If someone offered you a dollar in exchange for 50 cents, how much would you give? If you are like most, you would probably give everything that you had (I know I would). Ben Feldman sold life insurance for pennies on the dollar. In fact, he used to carry a $1,000 bill with him, which he would tell prospects he would sell to them for 3 pennies.
It’s a great strategy for selling and is an excellent analogy for marketing. Too many companies look at marketing and advertising as an expense – not as an investment. When budget time comes around, the first thing people look to cut is marketing, especially if sales are flat or declining.
All too often companies will cut their marketing budget before focusing on what they really need to cut, and that is usually staff. Laying people off is one of the hardest things an employer has to do. But since your job is to drive growth and sales, you have to make the decisions that are right for your company.
[ $1,000 Bill Facts ]
First printed as a small Federal Reserve note in 1918. As of 2009 there were 165,372 thousand dollar bills in circulation. Today, the note is discontinued, after having seen its last printing nearly 70 years ago in 1934.
When done right, marketing is the greatest investment that a company can ever make. I have personally watched companies grow their business exponentially when they marketed effectively and, most importantly, consistently. In fact, my company has helped one company grow from 0 to $100 million in annuity sales in their first year of business, while another company grew their life sales over $2 million in just a year and a half.
Marketing is the lifeblood of your business. When you cut back on marketing or don’t invest enough, it’s like slashing your own jugular. Marketing is the most important thing that you can do for your business. It moves the conversation from one to one – to one to many. It is physically impossible for recruiters to reach out and share your message with tens of thousands of agents a month, while marketing easily can.
Over the years I have spoken to many companies that believe they don’t need to market. They actually enjoy bragging about how they never advertise or “pay” to market. But paying is what they really are doing. They miss more opportunities a month than they could fathom. They tend to operate in small ponds, leave their marketing up to referrals or think that their internal telemarketers are capable of reaching the masses (which I’ll cover next issue).
They are eager to spend money on trips and incentives, but in turn do little to build brand equity and a reliable source of attracting new agents (which investors will eagerly pay multiples for). They bury their heads in the sand and leave it all up to their recruiters and partners in hopes that their mission and values are being communicated to the marketplace on a mass scale.
The value of external marketing is twofold. First and foremost, it’s how you find new producers for your recruiters to speak with and for you to continually market to. Too many marketing organizations rely exclusively on their internal lists for marketing and end up chasing the same agents over and over – who are what we refer to as “serial responders.” These are the worst type of leads, because they are always chasing shiny objects and if they are on your list they are probably on everyone else’s as well. So even if you do happen to get them, they won’t stay long.
The other reason external marketing is valuable is that, as I mentioned earlier, it can increase your brand awareness.
A lot of marketing companies think that this is worthless, but that couldn’t be further from the truth. When you look at valuations and acquisitions, the stronger the brand the higher the multiple paid. On top of brand value, there is also another hidden value that is often hard to quantify – new opportunities. We frequently hear from advertisers that because of their ads and perceived market position, they get more contracts and unique opportunities that they never would have if they weren’t in front of carriers, marketing organizations or the marketplace.
When marketing is done right, it is never a cost – it is an investment. Where else can you get a million-dollar or even 10-million-dollar producer for a few thousand bucks? Now, imagine that producer writing that type of business with you for five years. Even Ben Feldman would agree that’s an investment that’s almost impossible to beat.