What is more painful and causes endless pain? A dentist’s drill, or cold calling selling? Cold calling can cause endless misery and pressure. Insurance representatives are facing a career-ending defeat mechanism when they have to make cold calls. Learn why the pressure of cold calling to establish insurance leads can have such an emotional and torturous impact on millions upon millions of insurance agents.
Yes, millions. Over 70 million life and health insurance agents leave the industry each year. Cold call pressure and the emotional pain it causes is a major reason for a large portion of this decline. Despite this, insurance cold calling to set-up sales leads is still the most popular lead generation method. Cold calling was the most popular method of lead generation 100 years ago. It will continue to be used for the next 20.
Why? Cheap is not an option!
It all begins
An insurance representative is taught that leads are essential. It is also stressed that appointments can only be made if you have enough leads. This will lead to sales. This is where it all changes. Your instructor is given the truth. It is said that a unique cold calling formula will lead you to a financially rewarding career. This emblazed commandment is what you blindly follow because you are a follower of your leader. You may be a natural follower. You believe cold calling is a very effective way to get business. The virtues of cold calling insurance are taught to you so often that your brain is truly wiped clean.
The Magic Cold Call Formula
You are not only brain washed, but also poked by a chartboard pointer to keep you awake and remember the illustrated formula. This program is specifically designed for insurance agents. My butt. This cold calling selling method is used by hundreds in industries that employ sales reps. Here are the secrets to “guaranteed success”.
1. Calculate how much money (commissions), you will earn. Divide this number by the average commission that each insurance sale brings. This will give you the number of sales that must be made each month.
2. Next, multiply your answer by the number of sales presentations required to achieve an average-sized commission for one sale.
3. It gets more complicated. This new number is multiplied by how many cold calls it takes to set up an appointment.
4. This is the number of cold calls that you need to make each month.
5. You now get a bonus. Instead of subtracting the cold call number by 30 day, you can divide it by 20. This is it. This will tell you how many times you must make a call each day.
Einstein was a genius who created formulas that worked. This formula was created by a math major at college who never sold any insurance policies.
Why cold calling doesn’t work
No salesperson or team of mathematicians can accurately figure out the answer to #5 above. Your sales manager may devise a cold calling selling strategy that involves making 50 cold calls per day. You have two options if your results are poor. You can either make 60 cold calls per day, or you can add Saturday to your schedule to get more time on the phone. Studies have shown that you can successfully conduct a conversation with 10 people in just an hour. You might make 50 calls and get two leads to let you know they are interested in your product. Direct mailing is expensive and returns are only a 2 percent response rate, so that would be one lead. But, you have 2.
You have more than 100 cold shoulders from complete strangers whose names you probably pulled straight from a whitepage directory. You can cut down on your calls by hanging up with more than one person for every person you have completed a cal. A superhero can feel vulnerable if they are rejected 100 times per day. They may also be at greater risk of developing telephonenitis (fear of dialing a phone). It can become downright distressing and unnerving to feel uncomfortable. Your brain begins to work on your rational mentality. You start to confuse prospects with false suspects as you require at least two leads per day. These deluded suspects can be recorded as leads to keep you sane.
What’s a Lead?
An agent who is new to the industry and many long-term insurance agents will learn what a genuine lead is. Cold calling and prospecting are not the best ways to find a lead. A lead to me is someone who asks for information about insurance and is not under pressure. The prospect is able to afford insurance and is open to the idea of filling a gap.
Cold calling pressure makes it difficult to view prospects without all these qualities as a potential client. Unfortunately, it is rare for two leads per day to turn into two appointments every day. Calling sales reps are often stuck with cancellations or the misfortune of no show after driving all the distance to prospect’s home. If not all lead requirements are met, objections and “want-to-think it over” time stalls can occur. Newer agents average 100 life insurance sales per year. You will lose your job if you only make two sales per week.
Is it really important to overcome telephone objections when cold calling? Cold calls can lead to cold appointments. Cold calling can make you the best agent in the agency. However, it is impossible to beat more experienced agents who have learned their lesson.
Prospecting can be frustrating. Let’s face the facts, we are all overwhelmed by telemarketers that cold-call on everything. He says that we hate being on the receiving side, so we don’t want to do it.” Cold calling is thwarted by dread. It’s the fear of not being perfect, being yelled at or making a fool of oneself. Some barriers can be psychological. There are also people whose emotional makeup is not suitable for the particular stresses and strains that come with selling.
