PERSONAL LINES SELLING

WHAT DOES PIZZA HAVE TO DO WITH DATABASE MANAGEMENT?

Like high-tech pizza chains, agencies can use
database information to deepen customer relationships

By Troy Korsgaden

The following is an excerpt from my new book, Profit From Change; Save Me a Place at the Distribution Table, which will be released at the end of this year.

Whenever I think of database management, the story of a trip to the local Pizza Shack immediately comes to mind. I was driving home from the office one day and my cell phone rang. On the other end of the line my teenage son cheerfully informed me, "Dad, you are cooking dinner tonight!" I replied, "No problem," hung up the phone and immediately dialed the number for the local Pizza Shack. The woman who answered the phone didn't ask for my name, but rather asked for my home telephone number. I gave her my seven-digit phone number and the reply came back, "Do you still live on Robin Street?" I replied, "Yes" and she asked, "How may I help you this evening, Mr. Korsgaden?" I ordered two large combination pizzas and said that I would pick them up on my way home rather than have them delivered. When I arrived I explained to the young woman that I was there to pick up pizzas. And she said, "You must be Mr. Korsgaden. They are just coming out of the oven and I see you like jalapenos and ranch dressing on the side." How did the Pizza Shack lady know I liked jalapenos and ranch dressing on the side, I wondered. Then it dawned on me. Even the Pizza Shack has a database as one of its central systems of operating its business.

What makes the Pizza Shack different from most of the insurance agencies we run? The pizza store uses its database information to deepen its relationship with its customers. They understand their customers' tastes, wants and needs. It is amazing to me how they now will offer you a salad for the family, a six-pack, or two liters of Pepsi, as well as everything from breadsticks to additional pizza sauce. It is the same customer they have been doing business with for years, but it is the corporate leaders at this pizza chain who realized they can get the same customer to spend more money if they put the technology in place and train their staff to just ask. As multi-line insurance agency owners we can learn a valuable lesson from this pizza store experience.

There is no uniformity in the insurance industry when it comes to the use of database technology. Our research and the work we have done with agents nationwide have shown that the use of this technology really covers a broad spectrum. There is no one standard. Instead there are a variety of systems in use today. We are not advocating one database system over another. But the first thing an agent needs to understand is that a database system does not serve two masters. Captive agents tend to use their company's proprietary system plus a parallel system such as Goldmine, Act, or one of several others available. They use the proprietary system for backroom support and use the other system for customer relationship management. Factors to consider in this type of arrangement include the labor costs in maintaining dual systems, plus the challenge of keeping the systems in sync.

Before doing research, our assumption was that the company system was inferior to off-the-shelf products available. We discovered that the propriety system that my company offers really is capable of doing the things that need to get done when it comes to the customer. In no way are we knocking the off-the-shelf programs; their wide acceptance in the business world is seen as proof of their value.

Let's weigh the cost of parallel systems against what you might lose if you use only one system. In our experience, we didn't lose very much. Regardless of which type of database system you use, consider the following: It's vitally important to log calls incoming or outgoing with detailed notes. In addition, you will want to be able to send correspondence and mass solicitations as well as keep a household profile which includes names, address, phone numbers, other ways to contact, dates of birth, occupations, etc. You will also want a section to note customer likes, dislikes and policy information on every line of insurance, whether placed with your agency or not.

What we may have given up by using just one database is ease in migration of information and high touch fields for customer relationship management. But overall, the loss can be justified by not having to support two parallel database systems. Remember, it has been said that for every action, there is an equal and opposite reaction. Translated to our insurance agency world, this simply means that gaining some real cool stuff can lead to a lot of unnecessary work on a consistent basis.

Here's what you will want to do to ensure your success in database management:

1. Define the customer information needed to provide the Pizza Shack type of experience. Your system needs to help you connect every time you "touch" your customer. Even someone new to your organization should be able to instantly know your customers on the other end of the line when they call or when they walk through the door unexpectedly. Remember, people buy from people whom they know and trust. If your customers feel that you know them, they will feel like they know you.

2) Your system should be examined for efficiencies in data entry. The information should be entered quickly and at the time of contact.

3) Your system should be networked and accessible to everyone in your organization. This is because everyone in your agency should be "touching" the customer at every opportunity on an ongoing basis.

4) Your system should be backed up regularly because the information inside your database is pure gold.

5) The one nugget of information that we feel is the most important for your focus: Capture ways to contact your customer, for example, daytime phone number, cell phone number, pager number, e-mail address, etc. Information that is gathered and used constantly will guarantee your future success. This information will assist you in blocking out your competitors, who have only one way of contacting the customer initially, and that is at night on a home phone number.

Volumes could be written on the importance of database management. But we need not look further than the local Pizza Shack to see the possibilities. With fast food on every corner and 10 pizza parlors to choose from, the successful entrepreneur uses every opportunity to deepen his or her relationship with the customer. A business today cannot rely on just selling one item. We need to take a page from the Pizza Shack playbook and build on our customer relationships by knowing our customers better and anticipating their wants and needs. And this must be done seamlessly through every transaction and contact. *

The author

Twice named "Agent of the Year" from among 14,000 Farmers Insurance agents and a frequently featured keynote speaker at industry events, Troy Korsgaden has trained nearly 30,000 insurance agents and staff across North America using his industry-specific manual and seminar program, "Achieving Success in Agency Management." His training products include the book Power Position Your Agency; A Guide to Insurance Agency Success, and an audio tape set, "Building a Successful Insurance Agency: The 4 Essential Steps!" For more information, contact Troy Korsgaden Systems (TKS) at (800) 524-6390 or www.tksystems.org.