Financial Advisor Blog on Marketing, Lead Generation, Prospecting and Sales

Professionals in financial services often make the sales part harder than it need be. I have seen the following occurrence many times. You may recognize it:

A financial advisor tries a new system of generating business. Everything works well and they capture a few easy and profitable sales. The financial advisor thinks that he has found the holy grail so he does more of the same, but soon the results stop coming. So he abandons that holy grail and moves on in search of the next holy grail. Such financial advisors move from product to product, system to system, broker dealer to broker dealer, etc. They are always looking for the one activity that will turn them into a top producer.

This model of searching for the next greatest thing is the road to permanently low production or inconsistent flash-in-the–pan results.

Take a lesson from marriage relationships. If you want a marriage that works, you make a commitment and you stick with it. You work out the kinks, get professional counseling if you need it, do some soul searching but you commit to making the marriage work. You do not change spouses every year or two like you do your business activity. If you treated your business with the same commitment, you’d be rich and retired by now.

You say you’ll get committed as soon as you find a system that’s worth getting committed to? You’ve got it backwards. The system that works is the one you commit to.

Let’s say you start doing financial seminars. The attendance is great at first and you open a lot of new accounts and gather new financial clients. But then the attendance starts falling, appointments drop off and it’s costing you the same amount to hold the financial seminars for reduced results. Right at this point when you are ready to chuck the system, stop!

There is nothing wrong with the system! Rather, there are variables affecting your results that you do not yet understand or identify. Your job at this point is not to chuck the system and start your searching, but to dig in your heals and commit to finding the key variables which cause the best results.

I think there’s “simplistic thinking disease” we catch from being in the financial services business. The “gurus” reduce everything to a few simplistic variables such as rising interest rates, a falling dollar or the employment report. So we begin thinking that there are only a few variables that matter with any financial services marketing system that we select for generating business. We get the “simplistic thinking disease” and stop trying to figure out what causes our results.We adopt this simplistic thinking when in reality, there are thousands of variables that affect the market. Similarly, there can be thousands of variables that can affect any business approach you take. The key is to find the “key success factors” and control these to maximize your outcomes.

With seminars, you can experiment with several factors:

• Change the day
• Change the time of day
• Change the location
• Invite people from different zip codes or with different demographic criteria
• Change the seminar title
• Add a picture to your invitation
• Remove the return address from the envelope

There are dozens of factors you could change. Use your intuition and your gut to select the key factors you should change first and make only one change. You can only carry on a scientific experiment and measure the results of changing a factor if you change one factor at a time. This is the type of tenacious research that had Edison invent the light bulb or is responsible for almost any drug you can buy. Trial and error based on educated guesses. Those who are most committed get the extraordinary results.

The process is never done. I know top producers that have done seminars for 20 years, and these top producers are still experimenting. These seminars have been very profitable during and those most committed know they can always achieve better results.

I once had a teacher who told me, “Don’t expect to get heat from the fireplace until you put the wood in.” Great results follow from committed action, not from a continual search for the next idea you hope works better. Identify the last approach you employed that initially gave good results and then you stopped using the system. Return to it, commit to it and master it.

I see financial advisors who lose accounts and these losses are avoidable in most cases.
Even if you lose 5 accounts a year which could be avoided, that’s an additional 50 accounts you would have at the end of 10 years plus their referrals and their kids accounts, etc. In other words, knowing how to stop exiting clients can be very profitable. Client retention is easy with the proper steps in place--it can even be automated.

Client Retention Starts When You Meet The Prospect

Let’s face it. The main reason clients leave is because their expectations are not met. They think you do not call enough, or they don’t trust you, or they do not understand when you answer a technical question, etc. Studies show that rarely do clients leave because of poor investment return. Therefore, the major reasons they leave are due to something amiss in the communication or your follow through.

If you are not sure what each client wants, ASK THEM. In fact, every time you open an account, you must ask a client, “What are your expectations of me? What would you consider a very good result of our relationship? There’s no need to guess at what your clients want--just ask.
You may want to ask subsidiary questions:How often would you like me to call? To meet?Do you like phone, fax, email or mail contact best?When you call me, how quickly do you think I should be able to return your call? What do expect from your portfolio? Answers to the above question will also help you decide if you should take this client. If their expectations are unreasonable, say goodbye to them now. Client retention is somewhat a matter of selecting reasonable clients in the beginning.

