Non-Advice - Back to order taking or a chance to shine?

What's the issue?

In a flat mortgage market where margins are tight, all mortgage interviews are precious and commission from cross sales is as critical as ever for profit and growth.

A report by Price Waterhouse Coopers post M-Day confirmed what businesses know and interviewers experience - customers are more likely to buy if they like the interviewer and choose to take advice. 50% of customers using the advice route were extremely likely to buy compared with 17% following the information path only.

So where does that leave non-advice? Technically non-advice is made up of 'sales using filtering questions and execution only' but what does that look like in reality? From a customer's point of view it seems to translate into a service where the interviewer "can't make a recommendation," but "can ask you some scripted questions."

Some organisations report that up to 90% of their customers 'require' non-advice. Early signs suggest that interviewers faced with a non-advised situation do little to help customers confirm their own decision. They simply revert to pleasant order taking. No surprise then that cross sales are down.

From an organisation's point of view

Under non-advice, the directive not to 'lead'customers and to use scripted questions
has led to sales processes that deliver linear, monotone conversations. These stifle staff and add no customer value.

Qualified advisers worry about straying into advice. They dare not answer customers' questions or ask clarifying questions to help customers confirm their own decision. Desperate to remain compliant non-advice interviewers do the same. To compound the problem, lead generators, robbed of successful conversational 'hooks' clam up and the sales pipeline runs dry.

In reality, staff can influence a customer's choice early in a conversation. Lack of time or fear can cause branches to see nonadvice as an easy barrier to hide behind.

No-one is clear about the market demand for advice vs. non-advice. Maintaining and
supervising competent staff is an expensive business. Even more so if the number of enquiries is low OR the number of non-advice enquiries outweigh those for advice. Businesses must handle three pressures - meeting the needs of customers, the regulator and their own sales targets. But they also owe a duty of care to help customers make the right decision for themselves - this does not equate to order taking.

From a customer's point of view

Faced with a choice of '... two levels of service ...' customers opt for nonadvice for numerous reasons. For those who clearly know what's right for them, straightforward execution is completely appropriate. But do customers choosing non-advice really know what's right for them and do they actually understand what they have signed up for?

Customers' lives and their financial needs are becoming more and more complicated. At the same time, mortgages are much more complex as fully flexible and offset products continue to grow in popularity. Research shows 10% of mortgage borrowers are now using offset mortgages. A further three million people in the UK will be considering offset in the next couple of years.

So customers choosing non-advice may not be as informed as they think - and could be receptive to an interview that respects their opinion and aims to add value. An adviser who skilfully helps them recognise what they know and what they don't know, will find more customers receptive to exploring further needs or indeed changing track mid-interview.

At the moment a non-advice interview is, at best, pleasant and compliant. But selling the benefits of other protection and insurance products is tougher from an order taking position where there is little customer engagement and no tangible added value.

In summary

At a minimum good non-advice can help customers confirm that the decision they are making is the right one for them. An interviewer who helps them recognise that they aren't as informed as they thought, demonstrates empathy, expertise and credibility. Both approaches start to build a trust conducive to discussing further needs and building the ongoing relationship every business values.

The opportunity to add value to non-advice interviews is considerable, a chance to shine for sales and customer service. Duty of care under non-advice does not equate to safe abdication and pleasant order taking. Apparently risk-free order taking treats nobody fairly, least of all the customer.

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