I have spent most of my business life with the advantage so many entrepreneurs and business owners aspire to and envy: a big, almost universally recognized national brand. My local business operates under its national umbrella of brand, brand advertising on TV, radio, and print, and in online media, with name, logo, and slogan presented to the public every hour of every day. In fact, you probably know Allstate’s slogan, even though you certainly made no attempt to memorize it. It’s not like there’s a test. All I have to say is “You’re in Good Hands with” and you’ll probably get an A, and correctly name Allstate.
I have been an employee, independent contractor, and an insurance agency owner with this Fortune 100 company since 1984. They are the largest publicly held property and casualty insurer, with the most recognized brand and most famous slogan in the industry.
I’m happy to have had this life under their big-brand umbrella. But it is not my most important asset.
The biggest advantage you have as a business owner and entrepreneur is the relationships you have with your customers, prospects, and centers of influence (COIs). It took me many years into my business career for me to learn this most valuable lesson.
How I learned this lesson, and how I’ve made it the cornerstone of my business, is, I hope you wind up agreeing with, a story worth telling.
One of the big reasons I decided to go to work as an employee insurance agent selling auto, home, and life insurance for Allstate at the tender age of 23 was because of this famous brand. I mean, even I had heard of Allstate, and almost everyone needs or must buy auto and homeowners insurance, right? This should be a piece of cake. I was to be paid nicely plus given an incredible employee benefit package for taking orders for this huge well-known corporation and their famous brand.
I immediately bought into the home office advertising; after all, they were paying for half of it with their generous co-op advertising program for all different media, newspaper, radio, and TV. The local advertising reps were having a field day with all of us working as Allstate agents at the booth at the Sears department store. We were told by the local media reps we needed to “get our name out there,” and we followed their “expert” advice until our co-op funds were depleted. As I learned later, these local advertising and media reps are good at one thing, selling their products. I can count on one hand the number I have met in my business career that understand direct-response marketing and true measurement of return of investment (ROI).
Even though I had no way of knowing my results of this traditional image advertising, all sickness is not death. I had one huge advantage as a new agent in Florence, Alabama. I had a real asset in having a REAL business mentor and coach with my Allstate sales manager, Kathy Honaker. She had me working hard in the trenches on some real good things that other top agents in her market were doing with success and holding me accountable for my actions in pursuit on my goals. Most importantly, still used today, and now taught to other insurance agency owners by me today, Kathy taught me how to write out my goals, write out business plans for their achievement, and, most importantly, do the required action of starting the work immediately and being flexible to change toward said goals. I know this is not real earth-shattering news to most of you, but are you doing this?
I finished strong, my first year, winning rookie agent of the year in Alabama and a top 20% in country ranking in the first two years. This was my start in the “real world” just after graduating college with, of all things, degrees from the business school in marketing and management. The next 25 years I was an employee Allstate agent and an Allstate agency owner as an independent contractor with multiple locations. These years were full of a lot of wins, a few losses, and a devastating family tragedy.
For the next few years after losing my mentor to promotion, I also went through a divorce; got into self-pity, excuse making; lost my business drive; and goofed around a lot being single, carefree, and playing a lot of poker. Yeah, that’s right, poker. I have played with many of those celebrity guys and gals you see on TV today. No top of the Allstate productions list for me in those days. The best thing I did was manage to keep my job by staying in the middle Allstate agent rankings. Not hard to do when our world accepts so much mediocrity.
After enough of this “play time,” I began to hang out with the better agents in our market, started moving up the production leaderboard, and moved into the top 15% to 20% in the country ranking. In just a couple more years in the early 1990s I started hanging out with some of the top 5% of Allstate agency owners and became one of them rather quickly. Once I got there, I stayed at this elite level until I sold the last of my agencies in 2012 to concentrate full time on helping insurance agency owners grow and creating a family legacy through a company I founded in 2008, BGI Marketing Systems.
The top 5% ranking for Allstate agency owners is well rewarded with the highest cash bonuses, more money for approved marketing expenses, plus extra co-op advertising dollars, a very special business meeting of just your peers, and the annual international trip to some of the best destinations and five-star hotels in the world. My wife Vanessa and I have some incredible memories along with lots of Allstate family friends recorded in scrapbooks we will always treasure from Allstate taking us around the world in first-class style.