Last, do not assume that because the client gets a portfolio statement every month, they know what’s going on with their account. Call after the first statement for a statement review meeting. Many clients cannot understand the statements and they get confused (and may be embarrassed to say anything because they feel they may be stupid). So 6 months later, the client tells his friend, “I closed my account because the financial advisor never let me know how I was doing.” This is especially important--statement reviews, during a bear market when the news will unsettle your clients.

Client Retention is Solidified by Your Actions

1. Do not use jargon. When you answer a question, use plain English. Ask yourself if a third –grader would understand your answer. Jargon = misunderstanding = lack of trust = lost accounts.

2. Respond fast. (a) If you cannot return the call within an hour, have your assistant return the call and tell the prospect that you are tied up until (time) and that you will call back by (time). Then do not be late with this scheduled call.(b) Block out times during the day when you’ll return calls. When a call comes in, your assistant can set a phone appointment at a specific time. (My assistant also sets an alarm for me on my computer.) That way, you can manage the prospect’s expectation. It’s okay if you don’t call back in an hour, as long as your client doesn’t expect you to do so and knows you will serve them at a specific time later that day. Client retention is partially illustrating to your clients how important they are to you.

3. Never depend on your firm to follow through. It’s your responsibility to make sure client requests get handled. Remember, the people that work in the processing area of your firm are not highly paid. When a processor takes a week vacation, their work probably just sits on their desk getting old. When they return, they lose a week just getting re-organized. Your client has now been waiting 2 weeks with no response. Do you think they may be irritated?

Therefore, you must have contact management software with an alarm function. Set yourself an alarm to follow up in 3 days with a specific person in your firm. Similarly, if you are waiting for an outside transfer firm to handle an issue or another company to transfer funds, it’s your responsibility to follow up (of course, an assistant can do the follow-up, but it’s your job to have a well-trained reliable assistant who understands that their income is paid by your clients).

Place Complaints At The Top Of Your Priority List

Not only will a tardy response to a complaint result in a lost client, you may be tempting a legal confrontation. You must handle complaints immediately. Drop everything. In my observation, most arbitrations are the result of the complaints not be handled quickly and properly in the beginning by the producer.

When you call the client in response to their complaint, before they have a chance to say anything, you say “Mr. Smith, I understand you are not happy about (item). I want to assure you, I will do everything possible and as quickly as possible to fix this. Tell me what I can do.”
It amazes me that some brokers will argue with the client, tell the client they are wrong or worse, ignore the complaint thinking it will go away. The client may go away only to be replaced by their lawyer.

If you already have good client retention practices, learn how to automate client retention here.

The advisor explained, “I don’t get it. I used to get 60 people to my seminar and I am doing the exact same thing and now I’m lucky to get 15 people. I guess seminars don’t work anymore.”

This type of lunacy is common. The old definition of lunacy is “doing the same thing and expecting to get a different result.” The new definition is “doing the same thing when the environment has changed and expecting to get the same marketing result.” You won’t get the same result when your prospects think differently, act differently and have their attention in new arenas. It’s a different world than 2000.

Before the bear market in 2001/2002, Bin Laden & Company visiting New York on 9/11 and large securities firms knowingly touting dot-com stocks on the verge of bankruptcy a screaming buy, your prospects lived in a different reality. My hat’s off to you that you found a way to successfully market and sell in that old environment. But to think that the same tactics will still work, well, that’s lunacy!

Let’s recreate your marketing results for current times. A great marketing and sales program is the result of accurately defining your prospects’ current concerns. Their current concerns are:

• I am afraid of losing money
• I am afraid I will die when fanatics gas my neighborhood mall
• I am afraid that the world will never be normal again
• I am afraid that I will never be able to retire
• I am afraid I will get laid off
• I am afraid I will have to support my kids/grandkids

Therefore, when you send the same old “Prepare for a Successful Retirement” seminar invitation and you get three calls, don’t be surprised. The invitation needs to read:

Title: “How to Protect What You’ve got and Still Retire Before Old Age”

--the new reality of the stock market
—who can you trust?
--mutual funds that have increased in value in the last 36
months
--troubled times
—is the rising price of gold an opportunity for you?
--how to re-inflate your dreams for a great college education for your
children
--three things to check again to make sure your family is protected against
the worst

You’ve got to address investor concerns and when you do, they respond.

