Protection, persuasion and the power of positivity
Vishal Pandya is operations manager at the Society of Mortgage Professionals
How did we ever manage to function before the internet? The phenomenon of the world wide web has revolutionised our lives and virtually everyone now has the technology at their fingertips, on devices from mobile phones upwards.
They say there’s an ‘app’ for everything nowadays and one of my favourites is ‘TED’ (Technology, Entertainment, Design), hosted by a media organisation which posts talks online for free distribution, under the slogan ‘ideas worth spreading’.
TED talks are streamed live and address a wide range of topics within the research and practice of science and culture, often through storytelling. Speakers are given a maximum of 18 minutes to present their ideas and have included such luminaries as Bill Clinton, David Cameron, Billy Graham, Richard Dawkins, Bill Gates, Nobel Prize winners, Google founders Larry Page & Sergey Brin, and cultural icons such as U2 lead singer, Bono.
One particular video I watched has been on my mind ever since. It was a talk given by Alex Laskey entitled ‘How behavioural science can lower your energy bill’.
In it, he described an experiment where graduate students put different signs on every door in a particular neighbourhood, asking people to turn off their air conditioning and turn on their fans.
The signs were posted in batches, each containing a different message. One said that people could save money by doing so, another promoted an environmental message and a third encouraged residents to be good citizens and help prevent blackouts.
To everyone’s amazement, none of them had any impact on people’s energy consumption, despite a belief that the message about financial savings would have a significant influence.
However, there was also a fourth message that stated: “When surveyed, 77% of your neighbours said that they turned off their air conditioning and turned on their fans. Join them!” This, it was revealed, resulted in a marked reduction in energy consumption.
According to Laskey, this was a clear demonstration of how social pressure can be an immensely powerful tool to persuade people to take certain actions – and I couldn’t help but draw a parallel to how such a technique could be applied to our profession.
Even though powerful statistics exist about the UK protection gap, using them in isolation is clearly not enough to persuade a sufficient number of clients about the vital benefits bestowed by protection. But when put into a social context that people can identify with, they can be used to great effect.
Tapping into the trends and factors that influence people can provide a vital foundation for any efforts to shape thinking and refine product development. Pure statistics on their own are not a panacea, but use them in a way that the consumer can identify and empathise with and they come into their own.
It occurred to me that this particular TED talk illustrated how social pressure could get consumers thinking about protection much more seriously. For example, a recent Money Advice Service survey found almost half of working age couples and families do not have life cover.
Even more worryingly, another survey by the Centre for Economic and Social Inclusion, commissioned by the ABI, found that 10.6m households – more than 60% of working families – would see their income fall by more than a third if the main earner had to stop work because of ill health.
So if you don’t do so already, start telling your clients about what sort of people opt for your protection recommendations, inform them about the individuals who have benefited from your advice and, most importantly, extol the positives of protection, as opposed to the negative impact of not having adequate cover.
Amazon know a thing or to about internet marketing, so why not take a leaf out of their book and apply their ‘people like you also bought this…’ psychology. Putting it into adviser context such as: “one of my clients, who was in a similar position to you, opted to go for this type of solution…” could really help sell the benefits?
The 7 families initiative is doing an excellent job in demonstrating just how powerful sharing positive stories can be, by highlighting the need for people to plan financially in case they become too ill to earn an income. Let’s all put this learning into action by talking more positively about protection.
According to the charity, fewer than half of the working population have income protection and more than two in five (41%) of employees would have to rely on their savings to preserve their lifestyle if they could not work due to illness or injury.
The problem is more acute with women than men too, as a newly-published report from the CII has discovered. Their ‘Insuring Women’s Futures’ review found that 70% of women in their 50s are not saving enough for retirement (compared to 59% for men). At the same time, the average cost for women entering a care home from 65–74 is £132,000 – nearly double the cost for men.
One recent Scottish Widows study even revealed that 78% of those surveyed regarded their mobile phone as an essential expenditure – while only half that amount (39%), thought life insurance was an essential. Clearly, there is a lot of work to be done.
Nothing can help you get that message across more quickly than the internet. The vast majority of your clients will be on social media, so make use of it, in its many guises, to communicate with them and share all the positives your expertise can bring to the table.