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The
Times They
Are A 'Changin'
by John H. Melchinger --The
Marketing Coach
Everything that makes money is good. Every sale is a good sale. Every order is a good order. Every
client is a good client. Get the idea? There are myriad myths like these killing
people in business these days. In-practice professionals do not hold a magic shield
to protect themselves from harmful myths, especially self-inflicted wounds. In fact,
their often parochial approach to modernization, rethinking and retooling their practices
make them among the last to grasp the obvious: times are really different now. As
Will Rogers said, It isn't what you don't know that hurts you. It's what you know
for sure...that just ain't so. Advice worth heeding.
So what myths keep practitioners from making real progress in the modern age? Let's
explore and debunk the worst of the lot, and see if we can get some new era thinking
making better sense for us.
You must know with whom you will do business...
and with whom you will not do business.
Every sale is a good sale
Hogwash. Only a myopic salesperson would accept business just because "it's
there." Do you have insurance sales that have not paid the second year premium?
Did you ever work hard and long to win a case that was not profitable short-term
or long-term? Do a small case as a favor for someone, only to be roped into sorting
out someone else's servicing mess at great expense to you? Soon, commissions will
be unbundled from the products you sell and you will demand fees for your good counsel
and advice or not get paid. Only practitioners who believe the myth that every sale
is a good sale will continue to accept comparatively low average case earnings and
diminishing returns. You must know with whom you will do business...and with whom
you will not do business.
Every order is a good order
This is almost the same as Every sale is a good sale, but this myth allows you to
think that a walk-in or referral to someone who "just wants to buy a mutual
fund" is easy business, therefor good business. Fact is, unless you perform
some consultative investigation to serve your own interests, then you are an order
taker and not a professional offering expert counsel and advice. One financial planning
client of mine set a standard among her strategies: No product will be sold unless
it is called for in a plan. Her insistence on doing a plan to justify each product
she sells has earned her significantly higher average case size and more cases as
well.
Every customer is a client
To treat every customer as a client is honorable--but not necessarily good business
if it means treating every customer exactly the same. Regardless of how you act towards
them, your clients make the decision whether they are clients or merely customers.
Your modus operandi should be to know your clients well through regular, meaningful
dialogue (two -way contact), decide who among your clients earns what type of service
and attention, then treat them that way. You probably already do this, and a systematic
approach and delivery will help keep you fair, even though you do not treat everyone
to the same fine services you provide.
Every client is a good client
A client is a purchaser who also wants a serious long-term relationship, who is willing
to pay a fair price for your services and products, and who expects, respects, and
appreciates reasonable levels of service with your delivering those products. Extend
the arguments above to only your clients, and you will see why categorizing clients
and treating them by groups may make good business sense.
Can you imagine "firing" a troublesome client who does not respect you
as you would like to be respected? Try it, then decide whether you would be better
off with or without that client. If you would be better off without that client,
you know what to do. Firing a bad client frees you to pay more attention to others
who deserve it...and sets your standard for mutually respectful relationships.
I coach practitioners to explain that commissions are for placing and servicing the
product, and that fees and introductions are for the practitioner's good counsel
and advice. This sets the expectations you want your clients to have of you--that
once the advice is given and the sale is made, service is the reasonable expectation.
Every market research report is worth
something
Show your local marketplace that you not only know and understand them, but also
care about them as well.
Frankly, most market research reports provide scant usable information. The data
is often too shallow to support the opinions of the researchers, although researchers
often draw dramatic conclusions from that slim data. Who can know your marketplace
better than you? Who can gather firsthand, local market information better than yourself?
Isn't the very process of your gathering local information going to be your best
PR? Show your local marketplace that you not only know and understand them, but also
care about them as well. Learn your marketing information firsthand and prosper.
Focus groups provide safe data for making marketing decisions (Everything a representative
sample says is also true of the whole group)
Focus groups are as representative of a target market as politicians are of their
constituencies. Their opinions are also usually overrated. Be very cautious not to
read too much into marketing information based on focus groups. Because focus groups
are assembled by people wanting specific information about specific market segments,
and the groups the marketers assemble seem to fit fairly narrow criteria, marketers
give extraordinary credence to what focus groups say. So why do statisticians want
attitude and interest surveys conducted with the same sample populations twice in
one week, then again several months later? Because they know that attitudes and interests
can change rapidly, almost whimsically, from day to day, and a truly representative
sample cannot be taken in a single session. Single session focus groups may present
market-specific information with serious shortcomings.
