The 5 Success Principles to Closing More 401k Plan Business

The 5 Success Principles for Closing More Business and Creating Raving Fans

Would you like to know the 5 Success Principles to closing more 401k plan business – and creating raving referral sources?

These 5 principles aren’t complicated, but for some reason, very few people do all 5 (and do them consistently).

“You don’t close a sale; you open a relationship if you want to build a long-term, successful enterprise.” – Patricia Fripp

I think when we start viewing the selling process as more of a relationship building process, it’s easier to shift our mindset toward what it will truly take to build a long-term 401k practice built on mutual respect.

A lot of it really boils down to this, “How would you like to be treated if the roles were reversed and you were the plan sponsor?” If you ask yourself that question every time you start any interaction of a sales (or customer service) nature – then you’ll be in the right mindset to experience greater success.

So with that weird little rant over 😉 – let’s dive into the 5 success principles…

Success Principle #1 – Be Prepared

The first step in converting prospects into clients is to be prepared. Factors that lead to success include:

Research – making sure you’ve done the right amount of due diligence and research before ever reaching out to your prospect and ahead of that first meeting.
Controlling the process with the use of an agenda.
Asking meaningful questions and spreading out the process rather than trying to lay all your cards on the table at the first meeting.
Engaging prospects prior to important meetings to solicit feedback and clearly understand the challenges and goals of the group. This is often done by sending an email asking the prospect to answer a couple of questions ahead of time which is especially helpful to gauge the involvement of individuals in the process as well as identify conflicting opinions or strong opinions regarding changing providers or investment options. Let me give you an example…

SAMPLE PRE-APPOINTMENT QUESTIONS

The questions you send ahead of any meeting should depend on what information you already know, and what the anticipated purpose of the meeting is.

For example, if you’ve been invited in to talk to a prospect because they’d like to know what their options are or are looking to change providers, you might ask:

“What are 2 things you like about your current plan?”
“What are 2 things you dislike about your current plan?”
“If you could make one significant change to your plan, what would it be?”

If you’ve asked if they’d be open to an independent third-party review of their plan and you’re going in for your first meeting, you might ask:

“When was the last time you made any changes to the structure or fee arrangement on your plan?”
“What do you hope to learn in going through an independent review?”

The point of asking questions ahead of time is to:

Identify how engaged they actually are, 2) learn more about the plan and 3) engage the prospect early so they know you’re interested in helping them and not just showing them what you offer.
Learn more about the plan, and
Engage the prospect early so they know you’re interested in helping them and not just showing them what you offer.

Be creative. Send a simple email that states something like this:

“Ahead of our meeting on Thursday, I wanted to ask a couple quick questions so I understand your situation a little better and am better prepared when we meet. A quick reply would be much appreciated.” Questions… “Thank you taking the time to respond and I look forward to our meeting.”

Success Principle #2 – Be Different

Plan sponsors can’t differentiate between advisors because to them, everyone sounds alike – offering the same services and presenting similar material. If you want to be the advisors that gets the business, you have to be different.

Ways to demonstrate your unique value start by:

Being very, very clear on your unique value proposition – know who you serve and how you do it better and different than everyone else.
Pitch YOURSELF – Don’t make a provider’s pitch your value. If anyone can offer American Funds and that’s what you show up with as your finals presentation, your odds of winning the business just put you in the bottom of the pack.
Have your own pitchbook that sells YOU. Your finals presentation should identify what’s unique about your firm, how clients would benefit from working with you, and next steps should they choose to hire you.
Always be feeding back to the client their identified concerns to confirm and so you can be sure they understand how the solution you offer is a perfect fit based on what they’re looking to accomplish.
And finally, offer to assist with provider due diligence rather than compete in the process. Take a more consultative approach in offering to help plan sponsors identify best fit providers and quarterback the RFP or selection process. They should be hiring you and not a specific provider so be sure to indicate you can bring just about any provider in that would be a best fit based on their goals and objectives.

Success Principle #3 – Be Valuable

One of the most effective ways to win business and earn referrals is by being indispensable to your clients.

You must be valuable in order to win and keep business. In today’s day and age where customer service often takes a second seat to busy work and sales strategies – if you provide a top class customer service experience you’ll be way ahead of your competition.

