Sell the Whole Package: A Preliminary Discussion on the Elements that Influence Customer Perceptions of Value

In the auto and homeowners insurance sales arena, I often hear sales professionals declare grudgingly, It's all about price these days. I don't care what they say. Price rules! I understand why they say that, especially when a competitor’s premium comes in $100.00 less a half (6 month premium) then their stated premium.

Too often at that point, we end the conversation, wave the white flag and politely smile wishing them Godspeed while secretly hoping a year from now the tables will be turned on the competition when they have to raise their rates above ours! What a way to work and view our profession and our responsibility as experts and advisors in insurance matters.

Now, I realize that scenarios like this happen every day in the life of an insurance professional and that people are concerned with the cost of things. But I also realize that people don’t base their buying decisions solely on the weight of price. People are looking for value; and value is simply the relationship between price and the benefits of having a product or service.

Selling is a Transaction of Value

Sales is a contact sport. But, I would add, Sales is a transaction of value as well. People are emotional creatures who want to be wanted; who want to feel special,who desire to associate and buy from people they perceive to be like them. We are creatures that base decisions on emotion and later validate and justify them with logic. Bringing it back to the realm of auto and homeowners insurance sales, people will look at the price, but will buy based on the emotional benefits they perceive will result from buying off of you, your company and your agency.

Let me see if I can illustrate this point a little better. With many agency training classes we hold, I ask the following, Think about when you purchase things, particularly those things of a significant nature and value. What is it that causes you to buy from one place or vendor versus another? In other words, what is the reason why you buy a particular thing...from a particular person…at a particular place…especially when you have choices to go with someone else or go some other place to buy?

Without exception, the list of responses I write out on a flipchart is dominated with phrases like, a friendly salesman, a nice environment, knowledgeable sales people, not pushy, cares about me, I buy from people I trust, I didn't feel stupid when I asked questions, they made me feel special, they let me decide, I wasn't pressured, I felt comfortable, they took their time, they responded quickly. Now where is price in all this? It’s there…somewhere down the list indicating that, although price is a consideration in the buying decision, it is not the paramount issue we agents and sales people all too often claim it is.

1. The Price

Furthermore, independent research with investor/buyers list the top six priorities people value when choosing to work with financial advisors as, understand my situation, educate me, respect my assets, solve my problems, monitor my progress, and keeps in touch. Again, where is price? Where are the comments, I buy price and quality? They're just not there.

Price Does Matter...But it Isn't the Whole Matter...

It's not because price isn't an issue for people. No. It is because price isn't the whole issue for people necessarily when they choose one thing to buy over another or one place over another to transact business. Emotions rule. Relationships matter. It’s at the origin of feelings and emotion that people link the price to value and worth. It's how people decide...to decide.

So, to those who declare, it's all about price these days, I ask again, where is price among the overwhelming responses that I receive and industry research historically validates about human nature? Again, price does matter. Do not misquote me on this point. But understand when I say that the evidence and my observations on human behavior during the buying process confirm...price is not the whole matter. It is not even in the Top 3 in regard to reasons on why people buy…or choose not to buy.

So now what? What am I to do with this information? What does this all mean for me as a sales expert; an agent? Well, what it means is that we have to begin looking at auto & homeowners less as a commodity sale based on price and more on the emotional aspect of the sales spectrum.

It means we have to begin selling the whole package when it comes to the art of the sale. We have to look at things differently; to begin communicating the emotional benefits of the whole package to the customer so they can make the favorable value connection between price and the benefits of owning our auto and homeowners insurance product. Simply put, we need to get them to see that the premium is worth all that we say it is worth.

So how do we do that? How do we get people to the realization that our price is worth it? By helping them discover all those things about us, about our company, and about our agency that makes us so valuable to people and unique in comparison to the competition. By telling them our story and bringing them into our world of trust, care, concern, competence and friendliness. By being sales professionals who sell the whole package through mastery of key sales conversation basics.

The Value Diamond

So what exactly is the whole package? Well, the whole package deals with leveraging and linking what we understand about the emotional buying nature of people to the value proposition of four interrelated factors; Price, Product, the Person selling and the Place where people buy. I call that relationship, The Value Diamond Concept .

