Cold calling, as a method for bringing in new accounts, appears to be live and well.
Cold calling, as a method for bringing in new accounts, appears to be live and well. I'm sure that some Advisors can do it well. However, based on my own personal experience over the last month (yes, a small sample of data, but illustrative nonetheless), it's clear to me not only why this still exists but why it's destined to stay on the fringe of the industry. Firm names and their employees have been changed to save them from embarrassment.
Call number one:
“Dan, my firm has been running with an unprecedented string of winners in the stock market.”
“What do you mean by ‘unprecedented'?”
“The stocks we recommend never go down.”
“Please say that again.”
With emphasis: “THE STOCKS WE RECOMMEND NEVER GO DOWN.”
I hung up.
Call number two:
“Hi Dan, we've never met, my name is Joe Smith and my firm is Determined To Sell. I would like to have a conversation with you about your company's 401k plan.”
“Thanks for the call, Joe. Can you tell me a little about your background? Are you calling for yourself or on behalf of someone else?”
“I've been registered with this firm for five years and in the industry for eight years. I'm part of a team that helps small businesses act properly and to fulfill their obligations as a fiduciary for their employees' retirement accounts.”
“Hold on for a minute, Joe.” [Sarch checks the FINRA Brokercheck website to confirm Joe's background]
“Joe, actually I see that you have only been with your current firm for eight months or so. You have been licensed for less than five years and this is your third firm during that time.”
Silence.
“Joe, are you still there?” Click.
Call number three, at home Saturday, late morning:
“Hi Danny, my name is Dave DeBroker from BigFirm and we don't know each other, but I'd love the opportunity to meet you and tell you more about what BigFirm does and how we possibly can work together.”
No overpromising, nice approach, consultative, great voice, and a non-intrusive style. I politely listened and told him that I was fine, but appreciated the call. Maybe this is more representative of the current state of cold calling, I naively thought.
Call number 3a, at home, Sunday, early evening:
“Hi Danny, my name is Dave DeBroker from BigFirm and we don't know each other, but I'd love the opportunity to meet you and tell you more about what BigFirm does and how we possibly can work together.”
“Dave, we spoke yesterday. You called me yesterday morning and we had a conversation.”
Silence
“Dave?”
“I'm sorry, dude. My bad.”
Summary:
Why does this still exist? Because there are still bad firms out there, flying under the radar of the authorities, scurrying into new cracks in the regulatory walls once the lights come on. They wouldn't do it if they could not get some small percentage of people to bite. And at the mainstream firms, struggling and rookie Advisors still need to bring in money.
Are there successful Advisors out there who are currently, professionally, and effectively using cold calling as a regular prospecting tool? Send me a private e-mail; I would love to hear about it.
