Mention cold calling to a life insurance producer, and you're likely to get looks of dread. And for good reason.
The prospecting technique — contacting potential clients who are not expecting a sales call and who have not asked to be contacted by a financial representative — can entail hours of sales pitches, but yield only a few appointments. Yet many agents and brokers cling to the marketing method, believing they can build a profitable practice on outreach to strangers.
They may need to rethink this strategy. As more producers branch into financial planning or niche markets requiring specialization, success in the profession hinges increasingly on establishing a trusting relationship with the client. And cold calling, many argue, is antithetical to this process.
But there's another factor at work against cold calling: It's simply getting harder to connect with "cold prospects" via the telephone.
Who so? People aren't answering the phone as frequently they once did. Prospects who don't recognize a caller ID number often let the call go to voicemail, believing the caller is conducting a telemarketing campaign in flagrant disregard of the federally mandated do-not-call (DNC) list. Or the prospect is overburdened with other communications to be answered: e-mail, Facebook posts, instant messages, and the like.
But there is another variable at play: changing customs. It's become socially acceptable to not answer the phone, particularly where strangers are involved.
"Starting in 2013, I heard a lot of complaints from producers about their low contact rates," says Gail Goodman, president of ConsulTel Inc. and a national expert on telephone skills training. "Suddenly, without any warning, our society has changed. People with smartphones now find it acceptable to not pick up.
"We have become overly digital in the way we relate to others," she adds. "Even though you are reachable in myriad ways, you're allowed to ignore everybody."
Becoming more strategic
How to deal with this societal shift? Goodman recommends that producers use the phone more strategically. Rather than making calls in a scattershot fashion to people who may or may not be interested in their services or fit their client profile, producers should limit the phone's use to "phone dates." To wit: calling at a pre-arranged time prospects with whom the advisor has established a relationship to set up an in-person appointment. When a call is expected, says Goodman, contact rates (and appointments) increase dramatically. Using the phone also becomes a more rewarding experience. The challenge, thus, is to connect with prospects and get them to agree to a follow-up phone call. To that end, a host of methods can be employed — among them use of the technologies that are displacing the phone. Example: connecting with the prospect via e-mail, preferably following a personal introduction from an existing client.
Alternatively, the phone dates may follow contacts the producer makes with prospects in casual settings: at cocktail parties and receptions, church gatherings, golf outings or even waiting in line at the grocery store. More formal gatherings, including luncheon seminars hosted by the producer for the benefit of prospects, also lend themselves to a face-to-face chat with clients-to-be on the need for financial protection and retirement planning.
All well and good. The problem is that too many producers fail — or don't know how — to kindle a prospect's interest in exploring life insurance or finance planning during these social engagements. To boot, many aren't receiving adequate direction from their managers, who often assume — wrongly — that their agents and brokers are well-versed in the art of conversation.
That can be a recipe for failure, particularly in respect to Millennials (those born between the early 1980s and the early 2000s). "Because of their huge reliance on technology, many Millennials haven't learned how to have a productive conversation," says Joanne Black, president and founder of No More Cold Calling LLC. "But it's precisely these conversations that lead to connections and, ultimately, to more business."
"Many of today's young agents need intense training, mentoring and managing to get their conversation skills up to speed, she adds. "They need to learn to listen, ask the right questions and then follow through."
The last might entail connecting something the prospect said during a casual conversation — about his or her business, family or personal interests — to the services the advisor offers; and then to suggest, if only briefly, the ability to advance the prospect's financial objectives.
"People will talk all day about their business," says Goodman. "With all of the info you've acquired during a conversation, you can phrase what you do in the context of what matters to that person. Contrast this approach with elevator speech, which I'm trying to convince every producer to drop, because it's delivered out of context. "When a prospect finishes talking and asks, 'So what do you do?' you're answer should start with this part of a sentence: 'You know when you said….' Now you're able to connect their life to what do you, as opposed to vomiting what you do on other people," she continues.
That connection can be established using a story. Rather than blandly describing oneself as a life insurance and financial services professional, the advisor might say, for example, that he or she has helped many clients significantly reduce their income or estate planning taxes.
Assuming the prospect is intrigued, then the advisor might suggest a follow-up get-together over coffee; or else a phone date to do additional fact-finding and, if merited, secure an in-person appointment.
Can any of any of the warm-up conversing be accomplished through texting — a favored communications tool of young advisors? Goodman emphatically insists not, observing that pre-appointment chit-chat, much less talk about product, can only be done effectively in person. Texting should be limited to actually set up an appointment — and only then in compliance with a company-approved method (e.g., an enterprise-wide phone system that permits managerial screening of text messages.)
Caution is also warranted when using social media to link with client prospects. Too often, producers extend invitations willy-nilly to individuals with whom they only have a tenuous connection using a boiler-plate greeting provided by the software.
