Q: I own a small insurance agency and find it difficult to compete in the general insurance arena. How can I set myself apart from the rest of the pack?
A: In a broad-based market like insurance consumers have many choices. They can deal through agents like you or they can buy direct from some insurance companies.
Insurance is a personal service business and the added value an agent can bring to the relationship is worth paying a little more for some customers.
You should take a hard look at your current customer base and try to determine which of the commercial trade groups you insure produce the greatest return for your investment of time. This is one definition of "Defining Your Niche." This allows you to provide a targeted service to a smaller customer base.
However, even niches can be too broad in scope. Insuring contractors may be a niche, but there are many different kind of contractors, some of whom may serve a small, underserved market. Because these markets are underserved, they are usually under the radar of the mainstream competition.
Consider the trucking industry; there are local, intermediate and long-haul operations. Some haul general commodities, while other specialize in wide loads or haul hazardous materials. Look at the many tractor-trailers operating up and down our interstate highways and you will be amazed at the various trailer configurations, designed to accommodate different types of freight.
Your job is to investigate these kinds of situations to determine which of them are underserved from an insurance perspective. Remember the greater the risk exposure, the less interest there will be. However, if you can identify a market for the coverage, you will soon be the go-to person for this specialized niche.
It always helps if you have some background or history with your niche. An intimate knowledge of your customers operation is critical to you making the necessary inroads and establishing yourself as an "expert" in the niche market.
Once you have identified your niche, constructed a prospect list, and acquired the necessary insurance markets, you should join the trade associations who support the niche. Advertise heavily in their trade publications and volunteer to serve on committees. Construct a great website and hire someone to maintain and optimize the site, such that you are always on page one of the major web browsers.
Finally, always strive to be one who is regarded as sincerely interested in the success of the particular industry group you serve. This more than anything else will ensure customer loyalty.
Gray Poehler is a volunteer with SCORE Naples. Their counselors can assist and offer advice concerning management issues facing your small business. Counseling is provided free to all U.S. citizens and legal aliens. To register, call 239-430-0081 or visit tinyurl.com/43aqelw.
If you would like an answer to your question, please fill out the form located at naples.score.org/mentors. A counselor will contact you in 48 hours.