TO BE SUCCESSFUL selling in the retirement plan market, you need more than a solid product. You need to understand the market, your customer, and how to leverage your skills and other tools to differentiate yourself. These “sales tips” can help you do just that.

#1: Focus on the Customer

Sometimes it’s best to focus on the client’s needs as a way to gain entry. 

Plan Sponsors in Need

When searching for new business, one strategy is to target the “low hanging fruit” – i.e., plan sponsors in need. These sponsors will be the most open to hearing how you can help them improve their plan. You can pinpoint these opportunities by mining a prospecting database to retrieve specific plan data. Sponsors of plans in the following situations may be the most receptive:

§         Plans with weak overall investment performance. This data indicates considerable potential, as the sponsors may be unhappy with their current investment managers.

§         Plans with poor asset class diversification. The sponsors of these plans may be receptive to the opportunity for improved communications and education for their participants.

§         401(k) plans with poor participation. Expect an open ear for suggestions on how to significantly improve participation. But, approach these plans cautiously. You want to be confident that you have a strong education story to the table. 

Focusing on Fiduciary Issues
 

One way to get your foot in the door of a prospect is to appeal to his or her fiduciary responsibility. As you know, the laws affecting retirement savings plans are constantly evolving, and many plan sponsors aren’t aware of the extent of their potential fiduciary liability. Sponsors whose plan design subjects them to increased potential liability may be receptive to hearing about alternative plan designs or the compliance services of a different provider.

 

Plans well positioned for this approach include:

§         Self-directed or self-administered plans. Sponsors of these plans may also be looking to reduce their administrative burden.

§         Plans using old processes. Sponsors using antiquated methodologies such as balance forward valuation may be open to options that will bring them up-to-date.

§         Top-heavy plans or plans with a high percentage of highly compensated individuals. You have the opportunity here to review alternative plan designs and the advantages of supplementing a qualified plan with a non-qualified benefit.

 

#2: Leveraging Your Skill and Experience

It helps to look within to find the key to differentiation. 

Capitalize on Your Unique Experience

In a business where competition is fierce, it is imperative to show prospects the strengths and differentiators you bring to the table. One way to do this is to capitalize on your unique experience. For example, if you have extensive knowledge about a specific industry, target plans in that industry. You can position your background as added value. If you have experience with a specialized market segment or target market size, you might decide it is worthwhile to focus your business on that market and present yourself as a premier expert in that area. Whether you target a certain plan size in the Defined Contribution arena, or specialize in a niche market, such as 403(b), 457 or Taft-Hartley, focusing your business can help you stand out.  

Know & Show Your Value

Has this ever happened to you?

You (the advisor) are sitting at the conference table during a retirement plan sales presentation. The vendor is articulating their proposition and suddenly your client’s primary decision maker [focused only on the expense schedule] looks up at you over her reading glasses and asks, “What value will you bring to us?”

Don’t be caught like a deer in the headlights when this question is asked. Prepare yourself. Be ready with a formal document you can pull from your briefcase that highlights your areas of expertise and justifies your compensation. Outline your role(s) (e.g., investment advisor, plan design specialist, participant educator, etc.) and provide itemized details regarding your specific responsibilities.

 

In the event you step into the elevator with a decision maker, have a crisp, clear answer ready to recite when asked. With increasing competition and scrutiny over fees and disclosure requirements, be equipped at all times to articulate your value proposition.

 

#3: The Pre-Sale Phase

When it’s “game time,” make sure you always put your best foot forward to gain an advantage.

 

Power-up Proposals with Your Strengths

Have you thought to incorporate your strengths, as well as your firm’s, into RFP responses? When you request a proposal from a vendor on behalf of a client, be sure to incorporate your value proposition into the responses. Match up your strengths with the products and make sure you always include services the vendor is offering. For example, you may be providing services related to your best foot forward to communication and education, relationship management, portfolio strategy, and more. These tasks can set you apart from others and should be inserted into the RFP where applicable. Your services are value added. Use the RFP response to showcase your worth, not only in the pre-sale situation, but on an ongoing basis.

A Simple Way to Gain a Pre-Sale Advantage

Provide your client’s current asset allocation when requesting a proposal from a vendor. Taking this one simple step may help you gain an advantage during the pre-sale process. Here’s why:

§         It shows you are in control of the situation and distinguishes you as informed and involved.

§         You will likely receive more accurate quotes when vendors can price based on the true asset allocation. With this information, the vendor can assess the plan’s potential investment structure and price accordingly. If this information is not provided, the vendor is apt to price conservatively and you might lose a case that you’d otherwise win.  

Practice Makes Perfect

Preparing your team for the finals presentation. Depending on your client’s needs, you may bring a team of subject matter experts with you to a finals presentation. The contributions of this team should weave together to form the value proposition that aligns with your prospect’s end goal.

As a member of a sports team, you would understand your position and the role of each of your teammates. You’d know the rules of the game. You’d know the strategic game plan. And, most importantly, you’d practice. The same rules apply for your team in a finals presentation. Once you determine who the key players are, make sure they are prepared to add value to the discussion. Each member of your team should have a speaking role that relates to a specific topic, adds tangible value to the presentation and supports the prospect’s goals and objectives. You don’t want to be caught in the situation where one of your team players cannot demonstrate his relevance – this could discredit you. Conduct a practice session so when game time arrives, you are prepared for success.

 

We hope these tips will give you some new ideas on how to approach new and existing clients and stand out among the competition. To learn more about selling in the retirement plan market or MassMutual’s products and services, please call 1-866-444-2601 or visit us at www.massmutual.com/powertogrow.