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Portfolio > ETFs > Broad Market

2007 FMO reader survey results

By Staff Writer

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There are hundreds of marketing organizations out there, and all of them strive to provide agents with the products, systems and support they need to grow their business. Many advisors are happy with their marketing organization, but the relationships don’t always last for long. Advisors are known to be a transient bunch when it comes to FMOs. A top advisor is always on the lookout for a marketing organization that can boost his commissions and provide better support.

Senior Market Advisor wanted to find out what’s most important to advisors when it comes to marketing organizations. We asked what you like and dislike about your current MO(s), how you evaluate them, and if you are looking to make a change. In what areas do you think your MO needs to improve? What sources of information do you use to find out more about products and marketing organizations? These are among the many questions our advisor readers answered in this survey, which was conducted during the second half of January.

What we found provides insight into key issues facing MOs and advisor attitudes toward them.

When it’s time to change FMOs

1. When communication breaks down.
2. When an FMO fails to deliver on promises and commitments.
3. When an FMO doesn’t offer appropriate products for your clients.
4. When an FMO becomes a “commission pig.”
5. When an FMO lacks appropriate training, coaching or mentoring programs.
6. When an FMO lacks effective marketing materials, campaigns and strategies.
7. When an FMO lacks back office support.
8. When the company culture clashes.
9. When you’re treated like a number, not a person.

First off, nearly two out of every three respondents to our survey reported they have been affiliated with three or more marketing organizations during their careers, and one out of every three said he has been affiliated with five or more.

While 75 percent of the respondents said they are not currently considering switching marketing organizations, the other quarter are actively in the market for a new FMO.

Another survey question reveals that once an advisor is in the market for a new FMO, 85 percent will decide on one within six months. Some are simply dissatisfied with the performance of their marketing organization. In an open-ended question asking what advisors disliked about their FMO, many advisors complained about commission rates, product limitations, poor communication and a lack of marketing support. “The FMOs are not ready for prime time. They are way too small in staff and knowledge of the products they promote,” one respondent said. “They talk a good game, but their follow-through needs some help,” said another.

When it comes to what advisors like about their current FMOs, comments about strong personal relationships and a positive culture were by far the most prevalent. “The one-on-one relationship with my marketer,” was what one respondent likes best. “I can call him anytime for info, assistance or just to bounce ideas. Also, it’s a small FMO with resources behind it, so I can talk with the execs if needed.”

Accessible executives were cited by several respondents as positives, and the importance of good communication maintaining a good relationship was a recurring theme. “I have more than one (FMO),” one respondent answered. “The one I speak with most, [I have an] excellent relationship with my rep.”

Good product selection was another frequent answer to what advisors like best about their marketing organizations.

What are advisors looking for when they are in the market for a new marketing organization? Reliability was singled out by our respondents as being the most important criterion. A resounding 95 percent of respondents ranked “reliability” as being either “extremely important” (64 percent) or “very important” (31 percent).

Execution of promised deliverables ranked second, with 86 percent selecting it as “extremely important” (56 percent) or “very important” (30 percent). In descending order of importance were product selection, communications, speed of processing, technology, back-office operations, marketing and culture.

The survey also reveals that a majority of advisors continually evaluate the products they sell. By far the largest number of respondents, 61 percent, said they are constantly evaluating products, while just 15 percent said they evaluate products annually, 12 percent do so quarterly and 8 percent monthly. That was backed up by a whopping 92.5 percent of respondents saying they are currently considering adopting new products.

What’s most important when evaluating new products? Our respondents overwhelmingly said product features and customer service are the criteria they consider first. Ninety percent of respondents ranked product features as being “extremely important” (59 percent) or “very important” (31 percent) when evaluating new products.

Customer service is a close second to product features, with 88 percent ranking customer service as either “extremely important” (57 percent) or “very important” (31 percent).

The next most important criteria when evaluating new products is customer demand, with 78 percent ranking it as “extremely important” (40 percent) or “very important” (38 percent).

Marketing materials, commission rates and commission payment terms followed in order of importance for respondents evaluating new products.

In what areas do advisors say FMOs need to improve? More than half of the respondents (57 percent) said training/coaching is the area where their FMO lacks the most. Advisors also want better communication (42 percent) and better marketing materials (40 percent).

Survey respondents were not particularly generous when grading specific areas of their current FMO’s performance, as the most common response in each category was merely “satisfied.” Training/coaching again received the lowest marks with only 39 percent answering they were either “extremely satisfied” of “very satisfied” with their FMO’s efforts in that area. Product selection and marketing materials received the highest marks, followed by back office support and communication.

Respondents to the survey consisted primarily of seasoned veterans. Fifty-eight percent reported having been involved in selling life insurance, annuities, and/or LTCI for more than 10 years, and 26 percent of those for more than 20 years. Nearly two-thirds focus on selling to the senior market.

Take a few minutes to examine the survey results, and you will come away with a solid idea of what your peers think of marketing organizations.

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