Annuity Leads

There is extreme product myopia in the annuity sales industry.

Annuity brokers rely on insurance companies to provide an education on marketing and sales. However, the focus of the insurance companies is on the products they manufacture while the focus of the successful annuity broker must be on the client. Therefore, there is an incompatible focus between the insurance company and the annuity broker.

Of course, it would make sense if the annuity sales industry was also focused on the client because then the overall sales of annuities and other insurance products would increase. An example of this manufacturer-to-consumer focus is how Intel, which does not sell directly to the consumer, continues to heavily advertise on consumer television promoting computers that have Intel inside. Intel understands that by promoting the benefit (safety of a high quality microchip) to the end consumer, they do more business. But because the annuity industry continues to have a focus on its products and its distribution channel, the annuity agents and annuity brokers, these sellers inherit a product focused mentality. This costs all involved a lot of annuity sales.

Let’s take the example of an annuity agent who decides to use seminars to generate annuity leads. He will likely make an obvious beginners mistake and title his seminar something like “All About Annuities.” The selection of this title is plain stupid. The annuity agent is looking at the title of the seminar from his point of view, his product-centered orientation, and not the potential attendees point of view. The potential attendee will see a title “All About Annuities” and immediately conclude this is a sales pitch about annuities. Since no one wants to go attend the sales pitch, seminar attendance will be terrible. The annuity agent will then conclude that seminars don’t work, will market less and the downward spiral of annuity sales for both the annuity agent and insurance company ensues. The consumer has no interest in annuities. The consumer has an interest in conceptual benefits such as:

• Safety of principal
• Growth of principal
• Tax reduction
• Financial security for heirs

The annuity can certainly be a tool to all of these objectives of the consumer. However, if the agent puts the cart before the horse, the product before the objective, he will not get the consumers business. He will be a struggling annuity agent, always seeking to sell this product rather than provide solutions.

For an agent to get out of this product-centered mentality would require that he stop going to the insurance company training sessions. Rather, he would be much better served by holding a focus group among his target market and simply ask them, “what’s important to you about your money?” The answers to that question, the concerns that are expressed,  would then provide him the headlines, topics and content for his successful seminars and all other successful annuity marketing he might do. Because once the insurance agent understands what his clients want, he can start speaking about that. Once he has a room full of annuity leads, he then has accomplished the first step to more annuity sales.

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My firm ProspectMatch matches prospects with financial professionals and I have always found it curious that financial professionals only want leads of prospects seeking information on the products and services sold by the financial professional.

In other words, the average annuity agent only wants us to match him with prospects that have expressed interest in annuities and can be an annuity sale.  Other prospects have expressed interest in financial planning, mutual funds, life insurance, etc. but the average annuity agent is not interested in these general prospects.

However, the RICH annuity agents DO have an interest in these prospects.  Here’s the logic of the rich annuity agent:

1. When people express interest in a product or service, it does not mean that they will buy that particular product or service.

2. It does however mean that the prospect is motivated to seek a solution–i.e. if they fill out a form on the Internet seeking information on retirement planning, at least this is a motivated, “take action” person.

The rich annuity agent wants to speak to any motivated viable prospect and has sufficient confidence that if an annuity will help the prospect achieve his goals, the agent will have a sale.

How many clients have you lost because you have failed to cultivate a general interest from a prospect desiring to take financial action?

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Sure, you might start out with dreams of six figure salaries and the perks that come along with it, but the reality is that it’s a lot more difficult to make it as an annuity agent than the hotshots let on.  In fact, The Motley Fool (www.fool.com) reports that as many as 70% of annuity agents drop out of the industry within their first year.  If you’re struggling to make ends meet and wondering whether or not the industry is really for you or not, read on for more advice on making it through your first year in the field.

Adjust Your Expectations

If every annuity agent that got started in the industry made six figures in their first year, the world would be so full of annuity agents that there wouldn’t be enough customers left to make it worthwhile.  Instead of looking at the career as a guaranteed way to earn a high income, you need to adjust your expectations and think of your first few years as paying your dues to become established in the field.  Expect the cold-calling and the prospecting, and expect that you’ll earn a meager salary to do it.  Eventually, business will pick up and the grunt work of your first few years will pay off.

If you have funds to invest in your business, your path to success will be much quicker as explained at the at exclusive annuity leads.

Make Connections

Established annuity agents are just that – established.  Over their years in the business, they’ve made connections with customers and other financial professionals, and they’ve put their names out there for the entire world to see.  Think of your first year or two as an annuity agent as an important opportunity for you to make connections.  Join a trade organization, participate in your local Chamber of Commerce, and tell everyone you meet that you’re an annuity agent.  Eventually, the name recognition you earn from these activities will pay off in terms of new clients and referrals.

Stay Away from Shady Sales Tactics

If you stay on top of financial news, you probably already know that annuity brokers often get a bad rap.  And sometimes, it’s for a good reason – for every honest, legitimate broker out there, it seems like there’s at least one shark in the bunch, bent on manipulating and misleading customers into annuity products that aren’t right for their situations.  But here’s the thing – regulatory agencies are starting to catch up with these criminals, so if you don’t stay on the right side of the law when selling annuities, you could find yourself quickly out of business.

If you’re struggling through your first year as an annuity agent, it can be tempting to engage in shady sales tactics just to take home a decent paycheck, but consider the following statistics from CNN’s Money website as a cautionary tale:

• “Bank of America has agreed to return the money of anyone who purchased a variable annuity in 2003 and 2004 and was age 78 or older, citing high-pressure sales tactics directed toward senior citizens.”

• “Citizens Financial Group, acknowledging “‘unethical or dishonest conduct,” agreed to offer refunds to all its elderly customers who bought variable annuities in the last two years and will pay a $3 million fine.”

• “Waddell & Reed paid $18 million to settle charges that it pressured customers to exchange their annuities, generating commissions for its brokers.”

If you think the brokers who engaged in these practices are still employed, think again.  There’s no reason to jeopardize what could be a long and rewarding career on a few unscrupulous business transactions – focus on building your business instead, and sooner or later, the clients will come much more easily.

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