Owning a Patek Philippe Calatrava watch, or Rolls Royce, or being listed as a patron of the local art museum is never necessary consumption. Your cell phone will give you the time, a Chevy will get you where you need to go, and being a museum member gets you in the door. However, each of these higher levels represents an aspirational goal that some people feel means they have achieved social prestige and material success. Aspirational goals tend not to be price sensitive. Indeed, the higher the price the greater the exclusivity. Annuities and life insurance can also become aspirational goals, but the appeal needs to be targeted in different ways. The driving force behind aspirational goals is when the goal is realized it creates a special feeling of exclusivity that is acknowledged and rewarded, but the meaning of exclusivity differs among the wealthy.
The old money Patricians know they have money, so they don’t feel a need to conspicuously display their wealth. But they do like cultural or social rewards. For this group, having charities and cultural organizations show how life insurance and life insurance trusts can enable them to give more efficiently—and publicly acknowledging their generosity—is a proven way to sell life insurance. The marketing approach to the Patricians is to and through the organizations.
Those that are new money—the Arriviste—need to feel that they have arrived and this can be handled by making the Arriviste feel exclusive. Both life insurance and annuities come into play here with the marketing pitch that the difference between them and the Patricians is that the Patricians think in generational terms of providing for descendants; both life insurance and annuities can be used to turn the Arriviste into a dynasty. These customers are not treated like regular customers, but have their own private phone and web access to the insurance and annuity area. The company may make available special webinars and research appropriate to their financial stage in life. And depending on how high the minimum premium bar is set, there may be enough funds to provide access to legal, accounting, and estate and charitable planning services at a lower cost through affiliates.
Strivers are those that are more successful than most, but do not have the assets to become big money. An attractive aspirational goal is offering them something that only 13 percent of private sector employees have: A private retirement pension. Survey after survey says the majority of near-retirees want at least a portion of their non-Social Security retirement income to be stable and dependable—that it won’t go down or go away. The annuity word is not generally well received by consumers, due to a lousy job of defending the name by the industry, but pensions are perceived as something that is a) desired, and b) not generally available. The aspirational marketing message is that 87 percent of your (private sector) neighbors did not retire with the security of a pension, but you were successful and wise enough to have one.
For the Strivers, agents and advisors can market a degree of prestige and exclusivity by offering clients with sufficient assets and insurance through them certain perks that make the client’s life simpler. Offering house calls may be viewed as a perk, as well as having special speaker seminars on interesting topics that are by invitation only. A perk could even be providing transportation to and from the event. Since people differ, the agent will need to find out what his clients consider to be worthwhile perks.
Aspirational goals are those that a person feels convey prestige and success. Marketing annuities and life insurance as aspirational goals will result in larger sales and open new markets.
provides research and consulting services to insurance companies and financial firms in a variety of annuity areas. He also serves as director of research for the National Association for Fixed Annuities and as a research fellow for Webster University. In 1994 he wrote a book to help banks market investment and insurance solutions to their small business clients. In 1996 he produced the first independent hypothetical return monthly publication comparing all index annuities on the market, and in 1997 created the first comprehensive report of index annuity sales, products and trends, "Advantage Index Product Sales & Market Report" (quarterly). His insights on the annuity and retirement income world have appeared in hundreds of publications. In 2006 the National Association of Insurance Commissioners asked him to address their annual meeting and teach regulators the realities of index annuities. He was invited back in 2009 to talk to the NAIC about the effects of aging on senior decision-making. He is a frequent speaker at industry functions. Prior to forming Advantage Compendium, Marrion was president and owner of an NASD broker/dealer with offices in nine states. Previous to that he was vice president of a life insurance company and vice president of an NYSE investment banking firm. He has a BBA from the University of Iowa, an MBA from the University of Missouri, and a doctorate from Webster University. Marrion can be reached at Advantage Compendium, Telephone: 314-255-6531. Email: [email protected]