A simple strategy for closing more 401(k)s

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               American Funds video transcript: “A simple strategy for closing more 401(k)s”

Tom Warren: How can we convince prospective clients that you are the advisor they can trust to help manage their company's retirement plan? Renee, you see advisors competing every week. What are your observations?

Renee Grimm: Have you ever heard the expression, “People buy from people they like”? More importantly, when it comes to savings, people buy from people that they trust. How do you build trust and credibility?

If I think about an example, Coca-Cola comes to mind. They are one of the most popular brands in the world, and instantly recognizable. When we buy from them, we know exactly what we're getting. But they also draw an emotional connection, whether we know it or not.

Their ads and television commercials don't sell the soft drink. If you notice, they sell a feel-good experience. Most recently, their campaign centered around “share a Coke with Tom,” “share a Coke with a friend,” “share a Coke at the beach.” Coca-Cola's corporate mission statement is pretty refreshing, and I'm not trying to be punny. Surprisingly, they never mention product. Their mission is to refresh the world in mind, body and spirit, to inspire moments of optimism and happiness.

Tom Warren: I see where you're going with this Renee. The first company I thought about was Apple. People line up well in advance when they come out with a new product. Some of them even camp out overnight at the store to get the latest computers and iPhones from Apple. They trust the company and its products. But it's interesting that Apple's ads and commercials focus completely on the customer — how Apple can make their lives better. They challenge people to think different about how things can be done, and they embrace each person's individuality.

Renee Grimm: You nailed it, Tom. While both very different companies, both are extremely trusted. You can do this as a retirement plan advisor if you do the exact same thing. I'll share the secret for differentiating yourself in two steps. Step one, always keep your focus on the client. Yes, you're trying to sell, we've acknowledged that — let's admit it and forget it.

You know what gets me up every day? The work that I get to do in partnering with advisors like yourself is going to have a tremendous impact on the outcomes for thousands of employees every day. We are going to change not just how they retire, but the way that they live in retirement. The most important thing is, we have to offer a solution that can solve a problem. It could be any number of problems. Maybe they need to save more money. Maybe they need to save time, or they want to make their administrative functions easier. Whatever it is, we want to draw an emotional connection that's going to improve the way they run their plan.

The second step is this: You need to convince the prospect of your ability to deliver on that promise. It's really quite simple — just do what you say you're going to do. That is a major differentiator. Those things are your value as an advisor. The experience, your expertise and the services that you plan to offer, not just to the plan, but to the participants as well.

Tom Warren: Renee, that's great advice. So, let's consider how you can communicate your value to the plan sponsor, gain their trust and ultimately earn their business.

First, take an inventory of all the services that you could provide to plan sponsors and plan participants.

Then formulate a few powerful statements of what these services could do for the prospect. This is often referred to as a value proposition statement, or a commitment statement.

Renee Grimm: At its core, the value proposition statement should state three basic things: First, retirement plans are a meaningful part of what I do as an advisor. Two, what you'll do for the plan sponsor. How are you going to make their job easier? Three, what are you going to do for the employees? How are you going to provide that guidance and education to ensure that they have better outcomes?


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Making an emotional connection with prospects and earning their trust are critical to earning more 401(k) business. Advisor education specialist Tom Warren and retirement plan counselor Renee Grimm outline the strategy.

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