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RETIREMENT AT RISK

Business Booms for Gurus Teaching How to Sell to Seniors

Some marketing borders on manipulation. `I call this getting the fish to chase the boat,' one consultant says.

April 24, 2006|Josh Friedman | Times Staff Writer

SCHAUMBURG, Ill. — Niju Vaswani calls them the "seven Gs of senior interests."

He tells sales agents peddling investments to the elderly to focus on seniors' supposed soft spots: gambling, gardening, golf, gourmet food, grandchildren, groups and Greyhound bus trips.

Hitting one of the Gs is good, says Vaswani, a Bay Area marketing executive. A twofer is even better.

A Greyhound excursion to a gambling house, for example, creates a captive audience, Vaswani told a workshop at the Selling to Seniors Conference in this Chicago suburb.

"When was the last time you saw a senior jumping off a bus going 75 miles per hour?" he asked.

The annual conference is part of a booming behind-the-scenes business of coaching salespeople on how to break down the defenses of the nation's 36 million seniors.

Just as the elderly are inundated with pitches for annuities, brokers, agents and financial advisors are flooded with come-ons from sales gurus. Though often benign, the advice can blur the line between savvy marketing and unseemly manipulation.

"It adds to the perception that it's about commissions to agents, versus benefits to consumers," said North Dakota insurance regulator Jim Poolman, annuities chairman for the National Assn. of Insurance Commissioners.

Consultant Edwin Lichtig of GSL Advisory Services in Walnut Creek, Calif., hosts teleconferences with titles such as "How to Turn Seniors Into a Buying Frenzy."

During one of these calls, Lichtig advised salespeople to get a copy of a prospect's financial statement, circle each stock, bond or mutual fund investment in red and say, "Gee, everything you have is at risk." He even offered acting tips: "Good time to look startled."

Restaurant seminars are a time-tested way to sell annuities, but Lichtig says some seniors just come for the free meal.

"Sick and tired of the plate lickers? So am I," he said, urging agents to try fresh approaches such as renting a booth at a recreational vehicle show.

Dean Cipriano recommends advertisements with attention-grabbing headlines. He read a sample during a recent teleconference of his own: "Local Senior Sobs, Loses Half His Retirement Income in the Market -- Free Report Reveals How to Avoid the Same Mistakes."

Cipriano, head of Turn-Key Annuity Systems in New Jersey, said such ads had brought his clients a torrent of calls from anxious seniors -- and tens of thousands of dollars a month in sales commissions.

"I call this getting the fish to chase the boat," he said.

A Times reporter listened in on teleconferences by Lichtig and Cipriano, who advertise the sessions on the Internet and via mass e-mails.

Contacted afterward, Cipriano said he instructed sales agents to make sure the products they sold were suitable for clients. "We always teach agents to do right by their customers," he said. Lichtig declined to comment.

Some consultants say they have special insight into mature minds.

50-Plus Communications Inc. in Glencoe, Ill., which runs the Graymoney.biz website, suggests that advisors wear American flag lapel pins, display photos of their grandchildren and refer to clients as "people like yourselves."

Many of those now dispensing sales advice used to be in sales themselves.

Larry Klein, author of "Marketing Financial Services to Seniors," was censured by federal regulators and fined $150,000 in 1996 for putting clients in overly risky investments. One was an 83-year-old blind woman who bought bonds denominated in New Zealand currency.

Klein, who denied wrongdoing, now offers tools for salespeople, including a $1,897 kit on staging hotel and restaurant seminars. It includes prospect mailing lists and PowerPoint shows.

"What McDonald's does for fast food, we do for financial advisors," said Klein, of NF Communications Inc. in Walnut Creek. "We give them super-detailed instructions: how much salt to put on the fries, how much ketchup on the burgers."

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