Picture a single diamond shaped graphic, at each of the four apexes there is a word; at the first apex or point is the word, Price, next is Product, then Person and finally, Place. In the center of the diamond is the word, Value; representing that the sum total of all these factors together equal perceived value on the part of the customer.

Graphically, that’s what the whole package looks like; four factors interdependent on each other, working to make the decision to buy from you, worth it. So let’s examine each of these factors in brief and see how they affect the overall motive of the customer to buy.

Price Does Not Have Meaning or Relevance Until It is Compared to Something

First of all, price, what is it? Price is the quantitative measure of what someone must pay in order to have or get something. It’s sterile, clinical, precise, rational, and registers on the left side of the brain, that part of our anatomy which analyzes and computes but does not make the overriding decisions in our life, and that would include the decision to buy.

Price is a Measure...Much Like Fahrenheit or Centigrade are Measures

Price is what it is... a number...nothing more. You can’t change it. So when you present it to a customer, apart from all other factors, it means nothing. But when juxtaposed with the competitions price, it begins to have meaning and relevance to the customer. In some instances, that relevance means that it is a number higher than the other guy’s and, thus, is too expensive of a price. And in other instances, it means it is a number lower than the other guy’s and is, therefore, a good buy. And sadly, too often, that is how we approach selling our auto and homeowners insurance product- by price comparison that is dictated and controlled by the customer’ thinking and not by any sales ability of our own.

Our Great Folly as Sales Experts

Our great folly as insurance experts is that we allow the customer to define the rules of relevance. When it comes to the price of our product, why not exercise true salesmanship by shifting the customer's thinking and focus from what they are currently paying in auto insurance to what they can potentially get from us as a result of the price we just shared with them.

Did you catch what I just said? It was quick and a little subtle. But what I just said is powerful in terms of combating a competitor’s lower price.

Let me say it again a little slower and simpler, most agents exercise enormous stupidity when they fail to tell the customer what it is they are getting for the price they are asking. Now did you get that?

The Only Way to Combat a Competitors Lower Price... Is to Communicate Higher Value...

A better way of communicating price is to shift the customers thinking away from looking solely at what they are paying now and provoking their thought processes to consider the benefits of what they will get when buying off of you. The only way to combat the competitor’s lower price is for the agent to communicate higher value. There is no other way...absolutely none.

For example:

The premium for the first six months, Tom, is $500. Now that is a little more than $80 a month or about $2.50 a day to make sure that you, Peggy and the girls are properly protected if they are ever in an accident. For example, with you, Peggy, driving all the way to Columbus, a 40 mile trip one way every morning and evening is grueling…and dangerous for that matter. A lot of accidents do happen on the beltway around the city. This plan is structured to protect you if you are ever in an accident going to work, for example.

And correct me if I'm wrong Tom, but one of the things you mentioned at the beginning of our discussion was how frustrated you were with your last agent; he wouldn't return your phone calls, couldn't seem to care if you needed anything or any help. I know that must have been really frustrating. Please remember, that 1600 other families just like yours choose us and trust us to take care of their insurance needs. And if you are to choose us as your insurance carrier, I promise you we will treat you like family as well.

In fact, here is my business card, my toll free number is right there Tom, and here’s one of Peggy’s cards as well. You can call 24/7 and reach a live person if you call that number. And if ever you call and we don't have the answer for you right then, which is unlikely with all the experience we have here in the office, we'll find the answer for you and get back with you. We have a policy of getting back with our insured within 24 hours of a call, often it is less, so they know we care about them and appreciate their business. That's just how we work here at the Tom & Peg Insurance Agency. How does that sound, Tom? Peggy? Great.

To think that trying to get a customer to forget about the premium they are currently paying, especially if it is a premium lower than what has just been quoted to them, is not a realistic expectation. That is not what I am suggesting can be done in sales situations. What is realistic and possible is to shift some of that mental energy of the customer; that focus, that attempt at defining relevance by comparing your price to the competitions and to get them to ponder what it is they get for the premium we just quoted.

So instead of the customer saying to themselves, the premium is $500 every six months, but I pay $400 now. I’d have to give up $100 to go with Tony as my Agent...Instead, their thinking can be influenced to consider...Oh, so that's what I get for $100 if I go with Tony as my agent.

