Platform Sales Best Practices. (Bank Investment Marketing)

The practice of licensing bank staff to sell annuities, life insurance, and mutual funds has grown rapidly. The resulting performance, however, varies widely. In order to determine what works and what doesn't, Independent Financial Marketing Group commissioned Kenneth Kehrer Associates to survey 38 executives responsible for managing platform Their collective experience provides a blueprint for best industry practices. All of the banks in the study sell fixed annuities through the licensed bankers. Half the banks in the study have staff with Series 6 licenses selling mutual funds. Almost as many banks--45%--sell life insurance through their staff as well. Only 26% of the banks sell variable annuities through their staff. Some of the programs are only a few months old, while a few have over 20 years of experience. Usually a bank licenses its staff to sell fixed annuities and then trains the most successful licensed staff to sell mutual funds, but one of the banks started first with mutual funds. The typical bank in the study sells mutual funds through 70% of the bankers who sell fixed annuities, but two banks have more bankers selling mutual funds than fixed annuities. On average only half the staff that sell fixed annuities are also asked to sell variable annuities. On the other hand, almost all of the fixed annuity sales people are also expected to sell life insurance; 94% of the fixed annuity agents also are trained to sell life insurance. Less success with proprietary Of course, not all staff that have been trained and licensed to sell a particular investment product are successful. The percentage of licensed bankers that participate successfully in sales has come to be called the rate. Generally participation rates are computed on the basis of how many bankers sell an investment in any given month. Almost two-thirds of the staff expected to sell fixed annuities do so in a given month (chart below). However, the participation rate is only 29% for variable annuities and life insurance. Interestingly participation rates for mutual fund programs vary by the type of funds sold. On average, almost half of a staff asked to sell third-party mutual funds make a sale in a typical month, while less than three out of ten asked to sell proprietary mutual funds do so successfully. This finding is contrary to the industry lore that bankers are more comfortable selling proprietary products than third-party products. The participation rate is a key driver of the success of programs. Licensed bankers have to begin selling consistently to gain the experience and confidence to become successful investment counselors. Participation rates improve markedly with the maturity of life programs, but there is only a small improvement in mutual fund programs over time. Participation rates in annuity programs do not improve with the age of the program, underscoring the point that program design and management, rather than mere experience, are the key factors. Who's best at selection and support? From the point of view of the managers of programs, the most successful approach to selecting which bankers to license is the judgment of the bank branch manager or staff supervisor. Almost half the banks say that the specialist trainers provided by the broker/dealer are the most useful providers of initial banker training, whether by the bank's third party marketer (29%) or the bank's own broker/dealer (15%). The bank's own training department and specialized coaches have just as many advocates as trainers provided by the bank's B/D, while the financial consultant is preferred by slightly fewer banks. The banker's financial consultant is seen as the most successful source of ongoing training and sales support in four out of ten banks, far more than any other method. …