A dilemma is typically described as a tough or unpleasant choice. For example, a current dilemma for the Fed is if they stop the current “easing” strategy, it might hurt the stock market. On the other hand, if they don’t stop printing and buying back money, they are continuing to create huge future problems. Dilemmas abound in the financial world, but one of the most intriguing dilemmas going involves how the annuity industry promotes and frames their product strategies.
I think that this is a defining moment for the annuity leaders, and they have a difficult choice looking them in the face. Their dilemma is “Should we not change anything and everyone keeps making a good living? Or should we proactively frame one consistent message and reel in all of the cowboys that continually hurt the brand?”
Eyes wide shut
This great Stanley Kubrick film title appropriately explains the annuity industry’s current dilemma. Everyone knows that there is a huge enforcement problem with advertising and some FMO promotions, but no one wants to upset the premium applecart. The undesired plight of the vast majority of annuity agents is the constant re-education of prospects that are only hearing the too-good-to-be-true or one-size-fits-all message on the Internet, TV and radio.
What Your Peers Are Reading
On a side note, I travel the country and listen to a lot of talk radio in transit to appointments and I swear that Glenn Beck and Sean Hannity are the self-appointed voices for the annuity industry. Is that what we want? They certainly don’t have the needed licensure to say what they are saying. In just about every city I’ve been in, they are endorsing some agent who “has never lost a penny” and can “get you an 8 percent bonus on your money.” Just when I thought it couldn’t get any weirder out here in the annuity hinterlands, we now have the paid political endorsers pushing annuities without ever saying the word annuity!
Another ongoing predicament is the raising of the educational standards. The last time I mentioned this idea in one of my columns I got over 500 emails from the angry fixed annuity agents. Warm up those keyboards, because I still think this raising of the educational bar is needed, and a proactive step by the industry would send a positive loud and clear message to the annuity consuming public.
We all know that change is hard, but change is definitely needed. The annuity argument continues to be framed by people, stock market homers, and journalists that don’t sell annuities. It’s time that we (the annuity industry) start framing that argument ourselves.
Let’s dream for a second and ask what would Steve Jobs (Apple) or Jeff Bezos (Amazon) do if they were in charge of the annuity message and corresponding strategy implementation.
Steve Jobs once prophetically said “People don’t know what they want until you show it to them.” Jeff Bezos could have been speaking directly to the annuity industry when he said “What’s dangerous is not to evolve.”
I’m pretty sure that neither of them would be in a quandary when it came to addressing, changing and upgrading our antiquated yet profitable industry. Here are the three main things I’m pretty sure that they would implement immediately.
1. One simple clear message