How Advisors Reach Asian-Americans
If financial advisors and financial services companies want to navigate business opportunities successfully in the Asian-American market, they must consider differences between generations and among ethnic groups within the market, say people familiar with this segment of the population. They must also understand the importance that Asian-Americans place on factors such as trust, business ownership, education and savings.
Trust is very important to Asian-Americans, says Susan Cooper, an executive vice president of the New York metro branch of AXA, New York. “Once they trust you, they really trust you.”
Explaining different products and tax advantages associated with each of them is also important, since this is an issue that concerns some clients, says Hyunyku “Ben” Her, a financial consultant with the Fort Lee office of AXA Advisors.
Advisors should recognize that the first and second generations of Asian-Americans are very different, according to Henry Park, a financial consultant with AXA Advisors, Fort Lee, N.J. Park, who works largely with the Korean community, says the first generation has worked hard to establish a business and often is willing to take risks and retain control in matters such as estate planning.
Their children often are professionals such as lawyers or doctors, Park adds, but sometimes they continue the businesses their parents have established.
Life insurance is very important to Asian-Americans, says Phil Salis, vice president with Metropolitan Life Insurance Company, New York. He says multicultural MetLife representatives, who comprise 25% of the companys reps, produce 36% of MetLifes insurance business. Among this multicultural segment, there is a heavy representation by Chinese advisors, he continues.
In order to satisfy this need for life insurance effectively, there needs to be a “heavy educational aspect” to the product, Salis says. “There needs to be education and not just selling.”
The Asian community can be reached through print and television advertising as well as through sponsorship of Chinese New Years celebrations or other events, such as the Hong Kong dragon boat races in which MetLife participates, he adds. This 2-day event draws over 30,000 attendees, he says.
The Internet is another way to reach prospective clients, he adds, and in the next 6-12 months, MetLife intends to launch a multicultural Web site in various languages.
Ning Zhang, president of the Coalition of Asian-Pacific Americans, New York, says corporate sponsorship is an effective way to reach out to Asian-Americans. For instance, he notes that many companies participate in the Asian-American Heritage Festival in New York each May. This is a better approach, he says, than joining Asian organizations solely to market and sell products.
Noting that integrity is important to this market, Zhang says this community does their own research and if an insurance agent tries to sell a product that is not suited to them, then trust is lost. It is better to sell a product that they need right now and sell them additional products later on as needed, he says.
“Common courtesy works well,” he adds. “A hard sell doesnt.”
High on the list of issues that are important to Asian immigrants is the ability to protect their families, says Saul Gitlin, executive vice president-strategic marketing services with Kang & Lee, New York. In Asia, these immigrants had family that provided a safety net but often they do not have that here, he explains. And while there still might be an emotional safety net with friends and relatives, help may not readily be available if needed, he adds. Consequently, life insurance is an important product, Gitlin says.
Educating a potential life insurance buyer can depend on his or her country of origin, he continues. For instance, in companies that have more of a capitalist tradition, there may be greater familiarity with the product and thus, more comfort with purchasing life insurance.
Gitlin notes, however, that whatever the ethnic background, because of the recent arrival of many immigrants, companies cannot take for granted what those immigrants know and dont know in terms of brand awareness and product understanding.
“They may not know the names, the jingles or be able to quote the tag lines that someone born and raised here would know,” he says.
Gitlin stresses the importance of the producer in providing information to clients. Since these are very entrepreneurial communities, most have their own network of agents. But, if an existing agency is near an Asian enclave, then it would be effective to bring staff on board that speak the language and can reach out to that community, he says.
Haidi Huang, an agent for Prudential in Industry City, Calif., with a client base that is largely Chinese, says her clients maintain ties to their roots on the Chinese mainland, Hong Kong and Taiwan. Many have businesses and other assets in their homeland that they retain but also need to protect their families in their new country. “The bottom line is protection,” she adds.
Family, according to Huang, can comprise 3 to 4 generations. Parents take care of grandchildren and when parents need help, they are taken care of, she says.
Saving is also important to this community, she continues, and because it is important, they like permanent life insurance and often larger life insurance policies, Huang explains.
They dont like liabilities, she adds, and many pay off their mortgages in 15 years or less.
Once a client is a citizen or has a green card, if they are in the U.S. for more than 183 days, then estate tax issues could arise, she says, so advisors need to discuss estate planning.