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THE POWER OF HAVING A MARKETPLACE SPECIALTY

THE POWER OF HAVING A MARKETPLACE SPECIALTY

THE POWER OF HAVING A MARKETPLACE SPECIALTY
August 26
07:47 2021

Winning Strategies

By Brent Kelly

THE POWER OF HAVING A MARKETPLACE SPECIALTY

Begin the process of reaping rewards by accepting responsibility for your attitude and actions

According to Risk and Insurance magazine, 91% of this year’s top-producing “power brokers” have a niche or specialty in the marketplace. The same is true within our Elite 50, the Sitkins Network’s sales mastery group. At least 90% have a niche they own. I think that while a great number of agencies and producers agree it’s a good idea to have a specialty, only the most successful actually pursue a specific niche in their market.

I have no doubt that for the time being—and for the next five to 10 years—generalists will survive. They’ll serve a variety of niches and get along just fine. In the medical world, this is certainly the case, as general practitioners with broad skills have always been in demand. As a result, they’ve always done well, which I expect will continue.

But specialists will thrive. Based on their depth of training, they possess a level of expertise in specific areas that others lack.

In his best-selling book, Becoming a Category of One, author Joe Calloway discusses the three characteristics that define a business specialist:

  1. They know more about the customer than anyone else
  2. They get closer to the customer than anyone else
  3. They emotionally connect with the customer more than anyone else

If you’re an insurance producer, people expect you to know and understand insurance and risk management. If you do, you will probably do okay. But you will receive far more compensation by knowing and understanding your clients and their business. That’s what specialists do.

For example, let’s say you deal with manufacturers. A generalist will know the basics of business interruption coverage. But by understanding the industry, a manufacturing specialist is able to ask better questions, present better risk management solutions, and offer specific ways to keep the business operational after a loss. Specialists talk a different language, and because they understand the nuances of the business, their products and services are perceived at a higher value.

Diving deeper into the topic of specialists vs. generalists, we find there are three types of insurance producers.

  • Quoters and floaters (80%). This is by far the most prevalent type of producer. Their focus is on quoting as many accounts as possible, regardless of whom they’re quoting, whether they know anything about the business or if it’s a good fit. They’re just up to bat without practice or preparation, taking as many swings as possible and hoping they don’t strike out.
  • Trusted advisor (18%). This is a fairly exclusive group comprising very high-level producers. Unlike a vendor (someone a person calls after they make a business or financial decision), a trusted advisor is someone you call before you make the decision because you want their advice.
  • Indispensable risk partner (2%). This is the top tier a producer can achieve. You’re someone the business can’t live without! They consider this type of producer vital to their operation and bottom line—a partner in their success. This is where the specialists live.

Keys to owning your niche and becoming indispensable

It’s likely your agency has a producer who has some ideas about what interests them but hasn’t decided on a specialty yet. In the agencies we coach, we help producers identify and own their niche through a logical process.

Account review. One of the first things we have producers do is review their book of business and look at the top 20% of their clients that produce approximately 80% of their revenue. Usually, it’s pretty obvious that the bulk of their clients are in the same one or two types of businesses. This tells them they should probably write more of those.

In today’s insurance marketplace, can you survive and make a decent living as a generalist? The answer is “yes—for a while.”

I guarantee you have a niche (or two) that you have overlooked or haven’t paid enough attention to or simply haven’t taken the time to identify. In all likelihood, it’s right in front of you, hiding in plain sight, but you just haven’t bothered to review your current book of business. I see it all the time with producers who say they don’t have a niche until they realize that their eight restaurant clients account for 50% of their business. The types of business you already write the most of, and show a real proclivity for, are the ones you should be replicating.

Conversely, some people will claim to have multiple niches. They’ll say they “specialize” in businesses ranging from medical offices and restaurants to funeral homes and golf courses, thinking that diversity gives them more market opportunities. In reality, it dilutes the value of their true expertise, which is going to be focused on just one, two or maybe three specialties.

