Selling to the Affluent

Thomas J. Stanley

• Publisher: RosettaBooks
• Year: 2012
• ISBN:
  9780795325991
• Topic: Business
• Subtopic: Sales
• Index: Business

From the New York Times –bestselling coauthor of The Millionaire Next Door: "No one better illuminates the who, where, and how of the affluent market " (J.Arthur Urciuoli, former chairman at Merrill Lynch). In the bestselling classic The Millionaire Next Door, Dr. Thomas J.Stanley showed his readers where to look for the wealthy. In Selling to the Affluent, he shows us how to persuade them. This book provides an insightful roadmap of the motivations and purchasing patterns of the affluent—and delivers a strategy for salespeople to leverage that information to the best advantage. This book outlines all phases of the sales process, from approaching wealthy prospects to pinpointing their wants and needs—frequently different from those of less affluent markets—and selling both tangible and intangible products. It profiles several key demographics within the wealthy subset—including business owners, men and women, and the retired. It's the most detailed and inclusive manual on the market for selling to the wealthy. "Dr. Stanley's strategies consider the real needs of the high income professionals—needs that go beyond any product or service. These needs are psychological and revolve around the recognition of the individual's extraordinary level of achievements. He provides some terrific insights as to how to solicit and maintain business by unconventional, but highly effective means." —Carolyn J.Cole, chairman and founder of The Cole Group and The institute of Economics and Finance " Selling to the Affluent is well written, relevant, and exciting; it presents an important complementary extension to Marketing to the Affluent." —William D.Danko, PhD, coauthor of The Millionaire Next Door

PART 1

INTRODUCTION

CHAPTER 1

WHAT THIS BOOK IS ABOUT

WHAT DO THE AFFLUENT NEED?

Take a moment to visualize 100,000 sales professionals who target the affluent all seated in a large enclosed stadium. A picture of an affluent prospect appears on a huge overhead screen. A brief biographical sketch of the prospect is distributed to each of the sales professionals. The information includes the prospect’s occupation, social and professional affiliations, annual income ($183,350), net worth ($2.3 million), and achievements and/or awards. Also enclosed is an examination that contains only one essay question. The question asks the following: What does this affluent prospect need?

The majority of the sales professionals, more than 90,000, respond in a very similar way.

• Financial consultants indicate that the prospect needs their specific brand of financial advice and investment products.

• Life insurance agents state that the fellow on the screen needs a seven-figure face value life insurance product and estate planning.

• Real estate agents state that this target needs the home on the third fairway that they just listed two days ago.

• Jewelry sales professionals write that the prospect needs the $11,000 master timepiece and the prospect’s wife desperately needs the diamond encrusted woman’s version.

• Luxury car sales professionals unequivocally pronounce that “Mr. Affluent needs our top-of-the-line two-door while his wife would likely need the four-door touring sedan.”

• Clothing sales professionals are certain that this prospect needs a complete wardrobe overhaul given the picture displayed on the screen. They stipulate that he desperately needs their special-fabric, hand-tailored, custom-fitted, executive series of suits.

• Travel consultants feel that Mr. Affluent and his family need the 24-day world cruise at the super-class level which includes a helicopter tour of the Great Wall of China.

But a minority of the sales professionals, fewer than 1 in 10, submit a completely different essay. Interestingly, this minority group contains America’s most successful marketers. How do they sell to the affluent? How do they influence people who influence the affluent? How do they find prospects when they are most vulnerable to solicitations? What themes do they use to encourage prospects to say yes to solicitations? How do they time solicitations to enhance the probability of closing the sale? How can their selling skills be acquired by others who wish to target the affluent? These are only a few of the questions that are answered in this book. As an introduction to the topic, examine several of these prototypical responses. “Mr. Smart” earned over $400,000 in net commissions last year by selling to the affluent. His exam reads as follows:

