4 Ways We Focus on Price Not Value: We Don’t Believe We Are Worth More Customer
Insurance Agents vs. $8 Coffee
There is no denying it, things these days are expensive, but even still, there are higher priced items and lower ones. Why? Because we have options.
“It’s in every business’s best interest to go and figure out who that is. Independent insurance agencies are no different, but they certainly like to pretend they are.”
One of those options is a Starbucks cup of coffee that has always been a higher price than almost any other brand out there. People wait in line and go out of their way for that stuff.
Why? Because those people are willing to pay more for what they like, for what they feel is a higher quality.
Some of you independent agents out there are probably in that category and there is no shame. You are their ideal customer and we should talk about that.
The Ideal Customer for YOUR Agency
There is a specific type of person who would fit your agency like a glove. It’s in every business’s
best interest to go and figure out who that is. Independent insurance agencies are no different, but they certainly like to pretend they are.
The whole idea is helpful because it makes it easier to find and market to your target audience. Have you ever heard the line about how a friend to all is a friend to none? That applies here.
Out of your whole book, there is a group that you and your team likes more than anyone else. It’s not that crazy to think you could make a few changes and expand that group until it’s your entire book.
That is way easier than trying to be everything for everyone.
How You Spend
Every big, successful business out there got like that because they found their ideal customer and only chased that population. When you cater to everyone, you please no one. You simply can’t please everyone.
Starbucks knows that there are people out there who say, “that’s too expensive” or “it tastes like crap.” They are fine with that because they know that those people are not their people.
Take a look at your house, car, and office. Did you pay more for your TV because you really liked the quality? How about that jacket you got because it keeps you perfectly warm in the harshest conditions? Maybe, your car is nicer because you really appreciate leather seats?
Your tastes and preferences make you the ideal customer for someone out there.
McDonald’s Isn’t Ruth’s Chris
If you are still reading this and thinking something along the lines of, “Well, I can do both,” we have news for you.
Have you ever been to a nice steakhouse or to a restaurant with three dollar signs on Google? In general, when you go to those kinds of places, you expect the food to taste pretty dang good and be of very high quality.
Now, think about the last time you got fast food. You weren’t thinking about the quality when you got it. Instead, you were thinking about how this food was going to serve a need in a timely manner and that’s it.
If both are feeding you, why isn’t a Big Mac twenty-five dollars?
That’s because one is giving you high-end quality and one absolutely is not. McDonald’s is not trying to give you the same experience as a nice steakhouse and vice versa. Any fast food restaurant you pick is not concerned with giving you a “fine-dining experience.”
If You Sell On Price, You Have to Serve On Price
How does this apply to independent agents?
If your agency wants to be a cost-effective solution that always has the best, most competitive prices, you have to serve on that level.
What we tend to see is agencies wanting to give that high-end experience while hanging their entire worth on the price. You can’t do that. You will drive yourself and your team crazy.
All you independent insurance agents out there? You are worth more. That’s the simple truth of it.
So, you can step away from all that worry about price and focus on serving on a level that you feel comfortable with. You don’t have to be that agent only worried about price anymore.
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