Cross-Selling Financial Services

Cllifton Warren

• Publisher: Business Expert Press
• Year: 2017
• Print ISBN: 9781631578472
• eBook ISBN: 9781631578489
• Topic: Business
• Subtopic: Finance
• Index: Business

This book is about generating profitable revenue from existing clients, and converting part-time clients into 100 percent full-time clients. Professionals and firms that offer financial services want to enjoy continued organic growth, and maximize the value of their business. Retaining and developing existing clients is one of the challenges they encounter in the process. The financial services industry is currently facing several key challenges: increasing competition, industry consolidation, rapidly changing technology, a soft market (for rates, premiums, and fees), and an increasing number of regulatory requirements. All these factors make it difficult for firms to produce consistent, positive, organic growth. This book is a follow-up to the author's previous book The Financial Sales Handbook: A Professionals Guide to Becoming a Top Producer. Although this book is an extension of the first, readers can be confident in approaching it as a stand-alone book. Cross-Selling Financial Services: A Professional's Guide to Account Development is for experienced professionals and firms who want to protect their existing top clients and revenue, and maximize the long-term growth and profitability of their business. The book will also help professionals to sharpen their account development capabilities. It is designed to be the nucleus for corporate training programs, as well as a guide for self-employed professionals who must market and sell to stay in business.

PART I

Getting Ready

If your business keeps you so busy that you have no time for anything else, there must be something wrong, either with your or with your business.

—William J.H. Boetcker

CHAPTER 1

What Is Cross-Selling?

A midsize insurance firm, which had been struggling to achieve positive organic growth for several years, installed a new customer contact database. To verify that everything had been successfully migrated and to compare the results, they produced a list of all active clients. The leadership team was surprised to find that they had over 10,000 clients—and many of them had purchased just one policy.

Cross-selling is one of the most talked about and often neglected aspects of financial services selling. Although there are no official statistics that measure cross-selling effectiveness, most industry leaders and firms I speak with, identify cross-selling as an area in which they could be performing a lot better.

Top-performing firms, which consistently produce superior organic growth every year, understand and appreciate the concept of harvesting the “low-hanging fruit,” and the importance of sensing and serving the needs of their existing clients.

In this chapter we’ll answer these questions:

• What is effective cross-selling?

• What are the realities of today’s market?

• Why should cross-selling be a top priority?

• What does an effective cross-selling process look like?

What Is Effective Cross-Selling?

Effective cross-selling is more complex than just selling more to your existing clients to generate additional revenue. It also involves drawing your clients’ attention to additional needs, and allowing you to sense, serve, and satisfy the needs of your existing clients and maximize the full potential of your client base.

Controlled Profitable Growth

Top professionals understand that their existing client base is their own captive market—with returns that are ready to be harvested. It costs between five and seven times more to acquire a new client as to retain an existing one. This fact alone should guide your top strategy: cross-selling and marketing your full range of products and services to your biggest, high-priority clients.

To achieve growth, you must sell, wherever possible, to your existing clients, who are your own captive market. If you can use this means of achieving controlled profitable growth, you will save tremendous time, energy, resources, and marketing costs, because your existing clients already know, respect, and trust you.

Top professionals understand that cross-selling improves retention, increases profits, and strengthens relationships. One top professional at Guardian Insurance sells whole of life policies to his clients during their working career. Later, as they approach retirement, he offers advice on variable annuities to protect their income. He says that the key to achieving success in cross-selling is to understand and believe in your products. You must always work in your client’s best interest, and keep your skills sharp through constant learning.

Five Reasons Why Professionals Don’t Cross-Sell

1. Fear

2. Mandated products

3. Poor client information records

4. Weak selling system

5. Not targeting key buyers

Fear

Some professionals are simply afraid of offering additional products to their clients. It is a fear of selling. They don’t want to be perceived as salesmen, but rather as advisors or consultants to their clients. Although this is understandable and, in some cases, commendable, the reality is that your clients might have genuine needs, and if you don’t meet them, someone else certainly will. While it’s nice to sit back and wait for your clients to approach you—it probably won’t happen—especially if they don’t know about the full range of products and services that you offer.

Mandated Products

Sometimes firms try to mandate products to try and cross-sell. I know one firm that set a goal to try to cross-sell liability insurance to all their clients. In other words, they planned to promote it, via envelope-insertions, with every renewal notice, and as part of every invoice. That’s not an effective use of cross-selling time, energy money, or resources. A better approach is to develop a holistic approach, capturing all your client’s needs and mentioning only the appropriate products to service their needs.

Poor Client Information Records

I’m constantly surprised at how often professionals miss out on important client information. Part of the problem is that they simply do not capture enough information. It’s a simple process to capture the names and birth dates of your clients’ spouse, children, and other family members, as well as their past occupations, military service, hobbies, and sporting interests. This is all important information that can often pinpoint and identify the need for additional services.

Many top life insurance agents keep accurate, up-to-date files, so each year they can send birthday or anniversary cards to their clients and, in later years, to their clients’ children. Keeping in touch by mail is also a reminder of the need for additional coverage, for friends or family members.

Whatever business you are in, you can use this simple method. Information can easily be captured on a spreadsheet or in any kind of contact information system.

Weak Selling System

I recently met a firm that deals with affluent clients. Despite some of these clients paying this firm a lot of money and they handle some of their most complicated transactions, they are only officially seeing them face-to-face about once a year. The rest of the transactions are done over the phone. Some relationships are historical but in any place, you need a very tight selling process that enables you to have regular contact with your client. Not just to provide a service for them, not just to sell them something, but an ongoing process that gives you valid reason to remain in contact with them.

Not Targeting Key Buyers

This reason is partly related to fear. But, in some cases, it’s simply a failure to recognize who key buyers really are, and what their needs might be. For many years, a firm was providing financial advice and handling insurance for one of their affluent clients. Since they had a weak process, and did not collect sufficient information, they had no idea that the client also sat on the board of a couple of not-for-profit associations. It was by sheer luck that someone stumbled across the fact, and mentioned it to the firm. The not-for-profit had some specific needs that needed to be addressed, and the client who was on the board needed help in reducing risk exposure. The...

Table of contents

• Cover
• Half-title Page
• Title Page
• Copyright
• Dedication
• Contents
• Acknowledgments
• Introduction
• Part I Getting Ready
• Part II Getting Set
• Part III Launch
• Appendix A: Cross-Selling Refresher List
• Appendix B: Why You Need More Than Just Revenue Goals
• Appendix C: Glossary
• Appendix D: The Standard Industrial Classification (SIC) Code System
• Appendix E: Personal Marketing Plan Checklist
• Appendix F: Personal Marketing Plan Worksheet
• Appendix G: Sample Strategic Plan
• Appendix H: Client Advisory Board Marketing Guidelines
• About the Author
• Index
• Backcover