Tuesday, October 16, 2012

Sales Presentations That Do Not Work

Generally, I screen my calls at my office, because there are so many calls of people trying to sell something it is ridiculous. Recently, I received a call about a firm that has a unique advertising concept and I agreed to an appointment. When the appointment setter called me, he said that he was offering an "exclusive opportunity" where only one attorney from Rick Johnson Family Office, LLC would get primary exposure with their product.

First of all, I am not an attorney. Secondarily, Rick Johnson Family Office, LLC is not a law firm. Still, I gave the man the benefit of the doubt and politely informed him that I was not an attorney, but he could tell me more. He asked what did I do for a living. I told him that I was a Investment Advisor and Financial Planner. Then, his pitch suddenly shifted to well, "we do not have a Financial Planner in our exclusive territory, so you would be eligible." I also told him that I would consider this for my investment advisory firm, Marian Financial Services, Inc. I agreed to an appointment to hear what they have to say and honestly, if it was worthwhile, then I might consider it.

The lady showed up late for our appointment, but I did not hold that against her. She came in with her presentation book and a sample of the advertisement. In my 28 plus years of experience, I have been through way too many sales training programs, most of which are abject failures. I always joke to my wife that if I wanted an easy job, then I could go sell CEO's on sales training programs. Most companies are suckers for this kind of training. When sales are down, the sales consultants are like roaches. They are everywhere.

Forgive me. I got off track. Back to my story.

I immediately recognized that she was running on a presentation railroad track and she wasn't about to get off of it. So, I let her go through the motions, but was extremely disturbed that this kind of sales training is still taught by companies. This was something from the 1980's. I was stunned to see this kind of "training" still exists.

Here are some of the things that they teach. Put the product in the customer's hands and let them touch, see and feel it. Follow the presentation script, even when the customer tries to jump ahead. Lie and embellish to no end. Show the logos of other big name companies that they do business with. Repeat the exclusivity of the offer over and over again. Exaggerate the market penetration. Finally, make sure that there are no facts or proof to back up their claims in the pitch book.

I was told that this company did a lot of "checking" on Marian Financial Services, Inc. and they discovered that I was one of the most reputable financial services firms in the area. This is absolutely true, but she knew absolutely nothing about Marian. She said this while reading the logo on my shirt. This was an out and out lie. The appointment setter called me at Rick Johnson Family Office, LLC, not Marian Financial Services, Inc. This lady did not do any checking of who Marian was. She was lying through her teeth. She looked me right in the eye while doing it, too.

Secondarily, she tried to tell me that this advertisement was going to be seen by 20,000 people in an area that I know for a fact has less than 5,000 households and half of those are children.

At the beginning of the conversation, she asked me if I was the decision maker and I told her yes. When she got to the end of her script, I had to ask her a couple of times what the price was for this "wonderful" advertisement. Unfortunately, my question did not fit her script, so she delayed on purpose showing me the price. I must say, this kind of ticked me off. She still had some final sales pitches to deliver, before she showed me the price. After lying to me and ticking me off sticking to this sales script, I had already decided that I was not going to do business with this company. I did not care if the price was $100.

Of course, when she finally showed me the price, it was then that I discovered that there were 20%, 40%, 60%, 80% and 100% market penetration prices. If I wanted a 20% penetration of those "20,000" potential customers, then that would only cost around $2,000. If I wanted 100% market penetration, then it would cost close to $9,000. I would get $1,000 discount! What a joke.

By now, I am thinking that I am wasting my time. I tried to explain to the poor woman that I have a marketing budget and I would have to decide if this "wonderful" advertisement is a better use of my marketing dollars, than radio, newspaper or seminars. I told her that I would give it some thought. At that point, I was scolded by her about being the decision maker. She complained..."but you said you are the decision maker and you would make a decision by the end of my presentation." I told her that I did make a decision to consider it, but on my timetable not hers. Boy oh boy, she did not like that at all. While I had her pissed off, I thought I would go ahead and try and help her from a sales perspective. Probably, a mistake on my part.

