Knowledge Center

Knowledge Center Items Podcast Episode 34

How a Niche Can Support You Through the Good and Bad Times

Published on

Sometimes it's risky to go all-in on one industry you want to do business with.

However, that commitment has the potential to provide greater stability and success if you stick with it.

Because going beyond being an expert means you ingrain yourself into the fabric of that special industry.

If you've been there long enough, it'll be there for whatever the market throws at you.

David DeLorenzo, CEO of The Ambassador Group, talks about the hospitality, hospitality insurance has provided his agency over the years.

For more Change Insurance episodes, click here.

Full Episode Transcript

Joey Giangola: Mr. Dave DeLorenzo, how are you doing today, sir?

David DeLorenzo: I'm good. How are you?

Joey Giangola: I'm doing all right, Dave. I'm pretty excited about where this conversation is going to start, not quite sure where it's going to end. But I have to know, just by the little sneak peek you gave me before we got started here. What's the best story you have in your time before insurance, in the music business?

David DeLorenzo: Yeah, so I graduated from ASU out here in Arizona, Arizona State University. And during that time, I got an internship with Warner Brother Records. And so, always growing up as a kid, being in love with music and all that. I took the internship and I ended up working for Van Halen, Red Hot Chili Peppers... Who else is on my wall, here? Aerosmith, and a whole bunch of other bands. So, prior to insurance, which is a family business for me, I was working for these major acts and for the record labels. And that's kind of what curtailed me, eventually, into insurance and specifically into the hospitality realm. So I have a lot of interesting music stories back in the day from when I was like 22, 23. Just hustling around for these bands and helping promote their records. It was a lot of fun.

Joey Giangola: So I didn't even, I must not have been paying close enough attention, because I didn't see Aerosmith or Chili Peppers or anything like that. I did see a Sevendust gold record on there. That's a deep cut. I'm sure me and you, and maybe only handful of people that are going to talk about that, but that's a band that's definitely near and dear to my heart. What did you enjoy from maybe, it sounds like you were kind of tail end sort of, we'll say hair metal into the, we'll say, new metal era of music. What was that like, in dealing with those guys?

David DeLorenzo: Yeah. I've always been a Hair Nation guy, still am, growing up. Rat, Winger, Warrant, all those guys, are still my favorites. But when I worked for WEA, Warner Electra Atlantic, which is a distributorship for those three main labels right there, we ran into all sorts of different bands that we ended up promoting for. And so, you referred to Sevendust, that was one of them. But I have Matisyahu on my wall. I have Crazy Town, Jimmy Page and the Black Crows. So whatever was coming out on those labels at that time, back in the late '90s, early 2000s, that's pretty much what we were promoting and were putting out there for people to listen to.

Joey Giangola: So what was it like, what was the day that you said, it's time to hang it up in the music business and walk into the family business? I'm sure that, I don't know if that was met with excitement, if it was met with frustration, but what was that process like coming from what someone would deem on the outside as an exciting career, to something that somebody would also maybe consider, dare I say, boring?

David DeLorenzo: Yeah. Yeah. In high school I always worked in insurance, so I kind of understood, doing commission statements for my dad and his agency, and all that. Which is now the agency that I own, multiple years later. When I worked for these record labels. I mean, it was kind of like anything else. It was a job. You would work long, hard hours. There was a little bit of a, let's just say, an idealism that, because you were working with artists and you were doing quote unquote, a cool job, you would get paid, not a lot of money. And you would work very hard because, again, you're in an industry that not everybody can get into. So after a while, that would be trying, and once you met everybody and you did everything in that spectrum, it was like it just another day for most people, I'm sure, in movies and music and all that.

When Apple came out with, with iTunes and just changed the landscape of the record industry, that's pretty much when I was like, "Eh, I don't want to do this anymore," because the jobs are very limited, they didn't pay as well. And I saw the potential in more or less a stable financial industry, like insurance. And I had already had a red carpet to get into that. Plus, I love my family and I love my dad and everybody, and I love Arizona that, I just didn't want to go anywhere at that point. So I sucked it up, became an agent and made my $60 my first month ever, in insurance. And I think it was like, oh my God, 1999 or something? Yeah, it was crazy.

