Do You Buy 401(k) Sales Leads?

Do You Buy 401(k) Sales Leads?

I don’t dispute the opportunity for lead companies to operate and sell appointments to 401(k) Advisors. Advisors tell me they buy appointments because they want to grow their business and it is a cure for their lack of time or desire for cold calling. I know of abuses over the years committed by unscrupulous lead firms and their sales people.  But several Advisors have told me that although each lead doesn’t pan out, they have had enough success to continue to order leads.

I personally do not believe that it is necessary for Advisors to purchase 401(k) sales leads. My opinion is based on the minimal amount of time it actually takes Advisors to systematically approach plans and the additional benefits they receive.  To start with owners like talking with owners.  Advisors may uncover additional opportunities and they can brand their firm with the prospect with each attempt to speak with them.

Most Advisors I work with spend no more than 3 to 5 hours per week calling and dropping by plan prospects. I don’t believe any appointment service can match the passion and experience prospects hear in their words.  Dr. Amy Cuddy is a Harvard Business School professor and she and her colleagues have been studying first impressions, or in the context of growing a 401(k) business, the initial contact with a cold plan prospect.  Dr. Cuddy and her colleagues have found that when you and your plan prospect first meet over the phone or in person, they are going to quickly ask and answer to themselves two questions.  1) Can I trust you? and then 2) Can I respect you?

Focus on the few prospects that make sense for your business. Be responsible for the first impression with the decision maker.  Open a line of communication to serve their company retirement plan and any other company or personal financial issue they may have.  Save your money for other meaningful business building initiatives.

March 27th, 2017

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