I went on to challenge her on her 20,000 potential customer figure. I told her that I know the demographics of the area in question and she was totally wrong about the 20,000. The problem was that the 20,000 figure was in her presentation script. In her mind, if it is in the script, then it has to be true. You see? Here is what is wrong with the sales pitch book. They take it to all areas of town, but the same 20,000 figure is in the pitch book no matter what area of town they are in. Boy did I make her mad when I challenged her over this fact. She started closing her presentation book in a "I am pissed off" manner. Not very professional at all.

I did feel sorry for her, because I know that the sleazy people who prey on ladies like this with promises of making lots of money. These companies are the scum of the earth. In this economy, people are struggling to make ends meet. We do not need these sleazy people preying on others, giving them sales scripts filled with embellishments and encouraging them to lie in order to get the sale.

When she realized that she wasn't going to get the sale, she suddenly sprung on me that she had the authority to extend a special discount on the price. How convenient! Of course, there was a catch. I had to decide by Thursday. Another sales tactic by sleazy home office people. Never make an instant decision about anything. I would never ask someone that I just met to invest money with me without me knowing about who they were and what they need to accomplish. Further, I certainly would not try and sell them and close them in 15 minutes with a pitch book. Sleazy with a capital S is their sales process.

What is amazing to me is these companies do any business at all. This was a situation where the emperor has no clothes. Because of my background in sales and sales training, I could see right through their whole sales pitch. In my opinion, they would be better served to get off the presentation pitch book and try and learn about the business of the person that they were talking to. Most of the time, I was being talked down to and told how great their advertisement product was for me. Yet, they had no knowledge of my business. It was all about the sale.

Recently, I met a man who was retiring soon. After meeting with him, I realized that he had absolutely no idea what he was going to do after a long career. He expressed a lot of interest in technical analysis of investments and brought some charts to my meeting with him. I am a student of technical analysis myself, so I was able to discuss his charts without a problem. However, I realized what I had in front of me. Someone who had no knowledge of what he wanted to do in retirement, except perhaps try and find some part time work. Further, he appeared to be interested in technical analysis.

If I had this advertising firm's training, then I should have showed him a pitch book and tried to close the sale in the first meeting. However, what I saw was someone who needed time to discover what he wanted to do. He appeared to me that he might actually be the kind of person who might want to manage money on his own. If he is following technical analysis, then he is in tune with the movements of markets and believes that technical analysis can help him move in and out of the market. He needs to decide whether or not he wants to manage money himself, or hire a professional. I was not about to pressure him to make a decision in 15 minutes.

At Marian Financial Services, Inc., we do not try and close clients in 15 minutes, especially if we may not be a fit. We want clients who are committed to our firm and our philosophy. This kind of thinking does not fit in a sales pitch book. It does however fit into serving the best interests of the client. Sometimes it means we do not get the client. That is how we approach new customers. We focus on what is best for them.

Our clients value professional money management, visual financial planning and elder care planning, because we offer expertise and assistance that they cannot find elsewhere. More importantly, we do not use a pitch book.

United States of America, Divided States of America?

My mom is a life long Democrat and Bill Clinton fan. She was invited to one of his inaugurations and proudly displays his invitation on her wall. My mom lives in Arkansas and that is where I am from, too.

A long time ago, at then Governor Bill Clinton's 31st birthday, I was the sole bartender at his private birthday party, put on by his staff. One of then Governor Clinton's State Police officers used to come into the bar that I worked at when I was 21 years old. He is the one who put me in as the bartender at that private event.

I can remember how tall he was compared to me back then and also what he drank. He only had one drink that night and it was a gin and tonic. I was real shy back then and unfortunately, I guess I am still shy even today. We didn't talk much back then, the Governor and I. It is not that I was in awe of him or anything. It was more my treatment of popular people. I have always looked at popular people as just like anyone else, except they are popular and have taken steps to achieve what they have achieved. I have never been one to ask for autographs or have my picture taken with any celebrities. In my mind, these popular people would like a break from that kind of stuff, so I left him alone.

