Identity crisis: independent agents must make their brands known to grow their businesses.

The big guns of the insurance world have branding down to an art. Consider Allstate's Good Hands logo, State Farm's Good Neighbor slogan and the icons of Prudential's Rock of Gibraltar and Hartford Financial's majestic stag.

Independent agents lack these powerful marketing tools, yet somehow they must make their brands known in their local areas if they want their businesses to thrive. All too often, however, they fall far short in promoting themselves, said Peter van Aartrijk Jr., managing director of The van Aartrijk Group, a communications firm specializing in insurance and financial services, and author of the book Zoom, published by the Independent Insurance Agents & Brokers of America.

"Agents tend to be excellent salespeople who are extremely personable, persuasive, provide fine service, have good technical skills and are attentive to details, but as a group they do a terrible job with marketing discipline," he said. "Marketing is when you get yourself in front of more of your targeted people so you can do the great selling. But their marketing strategies--if they have them--tend to be haphazard because they're running from one sale to the next."

Indeed, independent agents do have a brand--as salespeople--but that brand is not helpful to them as they move forward in a very competitive and complex marketplace, said Anne Bailey Berman, co-founder and president of Chadwick Martin Bailey, a market research firm that has been working with many industry groups, including insurance companies, for 20 years.

"Insurance products are becoming more complex and insurance companies are looking to provide a greater range of products," she said. "Customers, both individuals as well as employers, are looking for more consultants. They're looking to better understand what they need, the specific products to address those needs, and options for buying those products."

If anything, branding has become more important for independent agents these days because they face new kinds of competitors in the form of banks, mutual funds, payroll service companies and work-site marketers, van Aartrijk said. "It's a very cluttered environment and if you're not doing anything, all you are at best is just a name," he said. "And a name is not a brand; a name is just a name."

With that in mind, independent agents need to do more to help themselves, Berman said. "They have to rethink their situation," she said, "It's almost rebranding as opposed to branding that's needed because they must change their whole position in the marketplace."

She thinks agents have to do a better job of understanding what customers are looking for and talking in a language that customers comprehend. "The majority of buyers of insurance are individuals and small firms," Berman said. "They are not experienced 'insurance' people, they don't know the legalese. And when you look at the products their brokers are providing them, they're highly legalese. So part of the problem is speaking the language of their marketplace and right now, they don't."

The Trusted Choice Program

A strong customer communications program also improves retention and the count of policies per customer, as well as numbers of referrals, van Aartrijk said. It's helpful, too, if agents who belong to the IIABA join its Trusted Choice program, which allows them to participate in a national brand of their own, he said.

The IIABA and independent agency insurers launched Trusted Choice in 2001 to address a problem, said Jeffrey A. Meyers, executive director of the program. "Consumers couldn't identify independent agents--they didn't know what they were--and we realized we needed to address this."

The result was the establishment of a program that "creates a consumer market brand and identity for our members," he said. Consumers are told about the benefits of working with an independent agent who can offer them choice of companies, customization of policies and advocacy support.

So far, some 4,000 agencies have joined, signing a licensing agreement and pledge, and paying up to $499 annually. In return, they receive benefits such as a consumer-tested name and logo, national advertising and public relations campaigns, local agency marketing support and consumer leads through the Trusted Choice Web site.

"We want to take this program farther and really raise awareness of Trusted Choice and its member agencies with consumers," Meyers said. "That's the most important thing about establishing a brand."

The effort appears to be working; Meyers thinks the public's awareness of Trusted Choice agents has been raised. In October 2004, Trusted Choice was advertised on national cable television during the Major League Baseball playoffs and more total hits were registered on the program's Web site than ever before, he said.

With the right branding strategy, van Aartrijk thinks that even small-town independent agents can compete with exclusive agents tied to such well-known brands as Allstate or State Farm. But to do so, the independents have to be disciplined in reinvesting 2% to 3% of agency revenues every year in advertising and promotion--excluding charitable donations--just as the big insurers do. They also need to leverage company cooperative advertising dollars, the funds that carriers provide to some of their best producers to support their growth.

"I just don't think they know how to use the money because they don't have marketing plans," said van Aartrijk. "It's a sizable amount of money. Sometimes it's only for advertising; other times it's for things like buying other agents or low-interest loans. It's for all sorts of things, but it's largely untapped."

Mostly, national and regional brokerage firms are taking advantage of these funds, but independents--the majority of the brokers and agents--are not, Berman said. "They don't have the time to figure out how to use this, and they probably don't have the resources, themselves, to take advantage of it," she said.

Berman thinks, however, that many agents are beginning to understand that they need help to improve their branding. Her firm has found that, in agents' views, carrier commissions, frequently seen as all important in retaining agent loyalty, are not what distinguishes one insurer from another. Rather, agents are looking for insurance companies that will help them sell more through partnerships, and by providing training and sales materials easily understood by customers, she said.

Key Points

* Branding has become more important for independent agents because they face new kinds of competitors.

* The Independent Insurance Agents & Brokers Association and carriers have launched Trusted Choice to create market brand and identity for IIABA members.

* Independent agents should reinvest 2% to 3% of agency revenues every year in advertising promotion.

RELATED ARTICLE: The value of testimonials.

Every January, the Masiello Insurance Agency in Keene, N.H., runs an ad that reports total claim payments made to area residents through the agency the prior year. Agency founder, Jim Masiello, characterizes these funds as assistance to the local economic base. "I'd run an ad saying that we paid, say, $525,000 to local residents to help them get through their losses during the prior calendar year," he said.