Here’s how to keep the pulse of your prospect’s concerns so that you can keep your marketing current:

1. Listen to your clients—the questions they ask and concerns they have are the same as other like them (same age, situations, etc)
2. Watch the nightly news and read the daily newspaper. People are incredibly influenced by the press
3. Run your own focus group with your target market: put an ad in the paper “Free dinner at Fish House Restaurant to participate in a focus group—people age xx to xx, household income $xxx,xxx. Provide your opinions re current concerns and financial issues for local financial firm research.

You must focus on a moving target as the public is always influenced by the latest constantly-changing events, so you must know what they’re thinking. If you don’t listen to your marketplace, they won’t listen to you.

In selling yourself and your financial services, it’s critical to realize that we live in a culture where prejudging is epidemic. Investors love to form opinions with almost none of the facts. Just listen to any economic prognosticator on television or your clients’ opinions about the stock market to see what I mean.

This prejudging virus forces you to alter your financial services marketing to make your best impression in the first 2 seconds of contact because you won,t get a second chance. The prospect will form a positive or negative judgment almost immediately. Let me give you some specific examples.

When sending direct mail, do all of your envelopes get opened? I doubt it because you allow the recipient to prejudge the contents without opening the envelope. You have a return name of your company on the envelope and you may also have a printed message on the outside of the envelope. You have a meter stamp and maybe a bar code or carrier route sort indicator. All of these scream “JUNK MAIL.” You will never get to communicate your message because the envelope gets tossed in the trash, unopened. You have allowed people to prejudge you and assume the contents of the envelope. Tip: mail items to strangers in a plain business envelope with a first class stamp, no messages, no bar codes, no return company name (use your own name) and with the recipient’s address laser printed on the envelope or through a window envelope. It’s impossible to prejudge the contents of a blank envelope and the recipient must open it. This will be financial services marketing that gets results.

The item in the envelope must have a super-compelling headline and it must be the first thing the recipient sees when they pull the information from the envelope. If the first item the recipient sees does not grab their interest in 2 seconds, you’re finished. TIP: include a big compelling headline and fold the page so that the headline is the first item seen when opening the envelope flap.

When sending information requested by a prospect or to a referral, include a picture and biography. (Have your picture at the bottom of every letter you send to the right of your signature). Remember that you are a stranger to the prospect. People are scared of strangers. By including your picture and biography, they get to know you. When you call, they feel like they know you because they know how you look form your picture. Tip: find the best commercial photographer in town as a good picture can open the door to win new clients.

Brian Tracy, well known motivational educator says, “the reason image is so important is because people are primarily visual and they form their first impression of you by the way you look on the outside. If they do not like what they see on the outside, they very seldom take the time to probe any deeper. In any field of sales and marketing where the impression you make on others is important to your success, it is absolutely essential that you look the part that is consistent with the financial product or service you wish to sell.” Clearly, Mr. Tracy understands financial services marketing.

As to your biography, DO NOT write a “me” biography. A “me” biography is where you talk about yourself “I graduated from Stanford…”, “I am a Certified Fund Specialist,” etc. Write it in the third person and before mentioning your position or credentials, have three to four sentences about what you can do for the prospect:

“John Doe has assisted over 2000 Ohio families increase their income up to 30% and reduce taxes up to 50%. In some cases, investors have used John’s advise to eliminate taxes on social security income and eliminate estate taxes. You may have seen his informative articles on ways to reduce stock market risks in the Akron Journal.”

Only after you have established why you are valuable, do you mention where you went to school and your credentials. Investors are interested in “what can you do for me?” before they want to hear anything about you. And when you do talk about yourself, keep all sales language out of the biography. That means you do not say “John is a registered rep with ABC securities” (unless your broker dealer requires it). Not only do 90% of investors not know what a registered rep is, the other 10% of the people know that you just want to sell something. Sure, everyone knows you’re in business to make a living, but never push any sales language in their face in a biography.