William Manchester, the author of the best-selling biography of Winston Churchill, once stated, “Men who think of themselves as indispensable are almost always wrong.” I fully realize that most affluent people can live and succeed in life without my basic product. There are thousands of people who sell identical or similar products. Thus, I always attempt to appeal to a higher need. Most of my clients and prospects in the affluent category are, in one way or another, selling something. They are business owners, attorneys, physicians, accountants, and sales and marketing professionals who happen to make extremely high incomes. More often than not, they buy from me because of something more than product and excellent service. I always attempt to help clients and prospects with that ever important need of increasing their revenue. I make referrals on behalf of all my clients who have something to sell. I also recognize their achievements both in conversations and in letters and cards that I send. Often, significant career achievements precipitate the need for my offerings. I pay special attention to determining the cash flow changes that are specific to the industries of which my clients and prospects are a part. Many of my clients receive up to two-thirds of their annual incomes during one or two months of the year. Calling upon them at other times shows gross insensitivity on the part of the sales professional. I am also actively involved in five trade/professional organizations that represent the segments of the affluent population that I have targeted. I specifically targeted the senior officers of several of these organizations. Some have purchased from me; others have not. But I have done many favors for all of them such as developing programs and seminars for their demanding members. I have also used my marketing expertise to further the causes of some of these organizations. I was instrumental in initiating a letter-writing campaign designed to influence selected lawmakers in opposing proposed legislation that would adversely affect the industry of which many of my clients are members. They have often reciprocated by asking me to give important speeches at major gatherings. Several have also published my ideas in their national trade publications. The affluent have a very strong need to affiliate with others within their same discipline. All things being equal, they prefer or need to patronize those sales professionals, as in my case, who are perceived as integral parts of these affiliation groups. I never take my clients for granted. Their careers, their revenue, and their achievements are significantly more important to them than whether or not they buy my product at all or purchase one from me or from someone else. However, I do my very best to associate my product and my form of service with these career-related needs.

Another respondent to the exam told of his commitment to affluent fishermen and fishing fleet owners. He insists this commitment is why many prospects from this industry seek him out as opposed to him “chasing the fish.” Recently, when several owners of fishing fleets received substantial compensation (more than $1 million each) from an oil company for damage to their fishing grounds, why did they entrust it to this particular financial advisor? Because he is viewed as an expert in helping solve the investment problems of people who fish for a living.

One of the most productive marketers of luxury automobiles also had a unique response.

How do I target the affluent? I do it by focusing on affinity groups that contain high concentrations of high-income prospects. Many of my best customers are surgeons. They don’t make house calls. They are too busy. So I make “house calls.” I tell them loud and clear that I cater to surgeons. I also target very high income producing sales professionals. I know when they are making money, but they never get enough recognition. So I give them my sales professional recognition package. It comes complete with a plaque and letter.

One of the essays from a super producer from the life insurance/financial planning industry told of his special brand of selling to the affluent. He is considered by many in his trade area to be the foremost source of financial wisdom for physicians. He has a genuine passion for helping doctors achieve financial independence. This commitment extends to his co-signing loans for young medical students to open professional practices. And this help is given without any promise on the part of the physician to become a client of this extraordinary financial planner. But many do become clients for life. Many refer their colleagues to him, and most brush off others who attempt to solicit their financial-planning business.

TWO OF AMERICA’S MOST EXTRAORDINARY SALES PROFESSIONALS

As an introduction and orientation to the topics covered in this book, profiles of two top performing sales professionals are given in Chapter 2. Both Dan and Gene are excellent role models for those who aspire to become quality professionals as well as balanced human beings. They were selected for the “most extraordinary” designation not only because they generate very high levels of sales commissions. Both have also adopted the whole life concept. In other words, they both have full control of their careers. Their careers do not control them. Both have fully balanced their family and career responsibilities, and both have achieved greatness by their own hard work, discipline, intellect, and tenacity. We can learn a great deal from Dan and Gene about how to sell to the affluent and also how to enjoy life.

IDENTIFYING AND CONDITIONING AFFLUENT BUSINESS OWNERS

Why target affluent business owners? Approximately 80 percent of the millionaires in this country work for a living. And 80 percent of these own their own businesses. Members of this segment are more likely than any other group to have high levels of income. This applies to the $100,000 and over annual income category as well as to the $1 million and above designation. Taken as a percentage of income, this group does have a lower propensity to purchase so-called status products. However, since many of its members generate extremely high incomes, even a small portion allocated to consumer products makes this group important to marketers. Also, the growth of privately held businesses in this country exceeds the rate of population growth by three to four times. Affluent business owners, as an occupational category, have the highest propensity to accumulate wealth. They should be a primary target for those who sell investment- and insurance-related products and services. Yet there is another reason why this segment is important. Only a small minority of sales professionals are truly proficient at selling to the affluent business owner.

