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Reaching the Middle Market, Part 2: How to Make Yourself Heard

By David Whiteside

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Last week, in Reaching the Middle Market, Part 1: Why You Need a Strategy, David Whiteside talked about how big, and complicated, the U.S. middle market really is.

Here, Whiteside talks about how insurance agents, advisors and other financial services players are dividing the middle market into segments, and how they’re getting the attention of the people in their target segments.

One Team, Two Generations

Some advisors work with multiple generations in the same office, rather than targeting a single demographic. One mother-and-daughter team applies that strategy to the middle market by making use of their age difference.

(Related: Middle Market Households Own Majority of Permanent Life Insurance)

Mischelle Copeland is first vice president of investments with Wells Fargo Advisors in Fort Worth, Texas. She works with her daughter Nicole Horton, associate vice president and investment officer, also at Wells Fargo Advisors.

Copeland and Horton serve multiple generations of middle-market clients.

“It always has been part of our practice to work with the clients and their children, and their grandchildren,” Copeland says. In some cases, Copeland and her daughter now serve their original clients’ great-grandchildren.

Copeland says members of each generation have different needs and priorities.

Horton caters to the younger clients, especially her fellow millennials. She especially enjoys working with entrepreneurs, new professionals, and goal-oriented families.

“They’re fun to work with,” Horton says, “They’re very ambitious. They’re very high energy. They’re very intelligent. They have things that they want to accomplish.”

Tech Noise

Millennials are having an impact on the entire middle market, not just because there are 92 million of them, and not just because they make up a huge part of the middle market, but because other generations are adopting their tech habits.

Baby boomer, Generation X, and even some senior households increasingly are taking the millennials’ Google-oriented, do-it-yourself approach to shopping for financial services.

Millennials (Photo: Thinkstock)

Millennials (Photo: Thinkstock)

Eric Palmer, chief marketing officer at Brokers Alliance, a life and annuity wholesaler in Fountain Hills, Arizona, says everyone has a smartphone now. Middle-market clients, and prospects, use their phones to check facts and ideas on YouTube, Twitter, Instagram and Facebook. They also seek out information on robo advisor systems and from specialized forums.

Facebook in particular is “heavily dominated by some of the older generations,” Palmer says.

(Related: Can Digital Advice Fill Advisor Gap for Small Investors?)

Even though middle-market consumers are making frequent use of social media services, producer advertising on those services is getting diminishing returns. Just as members of previous generations learned to tune out TV commercials, today’s middle-market prospects tend to ignore most electronic advertising.

“All the different postings on social media, all the ads, are just noise,” Horton says. “We can’t penetrate with Facebook. No one is checking their mail. Email boxes are full.”

Advisors say the millennials in the middle market are especially resistant to direct selling.

Teach Them to Reach Them

Horton says traditional networking is the best solution. She sees her peers in other industries adopting the same approach, as everyone’s prospects become increasingly time-constrained, tuned-out and sales-averse.

Horton’s practice keeps a modest presence online, and Horton and Copeland offer a popular financial boot camp every year in Fort Worth. They support their younger clients in all financial areas, not just investing. Horton might offer job-interview prep, or advice on planning for a family. That keeps her top-of-mind when those clients’ households need to invest.

Beyond that, Horton says, middle-market business comes in mainly through organic growth and word of mouth.

Eric Palmer agrees that providing neutral, useful education is key.

Producers who cater to the DIY prospect can brand themselves as trusted sources, Palmer says.

Seminar (Photo: Thinkstock)

Millennials (Photo: Thinkstock)

Palmer encourages producers to use the web and social media to teach rather than to advertise. He also emphasizes the value of high-quality video.

“As a culture,” he says, “we’d rather watch than read.”

(Related: 5 Uses for Life Insurance That Most People Haven’t Thought Of)

The more guidance an advisor offers, the more business the advisor stands to generate, even from the supposedly agent-averse millennials, Palmer says.

While millennials tend to take a DIY approach online, and resist any perceived sales pitch, “they like the idea that there’s still someone there, paying attention,” Palmer says.

Millennials typically seek personal advice later in the buying process, once they’ve learned enough to ask hard questions or define their agenda, Palmer says.

This benefits patient advisors, who can use this face-time to negotiate sales or educate their way to further credibility, he says.

4 Steps to Middle-Market Success

Agents and advisors who rebrand themselves as problem solvers and educators can still profit in the middle market, market players say.

Here are four tips for financial professionals who want in, drawn from the market players’ comments:

  • Study the target segments you want to approach, learn the “pain points,” and be ready with solutions.

  • Use high-quality digital tools to pre-educate digital native customers about a range of products — and be ready to answer questions.

  • Use social media and traditional networking to create awareness of resources.

  • Consider working with wholesalers or insurers that support digital marketing.

Go Wide

Eric Palmer says something else financial professionals can do to reach the middle market is to offer a broad range of products.

“I think people are looking for that one person who can guide them through the whole tour,” Palmer says. “Branch out, utilize the technology—you’ll survive.”

— Read Capturing The Millennial Middle Market With Smart Analytics on ThinkAdvisor.

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