And obey some common courtesies so that people do not prejudge you negatively:

1. On your first telephone contact, do not interrupt prospects. It’s a problem that some of my hard-driving East Coast friends have.
2. Do not close to an appointment without identifying their motivation so that you can offer a potential benefit. When you try to close for a meeting and the prospect’s desires have not been isolated, you will appear pushy.
3. When mailing, do not take a 4-panel letter-sized brochure and stuff it into a business envelope. Use a 9 x 12 envelope so that the brochure can lay flat and the mailing looks professional.

Focus your financial services marketing on those first 2 seconds to gain your opportunity to present who you are and what you can do.

Do you feel rejected when people don’t want what you are offering? Actually, when people do not want what you offer, they usually say “no” and you experience rejection. The sales process would be a lot more enjoyable and profitable if you never had to hear the word “no.” It is possible to avoid hearing the word “no,” if you follow these rules:

Never approach anyone that has not previously expressed interest, and ask them enough questions so that before you make a recommendation, you understand their concerns completely and know that they want what you offer. If you address their concerns completely, you should only hear “yes.”

Let’s take a look at both issues.

Getting people interested

You get people to first express interest by:

• Responding to an ad,
• Responding to a seminar invitation,
• Responding to a direct mail offer, or
• Buying a list where people have responded to other offers that match your offer (find such lists at www.srds.com).
  

Since the prospects has made the first move, your follow up is a response to their interest. Notice that none of the above methods of contacting prospects involves cold calling. Cold calling is a very inefficient way to find good prospects and it involves lots of rejection. I never cold call.

Now you’re thinking “but running an ad or mail campaign costs money and cold calling does not.” This is true. But you’re running a business. Do you know any successful businessperson that does not invest in their business? I don’t. So either leave the business and get a job (working for someone else who investments in their business) or realize that in order to be a successful business owner, you will need to invest in yourself.

I truly apologize if no one told you that. When you first started in this business, the company recruiting you wasn’t concerned if you had to face constant rejection nor did they mind that you wasted your time cold calling. They only paid you a commission when you made a sale, so your inefficiency didn’t cost them anything.

Let me give you an example of how investing can eliminate rejection. I wanted to sell more annuities. So I developed a compelling ad that gets annuity owners to call me for a free booklet. I send the booklet and make the follow up call a few days later. When I call, after introducing myself I ask them, “what motivated you to call for the booklet?”

They usually launch into something about their curiosity, interest, or problem. If they said something like “I’m not interested.” I would then ask, “Why then did you call me and ask for the booklet?” No matter what direction the conversation takes, there cannot be any rejection. They can only say they don’t want to talk about it; they want to read the booklet or something similar. All of those things are their issue because they called from the ad and “solicited” me. I didn’t contact them unsolicited.

Is there a fit between your services and the prospect wants?

Let’s deal with the next issue. The prospect and I agree to a meeting. The objective of our first meeting is to determine whether or not there is a fit between their desires and my products and services. My objective is NOT to sell them something. Making a sale becomes my objective only after I determine there is a fit between their desires and my expertise and products. The first meeting is for me to determine if I should reject them. If you skip this and believe that your objective in meeting with people is to sell them something, you will get a lot of rejection.

During the conversation to qualify them, I need to ask very powerful questions designed to assist the prospect to see their desires for themselves. It goes something like this: (S=salesperson, C=potential client)

S: Do you feel you pay too much taxes?
C: Yes, they’re terrible.

S: What have you done about that?
C: Well nothing. I keep hoping my accountant will figure out something.

S: But your taxes have remained high anyway?
C: Yes, they’ve gone up.

S: How has your accountant helped you with this?
C: He hasn’t.

S: What solutions do you think there are?
C: That’s why I’m here, to learn about solutions.

S: What solutions have you heard about?
C: I know there are tax free bonds and annuities but don’t know much about them.

S: You’d like to learn more about these to see which might be best?
C: Absolutely. Can you explain them to me?