So anyways, and just got started doing it. And a few years into insurance, I really niched myself into bars and restaurants, which made insurance a little bit more interesting for me. And that niche, any niche at times, can be career suicide unless you're really going to jump into it a hundred percent, and have nothing to lose. And I had nothing to lose. I lived with my parents and had a crappy car, and no wife, kids, nothing like that. So I just did everything I needed to do to, to have it work. And here I am, 20-something years later, and it worked.

Joey Giangola: So you brought me, David, right to where I wanted to go, when you talked about the niche that you have chosen. You said hospitality, bars, restaurants, and you mentioned the word, "Could be suicide." I would imagine you've seen your ups and downs in it, but what, I'm sure the question on everybody's mind is, what does that look like today?

David DeLorenzo: Yeah. I got a lot of phone calls, let's just say in April, of people that were concerned or wondering if I wanted to sell, or whatever it was, because they know how heavy I am in this industry. And a lot of these people, I guess you would consider them competitors, but I don't really consider anybody a competitor. But, friendly people that do some of the stuff that I do, that I run into. And I think the aspect of being nice was there, for sure, but in the same vein, it was kind of like, "Oh my God, are you okay?" And yeah, I mean, we're fine.

I think being as well established, and communicating with my clients the way that I did, and knowing that I have the marketing and the basis, and I am that one conduit for this industry and insurance together, with all the work that I've put together over the years has allowed me to be okay in this time of, what is going on. And so I know, I think indirectly what you might be alluding to is the fact that, hospitality is just getting crushed right now. I mean, all over, people are having to be shut down. They're having to be 50% occupancy. I will say in Arizona, we've been a little bit lighter shut down than most, but depending on what you are. If you're a nightclub, you're a coffee shop. If you're just a fast casual restaurant, it's just all dependent on what you do, how you pivot, if you do take out, if you deliver, all that sort of stuff.

And so, me personally, I have such a good book of business and a good clientele and people that are local, and have that relationship, that we've been able to pivot ourselves as an agency and we've been able to actually do really good this year.

Joey Giangola: So what was that pivot like, then? What were the conversations you were having with your clients to help? I'm assuming at some point, when the doors are closed or whatever, the insurance becomes somewhat part of that conversation. What were you, what kind of role did you play in helping them make it through that time? And especially since it doesn't seem like we're dealing with any sort of end in sight, per se, in terms of when things will get back to 70, a hundred percent capacity? What are those conversations like?

David DeLorenzo: So, I'm more or less an advocate and a connector for my clients. I'm not, I don't really consider myself an insurance agent, and I don't think they look at me that way, either. They just know that they have to buy this service, they trust me, and they know that I know a lot of people in other industries and other aspects of life. So, when they do reach out to me, I do whatever I can to help them out. And if it's, "Hey, we want to start doing delivery," giving them the advice on that. And certain programs or certain things that they can do to save money, and make money. It could be a marketing company that I refer them over to. It could be a basis of just different vendors that I'm connected with, to help them save money during this time.

And then obviously, the connection with the insurance as well, and talking to the carriers and finding out how we get them, albeit reduced receipts, reduced payrolls, all those sorts of things that help them through and communicate through this time of need. And then, I've owned 13 restaurants myself, so I do have a little bit of background and experience in that area. And so, I always tell people when we sit down and we have an insurance meeting with one of our clients, if it's an hour long, we talk 50 minutes about the hospitality industry and maybe 10 minutes about insurance, because insurance is really boring and dull, until you need it. And then you have to understand what it is that you've actually bought, and most people just don't. They don't care, until they have to know it.

So that's why I've been blessed to really focus on one niche and understand carriers, and who comes in the market and out of the market, and who has the best rates for this or that. And my clients trust me, on that aspect.

Joey Giangola: So, and this is something that's kind of been going through my head the whole time is, all the agents that I've talked to over the years, there's one or two things. If you ask them what type of business they want, when it comes to commercial, it's contractors, and then it's bars and restaurants. What do you think separates somebody that just is kind of looking for them casually, versus somebody like yourself who has owned restaurants, who has basically said, "This is it, this is what I'm doing." What do you think the agents that are out there that are mostly dabbling, maybe miss, in terms of the level of expertise to really be successful in that area?

David DeLorenzo: Yeah. That's a good question. Bars and restaurants are sexy. Yeah, there's some higher premium points on it, and I would probably see the same with contractors. I don't write any contractors myself, but I do know that world a little bit.