One thing that I have always done, and it is the biggest shortcut I am aware of toward success, is to watch and learn what really top performers do in their field and emulate it. I am amazed and frankly appalled at the number of people that think they need to do it, whatever “it” is, their own way. To me, this is far more than just ignorance. Ignorance can be fixed, but this stubborn, do-it-yourself activity borders on stupidity. And we are surrounded by it.
Direct-Response Marketing and Two Major Breakthroughs
I was introduced into the world of direct-response marketing in 2004. After networking and hanging out with hundreds of Allstate’s very best agency owners for more than a decade and a half, I was no longer an employee agent with Allstate. I now had an independent contractor status with no employee benefits. I was basically a small-business owner and would now be able to sell my agency, along with being able to start and buy more agencies. I was looking for something new or fresh, and, boy, did I find it with Dan Kennedy. Networking with Allstate’s best agency owners took me only so far, and there is no school of marketing at Allstate other than the corporate image-based ads. This is the reason for co-op advertising programs that I had long ago learned is me paying half to advertise the famous brand. After all, Allstate’s and other major corporations’ big advantage is their brand, and they protect that image by controlling the marketing and advertising messages.
I became a serious student of marketing for small-business owners, learning more and more about direct-response marketing and all that it entails. I began marketing the Bill Gough All American Insurance Agency, first using direct-response techniques and leveraging the powerful strength of the Allstate brand behind this new positioning. Almost immediately I began climbing into the 1% to 2% of all 11,000-plus Allstate agency owners in the country. This may not sound like much of a bump from the top 5% to the top 1%, but it is big on many levels, including cash bonus enhancements, company recognition, and tons of valuable high-level perks.
Because of the time spent running the agency and my obsession with this newfound information that, as you know, is about progress, not perfection, other areas of my life were suffering. I was not a very good parent or husband to my family. Thank God I happened to really hear Vanessa say one day calmly, but sternly, “Bill, you don’t know much about your three children.” She was right, I knew it, and I wanted to change it as the best years of parenting were passing me by.
So I began working on building better systems for more autonomy in my business to free my time to enjoy my family. Similar to what Ray Kroc did to make McDonald’s the most successful franchised business in the world, Is for running the day-to-day operations of the agency years ago. I also had my staff in specialized teams of sales, service, and administration, and I was in charge of marketing.
Something I discovered that is very important is that no matter how famous or powerful your brand is, it won’t sell itself. And it’s not a system. A business, with or without a great brand, that requires you as its chief-everything—chief salesman, chief producer, chief operations person—actually isn’t a good business. It’s a bad job, however well paid—the kind of bad job that punishes you and your family. A big virtue of a direct-response marketing-driven business is that it can actually be systemized. The obtaining of customers can be systemized. The retention of customers can be systemized.
Two big changes I made really made a huge difference in production, efficiency, and morale. First, promoting managers in each department versus our old style of one office manager for all three departments was the biggest change. Our management team worked together really well as the two ladies promoted in sales and service departments really wanted more responsibility. My former office manager had been stretched thinly over three departments. I had also been freed up to work closely with our three managers, and concentrate on the marketing of our business. Next, I gave ownership to the entire daily tasks outlined in our process manuals to all team members, giving everyone more responsibility in the business. I put in more measurements, and everyone was held accountable for their responsibilities.
An amazing thing happened: Our ranking in Allstate moved inside the top 50 as we improved our business. I was working fewer hours, but I was working on the right activities. So now I had more time to spend with my family and friends. All of this happened so quickly from late 2004 to 2006. I had been in business for 20 years, and very successful for most of those years, but in less than two years felt as if I had accomplished more than all of those other years.
January 1, 2007 . . . Worst Day of My Life
As parents, we have all felt that sick, empty, queasy feeling in our stomach, dryness in the throat, and the gentle sting of tears forming in our eyes when we hear of a tragic story of someone losing a young child. This is especially true when it happens to a family member, friend, or close acquaintance. Most say they cannot imagine having to go through that.
This tragedy happened to our family January 1, 2007, with the accidental drowning of our son William (Lil’ Bill) M. Gough III at the tender age of 23.
There have been many blessings that have come from Bill’s death. I do not have room to share them all here, but I will talk about a couple. First, we were all together as a family on vacation in Palm Springs, California, during Bill’s Christmas break from Auburn University. We know exactly how Bill died, and we were with him at the pool when he passed out from a heart arrhythmia due to complications from diabetes. Next, the reaction from friends and family was tremendous, including a group of insurance agency owners sending me a check to do something in Bill’s memory. I took that check and started the William Gough III Charitable Memorial Fund for the first of several scholarships that have now been permanently endowed. Later, I founded BGI Marketing Systems designed to help insurance agency owners that believed investing in my selling systems and processes could take their business to another level. A portion of every dollar that comes in to BGI is donated to the William Gough III Charitable Memorial Fund. You can read more about BGI and Bill’s story at www.BGIMarketing.com.