Cold calling can destroy your business status.
One thing I have learned is that to be a great salesperson and maintain a high closing rate, you must project the impression that you don’t need the customer’s business. Also, that you are willing and able to leave at any moment. But does cold calling give the impression that you don’t want their business? No! It’s very clear that you need the prospect’s business when you cold call them. The problem is made worse by the perception that busy people don’t cold-call because they don’t have time or are too busy with other things.
It could be arrogance. No! Prospects see this and recognize that they are not in desperate need of their business. They then want to buy from them! Many prospects will also call an office to speak with a top salesperson or a sales manager.
Cold calling gives the impression that you have nothing else to do but to try to make a living. This makes it seem desperate and needy.
Cold calling reduces production and is a waste of time
One of the main differences between successful individuals and organizations in the “Industrial Age”, and those in today’s “Information Age”, is the fact that successful people and companies use leverage to their advantage.
Leverage is an important topic, but cold calling allows you only to be in one place at a time. This means that you can only make one call and walk in one door at a given time. Your time and ability to manage it are the most important factors in limiting your potential results. However, you can leverage the power of systems to your advantage and be virtually anywhere at once by leveraging their power. Cold calling can only get your message across to one person (if you are lucky enough to reach them), but proper leveraged systems allow you to communicate your message to many people with minimal effort. The system is created, installed, and then it generates leads automatically for you.
Here’s a classic example of the non leveraged, non-systematic approach to activity planning that salespeople are taught, even in these modern times.
This method has many fatal flaws, which we’ll cover later. But the most important one is that it limits production. You’re in trouble if the number of cold calls you need exceeds your available time. There are only so many hours in a day. You can’t increase time but leverage can help you exponentially increase your lead generation efforts and beat Father Time.
Cold calling is not able to provide the quality leads that we want, but it does not work.
Did you know that cold calling has a lower conversion rate than any other source of leads? Call-ins and company-generated leads, replies from mailers, calls, referrals, introductions through networking, etc. Call-ins, company-generated leads, responses from mailers, referrals and introductions via networking are all far more valuable than cold calling leads. Here are some reasons this is true:
– Many qualified buyers won’t make cold calls or meet with salespeople unless they have requested it. This leaves little room for cold-call-generated appointments. This is the true story – these time wasters will stroke you and tell how wonderful everything sounds. Then they never make a decision or buy anything. Or worse, promise the world to you, then you’ll never hear from them again.
If you find a prospect in a buying cycle for your product by cold calling them, it is likely that they have at least three to four competing quotes. This means you are way too late. Cold calling can also destroy your business status. You’re likely to be the one in desperate need of the business.
Let me share something I learned recently. It is important to be able to accept that cold calling does not produce the great, qualified, ready to-buy prospects most people would love to have. This is why we often get a lot of shady prospects who will tell us all we need to hear, but never buy anything.
This realization occurred to me as I was reading an article on social dynamics written by someone who has spent years studying human social interaction. He was trying to understand why people who seem cold and inaccessible in social situations do this. He explained that the “mask” of a standoffish personality was simply a social mask used by the individual to protect themselves. Protection against what? Protection against being seduced, falling in love, etc. The writer explained that people who wear a unapproachable, socially awkward mask are afraid of being too close to other people.
The real kicker was when the writer used analogy to explain his point. The following statement was eye-opening for me.
“Most salespeople know that prospects who refuse to take cold calls or have huge NO SOLICITING signs all over their doors make it difficult to sell to. This is because they fear salespeople. They are aware that they have a low resistance to sales pitches and they will often buy from salespeople. However, people who are willing to take cold calls on an ongoing basis can do so because of their high resistance to sales pitches. They are very aware that they won’t buy and they don’t fear salespeople.
Did you get it? You might not have understood the message. This is exactly why cold calling doesn’t work. It just makes it difficult to get in front of prime, willing prospects who are ready to buy. They are afraid of us and won’t answer our cold calls.
Salespeople are writing more emails and letters asking for help with flaky prospects. The problem is that prospects seem to be getting less likable over time. This is because most salespeople cold-call, and these are the prospects that you will get from cold calling. They are known for accepting appointments and saying, “Wow that sounds great,” but then not returning any phone calls or emails. They don’t have the real desire or need to buy. Avoid cold calling to reach these prime prospects. Instead, use creative methods to communicate your message to them.