It is a subtle difference in thinking...But it is very powerful in its ability to influence and persuade the customer to buy from you even when your price is higher than what they are paying now.

Does Shifting the Customer’s Mental Energy Away from Their Current Company Work All the Time?

Does this technique work every time it is used? Of course not, but then again, I subscribe to the hockey legend Wayne Gretsky's philosophy, You miss a 100% of the shots you don't take....So take the shot...Eventually, you’ll be scoring points on cases you never thought you had a chance to win.

Don’t be one dimensional as a sales professional; always selling on price, hoping that your premium is less than the competitions. That’s no way to live or prosper as an agent. It reduces our profession to no more than “order takers” and makes us no different from what the Internet has to offer.

2. The Product

Product, on the other hand, is just as benign as price when it stands apart from all other factors. In some instances, the other guy’s product will have more bells and whistles (features and benefits) then ours. And in others, our auto and homeowners product will have more bells & whistles than theirs. So again, like price, product is quantitative, factual and sterile in nature. It is what it is, nothing more, and nothing less. So when we sell on product features, we win those where we are richer in feature offerings and benefits and we lose those cases which offer more than we do in comparison.

Price & Product are Left Brain Functioning Factors

Again, I am not discounting the impact that price and product has on a customer’s buying decision. They are important factors in a person’s perception of value. By their very nature, they are left brain functioning elements of the value string. That is, they are factually based elements that are points of discussion in a sales conversation and are processed physically, for the most part, in the left brain; a physical place in our minds that is dispassionate, calculating and unemotional... And because of the nature of price & product as factual based elements of value, the sales professionals has a bigger challenge in translating these naturally cold and left brain (where facts, figures, details are processed) factors into emotionally stimulating language for the customer to hear and process.

Before I move on to the final two elements of value and leave the subject of price and product as key factors in the equation of perceived value for the customer, consider the following two statements in regard to price and product. They are statements I will elaborate further on in regard to value and how to communicate it properly to a customer.
Never…Never…Never…State the Price of Something without Connecting it to a Benefit Statement(s)…

and

Never…Never…Never…Speak about Product without Translating its Features into Benefit(s)…

Two irrefutable & immutable laws of the true sales expert; to ignore this advice is to ignore one of the great secrets of the sales profession.

3. The Person

The final two factors, or elements, that make up this idea of value are emotionally based in nature. They are right brain functions, cohabitating with that part of our human make up which makes decisions, sees the big picture (things at a high level, in total), is stirred by visuals, beliefs, understands the conceptual and the symbolic, hopes and seeks solutions to revealed problems.

They are you, the person, the expert, specialist or agent; and the place, or the environment you create; the agency location, or the Internet website or portal that forms the juncture or point at which the customer buys. Both possess strong emotional pull on the decision making process of the customer to buy…or not to buy.

Their influence on the buying process and a customer’s decision to buy is both naturally more powerful than price or product, and their use and application by the sales professional is more natural and more easily duplicated as a successful habit. Both the person element and the place element of the equation stimulate a customer are right brain functions. Both play an enormous role in the success or failure in closing any sale.

The Person is You

On closer examination of the person factor in the Value Diamond Concept of Value, I refer to Dale Carnegie’s observations about perceptions and the avenues by which people form opinions, feelings, and impressions about us. Carnegie states that every person is known and evaluated by four things, and four things only; What we do, How we look, What we say, and How we say it.

What we do. Think on the occasions when you’ve been asked, So, what is it that you do for a living? Better yet, recall those times when you yourself have asked a similar question of someone. We all do it. Oh, I know, most times we’re asking out of polite curiosity. At least, that’s what we tell people.

Perception is Reality. Facts & Accuracy have Nothing To Do With Perception

But more accurately, from a human nature stand point, we’re asking the question not out of courtesy, but more as a means of sizing up the other person; a gauge by which we form judgments about people. Sizing them up, that’s what it’s called. Everyone does it. Yes, people are judgmental. They form opinions of us within seconds, right or wrong, cliché but true; perception does become reality. The truth, the facts, accurate accounting…none of these things has anything to do with perception.

