Managing Negative Annuity PR

So picture this… Your brand new prospect marches into your office, reaches exasperatedly into their bag, pulls out a magazine and says, “Well, I was going to buy that annuity but I just read this nasty article in Money magazine that scared the daylights out of me. Why on earth would you recommend something like this for me? I thought I could really trust you!” At which point they plant the article, which ripped indexed annuities (IAs), squarely in front of you.

You’re obviously stunned while a stream of images, a veritable history of negative articles about indexed annuities, goes through your head — Forbes magazine, The Wall Street Journal, the Chicago Tribune, FINRA, the SEC and now Money magazine. “What on earth was going on here,” you say to yourself. “And, what on earth should you say?”

Your brain starts to sift through your options. You decide that the best option is to take a moment to regroup. You say, “Just let me glance through this article for a moment to see what it says.”

Now, it doesn’t matter the veracity of any article and it doesn’t matter the product in question. When clients receive negative input from seemingly “reliable” sources, it becomes a huge issue in the selling process. Your client’s article is no different. You know, of course, what this article was going to say. And you also know, because of that article, that your sale is in great jeopardy; that your status as a reliable financial professional, in your client’s eyes, was tenuous at best and failing fast.

For better or worse, the written word is very powerful; sometimes it is much more powerful than we recognize or are willing to admit, especially when it’s negative. Once something is in writing, most people unconsciously will endow it with the absoluteness of truth. Even though an article might be misleading or biased, the fact that it is written lends it great credence and authenticity. And if the article is written cleverly, peppered with threads of truth (as many in our industry are), dealing with it is far more difficult.

OK, back to our current client situation. You can feel your reaction, immediate and powerful, a defense bubbling and boiling up and wanting to erupt from your lips (see if this looks familiar): “Mr./Mrs. Client, this just isn’t true. They’re not telling the whole story; they really don’t understand how indexed annuities work. Look at this here, that’s just a lot of you-know-what. That statement there is an exaggeration. And over here, it’s just not going to happen that way. And, this paragraph here is totally insignificant. An indexed annuity is a great product. Look what it can do for you. See how it fits your goals and how it delivers what you are looking for? And here are a whole bunch of articles that say just the opposite: how good these annuities really are. Let’s review it again, OK? I think you’ll be fine after that.” It takes all of your willpower to keep your mouth shut and your thoughts to yourself.

We’ve all been there and done that — tried to defend our products. And what are the results? When we fall into a defensive mode, clients tend to dig their heels in deeper. The more we defend, the more they seem to doubt us and the more they believe the article. I’ve seen trust erode quickly, replaced by a battle between advisors and the article. Defending is a strategy that has rarely worked for advisors, which is why my first rule is never to defend.

My First Rule: Never, Ever, Defend

Now, there’s a little voice going through your head saying, “Whoa! You don’t want me to set all that nonsense straight? No way! The best defense is a good offense! Somebody has to set the record straight! Chances are that I’m going to lose the sale anyway, so I might as well go down fighting!” And so on and so on.

The fact is, the little voice in your head, which sounds so logical and sincere, and so reasonable, is just your old caveman instinct to survive showing its fighting face — a fight-or-flight reaction deeply embedded in your DNA that worked well in the days of hunting and gathering, but is totally out of place in this modern era. When you see it rear its ugly head, screaming at you to go into defensive mode in a sales meeting with a client, you need to immediately cut its energy off and just stop defending. You will soon see that your best defense is no defense. Just the opposite of what your little voice is telling you.

OK, you stopped. Now what? If you’re not going to defend, then the only other choice is to agree. And that’s my second rule: to always agree.

My Second Rule: Always Agree, No Matter What

Now, just sit there and say to your client something like this, “Yup, that’s true; yup, that could happen; yup, that’s certainly possible; yup, yup, yup.”

After all your “yups” are done, sit back, look at your client and as sincerely as you can (because you are about to say the truth), say, “Wow, that’s a lot of stuff. After hearing all that, I can absolutely understand the decision not to buy one of these.” Then, pause and let that sink in. It’s absolutely not what your client expected to hear from you.