During this private party, when he came to the bar to order a drink, it was because he was taking a break from the festivities. He didn't appear to like all the attention, as strange as that sounds. He came to the bar to get away from the attention. Of course, that is totally opposite of the former President today.

When Bill Clinton won the presidency the first time, as an Arkansan, we were all proud of him, regardless whether or not we would admit it in public. Funny thing back then, no one would ever admit that they voted for Bill Clinton around Little Rock, but he always seem to win. Well, with one exception when he raised the license plate fees. People in Arkansas did not like that and replaced him with Republican Frank White. I truly believe that this taught him a valuable lesson as a politician. He learned that he was the Governor of 100% of the people, not just his supporters. When he was President, he reached across the aisle and worked with Newt Gingrich and the Republicans to get some things done.

Today, I look around and see a lot of vitriolic talk. Are we the United States of America or the Divided States of America? I am not sure how this has happened, but I for one, prefer the United States of America.

I am a Conservative, but I vote for the people that I believe are the best for the job. Some of my friends are Democrats and some are Republicans. The same is true of our clients. I respect people for being Democrats and understand perfectly why they are Democrats.

Firefighters, Policemen, Teachers and others have primarily been Democrats in the past and that is just the way it is. My biological father was the Chief of Police when he died. I am sure he was a Democrat. I am Catholic and historically, Catholics have been Democrats primarily because of their belief in helping others through charitable endeavors. I am not so sure if that is the case today, however.

One of my clients is a firefighter and a great friend of mine. He knows that I am a Conservative, but that doesn't matter to him. I respect him for his political position and certainly do not let that mar our friendship. Why should I?

My mom is still a Democrat today. Do you think I should quit speaking to my mom, because she is a Democrat? How silly that would be.

Not too long ago, we had a choice for a new mayor here in Jacksonville, Florida. Since, I majored in Criminal Justice, I have a keen interest in crime and criminal activities in our town. There is a certain area of town, specifically Northwest Jacksonville that is where a lot of crime takes place. Sadly, it is mostly black on black crime over stupid things like one guy looked at another guys girlfriend and got killed for it.

When the race for mayor came about, we had this young black man named Alvin Brown running for the office. In my mind, even though he was a Democrat, I felt that the city of Jacksonville needed a good role model for the blacks in our city. In addition, this man was more of a bipartisan politician. In other words, he would reach across the aisle to get things done. I voted for him. I know his Chief Financial Officer from my former position as Branch Manager at Charles Schwab. Ronnie Belton is a great guy and is in a tough spot. Poor Ronnie has to be the bad guy and present the budget.

Like other cities, counties and states across the country, the City of Jacksonville has to adhere to a balanced budget. In other words, there needs to be some sacrifices from the police, firefighters and teachers. These groups all thought that the status quo would remain the same with Mayor Brown, but boy were they shocked when their department got their pink slips. You should have heard the whining in the local Times Union newspaper.

The days of one group of people getting everything they want at the expense of taxpayers is over, if what is going on in Jacksonville is any indication. Not only are we going to have to tackle the budgets of our cities, counties and states, we must tackle the issue of our national debt. We simply cannot go forward into the future without some sacrifices from everyone. I understand that no one likes changes being forced upon them, but we need significant changes nevertheless.

People on the far left would say since I am a Conservative, then I must be racist and a bigot. No Conservative racist would ever vote for a black mayor. No Conservative bigot would have ever voted for Bill Clinton. No Conservative bigot would have friends that are policemen, firefighters and teachers. The truth is that I am an American in the United States of America and I want what is best for my city, my county, my state and my country, regardless of the fact that I am a Conservative.

Do not let the vitriol sway your opinion.

