The Value of Salespeople
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Financial advisors should not shy from thinking of themselves as salespeople. It has been said that if it weren’t for salespeople, the world would be a giant warehouse.
Sales is not the noblest profession in the world. Noble is a function of people, not professions. Everything you need in Maslow’s hierarchy in physiological and security needs are elements you buy. If you buy it, it is sold, and by someone or some organization that sells.
The attributes of salespeople range from:
I included zestful so the list could go from A (aggressive) to Z. I could have included zealous instead. There are roughly an even number of positive and negative characteristics. It’s all in how you choose to look at the question, “what do you think of salespeople?” Then again, name a profession where you cannot find a mix of positive and negative characteristics in the people who work there.
Yet, many financial advisors prefer not to think of themselves as salespeople.
Reaching the higher levels of Maslow’s hierarchy:
- love and belonging to,
- esteem to,
requires important elements of selling including,
- knowing yourself and others,
- recognizing and being recognized,
- creating positive and lasting impressions and connections,
- being responsive,
- going a step above,
- focusing on benefits,
- keeping in communications proactively, and
- becoming the most one can be.
Of course, those elements must be based on authenticity, honesty, and sincerity. However, the elements required for selling are required by all people who want to be an effective and productive member of society. In the financial services industry, we speak of “know, like, and trust.”
Consider my three sons.
- One is a professor of aerospace engineering and mechanics. For him to be successful he must sell his ideas to, for example, the National Science Foundation to get funding for his projects that support his student’s education. He must sell his programs and the attributes of his university to potential new professors and PhD candidates to select his university as a place to work and/or learn and grow.
- One of my sons is a municipal finance attorney helping communities fund their projects – schools, infrastructure, and various public works. He must sell his and his firm’s experience and capabilities as well as himself to get retained as the attorney who works with them on the financial aspects of the project.
- My other son is a wine salesman in a highly competitive marketplace. There are good wines and not so good wines in every salesperson’s portfolio. He not only has to know his and other vendors’ portfolios, but understand his clients, their customers, and the marketplace. Like all of us, he must sell himself and his credibility and performance. He may be more like a financial advisor. His events are tastings for example. Understanding clients and proactive communications is mandatory to success.
These are not unique examples and show that regardless of the role people play, “selling” is a native part of what each of us do and is necessary for each of us to be able to deliver our value-add to our clients and society. You may choose to call it positioning your offerings or solutions or sharing ideas. But selling is to hand over something in exchange for money or persuade someone of the merits of your offerings. That’s what most of us do and the way our world works. Selling, done appropriately, is critical to a functioning society.
As a financial advisor, you have much of value to “sell”:
- Your firm
- Your capabilities and value
- Dreams you can help people fulfill
The importance of selling skills
High-quality salespeople have much to offer beyond their products and services. They can demonstrate skills that we all can benefit from.
Why should we do that? Because success as a financial advisor requires all the characteristics of a salesperson. Many firms I work with plan for an attrition rate of more than 90% over the first five years of a new advisor’s entry into the business. Others have shared that somewhere between 10–20% of people who get licensed and try to become an advisor are successful at it.
A relatively small percentage of financial advisors develop a successful career. The reason is not that they can’t execute the basics of the business – financial planning, investment management, communicating with clients, etc. The reason is that many cannot build a book of business by “selling” their valued services to enough buyers, i.e., investors.
Most of us who have been in the industry for decades would agree and understand becoming and being a successful FA is difficult. We know the adage, “If I can get them (the prospect) in the chair next to me, I can close them (convert them to a client). The issue is getting them into that chair next to me.”
While being an FA provides a range of opportunities not widely available in many career fields, with virtually unlimited earning potential, flexibility in work schedule, and control over their practice, it is a high-stress environment and takes time and patience that not everyone has to build a client base, while meeting the demands of a high level of regulatory requirements. It takes continuous prospecting, costing time and money, and the acceptance, with grace, internal and external, of rejection and being ignored.
Firms need to reduce the attrition of new advisors, whether young hires or career changers. They need to develop new training programs, new remuneration approaches, assigning or encouraging new advisors to join teams, mentoring, looking to career changers with success experiences.
Those approaches must have a positive impact on reducing attrition to reduce turnover costs and replace staff. As FA Magazine reported, “Overall, about 37% of today's advisors are expected to retire over the next decade; by 2023, the headcount of advisors is projected to drop off by 1.4%”.
Salespeople bring value
Salespeople are one of the best sources of excellent content about solutions you want and need for yourself and your clients.
What advisors bring to potential clients is knowledge and insights from our experiences on how to best get the benefits and value from the application of what it is we offer (sell). Conversations are about the services we offer and their intended value. Whether the prospect hires you or not, there will be value in the conversation.
You also may need to decide on technology or content alternatives whether for financial planning, CRM, client reporting, rebalancing, data aggregation, risk assessment, administration, information, etc. Some providers offer multiple pieces that may be integrated. Some components may not fit your specific needs, but the integration is important even if some pieces have shortfalls. Suffice it to say these are complex decisions. Even if you hire a consultant to help make your decisions, you need to be informed about the choices.
We know you can Google, read brochures, talk to users, hire consultants, etc. though most people are reluctant to do this research. Speaking with the salespeople of multiple firms, asking the right questions, developing a comparative analysis, seeing the options, evaluating the salespeople and their company, re-asking questions as you learn more, etc. is what keeps clients and potential clients informed.
- Sales is not a dirty word. Salespeople have a critical societal role, and the good ones have the characteristics that bring value and success including helping, being creative, going above and beyond, and being benefit focused, among others.
- Sales skills are needed for the success of most, if not all, professions including those of financial advisors.
- Salespeople are excellent information sources above and beyond the offerings they provide.
David Leo is Founder of Street Smart Research Group LLC. He is an author, speaker, coach, consultant, and trainer to financial professionals. David is an experienced business manager who works solely with Financial Advisors, Planners and firms who want to organize, structure & grow their businesses by attracting, servicing, and retaining affluent clients.
If you would like additional details or have any questions about his articles or an interest in coaching schedule a free 45 Minute Strategy Session @ https://calendly.com/davidileo or contact him @ [email protected]. Call 212-598-4229 (Office) or 917-379-1249 (Cell) and visit @ www.CoachDavidLeo.com