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Power tools to ease workload

Following last week&#39s article on worksite marketing, I will take a more detailed look this week at the technological options that can enable IFAs to exploit the important sales opportunities that exist within the workplace.

The worksite marketing model presents a number of opportunities to financial intermediaries because it is an ideal way to target a large number of potential customers cost-effectively.

The next stage is to look at what tools are available to intermediaries to help them take advantage of these opp-ortunities.

It remains true that, in an environment of lower margins, IFAs will be looking to acquire bigger numbers of clients to maintain their income. The challenge is being able to service all these clients and this is where technology can play a crucial role.

The argument for using technology in worksite marketing is compelling. While worksite marketing provides cost-effective access to big groups of potential customers, technology enables the IFA to personalise the service to each individual client. This is a powerful proposition for developing long-term, profitable relationships.

Detailed below are three key areas where technology can help IFAs in the field of worksite marketing.

Initial sale

There are IT services available that can help the IFA to identify the needs of a corporate client, recommend an appropriate pension policy or flexible benefits package and set up and administer the scheme through the employer&#39s payroll.

This can be done using a specific worksite marketing package such as pension business or via a product provider&#39s extranet site.

The exact process will depend on which package or extranet site the IFA decides to use but the general principles remain the same.

Using a corporate fact-find, the IFA can assess the requirements of the business. This will include identifying the nature of the business, in terms of size, attitude towards remuneration, use of technology, the nature of the workforce, average age, income etc, as well as what type of benefits package it is looking to implement.

The adviser then selects an appropriate scheme. A specialist IT service may help the IFA to compare and select the scheme or, alternatively, the adviser will use its usual product research tools to identify an appropriate provider.

Once the recommendation has been made, technology can give the employer direct administration access to the product provider. The IFA will be able to add members to the scheme, select product options from a menu and set up payroll deduction.

Engaging the scheme members

Once the sale has been made, technology can help bring the benefits&#39 package to life for the employees. A corporate pension scheme can be an expensive benefit for employers to offer their workforce and so they want it to work as effectively as possible as a benefit that will reward and motivate their staff.

Technology can empower employees to take an active interest in their personal finances, which in turn will make them aware of the value of their corporate benefits package.

The first stage of this is to use technology to disseminate information to employees. This may depend on the employer&#39s attitude toward technology and be limited somewhat by how much it is currently used as a communication mechanism within the business.

For example, an existing corporate intranet site gives the IFA an ideal medium through which to disseminate information to employees about their employee benefits&#39 package and give them access to their own policy information.

It is important, for maximising the benefits to all parties in the worksite marketing model, that employees should be able to manage their employee benefit options simply from their place of work.

This may require discussions with the employer about their current policy on internet access or even the supply of access facilities at their different locations.

Moving on from just providing information, technology can help advisers work with employers to add many additional services that will empower employees to take control of other areas of the finances.

There are a number of components that can be bought and plugged in to existing intranet sites or IFA websites that enable employees to manage their share portfolios and aggregate their existing bank accounts and policies. Other components will enable employees to compare and buy products such as term insurance or general insurance for which the IFA will earn commission.

Individual service

The intermediary will potentially end up with a new bank of clients who have an active interest in their own finances. A major challenge now is going to be to service the individual needs of these clients.

By using an effective back-office administration system and CRM tools, the adviser can mine their new pool of clients to identify new sales opportunities.

Additionally, product research tools, comparative quotation engines and online transactions can help the adviser service a bigger number of clients effectively.

Intermediaries may already use some or all of these tools but without them they will be hard pushed to manage the increased client bank that is generated by worksite marketing.

However, worksite marketing has been slower to take off in the UK than perhaps initially expected.

This could be for a number of reasons. Stakeholder pensions have not taken off as quickly as anticipated, fears of recession have meant that some employers have been less keen to invest heavily in employee benefits and the dotcom bust has led to a reduction in companies offering affordable worksite solutions.

But worksite marketing still has great potential as a source of cost-effective distribution in the future. The bones of comprehensive worksite marketing systems are already in place. As employers begin to embrace the model outlined above, demand for this type of business will increase and we will see the introduction of more systems designed specifically to help intermediaries take advantage of the many benefits that exist for them.

Paul Seymour is a non-executive director of Marlborough Stirling and was on the recent inquiry into the provision of financial information and advice chaired by Sir John Banham


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