Almost 20 years ago, shortly after I had joined this newspaper, my then editor asked me to attend an LIA convention in London.
I remember the event as if it were yesterday. About 1,000 or more paying delegates were crammed into a massive auditorium, applauding a range of motivational speakers whose main aim was to make them feel good about selling financial products.
One guy told his audience all about a young man to whom he had sold a huge chunk of life insurance and his client had popped his clogs a short while later.
The moral was obvious – the poor man’s widow was devastated by her loss but she had been left well provided for by her husband’s foresight.
And, to ram the point home, the salesman then brought the widow up on to the stage and gave her a bunch of flowers while the delegates cheered wildly.
I thought the whole approach was not only mawkish and manipulative but also its pitch was aimed not so much at customers as financial advisers.
The message for advisers was along the lines: “Yes, you may wonder sometimes what on earth you are doing delivering a sales spiel 20 times a day. But never forget that, despite what even they might think, you are achieving something good for your clients, so feel positive about yourself, go out there and sell some more.”
This kind of message treats people as infants who understand so little about their needs they need to be cajoled and inveigled into doing something good for them.
That is why I am wary of any organisation whose members are only admitted if they can prove they sold a vast amount of insurance, the Million Dollar Round Table being a classic example.
Last week, Atkinson Bolton Consulting director Simon Gibson explained in Money Marketing why he believes the MDRT is an important part of what makes him a good professional.
Simon intoned: “Is talking to a client about their lifetime financial planning not selling an idea, a dream? Is discussing with a prospect why our services for the management of their money are right for their needs not selling ourselves and/or our business? Even more important, do we not need guidance through change, at work, at home and in the wider world?”
The moral here – and there always appears to be a moral – is that all these worthy aims can only be met by an industry professional if they are allied to a sales process, presumably one involving a financial product.
Now, I am happy to accept Simon is a good professional, as is Bhupinder Anand, another MDRT member whom I have long respected for his financial skills. And I do know the MDRT has a philanthropic arm and a code of ethics.
But regardless of whether it is done with the best intentions or with subtlety and finesse or by appealing to a client’s own self-interest, the notion that what financial advisers really need is more motivational talks on how to sell better misses the point.
It is the very act of “selling” financial products that has, over the years, engendered the levels of mistrust felt by so many consumers about the industry. Moreover, it is selling the wrong kind of product to the wrong type of client that has led to so many of the scandals.
I will undoubtedly be told by some readers the essence of true professionalism is the ability to identify the right product to sell and make sure it meets the needs of the client – and then sell him the idea that he needs the product. What is wrong with that?
I will go back to what I said earlier – the notion that we consumers need to be sold to infantilises us. Rather than treat us as grown-ups capable of making rational decisions on the basis of a good financial plan, the assumption is that without a clever way of knocking down our objections we will not realise what is good for our needs.
I would prefer to sit down with someone who explains the pros and cons of taking a certain step as opposed to another one. I do not want to feel I am being sweet-talked or pressured or moralised into doing something I would rather not do.
Yes, but, I can already hear some of you reply, if we did not try to sell, people like that poor widow 20 years ago would not have two brass pennies to rub together. Surely it must be worth it just to make sure is well provided for?
I will come back to my main point – selling, as regularly practised in the financial services industry, has been responsible over the decades for at least as much misery as it has benefited other individuals. Better not to sell than to do so and earn your client’s enduring mistrust ever after.
Nic Cicutti can be contacted at email@example.com