Want fries with that burger? How about a grande cup of Starbucks coffee rather than a tall? If you said yes to either question, I've just been able to cross-sell or up-sell you. Done deal . . . as easy as that.
So, how come when it comes to financial service products, achieving similar successes hasn't been that simple? If you poke around some insurer Web sites, carriers do exhibit a predisposition toward cross-selling. For example, Aetna last month completed the acquisition of the disability business of Broadspire, a supplier of disability and casualty claim management services. "We believe it will provide significant opportunities to cross-sell medical, disability, group life, and other products within both the Aetna and Broadspire disability business' customer base," declared Ronald A. Williams, Aetna CEO and president. Prudential Financial's site for its real estate business says, "PREA [Prudential Real Estate Affiliates] will facilitate the cross-sell of other Prudential products. . . . PREA will be a leader in the use of the Internet and implement e-commerce strategies to improve customer service and tie in cross-sell opportunities." The First American Title Insurance Company has a cross-sell division, and its "strength," per the carrier's site, is bringing the company's "multiple products and services to our customers through a single source of contact."
Yet a Forbes.com interview conducted with consultants from Find/SVP in 2004 pointed out, "everyone agrees that this is something [financial services firms] should be doing, and almost everyone agrees that they're not doing a very good job." The problem in insurance, they continued, is "most of the relationship is with the agent, not the company, and most agents don't understand other products."
On the agency side, the reality check isn't any more encouraging. In a fall 2005 article in our sister publication, National Underwriter, life and health edition, Raymond Adamson, vice president and senior coach at The Covenant Group, cited a survey by Axis Consulting that indicated "94 percent of insurance advisors believe that the ability to cross-sell effectively is 'critical.' But only 46 percent consider themselves successful at cross-selling."
This all sounds a lot like many people's attitude toward exercising–it's good in theory but hard to do in practice. It also sounds similar to a discussion in one of Tech Decisions' features last month regarding agency management systems and ease of doing business, i.e., insurers largely believe they're providing agents with what they need, but agents still assert they're not getting what they want.
Certainly, several issues complicate an agent's ability or desire to cross-sell. Still, the upside to cross-selling and up-selling is a win-win for carriers and agents. Insurers are making definite strides on the technology front, but as with the agency management challenge, they also need to look honestly at the situation through the agents' eyes to provide the solutions distributors require to make the most of a potentially lucrative strategy. After all, the challenge should be to get the customer on board–not the agent.
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