Analytics and the Independent Insurance Agency

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I just read a great piece in Forbes magazine about Jim Goodnight, CEO of SAS. SAS is the leader in high-powered analysis software. SAS helps large to midsized business analyze their data so they can make better decisions. The author asked Jim the following question: “What do businesses want to analyze today?” Jim’s response was, “Businesses are looking at customer data to gain insights into cross-selling and up-selling.” This sounds very familiar. It’s the old adage, “it’s cheaper to KEEP the customer you have than to acquire a new one”. Businesses are starting to realize that they need to objectively understand their customers better. Every customer leaves clues Read more [...]

The Law of Comparative Advantage Applied to Business

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I just read a great blog post on the Law of Comparative Advantage. According to Wikipedia, the law states the following: “Two countries (or other kinds of parties, such as individuals or firms) can both gain from trade if, in the absence of trade, they have different relative costs for producing the same goods. Even if one country is more efficient in the production of all goods (absolute advantage), it can still gain by trading with a less-efficient country, as long as they have different relative efficiencies.” In Bussgang’s blog, he applied this law to start-ups. I’d like to expand the law to all small businesses. To quote Bussgang: “As such, they [owners] get sucked into spending Read more [...]

Embrace Change

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It’s seems like just when I have things under control, a new challenge presents itself. When I first started Astonish Results, I had a picture of what our business would look like. I was always looking to the future. I thought that if we could only get “X” customers or “$X” in revenue, then we’d really have arrived! I also found myself thinking this way in my personal life. I would look to the future, and say to myself, “If I could only get to this point, things would really be great.” If I could only make $100K in income, have that huge house with a pool or you fill in the blank. Do you ever catch yourself thinking this way? Then one day it hit me. When I actually get to the Read more [...]

The Only Thing That Matters is Renewals

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Once a month our entire company gets together for lunch. We use this opportunity to acknowledge one of our employees and let them know how much we appreciate their hard work. We also use this time to speak to the group about one of our shared values or to reiterate our vision. Since, we’re adding new employees all the time, it’s important to revisit the same themes and make sure everyone is on the same page. Last month we talked about renewals. Astonish Results is a SaaS (software as a service) business. Clients pay us monthly for a fixed period of time. At the end of their contract, they can choose to stop the service. Obviously, we want them to continue with us since it’s much cheaper Read more [...]

Insurance Agencies Need to Play Defense and Offense

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I went to the RI Air show and subsequently got a really bad sunburn. While walking around the event with my two sons looking at all the cool airplanes, helicopters, humvess and the Blue Angels (btw - check out their website it's pretty cool) I come across this sight.   Geico. These guys are literally everywhere. I cannot go a day without hearing a radio commercial, seeing them on a billboard, seeing a TV spot, or being confronted by one of their SEM ads on Google. I’m out for a nice day with the family and I see them at the air show. These guys are aggressive. They are going for market share. They are committed to being anywhere and everywhere consumers show up. It’s almost to Read more [...]

My Experiment – Reading Faster

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One of my goals in the past few months has been to read faster. There is so much information out there to be absorbed, so much to learn. I set a goal for myself to read three business books per month. I failed. My solution is to increase my reading speed. I found this neat little application http://www.spreeder.com which allows you to past text into the interface and set the speed at which it flashes single words or groups of words before you. I started at 240 wpm and a 91% comprehension rate. I’m now reading at 325 wpm! I can still comprehend what I’m reading extremely well. I use my Google Reader to track all the blogs I’m interested in. I just copy and paste the text into the speed Read more [...]

Measuring Your Insurance Agency’s Internet Marketing Results

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As I began working on this post on measuring Internet marketing results, I realized I needed to speak to several deeper issues I’ve seen in the over 500 independent insurance agencies I work with. There is a clear marketing divide that is emerging which distinguishes those agencies that are leaders in internet marketing and those agencies that are trailing. So before I dive into measuring an agency’s Internet marketing results, I want to make sure I set the right foundation. Jump in with Both Feet  The best agencies in the country are not internet marketing “top-dippers”. These agencies understand and embrace the fact that both their current and potential customers are using various Read more [...]

Using CLTV to Increase Your Insurance Marketing Results

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I’m continuing to read “Data-Driven Marketing” and it’s really has me thinking about how independent insurance agencies market (IIAs). The author takes some time to define CTLV (customer lifetime value). Read about CLTV here. Jeferry's book about marketing, so the he is attempting to illustrate what the most successful companies are doing. His main point is that data is critical to getting the most out of your marketing efforts. So where does CLTV fit in? Well we all know that “all customers are not created equal”. Some customers are extremely profitable while others may even be negatively profitable. Typically, insurance agencies will market using a “one size fits all” approach. Read more [...]

Belief and the Decision Making Process

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Today is Easter and I’m thinking about the concept of belief. A belief is defined as “Something one accepts as true or real; a firmly held opinion or conviction.” If you believe something is true, your behavior should reflect that belief. If you believed you were going to die next week, you would do things differently. Belief is connected to behavior. Most businesses would say that their customers are really important. I think if you asked most small business owners they would say that customer satisfaction is a strongly held conviction. Yet when you begin looking under the hood, you find that is not the case. In other words, their expressed beliefs (customers are really important) Read more [...]

SaaS and the Independent Insurance Agency Business Model

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Astonish Results is a SaaS business. SaaS stands for "software as a service". A SaaS business "rents" software to customers on a monthly basis and in return receives revenue monthly. As the number of customers goes up so does the revenue. In theory, the cost associated with servicing customers should tail off as economies of scale kick in. For a SaaS business, it's extremely important to understand the CAC or "cost to acquire a customer" and the CLTV or "customer lifetime value". If your CAC is greater than the CLTV, your business model is in trouble and will not last (or scale for that matter). How is the SaaS model similar to the independent insurance agency (IIA) business model?  IIAs Read more [...]