Include Producers In Web Annuity Sales Plans, Panelists Urge

Include Producers In Web Annuity Sales Plans, Panelists Urge

By Linda Koco

New Orleans, La.

Do you think selling annuities by using the Internet is a downer?

Jeffrey Oster, president of Client Preservation & Marketing Inc., San Francisco, doesnt think so. Neither do the other executives who appeared with him on an e-business panel during an annuity conference here.

But the panelists were very clear about one thing: For such sales to work, producers must be involved.

The conference was co-sponsored by LIMRA, LOMA, and Society of Actuaries.

Online annuity sales "dont do well" currently, allowed Oster. But "Im here to tell you that you can make money selling on the Web."

The key, he contended, is distribution. That is, "the sales force needs to be educated on how to use the Web. You need to hook up a sales team to make the sales occur."

Teach the sales force how to use the Web for lead generation, Oster urged.

Use newsletters and various other online and off-line marketing methods to "drive traffic to the Web" and then use the Web to generate the leads, he suggested.

Of online shoppers who were recently surveyed, he noted, 37% "said they would buy more if they could interact in real-time with a sales person from an e-commerce site."

Furthermore, another study found that "14% of those Internet users who have not yet purchased online said they would buy online if they could speak directly with a customer service agent," Oster noted.

In short, he said, the current marketing communication models "must be shifted to include a sales force in the corporations marketing mix."

Portal sites are generating leads, he pointed out. But the problem is, businesses are failing to transform these leads from browsers to buyers.

Thats what Oster calls "distribution channel disconnect."

Whats needed to correct the disconnect, he said, is to implement directly linked contract management systems. Also, he said, train the sales team behind the e-infrastructure, and use a 21st-century approach to lead generation. (See chart.)

Shane Chalke, president of AnnuityNet Inc., Leesburg, Va., couldnt agree more.

His firm started in late 1997 as a Web site for selling annuities online, he told the audience. But, by early 2000, "we shifted our focus to selling through intermediaries and away from selling direct to the consumer."

It is "possible" to be successful in direct-to-consumer annuity sales via the Web, he allowed, noting that he knows a few insurers are making headway in that. "But its not going to happen through AnnuityNet."

For his company, greater success lies in working with intermediaries, Chalke said.

In his companys case, the firm is working with financial institutions to help them use Web sites in conjunction with the institutions distributors.

The problem with most online annuity sales efforts, he said, is that "the sales process has been centered on the manufacturer, not the distributor."

As a result, "the distributor loses control of the customer, and the customer becomes confused," he contended. For instance, when the annuity manufacturer (insurer) makes service calls to bank customers or sends out policy statements to them, he said bank customers can become confused--because they remember buying their annuity from the bank, not the manufacturer.

One solution would be to move the "client touch" services to the distribution side of the fence, using the Internet, Chalke said. "We propose that all this should happen inside the distribution channel."

The agents, with the help of an online "annuity service station," could help clients arrange asset allocation and do portfolio transfers, as well as view all available product solutions on a matrix, he added.

"This is a distribution-driven" approach to annuity sales, Chalke concluded, "and its the way things are going."

Its possible for agents to be successful using the Internet in annuity sales, agreed Kip Gregory, principal of The Gregory Group, a Washington, D.C., consulting firm specializing in helping agents work with technology.

But to make it work, insurers and agents need to know the Internet tools that are available and how to use them, he said.

Specifically, agents can harness those tools to help clients find solutions, Gregory said.

By tools, he said he meant Web sites that offer services that help agents do their work, at little or reasonable cost.

For example, he said insurers might use prospecting Web sites, such as www.myprospects.com and www.zapdata.com, to generate targeted leads for agents; Web conferencing sites, such as www.placeware.com, to put on interactive presentations; and mass e-mailing sites, such as Microsofts www.listbot.com, to distribute key mailings to large numbers of people.

Brokers and agents might also use those sites, he indicated.

And, for ready access to multiple business links, Gregory suggested agents visit www.CEOExpress.com. This is an "aggregator and consolidator of links" that can be a "goldmine of information for producers and marketers," he said. Also, www.blink.com, a free password-protected online bookmark account, can be useful for storing favorite links, and www.yahoo.com can be helpful to agents in search of information, he said.

Many agents are still learning how the Internet can help them sell, Gregory told NU. But once they learn, they can become very effective, he said.

Reproduced from National Underwriter Life & Health/Financial Services Edition, April 23, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

Return to NU Online Archive.

Copyright   2001 by The National Underwriter Company. All rights reserved. Contact Webmaster

For high-quality article reprints and e-prints, contact Reprint Management Services at 717-399-1900, ext. 166 or email kdewan@reprintbuyer.com.