The new head of cross-selling at Acordia Inc. says that expanding this effort with parent Wells Fargo & Co. is a top priority for the Chicago insurance agency.
Wells has made cross-selling its mantra, and though it makes sense in theory that customers would buy products from both companies, "once you start rolling it out, there are some practical matters that jump up," said Mark A. Green, a vice president and national cross-sell practice leader at Acordia.
"The practical matter is that you need [insurance] people that speak 'bank.' You need people that are going to develop good relationships with people, who are not the typical insurance broker," he said.
Mr. Green, who was named to his post Oct. 25, directs the national cross-selling efforts between Acordia's regional field operations and San Francisco-based Wells Fargo.
The plan is to hire or appoint cross-sell representatives in each of five regions, with Mr. Green as the corporate head. He said that because the bank and the agency are organizations with very different relative sizes and management structures, he is looking to hire people who can "talk both languages."
Mr. Green said his strategy has four main parts: building awareness of Acordia and its capabilities within Wells Fargo, recruiting people from both inside and outside each organization who can help cross-sell, educating agents and bankers about each other's businesses, and targeting Wells Fargo clients with specific products developed with insurers.
Since Wells bought Acordia in 2001, cross-selling has been "going very well, but there are tremendous opportunities on the upside," Mr. Green said.
If Acordia were able to reach one of 10 commercial bank clients, "you could have incredible growth from Acordia," he said. Though that is not the specific goal in the short term, the companies believe that cross-selling "will be the No. 1 driver of new business in a couple of years for Acordia."
The company is still deciding whether it should hang on to the Acordia name or more closely connect the agency with the Wells Fargo brand, Mr. Green said. Either way, he said, it has been very important to raise awareness about Acordia among Wells Fargo bankers.
The No. 1 goal of the Acordia purchase was "to bring more diversification to the client offerings within the bank," Mr. Green said, and that remains the agency's top priority. "The main driver is to further solidify the relationships of the bankers. That is a major aspect of the business plan."
Wells' purchase of Acordia still ranks as the largest bank-agency deal ever, and Acordia, with $6.5 billion of annual premium, remains the largest bank-owned agency in the country.
Though Wells has no banking offices east of the Mississippi, Mr. Green said Acordia's East Coast operations have had some cross-selling successes in tandem with specialty operations of the bank - something he says he was "pleasantly surprised" to see.
For example, he said, "the real estate group gives us tremendous leads," and the agency has also developed a strong working relationship with the Wells subsidiary Foothill Capital Corp.
In the areas where Wells has branches a few standouts have generated a lot of business, but others - possibly because they do not have an Acordia office nearby - have not made as many inroads.
Part of Mr. Green's mandate is to forge more connections between agents and bankers and to appoint specialists who can help with cross-selling. The specialists are to include people geographically situated in key areas or possessing specific expertise to help bankers with specialized client bases.
Mr. Green said Acordia is also talking with insurers to better understand exactly what kinds of products and services they can offer client groups as specific as "plumbers in North Dakota."
That way the agents could go to the bankers and say they have a product in hand that is applicable to a specific client or clients. This would alleviate a worry among bankers that they could refer a client but that the agency would be unable to supply the insurance the customer wants.
To encourage bankers to make referrals, "we're trying to make their lives as easy as possible," Mr. Green said.
Most recently, he was Acordia's vice president, alternative risk transfer. In that role he established the national practice group responsible for helping Acordia brokers with captive insurance companies, risk retention groups, finite risk, and other solutions that combine traditional insurance risk transfer with corporate finance and capital markets techniques.
Craig Whitehead, a senior consultant at Milliman USA in Chicago, said appointing someone to be specifically in charge of cross-selling is a smart move for Acordia and Wells. Banks and agencies are entering "chapter two" of cross-selling, he said, in which they need to look beyond the obvious opportunities and develop a specific and clear strategy.
"It's time to buckle down and make these things effective," he said.
Successful cross-selling requires making it easy for bankers to provide qualified leads, he agreed, and working with insurers to figure out which clients would be best for them is a way to achieve this. "For the bank it reduces the possibility of unintentionally irritating one of their clients" by not being able to satisfy an insurance need, he said.
James Campbell, a senor vice president and principal of Reagan Consulting in Atlanta, said he has been seeing more bank-insurance programs put someone in charge of cross-selling because it creates "individual accountability" for the success or failure of the effort.
Acordia's goal of getting most of its new business from the bank is not unreasonable, he said.
"Over the past couple of years we've seen a growing number of bank-owned agencies that are reporting somewhere between a quarter and half of their new products coming from bank cross-selling," Mr. Campbell said. Most of these are larger agencies that have been bank-owned for a number of years, where "these cross-selling efforts are starting to mature a little bit, starting to gel."
