Selling into the financial sector4th June 2019
Is selling into the financial sector really different?
I met recently with a senior manager whose organization is actively considering working in vertical markets. She asked me “What is so different about the financial services sector. Surely selling is the same where-ever you do it?” I reflected about this and then gave her 10 areas where selling into financial services is different from selling into other sectors.
1. Language. The financial sector definitely has its own terminology and a forest of abbreviations.
2. Complexity. This is multi-channel sector with multiple, sometimes conflicting routes to market.
3. “Co-opetition”: An organisation can be at the same time supplier, customer, distributor and competitor to another. Relationship management is therefore more demanding and more confusing.
4. Regulation: There can be no doubt that working in a highly regulated environment raises specific challenges and provides significant opportunities.
5. Unclear job titles: in most industries if you want to speak to the person in charge of sales you look for the Sales Director; for production the Production Director. It doesn’t always work like that in financial services. You have to be able to navigate your way through unclear job titles.
6. Privacy: This is a very private sector. The outsider may find it hard to gain information, to navigate, to get close to the players.
7. Perceived long lead times: Many generalists think it takes a long time to gain commitment in this sector. Some business does take a long time to close but some opportunities open and close very quickly. Our analysis has not suggested that there is an undue difference between this and other sectors but it is a perception that needs to be managed.
8. Specialisation: This is true of several sectors but there tend to be comparatively few generalists in financial services. People tend to develop their field of expertise and stick to it. This trend is changing e.g. bringing retailers into retail banking but this has not always been a happy trend.
9. Business models: It can be difficult to understand how financial institutions make money; e.g. the relationship between margins and fees in banking, the relationship between claims ratios and investment performance in insurance.
10. Power: It is easy to drop into a “master-slave” mentality when dealing with this sector. We tend to perceive financiers as having the power and the right to dominate us mere mortals who come towards them in supplication. There is an aura of fear around this business. Over the centuries the sector has made itself feared. It is special. It is different. It is powerful. It can be hard to behave in a balanced “peer to peer” way.
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Here is a good glossary to support your understanding of language in this sector.