History repeats itself in marketing (Everything that goes around, comes around)
This myth is no more true in marketing these days than it is in life. Computers become
obsolete about every 18 to 24 months. The consumer has changed dramatically in the
recent past. What worked in selling yesterday no longer works so well today, if at
all, because the consumer changed, as did the products they want and agree to purchase.
Yet there are salespeople who lament not having the good old days any more. They
wait nevertheless for buyers, sales managers and home offices to see the error of
their ways "over-complicating things" and come back to the basics (the
old way, again). These people do not see the light; do not make their own destinies;
do not take advantage of the new technologies; resist all change; will not capitalize
their own growth. They do not grow, and as the world around them changes and grows,
these salespeople shrink while hoping for history to bring the good times back around
again.Change does not always mean progress, but progress always means change.
Any brochure is better than no brochure
A poorly conceived brochure can do real
damage.
This is the same as saying sending any message is better
than sending no message. It's absurd, yet there are people who throw together brochures
for the sake of having one or because they think the market wants them to have one.
They go to great expense to have an advertising or PR firm put together something
slick that says little of what the practitioner really does, in terms the buyer can
understand and identify with. However, a poorly conceived brochure can do real damage.
Your brochure should explain what you do in language your markets understand; in
compelling ways your prospects can determine they want to meet with you; in a manner
that helps qualify your prospects; and keep you in compliance. Consistency of messages,
themes, style, type, and other factors creates good results. A brochure that is poorly
worded, organized or printed in comparison to your audience's needs and expectations
can do more harm than good.
Referrals are the best source of new business
The psychological difference between personal
introductions and referrals is important. The differences in sales ratios between
clients obtained by personal introductions and those acquired through referrals is
dramatic. Personal introductions are better by far.
Close, but not supported by fact. Personal introductions from your best clients to
others like them show dramatically improved results over traditional referrals. Personal
introductions fit one of two possible definitions: either (a) your client introduces
you face to face to someone you have agreed fits your ideal client profile, or (b)
your client obtains that personės agreement to grant you the courtesy of an interview.
Hence, when you call the prospect, you are not asking if s/he would like to meet
you; rather, you are calling to say thanks for agreeing to meet and that you are
calling to arrange it. The psychological difference between personal introductions
and referrals is important. The sales ratios differences between clients obtained
by personal introductions and those acquired through referrals is dramatic.
There are also other means by which customers are now being attracted to do business
with practitioners and institutions providing financial services and products. Many
marketers are discovering that although consultative selling has its important place,
there are more transaction-oriented marketing approaches that provide great profit
through a higher volume of lower average sales that also demand less costly service.
The sales person sees this as competition heating up; s/he should see it not only
as that, but also as the response to new consumer attitudes and interests, which
in turn demand new approaches by providers.
It used to be that when pressure causes change, the smallest unit (the practitioner)
changes first. This is no longer so, necessarily. Financial institutions, with capital
to spend for growth, and with new visions of emerging markets and highly targetable
segments, compete now with the traditional salespeople, often quite successfully.
They utilize information databases that they build and maintain, and they thus keep
on top of consumer and financial trends they can see in their own good data. Banks
are very good at this, but they no longer have an exclusive edge managing market-specific
and buyer-specific information. Good information processing allows great marketing
from your own home-grown data. Institutions are rapidly developing their special
databases to make advantages of changes going on in the marketplace, while the traditionalists
lament change or fight themselves into slow oblivion trying not to accept it.
Build your own database, collect your own data, obtain your marketing information
from what you know about, and go about asking for personal introductions.
The telephone is your best communication tool
Not necessarily. Other people who support you are your best communications tool.
Put them to work for you. If you think marketing communications is just delivering
messages to your clients, prospects and centers, then consider what the people who
know you say about you to others when you are not there. You can influence----even
teach others----what to say about you. This helps qualify prospects and solidify
what you do in your clients' minds.
