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Solution Selling Hype?

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It could be that the 2000s will turn out to the era of “solution selling” in insurance and financial services–just as the 1990s became the era of “product pushing.”

No one is using the solutions selling term yet, but don’t be surprised if you hear it soon–said derisively, just as “product pushing” is spoken with a curl of the lip.

Why so? Let’s back-pedal a bit. When “insurance and financial solutions” first showed up at the financial professional’s dance, maybe 8-10 years ago, it looked pretty good.

Advisors using this term sought to distance themselves from others who, though licensed, seemed more interested in selling certain products–often high commissioned ones or products on a distributor’s hot list–than in addressing what the customer needed.

Such product pushing has been blamed for inappropriate sales to seniors and others, drawing much negative press and industry tongue lashing.

The solutions advisors went to great pains to point out that they, unlike the product pushers, take a consultative, customer-centric approach to their work.

They said they focus on developing the best solutions for the customer’s situation, whether it involves a product or not. They do “talk product,” but only as one of many of their financial “tools.” Many of these advisors work on a fee or fee/commission basis, thus dulling complaints about “high-commission-sales.”

As noted earlier, that all sounded pretty good. What, after all, is not to like about putting the customer’s need first?

Problem is, from that well-intentioned beginning came today’s stampede of advisors–and companies–who all seem to be touting the very same thing.

Everyone, it seems, provides insurance and financial solutions.

Often, this talk is accompanied by the now familiar buzzwords–transparency, suitability, client relationship, etc.

It’s gotten to the point that some websites and brochures are so loaded up with all this verbiage that it is difficult to determine just what the advisor, firm or company actually does or sells.

Pity the poor consumer who is looking for a life insurance expert but ends up on a website of a professional who’s all about selling solutions. Such sites usually promise that the advisor can design solutions to meet the customer’s needs. But the visitor may have a hard time finding out if the advisor has any expertise in variable universal life, indexed universal life, whole life, or any other kind of life insurance.

This same problem is showing up on websites talking about annuity solutions, long term care solutions, and more. (Not all websites, but enough to give pause.)

Will consumers be better off with product-pushers? No. Most of them have websites and marketing materials that do say what products they work with and sell, and many pinpoint their areas of product expertise. But, in recent years, some of them have woven solutions-talk into their messages, along the following lines:

o “We don’t just sell products; we offer solutions to meet all your insurance and financial needs.”

o “Our state-of-the-art tools enable us to customize solutions that fit your every need, in every stage of your life.”

o “We’re the financial solutions experts.”

For the increasing number of consumers who research financial products before they buy, the solutions hype is gibberish. Many of them wouldn’t know an insurance or financial solution from a fishing rod. Put some flesh on those bones, please.

For consumers who are looking for independent consultants–that is, those who give advice but don’t sell products at all–the hype muddies the message. Many such consumers are seeking professionals who offer independent thinking, have experience and credentials in various financial areas, work in professional teams, and, among the more sophisticated, use “open architecture” strategies. For them, hard selling of vague “solutions” just doesn’t cut it. They want details, resources, and background.

Does this mean that solutions expertise has fallen into disrepute?

Absolutely not. As noted, the solutions approach has much in its favor.

It has helped redirect insurance and financial advisory services to customer-centric approaches. It has helped drive providers to concentrate more on meeting corporate needs by meeting customer needs. It has signaled to the general public that advisors exist who don’t sell any old product on the shelf, just to sell something. It has supported the industry wide thrust for greater suitability.

But to the extent that solutions talk is solutions hype that does not clearly (yes, and transparently) describe the work actually being done, it needs to stop.