Subject Code & Title : FNS40815 Finance And Mortgage Broking Certificate IV
Assessment Type : Assignment 3
Activity 1: Explain the difference between up-selling and cross-selling, using financial service products as examples.
Activity 1 Answer: Cross-Selling, Up-Selling, and Strategic Account Management: When it comes to selling financial services and banking solutions, the relationship does not end after the first sale. In fact, this is just the beginning. There is an untapped opportunity to grow existing accounts through cross-selling and up-selling products and services—and selling the true value of an institution and financial services team.
FNS40815 Assignment 3 Finance And Mortgage Broking Certificate IV – Australia.
Up-selling is to get the customer to spend more money – buy a more expensive model of the same type of product, or add features / warranties that relate to the product in question. A cross-sell is to get the customer to spend more money by adding more products from other categories than the product being viewed or purchased.
Activity 2
Explain some of the advantages of active listening.
Activity 2 Answer
You are unlikely to be able to help your customer effectively, if you don’t listen to their needs. By not listening you can become very frustrating to the customer, and may lose a sale or repeat visit. Listen to the customer’s needs, empathise and find the best solutions.Active listening is a skill that can be acquired and developed with practice. However, active listening can be difficult to master and will, therefore, take time and patience to develop.‘Active listening’ means, as its name suggests, actively listening. That is fully concentrating on what is being said, rather than just passively ‘hearing’ the message of the speaker.Active listening involves listening with all senses. As well as giving full attention to the speaker, it is important that the ‘active listener’ is also ‘seen’ to be listening, otherwise the speaker may conclude that what they are talking about is uninteresting to the listener.Interest can be conveyed to the speaker by using both verbal and non-verbal messages,such as maintaining eye contact, nodding your head and smiling, agreeing by saying ‘Yes’or simply ‘Mmm hmm’, to encourage them to continue. By providing this ‘feedback’ the person speaking will usually feel more at ease, and therefore communicate more easily,openly and honestly.Listening is the most fundamental component of interpersonal communication skills. Listening is not something that just happens (that is hearing), listening is an active process in which a conscious decision is made to listen to and understand the messages of the speaker. Listeners should remain neutral and non- judgmental, this means trying not to take sides or form opinions, especially early in the conversation. Active listening is also about patience – pauses and short periods of silence should be accepted. Listeners should not be tempted to jump in with questions or comments every time there are a few seconds of silence. Active listening involves giving the other person time to explore their thoughts and feelings, they should, therefore, be given adequate time for that.
Activity 3
What benefits does relationship marketing offer to banks?
Activity 3 Answer
Relationship marketing is ‘an approach which emphasises the continuing relationships that should exist between an organisation and its customers.’ Traditional transaction marketing focuses on the completion of the transaction and the pursuit of maximising profits for each transaction. Relationship marketing, on the other hand, focuses on the establishment of strong relationships and stable partnerships in order to maximise the pursuit of the interests of all aspects of the relationship. When a bank claims to be practising relationship marketing, it signifies that they have undertaken an organisation wide strategy to manage and nurture their interaction with clients and sales prospects. Relationship marketing is not only at the customer service point or at relationship manager level, but at every point in the organisation. The call centre representative handling a query, or the operations personnel processing a transaction, are both drivers of relationship marketing.
FNS40815 Assignment 3 Finance And Mortgage Broking Certificate IV – Australia.
Activity 4
Identify some ethical issues which might arise for someone selling financial service products and services.
Activity 4 Answer
Traditional selling processes place a heavy emphasis on left-brain functions, at the neglect of the right-brain. But selling requires people skills, and these are driven by the right brain. There is no denying that analysis, rational logic and financial information play a necessary role in selling financial services products, but, they should support the story, not be the story. An over-reliance on statistics and charts when selling, could leave you doing only half the job. These left-brain functions constitute, at best, up to 20 per cent of sales success. The right brain plays a dominant role,contributing 80% of sales success. It puts all the information together, forms a picture, and makes a decision. The presentation style many salespeople use is a half-brained approach to selling because it engages only 50 percent of the customer’s attention span. We’ve all seen customers’ eyes glaze over when financial statistics are mentioned, dry figures are not what they want. Customers want financial independence, security, peace of mind and simplicity in their affairs and they look to you for financial guidance. Top salespeople are both profound and uncomplicated, the way they sell is both illustrative and simple. Put yourselves in the customer’s shoes. Which response would you prefer: → “This managed share fund will produce an after-tax yield of approximately 5%” or → “This investment will generate an amount of no less than $285, payable to you every month.”
Activity 5
After hearing the story of the overall value of permanent life insurance, clients will most likely have specific questions, which boil down to three main objections: affordability, education and procrastination. What strategies might you use to overcome these objections?
