Selling in a Bumpy (Bear?) Market

Selling in a Bumpy (Bear?) Market

This is definitely not as much fun as it was a couple of years ago. While the severe reversal of fortune in some quarters of the investment industry has not caused a wholesale panic, it certainly does make selling to skittish investors — and with fewer resources — more difficult.

There are two distinct sales approaches firms can take in this type of market.

1. Status quo. This approach is all about hoping for the best while making minor tweaks in current programs. Comforting, but not terribly effective.
2. Proactive response. The hallmark of this approach is agreement that while some belt tightening may be in order, it had better be strategic and very smart. And all eyes are on the opportunity that other organizations’ reactive belt tightening will create.

If your firm would like to take advantage of this unique opportunity, there are a number of key sales tactics to put in place and organize your people around.

Education as a selling tool. While this is not news, most firms have not fully adopted this concept and organized their sales and client service efforts around the philosophy that an educated investor, sold by an educated sales force, is the best long-term client. We know that the assets of educated investors are stickier — they stay with firms longer because they know what they bought and what to expect. This is an area of opportunity as adopting an educational philosophy does not necessarily increase the costs of what you are already doing, it may simply make it more effective for the long-term.

Consistent ongoing communication. A trusted, confident advisor (whether sales or client services performs this function) is essential during market swings. Proactive, thoughtful, outbound communication is a requirement. Don’t just respond with generic bear market mantras — take the time to identify the particular concerns this market and environment is creating for your client base, and respond specifically to these issues. Give intermediaries the tools they need to make their communications more relevant and personal, too.

Back to basics. Now, all of a sudden, taking the time to do thorough goal-setting seems smarter than ever. This is a great opportunity to reinforce with your clients the basics of investing –how to set and meet goals, how market cycles (up and down) work and what they mean. These kinds of communications are also an opportunity to identify latent concerns and needs investors and intermediaries are feeling.

Empowering investors to find some peace in the midst of this market cycle is a noble goal. Accompany that kind of message with brazen self-promotion and you’ve got a winning approach.