In today’s Insurance Talk, Cheri Martinen and guest Tammy Lesueur discuss marketing growth strategies using direct mail marketing techniques for small business growth. Tammy Lesueur has over 25 years of experience in marketing, with verified growth in the insurance industry.
Strategies to Grow Your Business
Every small business starts out with the desire to build their business and then you get to a point where you wonder, ‘How do I get more customers? How do I grow this business?’ When we hit that point, I started looking around reading and studying, I hired a couple of people who were professionals in marketing and that taught me a lot about how to market.
One of the biggest fallacies that are in any industry is, ‘Oh, I don’t read advertising. I don’t pay any attention to it. I just throw it away or delete the click or whatever.’ The truth is, even if you do delete it or you throw it away, you’d look at the piece of advertising and the people who are in that profession know that and they use it. Any small business can do this. There’s nothing magic. It’s just sitting down and learning how to do it.
The Power of Direct Mail Marketing
Like I said, when we first started it was out of frustration and learning how to grow our business. The very first campaign I did was an old-fashioned, what they refer to as ‘direct mail’ campaign. Direct mail marketing is where you go to your mailbox, pick up the mail, open it up and there’s a postcard or there’s a flyer, maybe a letter or even a little magazine that you never ordered. It can be anything. Dental, try a new dentist, you know, buy this, do that, etc.
So anytime you get a postcard in the mail, advertising auto insurance, home mortgage or whatever, that’s a piece of direct mail. People don’t just send those out willy-nilly. You were targeted and that’s part of learning how to market. As a small business owner, you have to say, ‘What kind of customer do I want? Who am I looking for? Who do my services appeal to?’
Targeting Strategies for Direct Mail Marketing
My very first direct mail marketing piece was a very expensive. Basically, what we did was went through our existing book of business. Now we’re an insurance agency and we noticed we had mostly auto insurance customers, which is great, but my customers live somewhere, right? I said they have to live in a house, or they have an apartment or whatever it was, and we should be having that piece of business, and we should be also writing the home or the apartment. So, we did what they call in the marketing lingo, a ‘lumpy mail piece.’
A lumpy mail piece is an envelope and it’ll have something in it that’s lumpy. It could just be a little key ring, or it can be anything, but they call that a ‘lumpy mail piece’ because you can feel there’s something inside the envelope. I was marketing to my own customers, so I was willing to spend more money because I was looking for the second piece of business. What I did was send out a nine-volt battery and said, ‘Hey, have you put a new nine-volt battery in your fire detector in your kitchen or living room? By the way, we also do homeowners’ insurance.’ It’s basically what the letter said and to ‘Call us for a quote.’
The campaign was wildly successful. We increased our homeowners’ business by over 50%. We kept running that program for a couple of years. But, the important part is that we started off marketing to our own customers with the intention of getting that second piece of business. It will depend on your type of business if this could be successful for you as well, but anybody knows that if you sell someone the first time they’re twice as likely to be more loyal to you over a longer period time and purchase again. Specifically in the insurance industry, if you have three policies with somebody, you’ve likely got that customer for life because it’s very painful to change insurance companies and people don’t like to do it.
Repetition & Targeting with Direct Mail Marketing
It’s really great if you could send something out and get a huge flood of people coming in, but it’s better if it’s more consistent. You don’t always get that. One of the other things that we learned as we were going down the direct mail marketing road and learning was really identify who your customer is, who do you want.
Like with any small business, when we started out the first customer, we were just so happy we got them. But after you’ve been in business for a couple of years, you often hit what is normal, is a plateau. You may find that you have never sat down and looked at your customer list and said who are these people who are buying from me? Are they buying from me only within my area? Or are they buying from me from another state, maybe, or from a different place? And why do I want them?
The first thing you do is, look at your customer base. Who are they, where do they come from, and maybe even ask them, ‘Hey, so why did you stop by? Why do you like doing business with me?’ People may often say, ‘Hey man, I like you.’ Well, that’s awesome, because people do business with people they like. And that’s another reason one of the things that we found is when we segmented our book, is we did a lot of business with contractors, building contractors. Well, at that time, our area was growing very, very fast and there was a lot of small business contractors who were out there building homes or repairmen.