But when you look at hospitality, in general, it's very volatile. And when you're dealing with hospitality owners, and you're dealing with people with no experience. You have the owner that used to be a technology guy, that now wants to open up a brewery. You have the owner that, maybe worked in corporate America, and now wants to buy a franchise. You have a lot of these moving pieces of, things that already out the gate, already have some sort of smell of failure. And that gets very scary for underwriters. And if you don't have enough markets, which you cannot get, unless you're writing the volume of what it is that you're niche-ing in. So, if you don't have the markets, you don't have the availability to go and talk to different underwriters, and find different programs for whatever that sort of risk is.

And when you talk hospitality, you could be talking one minute, a high-profile nightclub to a high-end steak house, to a coffee house, to a brewery, to a convenience store with liquor and a bar in it. I mean, we do it all here. And so I have to have a whole plethora of carriers, that it's taken me years to build relationships with, and to build that correspondence with underwriters, to give me maybe a little bit more leeway than the average agent that dabbles in this, because they're going to turn around and go write that contractor, while they're working on the restaurant. And nothing wrong with that, that's what brokers do, and that's what independent agents are supposed to do.

I just had made that choice personally, to really just focus and structure just on hospitality. So that I'm always, my mindset is always in that. And I'm always staying on top of the educational practices of what's going on in hospitality, especially in Arizona, and being a part of affiliate sorts of organizations that have to do with that. And sitting on boards for the Liquor Council, and so, there's a lot of extra and added value that you don't necessarily have time to do, if you're dabbling in tech insurance, or you're dabbling in, again, contractors or car washes or any and all of that. So albeit, I will get those referrals, but I will outsource those to somebody else that's more qualified to do that stuff.

Joey Giangola: Well. Yeah, the interesting thing, I think that you'd said though is, is that it's not so much the insurance conversation, of just staying up to date on the nuts and bolts of the actual coverages. But it's the conversation that comes with being involved in the industry. And how much do you think is maybe lost in translation on that end with, maybe even the business owners that you deal with, from their previous experience with agents to where, they just didn't necessarily talk to them the way that made sense? How much of that ability to communicate has impacted the way that you are acquiring business?

David DeLorenzo: Well, personally, it's made a huge difference on the way that I do business and the way I wake up, and how I show up. And so, if that conversation is not something that resonates with somebody that I'm possibly getting ready to insure, or that I do insure, then I'm in a good position in my life, and I've run the things well enough that, it doesn't need to be a client of mine. Insurance can be very transactional, for a lot of people, and that's cool. Go to 1-800-BERKSHIRE and see how screwed you get, based on buying an online policy, not realizing that you're serving liquor and you don't have liquor liability. I mean, I see it all the time.

So, those are ripe for the taking for somebody that specializes in something, and really educates and puts themselves more out there in that industry. No matter what industry, no matter what niche it is. And it really all just comes down to niche-ing. And for me, it just happened to be hospitality, because I was in the music business and that's what I enjoyed, ever since I was a kid, 10 years old, staring up at posters in my bedroom of Eddie Van Halen, playing guitar. And here, there I go, 14 years later, working for the guy.

So it's all a matter of what you really imagine yourself doing, and then making it happen. And, clients are clients. You're going to have people that will become your friends, you're going to have people that just see it as, "Oh, I hate insurance, and it's just a transaction." And I've been through all that. I've gotten punched in the face so many times, that I've learned from it. And so, albeit, I don't need to be necessarily put through that. I don't need to have to, let's just say, have a relationship with somebody that's not going to appreciate or respect the amount of time and knowledge and expertise that I put on my end. I'm running a business, just like they're running a business. So it would be like, if somebody comes in and is criticizing their food, just because of the way that it was made. Then, don't eat there.

Joey Giangola: So I'm kind of curious with all the relationships and the ways you've... Maybe this is a couple of stage answer, but maybe take me through a couple of iterations of how this has worked for you, but what's your process for identifying and acquiring business? Is a lot of it coming, I'm assuming a lot of it's coming to you now, but at some point you were probably looking for the right people to go after, premium size, all of that stuff. How has that evolved for you over the years, in terms of the things that you've looked for, and just the way that you've gone about seeking out new clients?