Activity 5 Answer
In prospecting, the vast majority of objections are simply knee-jerk reactions from busy people who don’t yet see any value yet, in working with you. Nearly all objections at the prospecting phase of the sales process can be distilled into two categories: 1. I don’t understand the value proposition, and I’m too busy to think about it. 2. I’m not ready for a
buying conversation. When faced with client questions, concerns and objections, there are two key best practices to apply: → Articulate value early and concisely. You can mitigate the first objection above by simply respecting the prospect’s time and explaining what you want early in your communication. Every email, voicemail, and phone interaction should lead with an assurance that you won’t take much time, followed by a short (30 seconds or less, or one to two sentences), buy ercentric, and customised value proposition. → Don’t sell the product, sell the next step. It doesn’t matter if the prospect is ready for a buying conversation yet. How could they be? It’s possible they’ve only just learned about you and your product from this call. Don’t get into a product conversation yet. If they ask a product question, recommend that you show them in the next meeting.
FNS40815 Assignment 3 Finance And Mortgage Broking Certificate IV – Australia.
Activity 6
Identify some tools and strategies to become a successful customer relationship marketing manager.
Activity 6 Answer
Relationship banking associates should demonstrate analytical skills and be able to understand the financial situations of consumers and business customers. This ability allows them to make informed suggestions of bank services. Foreign language fluency is a plus. Interpersonal skills and written and verbal communication skills are necessary for strong performance, as a relationship banking associate. Bank employees in this position should be proficient in standard computer applications. Go looking for problems Don’t be silent. Ask lots of questions about what people are up to, what their plans are for the weekend, summer holidays etc. What’s new in their life, at their job, with the family? Your bank’s products solve financial problems people have. Those problems occur as people move through various life events (get married, retire, have kids etc.). Don’t sell. Get them talking about their lives and you’ll uncover problems you can address. Focus your questions on potential problems that your bank’s products solve: → Provide convenience. Is banking a hassle? Do they have access to money when they need it – wherever they are in the world? → Make them money. Are they making enough money? Could they be making more on account balances they have with you? Investments? → Help them get stuff. Loan products allow them to get things sooner than they would if they had to save up for them. Are they able to do what they want to do? Travel? Vacation? Renovate? Start a business?
→ Save them money. Are there areas where they could be saving money? What about the account they are in – are the service charges too high? Are they paying too much in credit card interest? How about that car loan? → Give them a sense of peace of mind or security.Increase their confidence level or decrease their stress. → Are they confident in their current financial picture? What about the future and their ability to retire or send the kids to university? How do they feel about those things? Is it stressful? Are they overwhelmed with debt? Get them talking about the problem, they’ll be more inclined to listen to ideas and potential solutions.
FNS40815 Assignment 3 Finance And Mortgage Broking Certificate IV – Australia.
Activity 7
Why is it important for banks to adopt CRM technology?
Activity 7 Answer
Prospecting a new banking client can be a challenging and, at times, long-drawn-out process. Depending on where the lead has been sourced from, the relationship manager (RM) could have very little information to start with. Their job then is to make contact, engage in discussions, identify the prospect’s banking needs, recommend suitable products and services, and finally encourage the prospect to do business with the bank. In many cases, management is not actively involved in this prospecting process. Most established banks have sophisticated tools and advanced customer relationship management (CRM) processes in place. However, many banks seldom clearly define prospecting activities, leading many RMs to develop their own approach, which may be inconsistent with best practices. This is where formal prospect management, a system of planning, recording and monitoring the bank’s prospecting activities, is essential. Prospecting activities should follow a clearly-defined process, with management having an effective control and monitoring framework over all prospecting activities. The level of management control and involvement will naturally vary, depending on the type of bank and its existing business model. Having an active prospect management system in place can help improve the performance of RMs. An effective control and reporting framework enables management to track progress and activity with various prospects. A prospect management system will also ensure that banks have ownership over the relationship with the prospects. In the absence of prospect management, there is seldom much documentation about the prospect; typically, all prospect related information resides in an RM’s head. Therefore, if the RMs leaves the bank, they take with them to their next employer all information about the prospects. A prospect management system will also ensure that only one RM is pursuing a particular prospect at any given time. Having multiple RMs from the same bank contacting the same prospect can come across as unprofessional and can result in the loss of that prospect.
Activity 8
Why have many banks adopted the strategy “Know your customer”?
FNS40815 Assignment 3 Finance And Mortgage Broking Certificate IV – Australia.
Activity 8 Answer
The more you know about the person that you’re trying to contact, the more likely it is that you’ll be able to connect and have a meaningful conversation. Use LinkedIn, other social media, search engines, and you own business experience to build a profile. Ideally, this should include the following: → How does the target’s industry work? → What role does the target’s organisation play in that industry? → Who are the target’s main competitors? →What is the target’s professional background? → Who do you and the target know in common? → What corporate role does a person with the target’s title usually play? → What events have taken place inside the target’s organisation that might create a need for your offering? → While you’re doing this research, keep track of all potential contact points.
Specifically, you want the target’s email address, physical address (office), and phone number. You also want the same information for people who know the target, especially any gatekeepers (like the target’s administrator) and any colleague who might provide you with an introduction. Do not worry if this list is incomplete, because in some cases it won’t be possible to discover all of it. However, you want to feel secure that you understand the target, why the target might want your offering, and how you are able to contact the target, beyond just making a cold call.
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