The Department of the Treasury and the Internal Revenue Service released new guidance that is “designed to expand the use of income annuities in 401(k) plans.”
By Linda Koco
WESLEY CHAPEL, Fla. – Do customers come to the advisor’s office armed to the teeth with information? Do they often have their buying decision already in sight even before speaking with the advisor?
The answer is ”yes” to both questions, and that is creating challenges for sales people who previously were the main information resource for their customers, according to business performance expert Ryan Estis.
Many consumers already have access to much of the same information the advisor has, said Estis, who is the chief experience officer at Estis & Associates, Minneapolis. For that reason, sales people will need to develop new “sales competencies” that will help them attract such clients and grow their businesses, he said an interview in advance of his presentation here on “rock star selling” during LIMRA’s annual distribution conference.
A different place
The new sales competencies he is proposing start with understanding and accepting that the existing sales approach (of being an information provider, for example) needs to change.
Buyers are in a much different place today than they were even a few years ago, he explained.
Thanks to the Internet and social media, “they are more informed, more educated and more sophisticated than previous generations, and a lot of them are at least 60 percent along the way toward making a buying decision without ever having contacted a sales organization or having engaged with a sales professional.”
That means advisors who are accustomed to being dispensers of information need to learn how to connect with customers in that “different place.”
His suggestion is to learn how to leverage the consumer’s increased knowledge and buying readiness in a way that drives growth. He described some of his ideas for doing this.
“Use technology to establish yourself as an authority in your field,” Estis said. For instance, build up a network on social media such as Twitter and LinkedIn. Then make sure to be active in posting to those media, so that people in the network can see that the advisor is keeping up with the field and is contributing to it.
“Put your ideas, opinions and strategies out there,” he said. This could entail setting up a blog, giving speeches, and writing articles in the area of expertise. This commentary often gets sent around to others, and that expands the advisor’s reach to new people and potential prospects.
“Don't ask for business,” Estis suggested, noting that he never does this in his own firm. Some sales people still try to make cold calls, he observed, “but cold calling doesn’t work. It yields only a 2 percent conversion rate, at best.”
In his experience, technology provides better mechanisms to attract business, and without the advisor having to ask for the business. The mechanisms include the various electronic media and platforms that allow professionals to speak in their own words, present their own ideas, and demonstrate their expertise, he said.
People who already know they have a need for a certain product or service will likely be on the Internet searching for a professional who can help them meet that need. They might see the advisor’s comments and decide to call or email to see if the advisor can provide assistance.
“You can influence and impact the market based solely on your activity online,” he said.
Advisors also need to develop some competency around preparing to meet with today’s more knowledgeable consumers. For instance, before the meeting, Estis said he Googles the prospect’s name, looks up the person’s profile on LinkedIn, goes to the person’s website, or uses another technology to learn more about the person.
If a new prospect has come to him by way of referral, Estis also asks the person who made the referral to provide some background information about the prospect.
Finally, before the sales meeting, he prepares five or six “good open-ended questions” to ask the prospect. “These are questions that will evoke answers that help establish clarity around what will influence the prospect to make a decision.” Then he uses this information along with the other information he gathered before the meeting to customize the offer.
When asking the prospect some of those open-ended questions, “be sure to make this a two-way communication,” he suggested. In other words, be a “good, active listener” as well as an expert who recommends solutions.
One of his financial services clients uses the 70/30 rule, he noted approvingly. “He spends 70 percent of the sales call listening and only 30 percent talking.”
Do seek referrals
In this new world of informed and sophisticated clients, Estis recommended employing a referral strategy. This doesn’t mean asking for business; it means “encouraging the firm’s best clients to make referrals. Ninety percent of satisfied customers are willing to make referrals, but only 11 percent of producers ask.”
As he sees it, referrals are part of the “positive brand advocacy through social media and technology” that today’s top sales performers employ to become successful.
Linda Koco, MBA, is a contributing editor to InsuranceNewsNet, specializing in life insurance, annuities and income planning. Linda may be reached at firstname.lastname@example.org.
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