We need to be the United States of America, not the Divided States of America. Vote accordingly.

Monday, October 1, 2012

Unintended Consequences of Obama Care

The choice between providing health insurance or paying a fine for employers will have unintended consequences. One of these is that older workers will get passed up for jobs over younger workers. The reason for this is that companies are in business to make profits. When you compare the health insurance cost of a younger person with that of an older person, then you will easily see a huge difference in premiums. As an employer, given the choice of hiring someone young with significantly lower health insurance costs as opposed to hiring an older worker with very high health insurance costs, the choice is easy. The employer will hire the younger workers.

Once this activity begins happening over and over again, then you will probably see lawyers jump into the fray with lawsuits claiming age discrimination. Obama Care really puts employers in a total quandary. These employers will have to make the choice of hiring a younger worker to keep more profits over the risk of not hiring the older worker and lawsuits that will surely follow.

Some employers will just pay the fine and let employees fend for themselves. Once several companies start doing this, then they will all fall in line and do the same. The fine, early on, will be significantly lower than the cost of health insurance. What will happen down the road is that the government will have to raise the fine to match the price of health insurance and index it for age and inflation. I believe that this will cause less people to be hired in the future. If an employer knows it is going to cost him plenty to hire a new employee, then they have to know that the new employee will more than offset the cost. Jobs will become harder and harder to obtain. Even harder than they are now, if you can believe that. I think this will make the unemployment rate artificially high for the future. I doubt that we will see full employment again ever unless Obama Care is repealed.

Another unintended consequence of Obama Care is that some employers will just give everyone a cash payment so they can buy their own health insurance. In order not to discriminate, they will give every employee the same cash payment. Herein lies the problem. If they give the same cash payment to every employee, both young and old, then the older workers will again get the short end of the stick. The distribution of an equal cash payment, which would be taxable by the way, would also cause the potential of age discrimination lawsuits. Attorneys would jump on this as age discrimination.

Employers are in a tough spot in regard to cash payments. What if the employer does decide to give some kind of graded scale cash payment to employees based on age? Is this going to be bracketed? If so, then what age brackets are appropriate? What precedent is there for a graded scale cash payment? How much should each age bracket receive as a cash payment? What if the employer decides on a graded scale cash payment, but because of the rising costs of health care and health insurance, it is simply not enough. Will older employees decide to sue for underpayment?

All of these are tough questions for employers who will soon have to deal with these issues. If you are an employer, you had better hire an attorney to help you make these decisions in regard to paying your employees a cash payment. Otherwise, you will risk age discrimination lawsuits.

Another unintended consequence of Obama Care is that people who are going to be hit with the individual mandate will likely not file their taxes on time. There will be droves and droves of people who put off filing their taxes, because they do not want to pay the individual mandate fine. In addition, they may delay filing their taxes at all for a year or more. People do this now without Obama Care. We cannot be naive enough to think that people will suddenly become obedient and file their tax returns, knowing they will be fined.

Consider a younger person in their late 20's that is a landscape assistant for a small employer. They have to buy their own health insurance, because of Obama Care, but fail to do so. They thought they could pay the fine at the tax return filing deadline, but they fail to do so because they lost their job. They are not going to take any savings that they need to survive the job loss and give it to the IRS to pay for the individual mandate or buy health insurance with it for that matter. They will wait until they are in a better position to buy health insurance and file their taxes later. These people will eventually have to pay, but with added penalties and interest from the IRS. This scenario will without a doubt hurt the middle class, which is another unintended consequence of Obama Care.

American employers have always focused on making profits. I do not believe that will ever change, because if they do not make profits, then they are out of business. What will they do? They will seek out loopholes or work arounds. They will look for possible solutions to these issues. I doubt that they will fall in line and comply.

I would be really surprised if the Obama Care in place today survives five years from now. The employers and employees of America will get out their pitch forks and demand change. This is the Hope and Change that we need.

Do not forget to vote!