Good Coop, Bad Coop

5 steps to tell if that preferred marketing program is really a benefit for your insurance agency

Insurance companies may not be as free as they used to be with co-op advertising money but they haven't given up entirely. Often the co-op comes with strings attached: use our preferred vendor and we'll pay some of the freight. Insurance companies compete on several levels for the hearts and minds of their agents and one of those competitive components is marketing support. But let's face it, while some insurance companies are really skilled when it comes to marketing, many are not. And often that preferred vendor or program is there for show as much as anything.

From time-to-time we get asked for our opinion about a competing marketing agency or service or we sometimes just get unsolicited feedback from agents about vendor decisions they have come to regret. We don't always have solid intel on our competitors and even when we do professional decorum precludes sharing any less than flattering information. So when we don't know or can't say, we'll usually suggest an insurance agent undertake some simple due diligence with these five steps.

1. How thoroughly was the vendor vetted? Often a regional marketing rep and maybe even regional executive management won't know the answer to this, so consider where the vendor is domiciled. If vendor HQ is right around the corner from the insurance company HQ they may have been chosen as a preferred vendor more out of convenience than ability to deliver superior services or results.
2. What is it like to work for the vendor? Glass Door and indeed.com both provide employer reviews by employees. Not every vendor will be represented on these websites, no reviews mean no search match. But when you find a search match be sure to take a close look at the reviews. One or two bad ones will be inconclusive but when you find a clutch of them, look for common themes like: 'no leadership', 'no vision', 'no employee development', 'great starter job, not a career'. Reviews like this suggest a toxic work environment, dissatisfied and unmotivated employees and likely high turn-over. When people aren't enthusiastic about their company it will seldom translate to a great work product or working relationship with your insurance agency.
3. Does the insurance company use the vendor's services directly? This won't always be a fair question. Insurance companies are enterprise sized businesses and most insurance agencies aren't. The vendor may not be 'built' to work with enterprise-sized accounts. But if the marketing company or vendor is fairly large, and the co-oping insurance company isn't using their services it could be a red flag.
4. Ask your incumbent vendor, if you have one. Doing so may be uncomfortable and may alarm your current provider who will likely think you are considering a change. But that's reality. Business is a competition and change is always a possibility. There might be some self-serving bias in your incumbent vendor's evaluation of their potential replacement but you should be able to sort out the authenticity of the response. And you may learn some useful information that will help you decide if the insurance company endorsed vendor service is a good option for your insurance agency.
5. Ask an agency who has used the marketing agency or vendor for awhile. Don't rely on the spoon fed references provided by the vendor or insurance company. Instead, ask anyone - agency acquaintances, association and agency management system contacts - anyone, ask them if they know of an agency you can contact who might be using the preferred vendor's services.