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Archive for December, 2008

Effective Sales Communication

Posted By Michael Roby | Tuesday, December 23rd, 2008

As a professional speaker I travel frequently. Recently I stopped on an interstate to get a cup of coffee.  Check out this sign at a motel in central Illinois.  Obviously the sign intends to say that the cost for lodging is $37.99 per person, but when you separate the digital media from the rest of the sign it appears to say the following:

One Person
Outdoor Pool

What’s a “One Person Outdoor Pool?”  Sounds like a fifty-five gallon drum or a feed tank to me!  For some reason this struck me as funny, but how often do we take a simple concept and confuse our clients and prospects with poor communication.  A confused mind seldom buys.  When selling make certain that you communicate in such a way that it is easy for your client to understand and make a solid buying decision.

  • Don’t use industry jargon. Remember, you are not training – you are selling.
  • Don’t use acronyms. For that matter, tell your clients how they benefit from your recommendation.  They could care less what it is called.
  • Present professionally. Use a planned presentation, and all the tools you need to do your job. Sell sequentially, and use approved sales materials to reinforce key points.
  • Be positive when you discuss fees.  Most products and service never discuss internal fees and charges.  Use fees to your advantage.  Start by saying “Most businesses never discuss their internal costs.  We do…”  Remember the markup on financial products is small compared to most products and services.
  • Always ask for the order.  Let the prospect know you want their business.

As an old friend told me some time ago, “Selling is not telling.”  Don’t just tell your story. Use it as part of your unique selling process.  Communicate clearly and effectively.  Utilize all the sales tools at your disposal to communicate effectively with your prospects and give them the best possible opportunity to say “YES!”

Good selling!

Star Pupil Or Problem Child; Managing Your Investment Department In Tough Economic Times

Posted By Michael Roby | Monday, December 15th, 2008

The last half of 2008 provided the banking industry with a host of unprecedented problems.  Many banks offer investments and financial planning services to their customers through internal broker-dealers or third party providers.  Regardless of you distribution model, your investment department faces challenges as well.  Shrinking account values, inappropriate investments, and delayed or damaged retirement plans damage customer relations.  Emotions run high when customers feel (rightly or wrongly) they have been poorly advised or misled.  Deteriorating client relationships in your investment department carry over to customers’ banking decisions.  Follow these five simple steps to make certain your investment department provides the highest level of professional service to you customers.

Manage your Investment Advisors – Too often banks neglect to provide the same degree of oversight to their investment departments as they do to their banking operations.  Manage your investment department the same as you would any other part of the bank.  This requires a basic understanding of the culture, benchmarks, and processes of the investment industry, as well as management processes designed to grow business and insure exceptional service. If you have a program manager, your increased interest and knowledge will help them in their role.  If you have a third-part program, assign a member of the bank’s management team to provide assistance and oversight of the operation.

Departmental Communication – Include your investment advisors in regular bank meetings and events whenever appropriate.  When your investment advisors understand the bank’s focus, they are better equipped to cross-refer business.  In addition, they experience the bank’s culture and expectations on a first hand basis.  Insist upon a basic level of reporting that allows you to exercise proper due diligence.

Investment and Service Offerings – Know what your investment advisors sell to your customers.  Be cautious about allowing your investment department to position its services as “investment management.”  In most cases, bank advisors sell packaged investment products utilizing portfolio managers, such as mutual funds, variable annuities, and separately managed accounts.  Most bank advisors do not pick stocks, for the most part, or exercise discretionary authority to trade securities for clients.  Product and service offerings should not be so broad as to hinder the advisors’ ability to have a complete understanding of what they offer to clients.

Examine Service Standards – Know exactly what a client can expect from an advisor in the way of service.  Most advisors establish and follow a service schedule that answers questions such as:

  • How often will the client’s account be reviewed?
  • How does the advisor segment clients for service purposes?
  • What additional services are offered, and how does the client qualify for additional services?
  • How is the service program administered, and who manages the service program?


Investment Policy Statements
– An Investment policy statement (IPS) is a simple document, usually based upon a template, which spells out an investor’s investment goals, risk tolerance, and expected results. It also lays out a plan for how the investor will monitor his or her portfolio, as well as the advisor’s roles and responsibilities. An IPS allows the client to be clear about expectations, as well as providing the advisor with rules of engagement, in addition to acting as a compliance tool.