When the people who know you also know how to tell others about you, you have a decided
advantage in professional practice marketing. To achieve this, you must be precise
in formulating and delivering your messages, as well as in how you teach others to
do this for you.
Life insurance is sold, not bought
You must be precise in formulating and
delivering your messages,
as well as in how you teach others to do this for you.
This is a dangerous myth that is in the process of being debunked. It implies that
it takes a salesperson to sell insurance; that customers do not look to make a purchase.
Good marketing experiences over the past decade prove that buyers will seek to buy
without being solicited by a salesperson; that institutions can sell large volumes
of life insurance without traditional career agents; that life insurance can be sold
as a commodity. The result of the I can get it for you cheaper sales mentality born
in the eighties is in large part that the sale of life insurance has become a commodity
sale. Brokers and agents made it that by selling price off a ledger illustration,
rather than by marketing to a consumer need or want, then satisfying it. Consumers
no longer have to wait for a life insurance salesperson to call. There are so many
advertised options to choose from, and so many financial services providers now offer
rather easy access to life insurance, that consumers can go get what they want. They
may not buy wisely or enough, but they will think they have...and the customer is
always right.
It's a numbers game
Marketing financial services and products and developing a clientele by selling them
your good counsel and advice and the products you offer, are as much about people
as they are about numbers like sales ratios, average case size and activity levels.
It's not a game. It's a business that should run profitably or cease to exist. Sadly,
very few salespeople I've encountered in financial services of any kind know their
own sales ratios or how to track trends. They may say It's a numbers game, but the
only numbers they track are premiums, commissions and minimum standards they must
meet in order to keep their benefits in an insurer's group plans.
It's a people business
Marketing financial services and products----however you go about it----is a business
about people. You can do good things for people. You can do well at it. You can do
well by doing good, but if you do not continue to do well (profiting in the business
part of it), will you be able to continue doing good for others? Certainly not.
Whether you market financial services and products as a counselor who sells, or sell
financial products as a salesperson who does little counseling, does not really matter.
You are in a business about people, so your numbers and the people you choose to
sell to are equally important to your success. Do not place one's importance above
the other. Balance your practice with a good marketing plan, and check yourself regularly
for trends to assure keeping your balance.
I sell. I don't need a marketing plan.
The most dangerous marketing myth, this one demonstrates willful ignorance. Would
you go hunting to bag food to feed your family and shoot your arrows randomly? Do
you eat any fish from the sea or any leafy green thing that you could clutch when
you are hungry? If you will, then you will endanger yourself and others.
Your marketing plan can be simple, straightforward and meaningful. It need not do
any more than focus on good targets, state how you are going to attract them to you,
and provide the basis for tracking trends and making suitable adjustments in course
along the way. The parts:
Mission: a brief,
memorable statement saying who you serve and basically what you do for them
Strategies: what
criteria, beliefs, philosophies and standards guide you in conducting your business
Goals: the
measurables you expect to achieve within certain time frames
Activities: the
things you will do (action steps) to reach your goals
Monitoring: how
you will track yourself weekly, monthly, quarterly and so on to make sure you are
on track to your goals, and if you are off track, how you will adjust to get back
on track
One irony in the financial services business is that it is so over-populated with
tactically oriented salespeople that it remains preoccupied with making transactions,
rather than looking down the road at a bigger picture than the present and developing
much more economical ways to satisfy buyers of financial services and products.
Here's a small thing demonstrating attitude, but it helps make the point. I know
there are many people who are irritated with the phrase financial services and products
because they think it should be financial products and services. Traditionally it
was the way they prefer. Smart marketing now demonstrates that services and products
are what the buyers seek. So, salespeople beware. The times they are a'changin'.
John H. Melchinger coaches in-practice financial services planning professionals
in
marketing to high income and high net worth affluents. His clients develop their
professional practices through effective market identification, selection, penetration
and
development, with compelling packaging and promotion for name plus idea recognition
in their chosen target markets. John's career experiences in financial services and
products-since 1977-make him exceptionally qualified to have developed innovative,
non -
traditional marketing and skills development programs in estate planning, financial\plan-
ning, business planning and consultative selling. His how-to books, articles, bulletins,
workshops and presentations have become classics in the industry, and his clientele
of financial services professionals are among the most profitable and produc |