I missed a lot in 2007, went to some dark places, and stayed out of the office three to four months. Amazingly, the staff was motivated to succeed, and we had the best year in our history at that time. One of the most rewarding things that year was I personally awarded Bill’s first memorial scholarship to a lady my age who told me if not for that $1,000.00 gift she could not attend school.
The following section on our referral rewards program describes how we started our charity giving in 2006, the year prior to Bill’s passing. I believe there are no coincidences for this occurrence.
Bill Gough All American Insurance Agency Referral Program
Before being exposed to direct-response marketing in late 2004, we were pathetic at generating referrals in my insurance agency. Referrals were generating only 2% to 3% of our new business sales. Even though our industry is strongly regulated by state insurance departments, I could give a small reward for referral as long as it was not based on a sales transaction. In other words, I could give a small gift card, lottery ticket, etc., as a referral reward as long as it wasn’t tied to a sale. If we quoted ten referrals and wrote five of them, we had to reward all ten, not just the five that purchased insurance.
In 2005, after more than 20 years in business, we decided to make a major effort to drive referrals in our insurance agency. We also discovered we could add a monthly random drawing of the month’s referrers and an end-of-year grand prize to make the referral program even more attractive. We immediately went to work hard on this as a company and made sure we announced this to our customers, prospects, and centers of influence. This was done in many ways and used different media. It was a slow process, but gained momentum fast as we continued to talk strategy in our office meetings. In other words, we decided our business was going to be about referrals, and we would constantly keep it at the forefront of the business. Everyone in the agency had a role in this critical part of our business. We put together a ruthless measurement and accountability system in the referral process.
Our measurable results were amazing: In 2005 our new business from referrals went from a paltry 3% to a very respectable 17% of our new business sales. In 2006, we added charity giving to the program and got a big bump in response. Referrals were 23% of new business sales, and we raised money for four charities. From 2007–2009 we had a separate referral reward program just for realtors and mortgage lenders. Today, 34% of our new business auto and homeowner sales comes from referrals.
Some of the marketing and media we used to promote the referral program include:
1. Referral fliers and everything else revolved around the program fliers that were on all desks, mailed out in every outgoing piece of mail. (See Figures 13.1A and B on pages 134 and 135.)
2. Dedicated a full page in our printed monthly newsletter with contest details and, very importantly, recognized our customers for their referrals, plus a photo of the monthly winner with a staff member.
3. Weekly emails to our realtor mortgage broker lists with photo of current monthly winner and previous year grand prize winners . . . this weekly email also gives a valuable business tip each week.
4. Referral program on all employee auto-signatures for their outgoing emails.
5. Monthly email to customers and prospects recognizing our monthly winner and all referrers for the previous month and, of course, the details of the program for all to participate.
6. Personal URL website sent to customers through email with link to give referrals.
7. Directed customers to use custom tabs on agency Facebook to submit referrals.
8. Fax cover sheets were created with referral rewards program on the bottom.
9. Special referral-only mail pieces were created . . . both postcards and letters.
10. Handwritten thank-you notes to the referrers mailed immediately upon the referral.
11. Measurement was key. We hold staff and each other strictly accountable. Check out the detail of my measurements below for first six years of referral program.
The results of our referral program January 2005–December 2010:
• 1,720 home and/or auto insurance leads received just from referrals
• 1,027 new auto and/or homeowners insurance policies written
• 59.71% closing ratio on these referred leads
• $715,362.85 new home and/or auto insurance premiums written for referrals
• 99% preferred home and auto policies, highest lifetime value
• 93.37% retention on these 1,027 policies
• $223,301.70 new business, renewal, and bonus commissions
• $31,890.70 referral campaign total expenses
• 7.02 to 1 return on investment . . . increases yearly (expenses are in first year only)
DAN KENNEDY’S COMMENT: Figures 13.1A and B are two pages from Bill’s insurance agency’s customer newsletter, all about the referral program. I think it’s important to understand that the big-brand company Allstate would be extremely unlikely to run a promotional program like this or send out a homemade-looking, personal newsletter, but when done by Bill building his agency brand it works well. And having Allstate as his product brand makes all his marketing more powerful. You should also carefully examine the list of the 11 things he’s doing to fuel his referral program. Eleven. Most business owners announce a referral reward opportunity, put up an in-store sign, maybe put out a flier, then wonder why it doesn’t produce. The principle here is that EVERYTHING needs to be aggressively marketed—brand(s), product(s), service(s), referral program(s).
