The Trusted Advisor

The difference between a product vendor and a trusted advisor is simple – customers routinely “fire” vendors while they “befriend” their advisors. Vendors are often dismissed for the most convenient of excuses including price or a simple change of circumstance. Trusted advisors, however, are kept nearby as they have developed a collaborative relationship with clients, thus establishing a credibility that vastly transcends price fluctuations or other developments.

This tactic presents a completely different approach to selling. Emphasizing trust may seem counter-intuitive to the ‘textbook’ approach for selling that most brokers or account executives have learned but traditional sales methods actually stress such highly rational elements of the buying process. These methods highlight a strong emphasis on quantitative, data-driven techniques for screening clients and matching them to appropriate insurance offerings. Reliance on the “usual” sales pitch, objection-handling techniques and closing scenarios is also stressed. Technical expertise and content mastery, particularly of the product, are similarly important. At the base of all this is the fact that good sellers should know it all.

Subsections of these skills are integral to the development of a truly effective sales technique. Expertise in your product arena, for example, is necessary and understanding how to handle objections is resting on the same scale. Such skills, however, are important on a tactical not a strategic level. Tactical skills often overlook one of the most important factors inherent in a buying decision or relationship – trust. The truth is that buyer’s behavior is highly influenced by the relations a buyer has established with their seller. As such developing a different approach towards the sales process is imperative to not only reach, but also advance, an ambitious sales goal.

To initiate a winning sale target or screen the client by their level of pain, not how well a particular product “fits.” Listen and pay attention to the buyers’ issues and needs, and frame your initial contact around these needs. Rather than present the client with a fixed agenda, a successful trust-based seller will present an agenda for discussion, placing a distinct focus on “problem definition.” Often, sales people go back to the office and “write a winning proposal,” but trust-based sales methods do not promote this divide. Trust-based advisors emphasize writing the proposal with the client on site and building a winning relationship. Rather than seeking a specific sales outcome, the goal is to develop a buyer-preferred outcome that creates the best case for the buyer.

This may sound abstract, but sensibility is recognizable upon consideration that many broker sales strategies run into trouble when they rely on the “rational” benefits of the organization – how long it has been in business, the qualifications of its staff, bland promises of service excellence, etc. Their emphasis is often on processes, designs, strategies and key lists to accomplish the sale alone. While such issues can be important, without an injection of trust, they will not be compelling to buyers. The significance of values should not be undersold. Some view these values as fuzzy, but they make their way into our everyday language and conversations.

When you are buying an intangible service like insurance, such factors become even more critical. In fact, many clients, as brokers know, view insurance as high-expense and low-value. There is no real interest in insurance issues. However, trust-based selling is one way to engage the buyer in a discussion about his or her problems or needs. In fact, trust-based selling will place far more emphasis on listening to what the client is saying and consolidating that into comprehensive terms. The goal is to work together to envision a solution, which may or may not involve mere insurance policies.

These trust-based solutions transcend the “win-win” clich by establishing truly collaborative relationships. An excellent example is risk management and loss prevention.

Consider a situation where a prospective client is frustrated with insurance rate increases and consequently does not want to consider the renewal process – pain is present and the potential client would likely want to discuss it. By focusing on the buyer’s needs and listening to his or her concerns, you have already established trust. Next, you can frame the situation in terms of proactive solutions to loss prevention and envision solutions – together. The course of action you are asking your client to commit to is not a product or price decision, but a collaborative effort to manage the insurance and risk management aspect of the business.

Becoming a trusted advisor does not happen overnight; it is the final stage in the “Ten Great Plays” of Vertical Growth. You cannot simply skip to this stage. One of the main reasons graduation to this zenith is necessary is that brokers need to develop sharply defined Value Added Services before they can become trusted advisors. The VAS has to be meaningful – to the client – and should be defined and written. All staff, from senior mangers to front-line account representatives, should be able to recite these and in turn generate favorite “spear” questions that reveal a client’s pain issues. This helps establish your brokerage as a trusted provider of long-term solutions, not product fixes.

These are not original ideas or new concepts. In fact, there is an excellent book on the subject called “The Trusted Advisor” by David H. Maister, Charles H. Green and Robert M. Galford.

Furthermore, insurance brokers are clearly not the first to do this. Look around and you will see Trusted Advisor Networks (TAN) established for important clients – attorneys, accountants, financial advisors, bankers and other business professionals. These professionals provide a crucial yet intangible service that is based on trust. They are solidly placed with their clients in a relationship that is not based on selling or price, but rather on counsel and collaborative decision-making.

For brokers to crack the TAN, the first step is to assess the ability of producers, or account executives. Consider this carefully. You have to have the right people in the right positions or the process will be sabotaged.

Next, build or join a network by meeting with other professionals, asking permission or writing letters. It is important to stay in touch and be persistent – you should lunch at least once a week with a member of a TAN, whether a banker, advisor or attorney.

Networking should develop into a critical part of your selling strategy, so much so that 75% of new business is derived from the TAN. Not only can the TAN introduce desirable prospects, but also it can collaborate with you to provide value-added services, greatly expanding what you can offer to current or prospective clients.

Why should insurance brokers not be seen as an integral part of the trusted advisor network? This is a good question, but one that has not been success- fully answered in our marketplace. Nevertheless, it has been answered by various groups of business professionals, who have developed collaborative relationships with their clients that bulletproof them from price competition.

It is time for brokers to learn precisely the same thing.