically nothing and triple his WC commission in just thefirst year.

The Workers' Compensation market is unique in Massachusetts—it'sthe 44th cheapest in the country and there aren't a lot of playersdue to its high effort and low returns. But Dik viewed this as anopportunity.

About five years ago, the agency, which writes about $2.5million in commission each year, decided to jump into the Workers'Compensation market with both feet. It branded a program calledWorkers' Comp Results, which has its own dedicated website andoffers third-party services with the biggest impact on reducingpremiums, such as reserve reductions, audits and HR support.

With help from agency interns, Dik builds dataprofiles—including experience mods, rating systems and currentpremiums—on these potential insureds from free and publicationinformation from the state, and puts all of that information intoan Excel spreadsheet. "We are taking the old way of marketing—ofgetting the data first—and then letting the system work," hesays.

From there, Infusionsoft—aplatform offering contact management, CRM, marketing automation ande-commerce—takes over. The software identifies certain niches thatDik wants to target for specific campaigns: Contractors orlandscapers, for example, who are paying at least 10% more thantheir competitors.

The software pulls these names and their data, and sends out aletter that includes actual premium numbers and comparisons.

This language grabs the potential insured's eye, and from thereit's inbound marketing, Dik says: "Ninety to 95% of my business isfrom inbound calls after a client receives those letters."

Infusionsoft automates the onboarding of new clients—across alllines, not just Workers' Comp. The software continues to sende-mails quarterly to potential clients, a programmed process sosuccessful that Knight-Dik closes about three policies a monthbased off of marketing campaigns that ended four or five yearsago.

Jan agrees with this strategy, and applauds the payoff: "Howmany times are you contacting your customers?" he asks. "Only atrenewal? If the nature of your message is a Halloween cartoon witha picture of pumpkins—that doesn't add value to yourrelationship."