Cold calling automatically paints you in a negative light
It’s disrespectful or wasting someone’s time that frustrates busy and successful people. What’s the best way to do this? This is the best way to do it than by cold calling.
Imagine yourself a busy executive who has a long to-do list and four meetings per day. You’re trying to keep your hands on the ball and imagine yourself juggling multiple tasks. Then, as you are struggling to think of how you’ll get out of that meeting before 8pm, you hear Frank Rumbauskas from FJR Advisors say this: “Hi Frank, this is Frank Rumbauskas. I’d love to meet with you. What about Thursday afternoon or Wednesday morning? Which is better for you? Let’s suppose you are a consumer just coming home from work, and you want to sit down for dinner. You answer the phone and get this message: “Hi Frank, how are your evening?” Do you think this is a good time for us to chat for a few more minutes? If not, I will call you back. It would be great if we could set up a time to meet and talk about your selling and how we can help.
This is obviously very annoying and disrespectful. Cold calling will achieve more than any other method combined. Why be negative about someone who might have bought from you otherwise?
Salespeople detest cold calling!
This is my opinion. Human psychology is well-known. It’s almost impossible to succeed at a job you hate. What reason would you want to make yourself miserable by working in a job you hate? Even the most jovial, rah rah, modern-age sales managers and trainers will admit that salespeople hate calling. Anyone who says otherwise is likely lying.
Buying vs. Selling: What is the difference? Sell: To trade or deliver money or its equivalent. The Dictionary
After the dictionary definitions for the words “buy” & “sell” have been displayed, I’m going to share my definitions of selling and buying with you:
Buying: The act or practice of buying something you desire or need for money. The buyer usually leaves the transaction happy and satisfied. Selling: Making an attempt to convince someone else that they need or want your product or service, despite the fact they might not. The buyer usually leaves the transaction feeling “buyer’s regret.”
Do you see the direction I am going? Let’s go one step further. My experience has shown me that cold calling is a way to sell. However, I believe that buying is possible when you use leveraged systems to get qualified prospects to your business. You can see that selling and buying cannot occur in the same transaction. Are you familiar with the meaning of “causes for”? This means that the buyer was presented with the right circumstances, which in turn induced them to purchase from you. This concept is completely contrary to selling as I understand it, and its synonym cold calling.
Salespeople routinely do things that instantly and unambiguously give ALL of their power to prospects and customers. They then hold all the cards, and have the sole authority to make the salesperson fail or succeed. Talk about power. Power is the ability to make someone succeed or fail. For a moment, think about this. It’s almost like playing God with someone. It was exactly how it felt in my early days selling, when prospects wouldn’t buy from me and I didn’t have any power to change it. Despite the fact that I was fired from my job, it was the same feeling. This is where the worst part lies. Salespeople believe they are doing the right thing, and they’re supposed to take actions that give away all their power. Many times, I have heard salespeople say that they are willing to do anything to win your business. “If you are my customer, I will be there for you.” I am all about customer service after the sale. If you have any questions, I will be there for you. “I’ll even give my home number. “I want to be available anytime, for any reason.
These salespeople can get themselves into all sorts of trouble if they say such things. First, customers will be incredibly selfish and want to get everything they want. They will also start to act incredibly sadistic towards salespeople who are truly at their beck. You must not give away your power in order to earn the respect of others, whether that’s in sales or personal relationships. Keep your power, and communicate clearly that you are worthy of respect and admiration. At the minimum, you must be considered an equal and perhaps even a superior. Only then will you earn the respect of your customers.
It’s both a game for wits and psychological positioning. If you present yourself as superior, the game is done before it begins.
How many times have those terrifying words “You need more activity” been repeated? Or maybe “The activity isn’t there.” It seems that “more activity” is the universal solution to sales lags. More, more, more. Important Note: Insanity can be defined as doing the same thing repeatedly with the same results. Here’s an idea: Why do you keep doing the same thing over and over again with the same results? Change your activity!
Bottom line: If you don’t like what you do, stop doing it. It’s time to change it. Change it. Do something different. Remember that most successful people in the world got there by working smarter and not harder.
This is the point: you shouldn’t waste your valuable and productive selling time on people who aren’t likely buy. What are my definitions for selling and buying? If someone intends to buy, they will buy. That’s that. Selling is a difficult task. It’s better to spend the time selling instead of focusing on the buyers.