Andy Marshall
Acquiring a new client is said to be five-to-ten times more costly than retaining an existing one. Often though, in an attempt to build a successful business, the focus ends up on getting new clients in the door rather than ensuring existing clients stay.
Over time this can have a big impact on your business, so the earlier you act and the more proactive you are with managing client retention, the more sustainable your business will be. What are some of the steps you can take to ensure your clients stay with you and give you more business in future? Here are three things you can do…
Tie your services to the customer’s objectives regularly
In today’s world, particularly post-FOFA, it is critical that you demonstrate the difference you can make to your clients and their financial situation on a regular basis. This is not just about marketing your services. Create the opportunity to sit down and discuss your clients’ needs as often as possible so you can find out what they want to achieve and talk to them specifically about how you can help. Ask them questions like:
- What are your immediate and long-term goals?
- Is there anything we’re not doing that we could be doing to serve you better?
- What are the most important actions we can focus on to improve your financial situation?
- What has changed in your situation since we first started working together?
The needs of your clients can change over time so take the time to understand what your clients want and how they measure success as regularly as possible. Then you can be sure to align your proposition clearly to their needs and remind them of the value that your advice and your services can provide over the long-term.
Use the power of data to understand your portfolio
There is already plenty of information available to you that can give you an insight into what’s going on with your clients and your business. It’s in your client files, in the systems you use and also in the reports you get from your product providers.
By taking the time to look in depth at the data at hand, you can start to truly understand the behaviour of your existing clients – which ones will add the most value to your business, who may need other products or services and which ones are likely to leave and why. Ultimately this will help you identify where you need to focus your efforts to ensure you are retaining the clients you want in the long-term for your business.
The challenge is making sure you know what to look for. What is the profile of your most profitable client? What trends can you identify in terms of age groups, policy types or client segments? e.g. younger clients may see less need to keep cover, 45 year olds with trauma may find the age-based increases challenging. What can you learn about the clients who have left and where they have gone?
It’s also important to ask your clients questions to gain insights that the data may not provide. Questions that focus on service expectations, the type of communications they want to receive, what their interests and goals are and most of all, what their level of satisfaction is with your services and if there are any areas for improvement. You can do this by creating a customer survey and by sending it out via email or conducting it over the phone or even in your next meeting.
It’s also important to contact your previous clients to understand why they left and what you could have done to keep them on your books. And you never know…by contacting old clients and having the discussion, you may just be able to get them to re-engage.
Understand key trigger points where you can demonstrate value and educate
To earn the loyalty of your customers you need to constantly demonstrate to them the value that you are adding. This requires you to really understand their behaviour at key trigger points and the providers you work with have the information available to help you with this.
Affordability of insurance for example, has always been an issue, especially for ageing clients and those clients who suddenly experience a drop in their income (temporarily or permanently). Interrogating your own customer data may allow you to identify those clients entering the ‘danger zone’ of lapsing (e.g. once a client with trauma cover turns 45).
You can also utilise early warning signals, such as a recent job loss or direct debit failure as an opportunity to get on the front foot early to reinforce the importance of keeping their cover, and where appropriate, offer solutions to help balance their budget (rather than cancelling their cover altogether). They may even be able to take a premium holiday…
By working with your provider to understand the behaviour of your clients, you can identify opportunities to reinforce your message – whether it’s to remind them of the need for insurance and the options available or to simply reinforce the valuable role you play in providing them with advice and the appropriate solution(s) to meet their needs.
Consider telling stories about successful claims and your role in the process, packaging your offer in a way that’s hard to replicate, regularly viewing loading and exclusions and encouraging them to think of you as the first point of call for all financial matters. Of course you also need to address the issues you uncover from the data analysis you’ve conducted (as above), including factors you can control (your service) and those you can influence (such as proactive communication before renewal time for at risk clients).
Andy Marshall, Head of Sales Strategies and Research, Life Risk, shares his thoughts below on how advisers and insurers can work together to achieve great results and to ensure your clients stay protected.
Working together to achieve great results
Rather than advocating a ‘one size fits all’ approach to managing retention, we learned very early on that working individually with each adviser can have some great benefits.
I have seen the outcomes that can be achieved for the advisers who we work closely with and below are some insights on the process that has seen many advisers and their businesses benefit.
To start with, we ask each adviser what is most important to them when it comes to working with us – and the resounding response is that they want the ability to speak with their insurance representatives as needed and are keen to develop long-term sustainable relationships built on efficient service and empathetic claims delivery.
Importantly, understanding what’s happening within each adviser’s business and with their client base, is what drives our ability to meet these needs and deliver on the positive experience advisers are looking for.
Our team is equipped with individual dashboards for each adviser, which we can share with them for discussion and analysis. By working closely together to really understand what is going on with their client base, we have been able to assist advisers in the following areas:
- Reviewing client communication channels
- Identifying and adopting new methods of converting prospective clients
- Business planning based on personal and business motivations
- Analysing the client base to identify where efforts need to be focused; and
- Understanding which referral networks are adding value to the business.
As a result, we have been able to help advisers re-focus on their business, improve business retention, build more referral relationships (even from clients who were at risk of leaving), and ultimately write more insurance across all providers and insure more people. It has been a win-win process for us all.
Get on the front foot with your client retention now
The earlier you act and the more proactive you are with managing client retention, the more sustainable your business will be in the long run.