S: I’d be happy to. But let me ask you something. Why is reducing your taxes so important? What will you do with the extra money you keep?
C: I’d take another trip.

S: You enjoy travel?
C: I love it. I have waited my entire working career to retire and travel to the places I want.

S: How does that make you feel when you can go more places?
C: Like a success. Like working my entire life has been worthwhile.

S: So If I can show you a solution that will allow you to pay less tax and travel more, we will have accomplished something important for you today?
C: Absolutely.

S: I see from your tax return, you paid $30,000 in taxes last year. By how much do you think it’s reasonable to reduce that?
C: I guess by $10,000—that would give me more cash for travel.

S: I see from your statements that you have $200,000 in the bank. If you needed to move that money to an investment that would give you that $10,000 tax savings to be used for travel, would their be any problem with that?
C: No, not at all. That money is just sitting there as I don’t know what else to do with it.

Notice that in this conversation I have made no statements. I have only asked questions. If you want to know what your prospect wants, then ask questions. They will tell you. Then, when you do get to the recommendation, they will say “yes” because your recommendation will be 100% consistent with what they told you they wanted.

This is so ridiculously simple yet so many people in financial sales people guess at what the prospect desires. There is no need to guess, just ask. There is no need to go into the second meeting thinking “I hope they go for this set of recommendations…” Rather, you will go into the meeting knowing that they will say yes; there will be no rejection. It’s like someone telling you that if you could get them the model 5556 car in black with tan interior, they would take it. You then meet them again in a few days and say “here’s model 5556 in black with the tan interior. Is this what you want?”

If they do respond in some inconsistent way then get rid of this prospect rapidly as you cannot serve anyone who changes their desires within a short period. Most people will, of course, say they want the car.

This simple 2-step sales process will keep you from being rejected and make the sales process a lot more enjoyable.

Use the resources and ideas below and in a year’s time you can easily have a thousand
email addresses of investors in your area. Then, just use a dripping system like this client newsletter to email them each month and turn them into clients. You can stay in front of prospects for peanuts and have a continuous drip campaign. These contacts will not only lead to new clients but also:
• Invitations to speak at their clubs
• Invitations to write articles for their newsletter
• Referrals to others not even on your list

1) Get Email Lists from Your Existing Clients
In addition to asking your clients for their email address, ask your clients for list of
email addresses they may have. They may be willing to share them with you or make a
solicitation for you. For example, say you have a client that belongs to the local garden club with 250 members. Your client may be happy to give you a copy of that list or solicit the members on your behalf with something like the following email:

Dear Folks,
Bob Smith has been my financial advisor for the last three years. He has an excellent
newsletter for us seniors called “SeniorFinances” and you can get a free subscription.
Each issue contains articles on where to invest for more income, items on insurance like
long-term care, tips on reducing your income taxes and estate planning, etc. To get a
free email subscription, just click here.
Stu Svenson
President

2) Rent a an Email List
Just like you can rent mailing lists for sending mail, you can rent millions email
Addresses targeted to specific investors. Of course, you may only want those in your area and you can select those you desire by zip code.
At your library, you can find a copy of the “SRDS” Direct Marketing List Source (your
library may have this service on-line from a PC at the library).
If they have the physical books, find the section with the email lists and look down the
directory for lists that contain people with money, such as

• People who take cruises
• People who own luxury cars
• People who gave large political contributions

Most of these lists area available by zip code and by age of person.
In the details of the list, you want the lists that offer a zip code selection so you can email to only those prospects in your area.

Please note that unlike regular mailing lists, email list vendors usually will not give you the list. They will want to do the email for you. So you are not going to be emailing them the newsletter. Rather you are going to be emailing them a solicitation to subscribe to your newsletter. It is those people who respond that you will add to your email newsletter list. Once they respond you then "own" that email address.

We have prepared the email text to send to a rented list below.