Finally, there are those producers who make a point not to specialize. They’re afraid of missing out on market opportunities, when in fact they’re typically lower-value distractions that aren’t worthy of their time. By chasing too many shiny objects, these producers minimize their chances of success. They’re “stepping over dollars to pick up dimes.”

This brings to mind the adage, “If you try to market to all, you market to none.” No one will hear your message if you’re trying to appeal to too many different business types. I see this with my kids all the time. If I tell them to do 10 different chores, none get done. However, if I give them one chore to complete, it gets done because they’re able to focus their attention and energy. Similarly, producers who can eliminate distractions and prioritize are more successful than those who get sidetracked by distractions. Because they have clarity, they can focus on what’s most important.

Now if you are a newer producer, this process may take a bit more time. However, the principle that “success leaves clues” still applies. Find an area or industry that you would love to associate with, identify the agency resources and key carriers that provide a competitive advantage, and then implement a strategy focused on getting introductions.

A focused pipeline. The best pipelines are filled exclusively with Future Ideal Clients (FIC), rather than suspects and prospects. Once you have identified your top 20%—the types of accounts you want to replicate—who are the FICs that you truly want to become clients of your agency? It’s really difficult to build a niche in specific industries unless you have a list of businesses that fit your desired client profile, in terms of size, type, etc. Keep in mind, this is not a wish list of clients you hope you can get, but rather a targeted list of people/businesses that fit what you do best and where you want to go.

Our most successful agencies and producers create a tangible list and scoreboard that enable them to monitor and track their progress with their FICs.

Targeted Account Strategy Plan (TASP). Do you have an actual plan for getting in the door of your FICs and working with them? Or are you relying on hope as your strategy? Our Sitkins Network members receive a template to help them create a TASP for FICs in any industry. It includes questions such as:

  • Do you have specific account information that includes decision makers, influencers, and partners?
  • Why is this a targeted account?
  • What are your competitive advantages or unfair advantages?
  • What steps will you take to secure a first appointment (this includes who, how, and when)?

Positioning. Once you have identified your niche or specialty, you must create a compelling story that will address your FICs’ key frustrations, share your unique process and, most important, communicate to them how they win.

How do you answer if someone asks you, “What do you do?” Are you able to succinctly and powerfully communicate how you help clients in a specific niche or niches? Have you thoroughly prepared and continually practiced your 30-second elevator pitch? This introductory spiel should include what you do, whom you help, and how you help them. Properly presented, it should spur interest and make your FIC want to know more. If not, they probably don’t fit your FIC parameters and, therefore, do not warrant further investment of your time.

Once you have identified the FICs that fit your demographic, you’ll want to know the names of their other trusted advisors or Center of Influence Networks (COINs). Often, COINs include key attorneys and accountants and, in some cases, their main vendor or supplier, as well. You may want to talk with them to ensure that you and the FIC are sufficiently aligned.

Promotional exposure is another key to positioning yourself as an expert in your niche. Where and how can you get your presence known? Frequently, specialists will write articles for publications that cater to specific niches. For example, writing for Rough Notes has allowed me to share my expertise on certain subjects, which also has raised my profile among independent insurance agencies. Speaking at professional meetings and events is another excellent way to position yourself as an expert. You could also offer to facilitate a roundtable discussion or moderate a question-and-answer session at a networking event or commercial conference.

The key point is you must consistently position yourself as the expert in your field. As sales guru and author Jeffrey Gitomer notes, “There are three types of experts: an expert, a world-class expert, and the world-class expert.” I agree. Where will you be positioned?

The bottom line

In today’s insurance marketplace, can you survive and make a decent living as a generalist? The answer is “yes—for a while.” But if you want to be elite and become the point of comparison, you’ll need to identify and own your niche.

The author

Brent Kelly, president of Sitkins Group, Inc., is a motivating influencer, coach and speaker who has a passion for helping insurance agencies maximize their performance. He spent 15 years in the insurance industry as a successful commercial lines producer and was named one of the top 12 young agents in the country in 2012. To help your agency gain clarity, build confidence, and improve culture, please contact him at brent@sitkins.com or visit Sitkins.com

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