David DeLorenzo: Yeah. In the very beginning, if anybody asked me for coffee, or if I could ask anybody for coffee, I did it. I always asked people that I always considered, in the industry, a lot smarter than me. I always learned, I still learn. I still... LinkedIn has been a good source of just getting to know other people that may be affiliated with the industry, not necessarily in the industry. But, and to this day, I get hit up by a lot of vendors that are like, "Hey, can I talk to you about this?" And then of course, they want access to my book of business, and this and that. But I'll always take the time out to sit with somebody, because people did that for me.

And so, really being passionate and putting out there what it is that you're trying to, what you are achieving, and through the process, and relaying that to others. Again, it just takes years and years and years of implementing, and not giving up and doing all that. So in the very beginning, getting to your question, in the very beginning, it was just a matter of going to any and every and all events, and talking to people and just, not being ashamed of what you do. Because again, it is insurance, and you see all the movies and the things about how insurance salesmen are the worst.

And so for me, it was more or less creating a personality around what I do and who I am, and being able to sell me and not the insurance industry, per se. Being able to sell me and the fact that I get back to you and then I'm responsive. And so, once you create that added value, and you create those connections, then you start building that book of business. And it can take three to five years, which it took me. I was looking at old check registers, of when I first started, because I wrote down what I made every month. It's absolutely nuts to look back on how long it took me, to actually make a career out of this. And I did, and I worked my way up, to now owning an agency. And so, has it progressed? Yes. Now I'm in multiple groups. I do, I teach insurance classes, and make them interesting from my perspective, on experiences. And I also am part of groups with different associations that have to do with hospitality and local promotion, and stuff like that.

And so most of my business now, if not all of it, does come from referrals and current clients and people that... And, now I get to be selective on who I take. I try to take everybody, but if it just is not a fit, then that's okay as well. Now, that being said, I'm still relatively young in this industry and I'm not really going anywhere yet. And yes, I've been doing it, at a very young age, but I'm still, I have that fire in me. So there's still a lot of marketing, I do a lot of Instagram. I do a lot of LinkedIn. I'm always, Facebook. Always, always, always building and creating that relativity, to acquire new business that is not necessarily referral, and not resting on my laurels. The minute that you sleep at the wheel is the minute that you crash, and then you have to rebuild. I'm just keeping the thing going.

Joey Giangola: Yeah. I want to talk about the marketing efforts in a second, but I have to ask this question first is, if you had to tell agents the one thing that you look for in a really good prospect in terms of just, to really get that premium where it needs to be, what's that one thing that they really need to hone in on and pay attention to that maybe makes a better hospitality client? And then on the other side, what's one thing that they really just need to stop chasing? Like, if this is there, generally nine times out of 10, it's not going to work out, it's going to be much more difficult to do?

David DeLorenzo: Yeah. Okay. So part of being niche, where I'm at now is, I don't have to really look at premium. I'm not part of one of these big houses. I don't have to do so much in premium, to create this much in commission, in order for it to be profitable. I know that goes against the grain on a lot of people's business models and aspects, and that's fine. But I look at a $500 BOP, the same that I would look at a $50,000 BOP, because I look at that $500 BOP has the potential to get up to 50,000. But, even better, because as you help that business grow from the perspective of being an insurance consultant, and then also giving them other tools to grow, when they do get to that 50,000 they're that much more interconnected, and it's that much better of a risk for you, because you have that relationship and you have over the years. So when this stuff comes to me, I really, really just talk to these people and counsel them and any and all of that business that comes in is, absolutely magical.

The one thing that I do not back down from is, really the attitude of the person on the other end of the phone, or in the meeting. So again, if there's a disrespect or an underlying tone of, "I don't need this, it's just crap. It's just, whatever," I think that's where we part ways. Because if somebody can't see the value, it's kind of like being in an abusive relationship with whomever, personally. If somebody can't see the value or understand what it is that you're doing is really there to help them, and you're showing the passion and the love towards that, then why do you need it? You want to be able to get... Your time is so limited, during the day. So you want to be able to give that time to other people that do respect that and love that. And maybe you'll open that space up for two other people, that are going to want that mindset that you give to them.

Joey Giangola: Yeah, I mean the value, that's huge. And making somebody, kind of converting somebody over to that, is very, a tough... You don't want to waste your life doing that, being in the convincing business, in some ways. And so I guess, talking about what you're doing in terms of the conversations you're having online, to put that information out there, to make yourself relevant to new people. What has that been like? I know, like you said, you've been active on LinkedIn. I think you have a podcast that's focused on restaurants and stuff, you bring on other restaurant owners. So, what has that been like, I guess, I don't know... How long have you been doing it? All the things, what has that done for your business and how has it further cemented you, within the industry?

