Growth through activation of exclusive agency
"Previous projects to increase sales success aimed at imposing a unified approach on the entire sales organization. SMP was the first consulting firm that successfully showed us a way to understand our agents' individual support requirements and to effectively implement them."
Director, insurers
"The growth lever within the exclusivity organisation lies in providing agents with individual support as required. SMP applies the relevant tools to enable targeted sales promotion - on each level of distinguisable AE clusters. The crucial success factor lies in particularly strengthening the center of the AE."
Ingo Marjan, Partner at SMP AG
Increasing competitive pressure in the insurance industry, a shift in the importance of individual sales channels and changing information and buying habits of younger customers all hamper sustainable sales growth in the exclusive agencies (EA). Activities designed to change this all too often run aground, however, because they underestimate the heterogeneity of agents and therefore ignore the needs of most parts of EAs.
In collaboration with leading insurers SMP is developing promotion strategies for AE in order to enable above-average growth performance.
A key success factor in sales promotion is the transparency of the agent portfolio. Here, the all agent are grouped based on two aspects: "cancellation change" and "production change". Given these facts, specific promotion strategies are individually developped for each agent type of the organization. This way the agents' requirements and needs can be supported accurately. Remuneration incentives, for example in the form of growth-oriented bonus models can also be tailored to individual agents and groups; examples of this are campaign and referral programmes or centralized / decentralized sales support.
Sales promotion also enables dynamic development of the AE, because individual incentives for contributions to growth can be adjusted to the situation of the agent.
SMP has successfully implemented various projects aimed at promotion of AE among medium and large insurance companies. As a result two main goals were achieved: a production increase in selected clusters of up to 30 % and the reduction of avoidable cancellations of up to 20 %.
Cancellation reduction with unsupported existing customers
"With their methodical approach and stringent execution the SMP consultants have made a decisive contribution to the sustainable activation of previously unexploited customer segments."
Director, medium-sized insurance company
"Many insurers make too little use of the potentials in their customer base. A structured classification and highly targeted addressing of currently unserved customer groups are a first step in successfully exploiting these opportunities."
Dr. Alfons Niebuer, Partner at SMP AG
Insurance companies threaten to cause waves of migration because of missing or incorrectly prioritized customer support. On average, every third insured person has had no contact with his agent over the past two years. Insurance companies experience this in the form of cancellation rates that are up to 35% higher than for clients that are supported on a regular basis. With each lost customer, cross- and up-selling opportunities are also lost.
With the project "Activation of unserved existing customers", SMP is helping insurance companies to sustainably reduce cancellation rates and to increase cross- and up-sellings. To achieve this, SMP jointly develops mechanisms with the client to identify and classify these unserved existing customers.
An important success factor here is the definition of "strategic customer value". This reflects the added value that can be achieved from a customer if optimal support is provided. By means of this key indicator our clients can develop value-based support and service strategies.
With campaigns tailored specifically to the type of customer, groups of existing customers are systematically developed and actively supported on this basis. SMP also provides support in facing the challenge of replacing old behavioural patterns with a structured approach within the sales organization. Moreover sales activities are specified at the agent level and monitored based on key indicators.
SMP has run successful projects at various insurance companies to enable activation of unsupported groups of existing customers. The cancellation rate fell well below the average of the total customer base and the potential of the customer base was exploited by cross-selling. The cumulative net customer base growth over five years was in the region of a medium two-digit million amount.
