(Photo credit: BrazilPhotos.)
What? Sell the competitor’s insurance products? Doesn’t that fly in the face of conventional wisdom? After all, your focus is to enhance your own company’s bottom line, not to better your competition’s financial status. Yet selling your competitor’s products might still be a strategy worth consideration. Just ask Geico who has done a stellar job of cross-selling products underwritten by other insurers.
If satisfying the customer is a goal of your organization, you probably also have supporting goals that include focusing on customer centricity, delivering a quality customer experience, and owning the relationship. Any insurer who is committed to delivering on these objectives needs to be willing to do whatever it takes to satisfy the customer. That could very well mean selling a competitor’s product.
With marketing spends at an all time high, insurers are very aware of and sensitive to the average cost of bringing a lead to their real or virtual door. But a lead without a resulting sale is little more than a lost opportunity and a wasted investment of marketing dollars. Once you have a buyer’s attention, it becomes critical to keep that buyer engaged; not just for the short term, one-time product sale, but to establish a long term relationship.
Rather than limiting the sale to what products an insurer wants to sell, the effort should be focused on what products the customer wants to buy. If a competitor’s product is the only thing that meets your customer’s need – well, losing the underwriting profit to a competitor for one product transaction might be a small price to pay when the reward could well be a customer for life. And think about the possibility of fee income. Some insurers are even turning their own unprofitable books into profitable books by selling their competitor’s products. Radical maybe, but only in the insurance business. Other industries have been doing it for decades.
If a lead comes in, an insurer should strive to find a way to always say ‘yes’ to make some kind of sale and keep the customer engaged. Maybe the buyer is shopping for a product outside of your appetite, for a product you don’t even offer, or for coverage in a state where you don’t write business. Through partnerships with like-minded competitors, you have the opportunity to broaden your product portfolio and be viewed as the customer’s “go-to,” trusted advisor for all things insurance.
Once a relationship and the trust are established between customer and your organization, you most likely become the brand of choice for the consumer – quite possibly for their lifetime.
Wouldn’t it always make sense to offer a competitor’s product if the customer is going to walk out the door, hang up the phone or click off your website otherwise? Once they’ve moved on to a competitor, chances are they won’t be back anytime soon. Better to keep the customer in your sales channel, generate revenue through sales commissions, and keep the eye of the bigger “lifetime value” prize. Plus, the market insight that is gained from selling a competitive product can be invaluable in making new product decisions.
While this approach may challenge conventional wisdom, it’s no secret that consumers are now making the rules and dictating what insurance products they want to buy and how they want to buy them. This shift is forcing insurers to think and act differently.
Satisfying today’s customer takes more than a pleasant user interface and a quick underwriting process. At the end of the day, the customer still wants insurance coverage above all else. Those insurers who can give them all the insurance products they want – plus do it easily and quickly – will be the “lifetime” winners in this buyers’ market.