David DeLorenzo: Yeah. So when people see somebody online, and they get to know them, and they understand all the quirks. And you'll see me out running, with my hair sticking straight up, kind of like the shirt, here. You'll see me gardening in overalls. You'll see me... I don't, I am who I am. Like, that's it. I'm not in a suit and tie, and that's cool, if that's your thing. That's just not my personality or who I am. So, I've been very successful, just being myself. And so when I put myself out there, and people already have that familiarity, or I keep, let's just say, a relevant of a figure, and people are seeing what's going on with my life, which I don't mind sharing at all. I'm not really a very private person, I'm putting out there... Because I put it all out there with a positive tone, and with a tone to be able to help, and hopefully inspire others to do things. Especially in the food, fitness and focus realm, which is personally where I come from, and which helps business for everybody.

So, yes, I do have a podcast called Bar and Restaurant Podcast. And really, that was just something I started a little over a year ago, just to have my clients come in and talk to me. My business meetings are no different than my podcasts, but this was a way for me to be able to record it, put more of myself out there as a host of something, and then more importantly, have these local businesses tell their story. And for people to get to know who they are and why they started in the industry of hospitality, and they have families and they're all humans. So when you put the face to the name of an establishment that might have 10 locations, but now, you know who the owner is and why they've done that and who they are, it creates that... And if that helps get more people to go there, then cool, I did my job. And that's it, that's just another added value item.

And then the other thing I utilize social media for is just, any sort of other educational stuff that I learn, or just keeping stuff on the radar of my clients. And others that can.. You don't have to be my client. I don't care. I'm here to help everybody, so anything I can put out there to help for the benefit of that industry, I do it. And it works great. I love it. It's just part of my job. Social media and marketing and all that, is part of my job. It's not something that you just do just because, "Oh, I got to do this." No, I love it.

Joey Giangola: All right, Dave, we got three more questions for you, sir. And the first one, very simply, what is one thing that you hope you never forget?

David DeLorenzo: I hope I never forget where I came from, and who I am. And, the reason why. Why I am doing this. Because I think, if that were to ever get lost, then I would have to certainly move on. And do I not, do I have crappy days, where I struggle? And I'm like, "Oh my God, this?" Yes. But in the long-term, most of my days are absolutely amazing. And I wake up every morning with an inner fire, to be able to do what I'm doing right now.

Joey Giangola: All right. And then, on the other side of that, what's one thing you still have yet to learn?

David DeLorenzo: Everything. Every day there's something new and something exciting, that I know that will come my way. There's mistakes to be made, that I will learn from, there are people that I will meet that have situations that I will learn from. And there's going to be, just like with the virus and all this other stuff, there's going to be new and interesting situations, that I'm going to be able to learn from. And so, as long as my mind is keeping active and I'm learning, and I'm understanding, that to me is, that's life.

Joey Giangola: All right Dave, last question. If I were to hand you a magic wand of sorts to basically reshape, change, alter, maybe make insurance a little more exciting in some way, what's that thing? What's it doing, and where is it going?

David DeLorenzo: Wow. Make insurance more exciting. Well, I think I've done that with my own niche, and the way that I put it together. And again, hospitality sounds sexy and this and that, but remember, it's very volatile. There's a lot of un-sexiness to it. There's a lot of loss in it. There's a lot of things that, albeit if you're looking to even niche in other industries, as we talked about earlier, to make things a little bit more, let's just say sexy and fun, is to just really dig down deep into it and create a story around it, and be a part of it. And show people out there, without any sort of backing down in your mind, or any self doubt, that this is what I'm doing and I'm doing it because I love it. And there's a lot of good that comes from this.

And again, when you're an insurance agent or broker, you're not the insurance company. You're a person that's trying to help the client, and put them together with the best insurance company. So to really tell that story, as an agent, and to show your humanness and to show the empathetic nature, and your love for the industry, but maybe in your own way. That's how you just create the overall sexiness, where people are doing business with you, and not necessarily company A, B or C.

Joey Giangola: Dave, this has been fantastic, so I'm going to leave it right there.

David DeLorenzo: Thank you. That was awesome.

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