Think there’s no place for selling in the new world of advice? Think again. Elixir Consulting’s Business Coach, Lana Clark, has some sage advice for those just entering the financial advice industry…
Sales. Selling. Depending on your tenure in the industry and how hard you’ve been beaten with the compliance stick, you might have a range of different thought responses to these words. There’s been a lot written about the need for insurance to be sold (a riskinfo poll in January found 90% agreed this to be true) and we often hear that today’s advisers aren’t taught how to communicate, or sell, and are in fact fearful of selling (according to another riskinfo poll in September). We have a firm belief at Elixir that the need to sell advice has never been greater, and do a lot of work in this space. (Note I wrote selling advice – not selling insurance?)
It’s imperative for advisers who are fearful of selling to learn to reduce that fear and contribute to a stronger, more robust community, where the number of lives that are insured increases and the strain on the public purse when tragedy strikes is lessened.
In this article I’d like to take a new approach to the conversation and encourage readers to establish their own sales plan. Complete with targets and reportable key performance indicators (KPIs), this plan will help you to grow your business – and also grow the number of clients you are helping.
Before you say, “FoFA means we can’t have sales targets,” think again. Whilst product sales targets are taboo, it is a commercial reality for every practice owner that, in order to pay their staff and continue to provide a valued service to their clients, they need to ensure that every adviser in the business is generating sufficient revenue and working with sufficient clients to cover business overheads and provide a profit to compensate them for the business risk they bear every day.
Sales is a numbers game
No doubt you’ve heard the phrase ‘sales is a numbers game’ – the more people you talk with, the more sales you should make. It’s surprising, though, how many advisers we see who focus purely on volume of activity but have no objectives identified and certainly no mechanisms in place to measure activities and monitor results. This usually results in burnout or frustration, and sometimes poor judgement in client interaction, with poor conversion rates on their activity. On the flipside, advisers who take time to create a plan – to consider how many clients they need, what type of clients they work best with, and where to find those clients – find they generate far greater returns.
Every adviser, whether they be employees or business owners, should have sales targets that are appropriate for the capacity in the business. These can be determined by starting from the targeted income for the firm, including a profit margin and allowance for existing and likely additional expenses. Accounting for recurring revenue that is generated from the current client base, the amount of revenue required from new business can be calculated. Then, think about how many clients you need to service in order to achieve that figure. Often the best way to determine this is to consider the niche in which you work; determine the average or typical revenue that you generate from a new client, and then work out how many clients you need to help in order to meet your target. Take into account the number of clients each adviser provides ongoing service to, and therefore the capacity they have for bringing on new business whilst not sacrificing service to existing clients. Then voila! Set your new business targets. We suggest you have both a financial target as well as an activity target. Always focus on your activity target, as it is easier find new clients rather than new money.
Build an emotional connection
In the past advisers might have been taught to capitalise on the fear of death (figuratively backing the hearse up to the front door), but those days are gone. Great advisers create an environment of trust, discuss outcomes for the client in the event of an unfortunate incident, and provide them with choices on how to manage those outcomes.
Having a deep emotional connection to one’s loved ones and lifestyle is the link many advisers often miss when it comes to engaging clients and ultimately selling them a solution. These things they are putting at risk are usually what they have the strongest emotional ties to, so it is in their best interest that you help them to feel the gravity of the situation and truly consider their options. In order to do that, you need to ensure they don’t just dismiss or make light of your advice. Rather, help them connect to the outcomes emotionally, and then make a considered decision whether or not to proceed. If you are fearful of taking the conversation to an emotionally confronting place, or do not help them to set aside their objections, you’re doing them a disservice. At worst, if a client truly cannot afford the optimum insurance cover, work with them to arrive at a solution they can live with. This requires the ability to sell, rather than to simply step aside at the first hint of an objection.
Have a process
One of the biggest foundations of client engagement is having a great process. There’s no single perfect process for every client type and business model; the most important thing is to make sure you have one, that it’s documented, that you understand it and you follow it (and improve it over time as required).
Every client interaction will be different and unique to their specific needs, but if you can get comfortable with the way that you structure your discovery process, and are well-practised in the art of great questioning, you’re that much closer to fearless advice provision. Find a workshop you can attend, or find a mentor, coach or colleague that you can practice your conversations with. Have them give you every objection under the sun, and listen to their observations about how you dealt with them. Don’t be afraid of role playing to help you remove your fears before sitting in front of a real client.
As a risk adviser, you are obligated to deliver great advice to clients and give them the very best opportunity to implement that advice. Accept that this will entail the ability to communicate well, and yes, embrace the need for the ability to sell. Keep your ‘bulldust’ radar on to ensure that you never recommend clients buy policies they don’t need, and fearlessly work towards your new client targets, safe in the knowledge that your clients will be indebted to you if they ever have cause to claim on their policies.
Lana Clark is a business coach with Elixir Consulting, a specialist consulting and coaching firm that is dedicated to helping financial advisers and risk specialists to get their businesses performing better.