What a customer perceives is their reality. It doesn’t matter what the truth is…It only matters what the other person’s perception of you is…for that is…their reality. End of story. The sooner a sales person grasps that reality, the sooner they can move on to becoming a better sales professional…and a better person for that matter.

You, as the Person…are Worth the Price…Because You are Cool.

It’s here that we have a distinct advantage over our competition – lower price or not. We are specialists, experts, resources extraordinaire, advisors and consultants, agents and financial counselors whose sole mission is to have or get all the answers, rescue from confusion and assist people in order to make their lives better, safer, less tragic and happier in some cases. We are cool!

That is the message. That is the path we need to take as agents when articulating our story in our sales conversations as we introduce ourselves to prospective customers.

For example:

Today, I’m also trying to earn your business, Mr. Smith. And if you choose our agency to take care of all your insurance and financial needs, my pledge to you is to be your personal advisor and experts in these matters; to do much of the worrying for you so you don’t have to.

I am your link to value, making sure your insurance dollars are spent in the most efficient manner for you as possible. Sure, you can buy auto and homeowners insurance off of just about anybody who has a license. But at the risk of sounding arrogant – I’m not just anybody, Mr. Smith. I keep my promises to my customers of being there when they need me.

As your agent, I’ll work for you, dealing with the details that can often be confusing when an auto accident occurs, answering your questions when your kids begin to drive, working for you 24/7 so you don’t have to worry about those things.

Other companies give you a 1-800 number and forget about you in voicemail purgatory; avoiding the responsibility of being you advocate by hiding behind voicemail messages. That’s not how we do business. If you need help or have a question, I’m always here for you and can take the time to talk and meet with you whenever you like.

In that sense, I’m worth it.
That’s the value I bring to folks like yourself, Mr. Smith.
I care – and because of that, my customers value the relationship we have.
Doesn’t it make sense to have that kind of relationship?

That’s what we do as sales professionals, and that’s value. So altogether, with telling our story, using emotional language, understanding the impact of vocals and how we say things on the human psyche to relate to us and by being conscious of appearance and body language, we can evoke a positive emotional response within people that speaks to them from within saying, I’d like to buy from this person.

That’s the kind of salespeople we should endeavor to be.

4. The Place

The fourth and final piece to the Value Diamond Concept of Value is the place, and in our discussion, I will confine our discussion to a physical location such as an agency office. Although, what we discuss is applicable to a website or other Internet portal where business is transacted.

As such, how is your agency environment perceived by customers and the community around you? Is it a place where customers are greeted readily when they walk through the door? Is it inviting with a reputation for expert service, caring people and a staff that is always there for you when you need them?

When is the last time you took a long hard look at the physical condition or look of the exterior and interior of your office and asked yourself, Is this the kind of place I’d want to put my money? If the answer to that question is something other than yes, then changes need change.

Environment Matters in Perception and Perceived Value

You see, environment matters, and I don’t just mean the physical surroundings. Yes, it’s important to have as professional looking, comfortable and inviting place. But what of the environment the sales team creates? How are people greeted? Are giveaway items used and handed out as people walk in for an appointment?

How easy is it to transact business? At every connection point of customer contact whether it be a call-in, walk-in, seminar you are delivering or appointment; how can we make the customer feel valued, feel special, feel important?

What strategies do we employ to convey convenience, ease, and an overall pleasant experience for the customer when a call-in is taken on servicing issues? When an auto claim is filed, what’s your strategy to relax the customer and engender confidence and loyalty towards you and the agency?
Marketing is not only getting customers into the door and in front of you for a sales conversation. Marketing is keeping customers as well. So it behooves us as sales professionals to build a fence around our customers, to avoid defection and leverage the good will of the place for cross selling and up-sell opportunities.

The Whole Package: Price-Product-Person-Place

The Whole Package…that’s what it is. A combination of a competitive price, a quality product, expert advice and resources as the person, the agent and a place or environment that sets the right tone and atmosphere where the customer is comfortable and can see that you are a person they can do business with. That’s left brain and right brain stimuli working together to trigger the buying decision in your favor.


These elements will be examined again in later commentaries about value.