Measuring marketing communications results 

Granted that what follows is an oversimplication, it beats not having a clue about the value of your direct investment in marketing communications programs. 

You budget $10,000 for marketing communications this year. 

Your average commission income from an auto/home account or BOP is $200.  

So, you will need to produce 50 new accounts to cover your DIRECT Year 1 marketing communications investment.  

Your Lifetime Value of Customers (LVC) is 7 years.  So your ROI will be 6x $10,000 or $60,000 from the new customers gained this year minus your direct KEEP (retention) costs. 

Rules of Thumb for annual marketing communications budgets 

These figures are based on published reports and our own experience working with hundreds of agents over the years. 

Maintenance Budget:  1% of commission income 

Modest Growth: 2% of commission income 

Aggressive Growth: 3% of commission income 

Heavy up your prospecting activities in the fall 

“If you want to pick huckleberries, your have to go where the huckleberries are!” 

Our Massachusetts clients tell us that 30-35% of their auto insureds still have January renewal dates for auto insurance.  If this anecdotal research is accurate, it makes sense for agents to (1) Develop a heavy-up schedule of new business prospecting activities---advertising, direct mail, PR, referral, and personal selling activities to during the August1-December 1 period;  (2)  Make sure that positive customer retention contacts are made during that period, culminating with renewal activities 60 days before January X-dates;  (3) Consider allocating up to 60%  your annual marketing communications budget during the August-December period. 

Most prospects don’t respond right off 

Make sure you commit to a quality prospect list, i.e. neighborhoods where your customer penetration is low right now or newer home neighborhoods or neighborhoods where the chances of a three-car family is high.  Make sure you touch those prospects at least three times from August to December.  One-shot contacts are doomed to failure; a waste of money.

Promote second opinions 

New business activities should feature “second opinion” benefits and aim at attracting X-dates and a choice to quote at least 60 days before a prospect’s January renewal date. 

Make sure your Fall newsletter requests referrals 

Don’t have a quarterly newsletter? Then prepare a special “annual edition”---a flier that you mail to all your customers, and ask for referrals.  Make sure you feature ALL the lines of business your agency writes.   

Why should a prospect buy from you? 

Make sure you point out your Unique Buying Proposition (UBP) in all of your sales literature, and in your “one-minute elevator talk.”  Why should the prospect buy from you? What makes your agency the best choice?

Here’s a simple personal lines or BOP new business idea.  Contact one prospect a day PERSONALLY, and ask for a chance to quote on his or her insurance.  For most producers, there are about 220 workdays in a year. Let’s say your closing ratio for new sales among the 220 personal contacts you make is 30%---or 60 new personal lines accounts.  What would your total new commission income be based on your current account average? 

Small chunks lead to big results! 

.  Give customers reasons TO ADD more coverage.  

.  Give quality prospects reasons TO REFER you to friends.

Creating a Positioning Line that differentiates your agency from all other “me-too” competitors is a critical success factor.  “Why is a simple theme-line that appears in all our marketing support materials so important?  Isn’t just cosmetic?  How can it possibly help build our business?”  Natural skepticism! 

Here’s why.

A well-conceived Positioning Line is a RALLYING point for your agency: 

It tells customers why they should buy from you. 

It tells your producers what they are selling. 

It tells your support staff what they are servicing.  

For examples of Positioning Lines MullaneyCookson has developed for clients, and background on their development, e-mail Don Cookson at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it .