What do affluent business owners want from sales professionals who target the affluent? Their needs are similar to those of affluent members in other occupational categories. There is an important difference, however, which sales professionals should recognize. Affluent business owners place a higher priority on their achievements within the context of their chosen industry than they do upon status or social class membership. The enlightened sales professional looks for opportunities to associate his product or service with the career achievements of the prospect. Some of the more innovative marketers of expensive products have discovered the value of the affluent business owner’s need to own the symbols of achievement. A manufacturer of expensive watches gives the Rolex Spirit of Enterprise award each year to those whose accomplishments deserve special recognition. Most recently it gave the awards in the categories related to applied science and invention, exploration and discovery, and the environment.

Over- or Underprospected?

A national trade publication recently presented a list of what it considered to be the top 100 contracting firms in America. The list contained the names, addresses, and telephone numbers of the three top executives in each firm. How many sales professionals called these executives in an effort to recognize their achievements? How many sales professionals wrote a letter to these euphoric executives stating that it is only appropriate for a top executive with a top-ranked firm to purchase the best product, to get the best service, and to patronize the best supplier? ZERO! Why ZERO? Because most people who attempt to sell to the affluent never make unsolicited calls upon prospects, and those that do never read any material about successful people who exist outside their own industry!

A multimillionaire recently asked me an interesting question. “Tom, is it true that most wealthy people are not called on by salesmen?” My response was given as a question. “Robert, how often are you called on by sellers of anything?” His answer was predictable. “Tom, the only guy who ever called me is the owner of a Rolls Royce dealership, and he was smart to do so. But you would think that people would call. I’m not hard to find. I just gave $200,000 to a local charity. They put my name on a bronze plaque so everybody in town could see it. But nobody selling anything called. You would think they would realize that I have money.”

An owner of a small fleet of fishing boats recently received a check from an oil company for over $1 million. This money was intended to compensate the owner for damages to his fishing grounds. How many sales professionals called this affluent prospect? One and only one. The sales professional in this case is a specialist. He focuses upon selling to affluent fishermen, suppliers to this industry, and buyers of their harvest. He also reads “the journal of affluent fishing,” The National Fisherman.

Fifty top-ranked sales professionals spent an entire day together at a seminar. The seminar was held in a room within 100 feet of a doll auction. The auction was attended by hundreds of affluent prospects. Many dollars changed hands that day. Several attendees paid up to $40,000 for one doll. The auctioneers received between 10 and 35 percent of the sale price. Not one top-ranked sales professional who targets the affluent attended the auction. These sales professionals need to ask themselves, “Is it more productive to cluster with high concentrations of my competitors or with high concentrations of prospects?”

A three-day conference was recently held in Hawaii. The average annual income of the attendees was $750,000. How many sales professionals were even aware of this target of affluent market opportunity?

Some of the Themes the Affluent Business Owner May Wish to Hear

“The feature article in Waste Age is about you. Your achievements in the industry are legendary.”

“Many of my clients are also business owners. I’m sure that a lot of them would be interested in learning about the services your firm offers.”

“I have several contacts who are business writers. I’m sure that they would love to tell their readers about your operation.”

“Your industry has been very good to me. Most of my best clients own restaurants within the same chain that you do. You probably have come into contact with a few of them.”

“The article in Pizza Today said that you were one of the top independents in the country. You may want to reward yourself for your achievements by trading up to one of our top-of-the-line models. After all, you are the best in your industry. It’s only logical that you should own the best product offered from my industry.”

“Would it be all right to mention your company’s products when my clients ask me about where they should go to buy something like this?”

“You are an important role model for a lot of people in your industry.”

“Tell me how you made this operation so successful.”

“We have selected you as entrepreneur of the month. It is a statewide award. Here is your plaque that salutes your outstanding achievements. Would you mind if we told the local business press about your award?”

“Here’s a copy of the speech that I gave at your industry’s international convention. It contained several of your ideas. Would it be all right if I mention you as the source of my inspiration? This material will be published in next month’s issue of your association trade journal.”

“Many of my clients sold their businesses. It’s not easy to turn over the keys to someone else. Some of my clients told me that it took over a year before they got over their withdrawal symptoms. You may want to talk to some of them. I’m sure that they could be of some assistance to you.”

“I just wanted to call to congratulate you on your selection as businesswoman of the year. Would you be willing to come by our office sometime and give an informal speech about how you succeeded in a very competitive industry. Many of the young women in our department are struggling. They could benefit from your insights. They need a strong female role model. Will you come by Friday morning? I will buy breakfast.”

“Congratulations on winning your latest contract. It’s not every day that a locally based fi...