Consider using these strategies to enhance to value of and quality of service rendered by your investment department.  A minimal amount of oversight provides customers with the best possible level of service and protects the bank’s valuable customer relationships.  An investment department provides addition fee income and a more complete financial product offering, which improves bank customer retention.  Make certain this star pupil continues to make its bank parent shine.

Choosing a Financial Advisor

Posted By Michael Roby | Monday, December 8th, 2008

Your choice of a financial advisor ranks high upon the list of critical life decisions.  Selection of educational institutions, career, where to live, and family create lifelong consequences.  Choosing a financial advisor often determines what happens to the financial results of those consequences, all the way from financial independence to financial ruin.  Developing a relationship with a financial advisor requires due diligence and review; the advisor that is right for you today may not be the advisor you need in the future.  Consider the following keys to selecting and continuing a relationship with a financial advisor.

Choose An Advisor Whose Practice Is Client-Focused

Advisors who build a business – and it is important to remember that it is their business –  focus on their clients needs; your dreams, goals and objectives.  First, they need to focus on you.  Almost any advisor will spend some time early in an initial interview discussing his or her credentials, (as well they should) but the main focus of every meeting should be the advisor discussing your objectives, your resources, and your outcomes.  Eighty to ninety percent of an initial interview should be devoted to the advisor getting to know your goals and current situation. In addition, any meeting should lead off with a discussion of your objectives, and whether those objectives have changed in any way.

Everyone needs an advisor that is a general practitioner that is willing to use outside resources to help you realize your goals.  However, look deeply at an advisor that attempts to manage client relationships and manage money.  Money management demands an amazing amount of time, education, and expertise.  Rare is the advisor that can do both.  Most advisors are not trained in portfolio management, so look for advisors that know their limitations.  If an advisor states that they are an “investment manager” or “wealth manager” ask for their long term results – in writing.

Look for advisors that use a variety of financial instruments and devices to help clients reach their objectives.  Advisors that focus on one product as a solution to all problems should be avoided, as should advisors that sell primarily proprietary products.  If an advisor with The ABC group offers ABC insurance, ABC mutual funds or separately managed accounts, and ABC annuities – you get the idea – beware.  Does this advisor represent you or ABC?  Also seek advisors who discuss fees without your having to ask.


Choose An Advisor Who Focuses on Your Goals Instead of Products

Any time an advisor makes a recommendation for change, the conversation should begin with a paraphrase of your objectives.  Only after you reaffirm your goals should the advisor discuss the details of changes they propose. If an advisor’s first words focus on a new financial product or service, bring it to their attention, make the advisor tell you why the old solution is broken, and why they changed their opinion of their prior recommendation.

Earlier it was suggested you look for advisors that have broad product offerings.  On the other hand, look for advisors that can tell you specifically what they provide in the way of service.  Avoid advisors that state they specialize in a large list of services.  A brochure that says, “We offer stocks and bonds, mutual funds, annuities, life insurance, long term care, investment advisory services, tax planning, options, retirement planning…” often reveals an advisor who only wants to sell something – anything – to anyone who will buy it from them.

Choose An Advisor Who Offers Exceptional Service

Ask your prospective advisor, “What can I expect from you in the way of service?”  Every client deserves exceptional service.  You should always expect the following at at absolute minimum, regardless of the size of your account:

  • Advice based on a comprehensive discussion of your objectives
  • Prompt execution of all trades, orders, documents, returns, and applications
  • Prompt return (twelve to twenty-four hours; same day for urgent situations) of phone calls and written correspondence
  • An annual review face to face review

Instead of telling the advisor what you expect, ask for his/her service proposition, and see if it matches up with your expectations. You want an advisor that regularly communicates with you, as opposed to someone who only calls when they want you to make a buying decision. You should have reasonable service expectations, but if you don’t feel the advisor is as interested in you after you become a client as they were before you became a client, express your feelings and if necessary, change advisors.

Select an advisor that you genuinely like and respect.  While liking an advisor is not a good reason to entrust them with your financial affairs, you want to enjoy the meetings you have with this person who helps guide your financial future.

Beginning or continuing a client-advisor relationship requires homework in the way of research and referral, and an approach based on trust and teamwork.  Do not take this lightly; your future could depend on your decision.