Initially, the ad had a big impact. An official of one of the carriers he did business with quickly called the independent agent to ask just what was he doing with this ad and why was he doing it? Masiello's response: "What business am I in? I'm in the business of helping people if they have a claim. And why shouldn't I tell everybody that we do a great job in helping 544 households. Can you imagine the economic impact that has on the community?"

Masiello left the agency about eight years ago, but the tradition carries on with present management. It was also his practice to use testimonial ads from satisfied local customers. He credited the effectiveness of these in bringing new business his way. "Having a third party say something about your service and getting it out to the public, that's extremely powerful," he said. "That's the type of thing that builds your name recognition."

But it's also important to be consistent with this, Masiello stressed. While some agents advertise sporadically, he ran his testimonial ads at least three times a week in newspapers."It's common sense," he said. "A lot of times when people are trying to promote themselves, they just go off in all kinds of different places and areas. Just a little consistency, that's all it takes."

Masiello's ads included what he called a "template"--a uniformity of layout, logo, photos of customer service representatives and always a customer's testimonial praising the agency's service on claims.

The only variations in this were the customers' comments. Masiello obtained these quotes by mailing survey cards to customers, asking for their evaluations of his business.

"If somebody had a claim or it's a new customer or it's a change in coverage, they received this card and on the card would be four or five questions about the service," he said. "Then there would be a space for comment. People love to comment. Everybody in the community knew the testimonial ads and wanted to be in them. We even had people calling us sometimes swing 'Put me in one of those ads."

This strategy can help a local agency rise above the competition, he said. When potential customers see their neighbors praising an agency in the newspaper, they tend to decide to do business with that agency, Masiello said.

RELATED ARTICLE: Steps to success.

Peter van Aartrijk Jr. researched the material in his book, Zoom, by conducting numerous focus groups with agents and their customers, and by overseeing others who led discussions with insurance consumers over the telephone and at malls. He's found that having a strong brand is essential for an agent because it generates referrals, with satisfied customers spreading the word about the agency's service to family, friends and co-workers.

Van Aartrijk, managing director of communications firm The van Aartrijk Group, suggests that independent agents who want to improve their branding consider taking these steps:

EVALUATE Agents should confer with customers, prospects and employees to take stock of where they are now and where they want to be. Chances are that through this, they will learn that it is the little things they do--and not the coverage they offer--that really builds their business, he said.

"Agents often get caught up in the technical aspects, but customers look at how promptly they return phone calls--even returning calls at all--or the receptionist who takes a little longer to chat," van Aartrijk said. "It comes down to human elements, and that's consistent with how most people look at their brands."

REDEFINE This has to do with positioning. For example, van Aartrijk's firm worked with an agency that had a traditional Main Street type of setting. Agency principals were concerned about their loss ratio. They examined their book of business and realized they were writing too many walk-ins looking for a good deal on car insurance. "They relocated to a professional office setting and the walk-ins stopped, their loss ratio went down and now they're able to reach out to the people they want," he said.

RETHINK INFRASTRUCTURE Agents need employees with technical skills as well as the right kind of technology to support what they want their brand to be. For instance, if the brand is supposed to be ease of doing business with customers, agents must be sure not to keep people on hold for 20 minutes while they hunt for an insurance binder or statement, van Aartrijk said. "You have to have good technology for what you say you are going to do," he said.

DEVELOP A MARKETING STRATEGY For example, an agency may come to the conclusion that it needs to invest more in customer communications. One outcome might be to stop pitching to strangers by buying big display ads in the yellow pages and concentrate instead on communicating with established customers, something that,Van Aartrijk argues, independent agents need to improve upon.

"In all the research that we have done, most of these people are only hearing from their agent once a year, and that's typically a bill," he said. "That's just not adequate." In his view, agents should initiate at least four customer contacts a year, using letters, postcards, newsletters and e-mails. "You have to do something," van Aartrijk said. "People often won't respond to it, but they see value in your talking with them."

RELATED ARTICLE: Strength in numbers.

Independent agents Nicholas Argeros and Jacki Jungsberger say membership in a large, recognizable network has helped build name recognition for their agencies in their communities.

Argeros, owner of Argeros Insurance Inc., Reading, Mass., is also president of the allMass Group of 22 agencies throughout Massachusetts. "The group is recognized as an entity greater than the individual agent," he said. The allMass name is on his sign, advertisements and communications. He and his staff answer the phones citing allMass first, then the agency's name. "We just try to keep that entity alive from the perspective of giving a definition to the agency, of being part of a larger group."

Jungsberger, a co-owner of Tri-County Agency, Brick, N.J., belongs to the Trusted Choice program of the Independent Insurance Agents & Brokers Association. She feels that this brand helps her grow her business, and makes her agency stand out from others.

"It does add to the value of your agency," Jungsberger said. "It takes time but I know that being a Trusted Choice agent and the pledge of performance that we sign, which I give out to my clients, have definitely helped us sell business."

Sponsoring community activities not only helps area groups but gets his agency's name out more to local people, Argeros said. He favors donations to police, firefighters, drug awareness programs and the Special Olympics.

Jungsberger is a long-time member of her local Lions Club, an activity that she enjoys but that also serves to build a number of business alliances with area real estate brokers, mortgage brokers and attorneys. "We help them, they help us. It has worked really well," she said.

Visibility in the community--and patronizing local businesses--helps build her agency's name recognition, too, Jungsberger noted. "People get to know who you are, they see you around town, they see you at all the different events, they know you do insurance," she said. "So they think of you to call."

Jungsberger said she is branding every day, seeing customers or prospects even when she's stopping at the Wawa convenience store in Brick to grab a cup of coffee. "I have one client who goes there every morning, and I always talk to him," she said. "He referred another electrician to me and it's now a great account--just from going to Wawa."