FIGURE 13.1A: Referral Flier, Front
FIGURE 13.1B: Referral Flier, Back
The Power of a Printed Monthly Newsletter
Dan Kennedy says it best, “Done right, the monthly printed newsletter is the most powerful relationship-building tool for small-business owners and entrepreneurs.”
I was first introduced to the concept of the printed monthly newsletter in early 2005 and really liked the appeal of it. I put it on the “to-do list,” and it kept getting pushed back as I never realized the difficulty of this task because I had never done anything like it before. Finally, after more than a year we launched it in April 2006, and it became an immediate hit with our customers. I am very proud of our production team, as we have only missed publishing it one month, just after Bill’s death in 2007.
The newsletter works best if done similar to Aunt Betty’s Christmas letter telling the stories of her family over the past year. It is a feel-good publication providing helpful, useful information designed to improve your customers’ lives. It gets into the home working for you, and has good shelf life provided you are interesting and not being a sales pest—or even worse, boring.
It also serves as a customer magnet attracting more cross-sells and upsells from your customers. Referrals will skyrocket with a well-promoted referral rewards program. Customer retention improves as you build trust and loyalty with your raving customer fans. You will become the expert in your marketplace and dominate your competition because they have no idea of this incredible relationship-marketing tool.
A couple of questions about newsletters I always get are: 1) Why monthly? Is quarterly enough? 2) Can I just do an e-newsletter?
Of course you can easily say yes to both of these, but I strongly suggest not.
Today we are bombarded with thousands of messages daily, and people are busier than ever. This reason alone should be enough to want your valuable message in the home or business of your customers every 30 days. A peer of mine tested dropping his monthly newsletter to a quarterly publication and after just six months went back to monthly. His referrals really dropped off, and many of his customers complained about not receiving their beloved publication. His test proved it for me.
An enewsletter is cheap, sure, but it is so much harder to consume a large amount of information. If you insist on doing an enewsletter, do it, but also do the printed version. The printed newsletter is the best way to build valuable relationships. Try sending your mother an e-birthday card and see how that goes for you.
Here is an example of a cover story for my newsletter, featuring a story of my wife and daughter Bailey’s experience with an auto accident. (See Figure 13.2 on page 138.) The story includes a picture of Vanessa and Bailey with the damaged SUV that hooks the reader. I then pivot to “. . . if you happen to be involved in an auto accident here are the five things you must do.” I could easily have written an article about those five things as laid out on home office boring brochures. Vanessa’s story is real with photo as proof and demonstrates how accidents can happen to anyone. No faceless corporation or clever caveman ad can compete with these real world experiences in my customer newsletter each month.
We also have a done-for-you newsletter program for insurance agency owners. More info at www.bgimarketing.com.
FIGURE 13.2: Newsletter Cover Story
DAN KENNEDY’S COMMENT: Bill’s choice is a vital one. There are two ways to present useful information like “The 5 Things To Do If Involved In A Car Accident”: his way or in a simple, straightforward, factual, and instructional way, as most big companies would do, probably in a marketing piece plastered with corporate logo. That has two chief drawbacks. One, any company can do the very same thing. It is generic information. Two, maybe more importantly, it’s boring. I teach that the ultimate marketing sin is being boring. So Bill’s way, engaging the consumer/reader with a first-person, personal story, then gradually segueing to the instructional information, serves to make it proprietary and interesting. Fortunately, there is no law that dictates, if you have a brand, or operate under the umbrella of a brand, you must make it the focal point of everything you do.
If the customer newsletter is the most powerful relationship-building tool, your book is the ultimate positioning tool that elevates you miles above your competition.
A couple of books I authored and used in my insurance agency were written for a specific audience for a very specific purpose. My first book, A Business Success Journal, which I co-authored, was written for business owners to help launch and grow my referral rewards program. I made this book readily available as gifts to my commercial insurance business owner customers and my COI businesses.