When clients give you negative articles (or any negative message for that matter), they expect you to defend and try to convince them otherwise. Because we know that’s their strategy, it would be in your (and their) best interest to do something extraordinary, something that short-circuits their negative thinking. So, we agree! But, that’s still not enough. We then need to take it further than that. And that’s my third rule: to always go negative.

My Third Rule: Always Go Negative

We agree with our clients, but we need to go further than they expect — to the point where we say to them that if all that negativity is true, we wouldn’t buy either. Instead of creating a battle, we go negative with these clients and align ourselves with their thinking. Both of you are now sitting at the table looking at the article, agreeing that, based on the article, you both wouldn’t buy it. Clients don’t know what to do with that.

Then, we go one step further and actually get more negative than these clients do. If they’re upset, we get more upset than they are; we get more negative than they are. What happens next is remarkable. Seeing you so upset actually motivates your clients to bail you out, to rescue you. They actually begin to minimize that negativity of the article, all by themselves. They will say something like, “Trent, it’s not that bad. I think you’re overreacting. You know, lots of these articles are just written to sell magazines.”

Now you can say to Mr./Mrs. Client, “Gee, maybe I did overreact. Where do you think we should go from here?” And this leads to my fourth rule, which is to reverse roles.

My Fourth Rule: Always Reverse Roles

Your client will answer your question of where to go next with something like, “Well, I don’t know. Like I said, they can’t be all that bad. When you showed them to me there were things that I did like: the guarantees, the income in the future, doing better than my CDs, the fact that I couldn’t lose. I guess I’m still interested but I just don’t know who to believe.”

Now, look what’s happened. Our roles have reversed. Your client is now selling you on the benefits of indexed annuities, instead of you selling him/her. They are disqualifying elements of the article themselves. All you did was be honest with them, align yourself with their thinking, open a different door by going more negative and let them walk through it. Once the roles have been reversed, you will regain control of the meeting. Negative articles about your product rip control of the meeting process out of your hands. Having your clients sell you (and themselves) puts that control back.

Now you can really open up and say more of what you wanted to say in the first place. Why? Because your client feels heard, understood and respected. “Mr./Mrs, Client, I don’t know what to tell you. The problem is that there is a grain of truth in everything that’s being written here. There are surrender charges. There are caps. They can be confusing. There are some poorly designed products and, I might add, poorly trained salespeople.”

After taking another breath, you add, “How can I possibly defend this product other than to say that it has worked well for millions of people and the author of this article doesn’t say that anywhere. He would make it sound like all those folks were duped and that the division of insurance in every state in the union would permit their constituents to be ripped off. I don’t know about you, but that just doesn’t register for me. Based on all that, what makes sense to you?”

If said genuinely, your clients, invariably, will agree with you. But that still won’t allay their fears or supplant the power of the written word. There will continue to be a part of them that is still very wary. You address this by bringing it right to the table, “Folks, if I’m sitting in your shoes I would be totally confused and very wary, as well you should be, right? And, if I were you, I would have two choices. The first is to toss the potential of using this product out the window and go in a different direction. The second would be to remain open-minded and learn more, especially how significant, or insignificant, all these threads of truth really are. I’m good either way. So, what will it be?”

More than 90 percent of time, your clients will ask you to review the product again, and eventually buy.

Conclusion

By getting out of a knee-jerk, defensive mode (which clients expect), the power of the written word is diffused. Without a defense, there cannot be an offense, and vice versa. Columnists thrive on controversy, and it is that controversy that empowers their words. When you take controversy off the table and substitute it with a healthy dose of collaboration, then power and control will align with you, taking you from the back to the head of the class.

Remember, the more popular you, your preferred product, your service and what you stand for become, the more negative PR will rise to try and tear it down. No person, product or service is exempt. Mutual funds, variable annuities, gold, ETFs, options, bonds, REITs, stocks, banks, insurance companies, indexed annuities, Wall Street and even CDs have all had, and will continue to have, their share of negative PR.

Negative PR is directly correlated to popularity. So, instead of moaning and groaning, fighting and defending, and getting into a battle of your articles versus theirs, learn to harness and reprogram yourself. Follow the four rules I’ve given here and your clients will turn themselves around by themselves. When that happens, they win, you win and life is really good.