Don’t let the wrong financial advisor take advantage of you! Get your FREE subscription to SeniorFinances Newsletter, designed especially for people (describe your target prospect) Don’t be in the dark about your money!
Easy to read articles on:
Ways to reduce your taxes that you won’t hear from your accountantHow to steer clear of “sucker” mutual fundsSafe income investments that pay you 6% and MOREHow to slash taxes on your IRA withdrawals by 50%Understand long term care insurance before you buyHow different types of annuities work and which can help youHow to get cash for your old life insurance policy (more than your insurance company will pay)The big difference between bonds and bond funds that many retirees don’t realizeHow to identify hidden fees in your mutual fundsAnd much more on taxes, IRAs, annuities, long term care, investing for income,insurance and every phase of finances that affects people (description of your target market).

Receive SeniorFinances FREE every month:
Just hit reply to this email and then in your reply provide your information below to get your subscription:
Your Name:
Your zip code:>

3) Inexpensive Ads on Local Web Sites

There are dozens of web sites focused on specific groups in your area. Just for fun,
we did a search on “Columbus Ohio Senior.” Here’s what we got without looking any
further:
http://www.ohiosenior.com—a web site for Ohio retirees—$49 a month for a banner ad
http://www.columbuswired.net/SeniorLiving/default.htm—the senior page of Ohio’s web
magazine—$20 a month
http://www.ag.ohio-state.edu/~seniors/—the Aging in Ohio web site
http://www.subasekb.navy.mil/retkbnews.htm—the site for local Navy retirees
http://www.oshpra.org/mends.htm—the Retiree Association of the Ohio State Patrol
The ads are very inexpensive ($20 -$50 per month) and thousands of seniors can see your
ad to subscribe to your free senior newsletter.

4) Subscribe to Our National Internet Marketing Service (if your target prospect is the 50+ crowd)

The SeniorLeads™ service advertise on all of the national senior web sites asking seniors if they want free financial information on retirement issues.
If you subscribe for that service, we provide you the leads for your area.

5) Have a Sign-Up Form on Your Own Website

If you have your own website, be sure to promote the newsletter on the site and have lots
of places where they can sign up for it. Promote your website using Google pay per click on a local basis.

I interviewed a sales candidate yesterday and he told me the two most important things about sales are listening and fulfilling your prospect's needs. Most people in sales would agree that these are important aspects about sales and this conclusion is unfortunately wrong.

First, people never, ever buy what they need. Needs are not relevant to any human action unless a matter of survival. (You will kill wild game with your bare hands if you are starving and need to eat to survive. In all other non-survival situations, you will not act based on your needs). Human action (unless for survival) is based solely on desire. The Centers for Disease Control report that 65% of Americans are obese and need to lose weight. But notice that most of those people are not on a diet. The only people that have called Nutrisystem, Jenny Craig or have placed themselves on the South Beach diet are those that want to lose weight. If you want to be a poor sales professional, keep focusing on prospect needs and you won't make any sales. Worse, take an a seemingly altruistic motivation to supply to people what they need (but they don't want).

This difference between needs and wants is not a semantic issue. I did some work for a VERY large insurance company. They have their agents complete a needs assessment for each new prospect. The entire indoctrination of their agents about prospect needs insures that their agents sales are significantly diminished. If the company simply changed the form name to "Desires Assessment" or "Wants Assessment", the conversation between the agent and the prospect would be altered, the prospects motivations for action would become more clear, more quickly, the prospect would be better served and the agent and the insurance company would make more sales.


The second issue of importance to this sales candidate was listening. But the important question is listening to what? Listening to what the prospect says? Sit down because this will shock you: what the prospect says is irrelevant. If you listen to what the prospect says and respond to that, you will likely have the typical sales conversation of trying to convince, persuade and overcome objections. This is because your prospect is programmed to say things to ruin your sale, to interrupt your scripted presentation and to make it hard for you to close. So don't listen to what they say.


Here's an example. A prospect may ask a sales professional at our company, Javelin Marketing, "where do you run your ads to attract prospects for my business?" In fact, the prospect could care less where we run the ads. The prospect is doing the best he can to use words to express his concern. His concern, if you really listen, is, "will you be able to get me quality prospects that will do business with me?" The sales professional who speaks to his concerns will avoid a needless conversation (about the various web sites where the ads run), better serve the prospect by addressing their actual concerns and close the sale is less time.