If you measure the results of your marketing and sales programs, congratulations. Most independent agents don’t. We know from experience. When we consult with agency principals about their number one source of new business, the answer invariably is: referrals. But when we ask them to tell us what they do to get referrals, how many they received last year, what their close ratio on referrals is, and how much new premium and commission resulted, we usually draw a blank.

The reaction is the same with questions about direct mail programs.  Some agents know what the response rate was for a given mailing.  But they draw a blank about how many direct responses and x-dates were generated by second and third mailings, and followup calls; and how many quotes, how many closes, and how much revenue was generated during the year.

The goal for every agent sales program---large or small—should be a solid Return on Investment (ROI). For direct mail programs, you should set a break-even on your direct costs as a MINIMUM result for Year 1 new business commission income.  Renewal income for Years 2-5 (and beyond) should be factored into the ROI for your original investment.

If you know your numbers, you can practice what we call Predictive Marketing. Predictive Marketing, as the name implies, enables you to invest x dollars in a sales program knowing that there is a high probability that you will get y dollars of income as a result.

Like everything else worthwhile, it takes planning, stick-to-it-ness, and repeatable work processes to become an accomplished pro at Predictive Marketing.  Not easy. But very profitable