From the Editor: How to lose clients and influence people

Some words commonly used in financial services have become synonymous with wrongdoing but, in most cases, describe fair and, often, essential practices.

‘Selling’ is one of them, ‘charging’ another. So how about cross-selling? That’s got to be bad, conjuring images as it may do of unscrupulous advisers and providers flogging products to existing clients solely to supplement their incomes.

Yet cross-selling, done properly, is one of the purest examples of a practice that can be beneficial to both the client and firm. It is surely reasonable for advisers to scan clients’ financial plans for gaps which, for whatever reason, have not previously been filled. Is it wrong to contact a customer so-far unwilling to buy protection to restate its importance?

Cross-selling was this week cited by insurance brokers and life companies as an area they will target in the first period of the year.

According to the Confederation of British Industry’s (CBI’s) latest survey of the financial services market, almost eight in ten (79%) brokers expect cross sales to be a growth area in Q1, as do half of life companies.

With the current state of financial markets stunting consumer confidence, it appears few businesses expect a rush of new clients in the early part of
this year.

We wrote about the CBI report, and the inevitable reader comment appeared shortly after publication.

‘Bournemouth IFA’ wrote: “It’s not just the life offices. I know plenty of IFAs who are looking to cross-selling to subsidise their income. Everything from will writing and non-regulated insurances (fair enough) to utilities (yuck).”

Is it fair to argue any member of the public who reads this comment would leave with the impression advisers do not have their clients’ interests at heart?

Here's why: 'Cross-selling', like 'charging', has got a bad rep. It sounds like an unethical practice, when it isn't at all.

Consumer trust in financial services depends on things like this.

It is time we started turning the negatives into positives; time we started communicating to the public that ‘selling’ a product is not the same as ‘mis-selling’ it, and that charging for your services is fair and right and reasonable.

Scott Sinclair Editor, Professional Adviser and IFAonline.co.uk