So, we realized that we had about a hundred contractors in our book of business. This sounds like a lot, but it’s really a very small number when you look at the State of Oregon and there are more than 75,000 contractors in the state. And that’s just in Oregon.
In going down the contractor line, I realized that we had a good market for these customers. They know me, like me and I have a solid Contractor Insurance Program for them. So, how do I get a list of lookalike prospects? Well, back in the day there was not a place online to get a list. Nowadays there are several list curators where you can purchase a list of prospects based on parameters that you choose. Fortunately, in the State of Oregon, if you are a contractor, you have to be licensed with the state’s contractor board. So, we were able to purchase the list from the Contractors Board here in the state of Oregon.
Normally in any profession, if the industry requires a license, you can get a list of those with that license. Whether it’s hairdressers, contractors, bars, etc. You go online and say, go to the State of Oregon and type in ‘licensed professions’ or ‘people who need a license’ and you’ll get the entire list.
Your list is the most important things that you have as a marketer, because those are the people that you’re going to go after to make that next sale, no matter what it is. One of the interesting things about direct mail marketing is the consistency. You can’t just mail once and be like, I did it. Statistics show that direct markers should plan to mail the piece at least eight to ten times for it to capture the recipient’s attention and cause action. It’s a big commitment!
A lot of people will mail one direct mail marketing piece out and they’re like, ‘Oh, I didn’t get any phone calls.’ Well, you mailed it once. And you know, everyone knows everybody’s busy, they go to their mailbox, they pick up the mail and they’re like, ‘Oh, flyer, pitch it.’ And it might not be time. Maybe they run out of that product that you sell in another month. And then when they get the flyer, they’d be like, ‘Oh, I need to purchase that.’
There’s something to be said about being repetitive. Even though people will tell you, ‘Well, I got your postcard, I just threw it in the trash.’ I’ve actually had people tell me that, but they’ve got my postcard enough times and thrown it in the trash enough times. They recognize the name of our business and then they go ahead and call.
What Are You Selling?
Once you’ve got your list and know you want to market to those people, whoever they are. Then you must decide what are you going to sell them? Is it service? Is it the lowest price? Is it maybe the quality of the product? Or maybe you have something unique to that product that makes it special that you want to make sure that you get across?
In our case, we sell insurance. Well, you can buy your insurance anywhere. You can buy it online, you can buy it from us, you can do a lot of different things. Why would you do business with me? So, one of the things that we always try to sell is our knowledge. In Bancorp Insurance we have over 150 years of knowledge when you add up all the agent’s history in the market. We have a lot of experience, and that experience is what sets us apart from other agents or online carriers. We know your industry and what you need initially and on a day-to-day basis for support.
Whatever it is, knowing what sets you apart from your competition is what you need to sell to your prospective customers.
What is Niche Marketing?
And then that’s something that we haven’t talked about but actually niching. Which is looking at your customer base and saying, ‘Who are my customers? Who are my best customers?’ Don’t just pick the ones that shop once and never come back. Who are the people that come back again and again? Once you determine who that is, try to find more people like them?
Who do you know on that first name basis when they pick up the phone and call you, or they go online, and they send you an order request. You know the guy who’s ordered three things from you or five things or whatever it is. Maybe you have an association that you know five people from that all order from you consistently. You might need to be part of that association to connect with more people from that group. The main questions to ask about your prospective customers are…Where are they congregating? What are they doing? How are you going to get to them?
It all depends on what you’re trying to sell, and you want to speak to that customer specifically and help them solve whatever the problem is that your product solves. That is the key to a solid direct mail marketing campaign.
Bancorp’s insurance agents are available to provide you with a free review and consultation. Contact Us – Bancorp Insurance Call 800-452-6826
Disclaimer: This content is provided for general information purposes and is not intended to be used in place of consultation with our agents.