In the last 12 months, the world has changed a lot. Has your business changed or has your approach remained the same even when your prospects have different concerns? This is the Achilles heel of most financial advisors—as the world changes and prospects have different concerns, advisors continue to:
- Sell the same things
- Say the same things
- Do the same things
Is it any wonder you can’t attract business when the variables of the game have changed but you haven’t? Do your prospects hear from you the same things that have not worked for them, advice like:
- Equities for the long run
- Be patient
- Diversification is key
These mantras are old, tired and as far as your prospect is concerned, is mindless droning they teach you in financial advisor school, repeated by mindless “financial advisors.”. These recommendations have caused them nothing but big losses in their portfolio.
The stock market fell 23% in 2 days in October of 1987. Like now, investors had no appetite for equities. Thousands of stockbrokers starved as they continued to talk up stocks to people who had no interest. This is a very foolish strategy. A better strategy is to sell what people want. (If you have some altruistic bent that you want to sell what people SHOULD buy, you will always be poor. If you want to educate people, then become a teacher and make $60,000 a year. If you want to make money as a financial sales professional, then sell what people want).
One clever advisor called through his prospect list in those dark days of 1987 and in three months opened 100 accounts selling bonds to his new clients. He called and asked if they shopped at Safeway (tip: sell something familiar to your prospects, not a fund or some arcane security). They all shopped at Safeway, the dominant supermarket in the area. He then proceeded as follows:
Advisor: How much money have you spent at Safeway over the last 20 years?
Prospect: I don’t know, but it’s thousands of dollars
Advisor: How would you like to get some of their money for a change?
Prospect: sure, how does that work?
Advisor: Safeway is offering bonds that pay 11.75% (interest rates were higher back in the 80s so this rate was not out of the norm) so on a $100,000 investment, you get two checks a year of $5,875. Would you like that?
Prospect: I only have $50,000 available. Can I still get these bonds?
Rather than pitching stocks, a financial plan, a mutual fund or something else for which prospects had no interest, this advisor pitched what prospects wanted:
- A familiar name that gave them a sense of security
- A fixed return
Are you selling what people want?
Having spent years trading the financial markets I have cultivated many relationships with various full service brokers brokers. In the last 18 months, their numbers have declined through attrition.
Only the ones that have learned to apply some critical thinking and move outside of their comfort zones have remained. I suspect they will still be standing when this economic meltdown ends because they are using the plan illustrated in your article….giving people what they want and not what the broker wants!!
Excellent article!
Jagger
I think that you have to be able to follow the market as it changes in order to survive it. most people don’t know how to do that and fail… then blame the economy or market… they should be blaming themselves for not using it to their advantage…
you have to be able to change with the market , not work as you always have before. it just won’t do.
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The key to business success is being able to adapt to the times. In down times we must do more to get the results we need. Sometimes we must resist the pressure to spend less on marketing and promotion in bad times because we need to reach more people to get the same result.
Great post. This gets at the core of what a strong brand is. If you already had a wonderfully powerful brand you might not need to adjust because your audience is sticking with you. If you’re not doing well in this economy it is likely because the way in which you’re positioning your product or yourself is no longer relevant to the people you’re interacting with.
My business is actually up – I own a web development company and started targeting entrepreneurs trying to get ahead of the curve and have been doing very well.
Simple advice, but great advice. Also noteworthy is that there will still be plenty of opportunities to “educate” people when the market/overall economy isn’t so terrible, i.e. – when fear is at a minimum, and greed is the motivation that takes hold (after all, there are only two factors at play in investing – fear and greed). People are reactionary. It’s why they’ll sell real estate (and equities, for that matter) when they should probably hold. It’s why they’ll buy when the market is near the top, instead of selling. They’ll follow the trend. The advice herein is a good trend to follow too, as it turns out.
Your article hit the mark. I was just discussing our companies diversification with my partner today. We had to change or go close the doors. Change is good, hard work and a little scary, but good.
Very true.
Even Albert Einstein said:
We can’t solve problems by using the same kind of thinking we used when we created them.
You got the point! Are you selling what people want? Good question and good answer as well
I am not able to agree with you regarding the term patience because patience in marketing wont help any more. A business needs quick marketing tricks otherwise it will affect the business very badly.
I think you got the point, many people complain about the crisis but will not see that the problems actually come from their own company…
Even in these days, innovation and strong marketing can do wonders.
Nice reminder!
This is simply the reason why people should be flexible to change. Some things are inevitable and adapting to the situation is the only choice. Resisting will just make things worst, so a business should have a plan B,C,D..Z.
Thanks for the reminder!
Sometimes we must resist the pressure to spend less on marketing and promotion in bad times because we need to reach more people to get the same result.
I think yes, Patience is what really needed for once if they are down with their businesses!! Its all one has to trust themselves in these tough conditions so as to be stable every time.
I think people that use financial advisers should do their homework and have some kind of insight on what their financial adviser is up to. A common mistake most people make is in thinking that their financial adviser is on their side. Advisers only look out for one person, themselves.
Pretty interesting post. It is important to keep up with the times and make sure you’re not trying the same old strategies. Also, to return to fundamental principles and make sure you’re offering the customer what is really needed.
Yeah, great article! I know many owners that claim their business is down and the immediately blame it on the economy. However, if other businesses in the same industry are finding success, that can not be the only reason! Businesses must diversify and adapt to changing trends.
The economy forced many companies out of the market, or to reduce their budgets. But on the other hand the economy does benefit other businesses such as “home based businesses” and also methods like out-sourcing.
thanks .
A common mistake most people make is in thinking that their financial adviser is on their side. Advisers only look out for one person, themselves.
This one hits the spot like bulls eye. It’s true that the key to business success is being able to adapt to the times. In down times we must do more to get the results we need. Sometimes we must resist the pressure to spend less on marketing and promotion in bad times because we need to reach more people to get the same result.
Interesting. If you have only one business it’s very risky for you, as you must be forced to retire from it. Better have many sources of income even if you don’t make so many profit as you could do by dedicating to one business.
online business is always risky but it is needfull
Nice article about online busoiness,everyone like this business these days
It’s really part of having a business, whether it’s going up or unfortunately it’ll get down. And it’s not really even base on the economy or market, sometimes it’ll just gonna get down. So when you know that it’s getting into that then you must find ways to pass that.
I agree, the key in order to remain profitable is to adapt. Today’s market evolve a lot faster than it did previously due to the internet and new technology. You constantly have to reinvent the way you do business and find ways to improve if you want to remain competitive.
People have to be flexible and remember that many people make their fortunes in down economies. There is opportunity in everything, you just have to know what to look for….
“whether you think you can or you think you can’t, you’re right”
Great article. I think though that during financial downturns there are simply fewer potential clients available for people offering financial services. You can’t persuade people to take advantage of services they can’t afford!
maybe there are fewer potential clients. but i totally agree – if you change the rules in your business when the world changes you may lose some of your clients, but for sure you’ll aquire new ones!
when dealing with the market then there is the problem of marketing strategy and target market positioning. The main focus for us is to have a competitive advantage over competitors
I like your Advise about marketing.I agree with your ideas. In marketing we see result after more than one year and i agree your advise that client is moor important