My main COIs are mortgage brokers, realtors, and various dealerships selling automobiles, boats, mobile homes, and motorcycles. All of these businesses have weekly meetings. I would just call and get on the agenda for five to ten minutes, give them some helpful info about how we could serve them, and gift them my book. The “Wow” factor of the book was the unique positioning I had over every competitor in the marketplace. I must be an expert, right? I wrote this book on success, and I’m offering to serve them with helpful information that can help their business with a little implementation.
My next book I authored and published myself, Informed and Insured: Everything You Need To Know About Insurance Before You Pay Your Next Premium. It was written for anyone that needs personal insurance, including auto, home, life, and personal recreational vehicles. The purpose of the book is to provide very helpful information for buying personal lines of insurance. It strongly suggests avoiding the huge mistake of self-service by trying to buy insurance online and from the 1-800 numbers.
RESOURCES
If you are in the insurance industry, you should definitely check out the book and newsletter publishing programs Bill provides, at www.BGIMarketing.com. Whatever business or profession you’re in, if your interest is piqued about being the author of a book get a copy of the book, Book The Business: How To Make Big Money With Your Book Without Even Selling A Single Copy by Dan Kennedy and Adam Witty, from Amazon.com, BN.com, any bookseller, or advantage family.com. And you can find resources for customer newsletter publishing at DanKennedy.com/store.
Informed and Insured suggests using a trusted insurance advisor, not a policy peddler, and who better to help than an author of the book on how to successfully buy personal lines of insurance.
A book makes a very powerful offer for your direct-response advertising and marketing. We use it constantly in print media, direct mail, email marketing, social media, customer newsletter, and live radio ads.
FIGURE 13.3: Book Covers
Authorship may seem like a Herculean task. It sure did to me when I first thought of the idea. Basically, I just wrote out the information I constantly share with my customers, prospects, and COIs. I’m not saying it’s easy, because it is not, but getting your content on paper that you deliver on a regular basis is not that difficult. If you are an insurance agency owner or work in an agency, you may qualify to buy the authorship rights to Informed and Insured. You can refer to our website for more information.
Above are the covers of my two books written for two very different audiences, one for business owners and one for the personal lines insurance buying public. (See Figure 13.3.) Both of these books serve my business well.
Free-Standing Newspaper Insert
One of the best ways to really stand out in your local market is the use of newspaper inserts. Most newspapers allow you to target certain ZIP codes if you wish, and in my experience the rates are much better than regular newspaper ads.
Figures 13.4A and 13.4B on pages 143 and 144 are great examples of one of my BGI Elite Mastermind Members using a direct-response ad with a great offer on the front and leveraging the power of the Allstate Insurance Brand on the back. Allstate will even pay for half of this ad because it is one of their co-op approved advertisements.
DAN KENNEDY’S COMMENT: One side of this FSI uses an ad created and provided by Allstate, and, frankly, it is fairly typical corporate brand advertising. I judge it mediocre and ordinary at best. But combined with the other side that Jason created, a great direct-response ad with all the right direct-response elements*, he gets the best of both worlds: the umbrella of the known and trusted Allstate brand, the effectiveness of direct response. This is a terrific example of marrying brand and DR. (*The elements used here are benefit-driven headline; breaking news [first paragraph]; guarantee; testimonials; offer with deadline.)
Like All Marriages, There’s Give ’n Take and Tension
The marriages of a big, corporate brand and a local business brand with aggressive direct-response marketing hasn’t been a simple or easy one. It has its times and places of conflict. They don’t go together like peas in a pod. As you can hopefully see from the results I’ve shared here, it’s definitely worth the trouble! I can say with rock-solid certainty that I would not have reached the pinnacle of success within the Allstate agency community if I had simply relied on the power of the Allstate brand and their advertising to carry me. I can assure you, I would not have made as good an income or created as much equity in my agency if I hadn’t built my own, local brand, The All-American Agency, as well as my personal brand. As I’ve explained, I would never have achieved anything close to what I have by depending on brand and image marketing. Injecting direct-response advertising into both the upfront attraction of new clients and the back-end retention of clients and mobilizing my referral armies was the rocket fuel.
FIGURE 13.4A: Direct-Response Ad, Front
FIGURE 13.4B: Direct-Response Ad, Back
BILL GOUGH built one of the most successful Allstate Insurance agencies in America, and provides training, coaching, and marketing support to more than 1,000 Allstate agency owners as well as other insurance brokers, agents, and professionals through his BGI Marketing organization, www.BGIMarketing.com.
