Always be closing? The end of selling

On a recent flight I watched a movie I’d seen decades earlier and marveled at how life has changed. The cult classic “Glengarry Glen Ross,” based on David Mamet’s Pulitzer Prize-winning play of the same name, is the poster child for the ugly underbelly of selling. And no moment is more illustrative than when an intimidating Alec Baldwin berated a group of disheartened salesmen from his blackboard to “ABC. A Always, B Be, C Closing. Always Be Closing!”

I started working in the investment business in the early ’90s, the same time as the movie was released. I was taught that the rules for success were pretty simple: If you wanted to grow, you had to sell. Investment performance might matter a little, nice brochures could be helpful, but above all else, growth required the ability and willingness to sell. Cold calls, Saturday morning seminars, handing out business cards to strangers were all part of breaking into the industry back then. I hated most of it, though I was pretty good at it because I loved what I was selling (and my accent helped a little).

This perspective on sales came to dominate the mindset of the financial services industry. Remnants of it linger even today — witness some of the sales scandals that are still occurring at some of the largest firms. While the single-minded focus on selling has softened over the past few decades, the world has changed so much that the entire idea of selling is evolving to something quite different.

From Selling to Telling

The internet changed everything. Today consumers are more informed than ever. They know what their alternatives are, what things cost and how to find what they want on their own terms. Most of the marketing and negotiating is happening before the client ever comes in to meet you. Clients today don’t want to be sold, they just want to be told. There are three major changes all firms need to adapt to:

1. From push to pull. Historically, financial products relied on push marketing. That’s marketing jargon for convincing clients to buy by pushing your products on them, often done person to person. By contrast, pull marketing is more about creating a need in customers and attracting them to you to fill that need. Think of it as the difference between being a lighthouse and being a hammer.

The internet has given all the power to consumers. The old push strategies might still work, but the younger the client, the less they care about what you want to sell them and the more they care about how you will help them with a problem. It’s a subtle but important mindset difference here: Your job is to solve a problem, not to sell your product.

2. From a salesperson to facilitator. When firms like AutoNation take the selling out of used car sales (they tell you the price over the phone before you even come in), you know the world has changed. The old model of the insurance salesman peddling his goods to everyone regardless of need is broken. The winning salespeople of tomorrow understand they have to identify how they can help a person in need.

It means being far more collaborative than dictatorial. It means listening a lot more and putting the client, not your product, in the center of the discussion. It also means being willing to walk away if you aren’t the right solution for the client. Since most potential new customers have already done their homework before they meet you, your job is not to sell any more, but to inform and educate and guide. Less selling, more telling. Ultimately your job is to make sure you are compatible with prospective clients and can work well with them over the long term.

3. From product to service. Whether it’s a managed portfolio or a financial plan, most advisers still sell their services like a product. Why does that matter? Because products have a fixed price and are compared to alternatives, and cost ultimately becomes a major issue. If your product is an investment portfolio, then it can be compared to the performance and cost of many alternatives. There’s plenty of information and choices out there. However, if your investments are a service built around a specific client’s needs, and if your service goes beyond investing to providing financial life guidance and dynamic ongoing planning, then there really is no comparison. The client is paying for ongoing, individualized service that cannot be shopped around.

Always Be Helping

Think about it. Does anyone really like to be sold to? I often hear about advisers trying to hire a rainmaker to help them grow. These efforts invariably fail because people have moved on from that old ABC model, even if the firm hasn’t.

Most firms have not adapted their services or their online presence to reflect that mindset. They still talk too much about themselves and their products rather than the clients and how they will be helped.

In the new world, it’s not about selling your stuff to people but building your service around helping people. Alec Baldwin might have declared that “coffee’s for closers,” but the cream goes to the helpers.

(More: What one thing would you do to assure your firm is competitive for the next decade?)

Joe Duran is founder and CEO of United Capital. Follow him at @DuranMoney.