TOP FIVE LESSONS TO LEARN FROM BIG PIZZA
From Big Data to bigger slices, learning how to improve on what we do
“[I]dentifying ‘high potentials’ is just as important as focusing on ‘high performers.’”
By Michael Wayne
On the surface, you may not think that the insurance industry has all that much in common with the likes of Papa John’s, Pizza Hut, and Domino’s. Our menus are completely different, our products don’t fulfill the same needs, and there is no comparison as far as taste. I would go so far as to venture that the public feels more satisfied when they make a pizza purchase than a coverage purchase. If they order a pizza for delivery, by and large, they know that before long they will have a delicious experience of dough, cheese, and whatever toppings they choose.
Insurance is security. Pizza is indulgence.
In recent years, Big Pizza has had to come to terms with the fact that pizza no longer holds a near monopoly of being the most readily available meal to the majority. DoorDash, Grubhub, Waitr, and other services have changed things. Add to that the challenge of recruiting delivery drivers as well as additional staff, and Big Pizza has significant issues.
Reportedly, in the first quarter of 2022, Pizza Hut U.S. same-store sales dropped 6%. This wasn’t because of a drop in consumer demand. Rather, it was because, while “no one out-pizza’s The Hut,” The Hut’s delivery channel met with capacity channels that limited its ability to meet orders. In response, Pizza Hut is working to prioritize operations, improve staffing levels, increase ordering availability, and more effectively leverage the use of its overflow call centers.
An employee shortage crisis and employee retention issues … Does this sound at all familiar?
In late April, Brad Whatley, managing director of insurance recruiting pillar The Jacobson Group, stated at the annual 2022 Life Insurance Conference that insurance unemployment stands at 1.5%. The national average for all industries is 3.6%. Additionally, Whatley stated that replacing employees costs approximately one-half to two times the salary of their predecessors. As if that didn’t make things sound desperate enough, consider that in the finance and insurance sector, 2021 saw the highest average monthly retirements in more than a decade. In February 2022, some 83,000 finance and insurance professionals simply walked away from their jobs.
At this point, two words are likely dominating your thoughts. In some cases, they aren’t words I feel comfortable including here as a pair. For many of you, however, the words are “recruiting” and “retention.” Along that vein, Whatley intoned that identifying “high potentials” is just as important as focusing on “high performers.” With that said, here are the top five ways that Big Pizza may show us the way in figuring out how to improve upon what we are doing.
No anchovies, add extra data. Client data is paramount to long-term success. Increasingly, Big Pizza is using Big Data to offer personalized marketing and call-to-action messages that are developed with the assistance of consumer locations, demographics, and knowledge about other purchases. Likewise, the more we as insurance professionals know about our clients and prospects, the better we can tailor coverage. More important, we can anticipate needs. If modeling and analytics are not already a part of your arsenal, it’s time to get serious.
Get customers to come pick up their pizzas. Of the big three pizza companies, Domino’s seems to be working this angle the hardest. Domino’s is incentivizing customers to pick up their own pizzas by offering them a $3 coupon code for a future order. Our model isn’t one where clients are coming to our offices to pick up their policies, and rules against rebating don’t allow us to offer coupons for future insurance purchases. So, what can the insurance industry pull from here? In short, it’s the delivery method.
Clients and prospects are used to being able to get whatever they want with a tap on a screen or a click of a mouse. We need to provide an online, customized experience that meets the needs of as many clients and prospects as possible. If your organization hasn’t embraced technology in the past, the present is passing you by, and the future is looming.
Drivers are for delivery, not making pies. One tactic Big Pizza is taking is separating drivers from their colleagues behind the counter who are actually working with the dough and toppings. This one translates pretty straightforwardly. Producers are not account managers. Account managers are not producers. Marketing personnel are not human resources specialists and, well, you get the idea. Cross training and redundancies in many regards are great, but ensure that your team members understand their defined roles and aren’t overextended.
Include 33% more pepperoni; charge a little more, too. At the start of the year, Little Caesars was adding 33% more pepperoni to its Hot-N-Ready Classic Pepperoni pizza. That surplus meat came at a cost—an extra 55 cents that boosted the cost per pie to $5.55 before taxes. While this marked Little Caesars’ first price increase in almost 25 years, the price point was still around 50% the cost of similar competitor products. If there are added-value resources that you have held off providing via an in-house manner or by TPA because of cost or time considerations, maybe it’s time to reevaluate. While fee increases are generally shunned, if you can show the worth of what you are doing and how you are innovating, there is a good chance your clients will be receptive.
Make bigger slices. Jet’s Pizza, which has more than 250 franchises throughout a 16-state footprint, announced in January that to combat the ongoing labor shortage it would make its pizza slices on all small and large pizzas bigger. Simply put, Jet’s expects that its crews will be making about 25 million fewer cuts annually. The lesson to be learned here is that we need to figure out where we can be more efficient. There are multiple areas that we can target in this regard, but here are just a few suggestions:
- Research and implement the right agency tools
- Train your agents to cross-sell
- Help ensure your agents’ mental and physical health
- Make certain meetings are intentional
- Restructure, or “slice” up, workdays into set timed intervals
Big Pizza can teach us quite a bit about ourselves. That includes remembering to not write about pizza on an empty stomach.
Michael Wayne is a freelance insurance writer.