Start by being actively engaged with your clients – reach out to your prospects and clients, ask if they have questions, let them know about important events or updates they should be aware of.
Next – be available. When business calls – pick up the phone! The most frustrating thing for your prospects is to call your office and not get a live person or not have their phone call returned within a short amount of time.
Be accountable – tell plan sponsors what you’re working on, when they should expect to hear from you. Follow up immediately on calls and inquiries and if something doesn’t go exactly as planned, explain why right away and regroup. Tell your clients what you’ve done for them – they have no clue all the behind the scenes work that’s often done in preparing investment reports, fielding participant inquiries, individual meeting results, etc. Make it part of your annual review process to list out everything that was done throughout the course of the year and what they should expect for the following year.
Measure, monitor, and make adjustments. They say he who doesn’t measure doesn’t want to be held accountable. Ensure plan sponsors have clearly defined goals and objectives and measure the effectiveness of the services you provide each year towards meeting those objectives.
And finally – elicit feedback. Engaged clients are referral sources. Ask new clients why they hired you. Ask existing clients what they find most valuable about your services. Consider putting together a client advisory board of clients that can provide feedback on what THEY find most valuable, any changes they’d recommend, and for suggestions on how to find more clients LIKE THEM.

In a survey conducted by Fidelity*, when plan sponsors were asked what they valued most about their advisor, the answers make a great starting point for identifying ways to be more valuable. The answers included:

Helps improve employee outcomes
Helps improve employee satisfaction
Provides financial advice or guidance to employees
Helps plan sponsors understand and adjust plan design to meet company’s changing needs
Performance of Plan Investments (came in last)

Success Principle #4 – Be Persistent

Not fly-on-a-hot-horse persistent… But if you really want to build and grow a solid relationship, you can’t be afraid to be persistent.

What I mean by this is:

Be prompt and responsive. I always tell advisors to ask their new clients why they chose them and quite often I hear answers like “I hired you because you got back to me right away and promptly provided what we talked about – I never even heard from the other guy until after I already hired you.”
Which leads me to the next point – Do what you say you’re going to do. It’s a simple concept really, and one that actually yields HUGE results because so few people actually follow-through with commitments they make. Do what you say you’re going to do.
Be pleasantly persistent and polite. And please use proper etiquette and value strategies in your emails.

Don’t send emails like “This is Joe, boy the summer went fast. I was wondering if you’ve made a decision yet regarding moving forward with the proposal I provided”…There is absolutely NOTHING in this email of value – it’s all about the advisor saying are you ready to hire me yet?
A better approach is to send an article that you think might be of interest and indicate that you were thinking of them, explain how the article or content applies to their situation or why they’d find it interesting, and at the close indicate that you were wondering if they’re any closer to a decision but are confident they’ll reach out when the time is right.

You have to continue to provide this kind of outreach VALUE because as we’ve said before, it’s a long sales cycle.
Finally – always be offering value, before the sale, during the onboarding process and ongoing after they’re clients to reassure them they’ve made a great decision and give them confidence in dropping your name when they identify the opportunity to refer you to a friend.

Success Principle #5 – Be Proactive

This last section provides the most opportunity for those willing to embrace this simple concept which is – be proactive.

Continue to educate your prospects and clients throughout the life of your relationship. Use every opportunity to provide value and make your clients more informed consumers.
Updating your clients on regulatory issues is a great way to be proactive, keep in touch, and head off the competition that might come in trying to steal your plans based assumptions that you haven’t been keeping your clients informed of what’s going on in the industry.
Implement a systematic service process. The happiest clients are those that have realistic expectations of what to expect throughout the year, and a prudent service process can ensure you’re covering all key issues with your clients that can keep the competition out.
Annually, remind your clients about all of the services they’re getting and what else you offer that they might be interested in. Never assume that your client is aware of all you do and all you CAN do for them. Use the annual meeting as a way to recap the services you provide, find out what services your clients value most, and help them understand when it’s appropriate to refer you when they see or hear of someone having similar challenges to which you’ve provided solutions for them.

In the another survey that was conducted by Fidelity (same survey, different year)*, when plan sponsors were asked about things that were missing from their advisor’s service, they identified:

78% Don’t report how much time is spent working on their plan
69% don’t report on types of activities for the plan
60% don’t demonstrate how plan performance has improved

This means there are huge gaps between what plan sponsors want and what advisors are providing and by having even just this list right here, and then making it a point to include this information in your communication to your clients, you’ll be on your way to creating raving referral sources.

Too Much Information (TMI)?

What do you think? Too much to try to do consistently? I don’t think so at all. (Although it sure looks like a lot of bullet points!) 😉

These are the 5 success principles to strive to follow if you want to convert prospects into raving fans.

You have to understand that the relationship is the sale, and in order to have a solid relationship you have to be prepared, be unique, and be persistent, valuable and proactive.