When it comes to generating high quality leads, it doesn’t get much better than referrals for independent agents. The inherent trust and interest level linked to word-of-mouth makes referrals extremely valuable.
In fact, referrals convert 30 percent better than leads from other marketing channels and have a 16 percent higher lifetime value, according to Lisa Ross at website conversion optimization intelligence provider Invesp.
One specific type of relationship that can be valuable for agents to cultivate is with local car dealerships. Let’s now discuss the dynamics behind this type of relationship and how to properly leverage it to generate qualified leads.
Focus on Building Relationships with Key Staff Members at a Dealership
Car dealerships are usually quite large and employ an average of 69 people, writes Jerry Reynolds, president and host of Car Pro Radio Network. This means there’s the potential for independent agents to form numerous relationships — all of which can be referral sources.
Specific dealership positions include the receptionist, salespeople, internet sales manager, assistant sales manager and general manager, explains Ronald Montoya, senior consumer advice editor at vehicle comparison site Edmunds. These individuals have unique roles and can serve as points of contact.
For example, it’s the job of the assistant sales manager to close car deals and talk numbers. Therefore, it would be advantageous to build a relationship with them, as they could mention your agency after they’ve secured a purchase and the conversation turns to insurance.
There’s also the finance and insurance manager who handles areas like service contracts, extended warranties and anti-theft products, notes the team at Automotive Dealership Institute, an automotive finance management training program. The F&I manager come in at a critical point in the sales funnel when customers are exploring ways to protect their vehicles. So if they bring up your name up as a trustworthy agent who can provide comprehensive insurance coverage, there’s a good chance many customers will be receptive.
While it’s probably not realistic to develop relationships with every single staff member at a dealership, focusing on a few key people who are involved with the insurance side of things can be huge for generating referrals. This is important because these are the individuals that are in the best position to help you get the type of prospect you want, notes marketing consultant James Pollard, founder of The Advisor Coach.
Be friendly with everyone, but be selective about who you build relationships with.
Concentrate on How to Make a Car Buyer’s Life Easier
Buying a car can be stressful. Mark Solheim, personal finance editor at finance news magazine Kiplinger’s, even goes so far as to say that it’s one of the “most anxiety-inducing financial tasks” a person will ever perform.
The reasons are many. Car shoppers have to do research, get quotes, haggle with dealers, and choose the right add-on features, says business news writer Brian O’ Connell. For first-time buyers, the experience can be especially overwhelming.
Any way you can work alongside a car dealership to simplify the process and make a car buyer’s life easier when buying insurance is beneficial to all parties. The buyer can find the exact vehicle and insurance coverage they need more easily; the dealership can secure more deals and improve their brand reputation; and you can bring in more referrals.
This partnership is the main angle to take when building relationships with car dealership staff. For instance, make it a point to mention the specific types of auto coverage you offer and what type of customer each one is best suited for. Or if you sell insurance for vehicles like motorcycles and RVs, you would definitely want to let staff members know so they can point relevant policies out to their customers.
That way staff can seamlessly offer suggestions to their customers based on their needs and reduce much of the stress that comes along with car buying. This brings us to our next point.
Be on Call to Answer Questions
Another way to crank up rapport with key contacts and enhance the customer experience is to make yourself available. After all, the easier it is to reach you, the better chance you have of landing quality referrals, according to insurance marketing platform Agent Branding System. On the other hand, if car dealers struggle to get in touch with you, those chances are reduced considerably.
That’s why it’s so important to ensure they have your contact information, explains John Rampton, entrepreneur and chief at productivity tool Calendar. This way they can call or text you whenever a referral opportunity pops up.
It’s also important that you’re on call to help a salesperson answer a question on behalf of a customer. Maybe they’ve just closed a deal and their customer is interested in liability coverage, but need clarification on how much it costs. By instantly responding to a salesperson’s phone call or text, you could explain the full details and potentially get a new customer.
This is fulfillment of the trusted advisor role and a vital step toward creating a pipeline of inbound referrals. While being available around the clock probably won’t be feasible, being available during standard business hours should be.
Make Sure You’re a “Risk-Free” Referral
One of the main reasons why people are reluctant to recommend an independent agent is because they’re not 100 percent sure they’ll deliver great service, writes Harry J. Lew at the National Association of Professional Agents. If this happens, it can damage their reputation and negatively impact their business.
It is therefore crucial that your contacts within car dealerships view you as a “risk-free” referral. In other words, they should have total confidence in you.
“When it comes to getting referrals from your network, confidence is a vital component — not your confidence, but the confidence your fellow network members have in you,” says Ivan Misner, Ph.D., author of “Networking Like a Pro” and founder of referral organization BNI. “None of them wants to risk their personal reputation by referring business, information or contacts to a stranger.”
How do you gain this confidence from staff within a car dealership? First of all, you should acknowledge that it takes time, and there’s an intrinsic confidence curve. But you can minimize it by staying in close contact with staff members and making yourself available when they have questions.
You should also make it a point to send referrals their way whenever possible. Sales coach Joe Micallef notes that reciprocity is a key ingredient in successful referral marketing: It’s important to give as well as take. If one of your auto insurance customers was in the market for a new car, for example, that would be the perfect opportunity to mention the dealership and point them to particular staff members that could help.
Finally, it’s important to keep anyone who sends you a referral in the loop and not leave them hanging. “When someone provides you a referral, keep them updated on the status,” explains Alice Kemper, president of Sales Training Consultants. “A quick message telling them you have initiated contact or you have a meeting scheduled is always a welcome surprise and closes the loop.”
For example, say a finance and insurance manager at the dealership had a customer who wanted comprehensive auto insurance. This covers a wide spectrum of issues such as fire, hail, falling objects, theft, vandalism and even riots, points out insurance writer Lacie Glover. That manager knew you offered the type of exhaustive coverage their customer was looking for and recommended that they call you. In this scenario, you should let the manager know if the customer initiated contact and if they ended up buying a policy. You don’t need to go into great detail, but touching base to keep them updated is a good idea.
Remember to thank your contacts at the car dealership for helping you grow your agency. After all, they’ve done a lot for you, says James Peterson at promotional products company Ipromo. Not only did they send a quality lead your way, but they saved you time by building trust.
Recognizing Car Dealerships as a Valuable Lead Source
Referrals have been and continue to be one of the best ways to generate leads and help you lower your customer acquisition cost and cost per lead, writes the team at field sales software company Spotio.
And because they’ve already been “warmed up,” referrals are much more likely to convert, notes marketing strategist Adrian Jans at Agency Revolution. “Not only are referrals highly likely to become loyal, long-term customers that buy more policies, they’re also likely to become the type of customers that deliver the most referrals.”
Car dealerships can be especially great partners because they fit in naturally with the auto insurance buying process. Understanding the dynamics behind these relationships and knowing how to fully leverage them can have a dramatic impact on your agency and help you boost your profitability.
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