From the April 2009 Issue of Senior Market Advisor Magazine

Erratic markets, depressed asset values and nervous clients have combined to form a perfect storm for the senior advisor. But as in nearly every catastrophe, a few hardy souls who refuse to accept the status quo emerge to snatch victory from the quickly closing jaws of defeat. Advisors with determination and imagination are finding that it’s not impossible to bring new clients and increased revenue on board especially when one accounts for a growing need for security and answers amid today’s financial maelstrom.

“You’ve got to get out and be in front of prospects every day in this market,” says Phillip Kinney of Market Street Advisors in Smithfield, N.C. “It’s not enough to continue with business as usual. You’ve got to view every conversation as having business potential.”

Kinney, who likes to identify a client’s potential problem before revealing a solution, remains innovative in how he’s growing his business. He recently launched an area business-networking group (Smithfield Area Lead Share Association) which meets weekly for breakfast to provide leads, ideas and camaraderie.

“The energy that comes out of the group is amazing,” he says. “And the leads have not been bad either.” Kinney is adding services to his practice such as health savings accounts (HSAs) and supplemental disability insurance such as Aflac. People are looking for ways to save money but still get the coverage they need. When you say you can offer that, their eyes open.”

identify client needs
Veteran Joseph Ventura, a perennial top producer, says his business has been percolating throughout the recession due to a variety of factors, not the least of which is extensive experience in all types of markets and a great ability to identify client concerns and needs.

“Advisors need to appreciate that everyone thinks differently and that referrals can come from the most unlikely of sources,” notes Ventura who’s been providing annuities to a lot of new clients in their 20s and 30s, as well as pre-retirees. “The living benefits offer a lot of solutions to a variety of problems such as lifetime income, a death benefit and potential investment growth.” Layoffs, Ventura says, have helped drive his business as good word-of-mouth referrals create warm leads. Ventura relies on business networking, a quarterly newsletter and regular client-appreciation events to keep business humming. Recently he’s increased his media-relations efforts while recruiting new advisors.

seize the opportunity
“Change brings opportunity,” Ventura says who encourages advisors to “capitalize” on their existing relationships while cultivating new ones. “Every environment, including a bear market, brings opportunity. I tell this to prospects as well as to wirehouse reps, many of whom are now feeling disenfranchised.”

Ventura’s VA sales efforts may be bucking the trend. For the first nine months of 2008, VA sales reached $122 billion, a 10 percent decrease. Despite a VA sales decline, overall individual annuity sales logged a record-setting pace in 2008, reaching $197.1 billion through the first three quarters, according to LIMRA’s U.S. Individual Annuities Third Quarter 2008 Sales Report. Fixed annuity sales were up dramatically, 41 percent reaching $75.1 billion during the same period, possibly reflecting an investor need for safety.

“Advisors need to maintain and restore trust,” says Steve Mazda, an advisor in New Hope, Pa. “They can’t be afraid to make the moves clients need. Meet everyone’s requirements and stay aware of changing risk tolerances, especially as clients consume the media. You must adjust to client changes in risk tolerance or you’ll lose accounts.” Mazda has maintained his local television advertising and sends a quarterly letter to remain prominent.
“I had previously sent a biannual letter. That was a mistake,” says Mazda. “I now urge clients to call me anytime and contact has increased. I’ve become an intensive care nurse 24/7 for my clients.” New business for Mazda is coming from “indirect marketing” such as an association with a local hospital’s fundraising group and developing other key relationships to create an influential network.

a proactive approach
“It’s critical to be proactive in this environment and demonstrate to clients not only the strength of the guarantees you are offering but also the strength of the guarantors,” says Peggy Hollander, founder and managing director of The Succession Group, Inc., in Miami, Fla. “We show clients the possibility of mitigating risk through products that offer guarantees. Clients get very emotional when it comes to their money. But rash decisions often lead them to changes that may have adverse effects on their growth potential. We urge them to replace emotion with a disciplined investment strategy and focus on service. The most important agenda item in a downturn is client service.”

While clients today are accustomed to shopping online for investments that can save them money, advisors can counter this trend by offering expertise and service. “There’s no substitute for in-depth client knowledge,” says Ventura. “A toll-free number answered by a stranger is no comparison to someone who knows you when you’re feeling anxious.”

“Emotions probably play the greatest role in our decision making,” agrees Carol Bentley, author of Beat the Recession. “Emotion, experience and perception affect our decisions. That is why it’s crucially important to understand your target prospect.”

Obtaining new clients will always be challenging but the landscape has changed for senior advisors. While advisors must work to acquire new clients, they must provide service and communication to keep present ones onboard. In the face of declining asset values and subsequent revenue shortfalls, those with creativity and energy will emerge victorious.

Click the links below to read the rest of The Trends Issue:

Getting creative in a tough LTCI market
By Ed McCarthy

Playing it safe
By David Port

Use the 5 best marketing trends to get ahead in 2009
By Jim Lineweaver

When the going gets tough, the tough start selling
By Adrian Miller