Monday, December 31, 2007

Choosing A Professional Designation

by Tammy de Leeuw
Financial Advisor Netzone


In the companion FINANCIAL ADVISOR NET"ZINE", I have been attempting to answer the burning question: "Are there ANY designations worth getting anymore?"

This was prompted by an unusual request I received from the Certified Retirement Financial Advisor (CRFA) coordinator asking if I would host a webinar for them. When I finished laughing, (those of you who know my background will realize why I laughed) I began to think that the designation industry, while it is wheezing and sputtering, isn't dead yet.

Put away those "magic bullets", Festus...

I am frequently asked "Do I need financial designations?" Now, come on people, how am I supposed to know that?

Are you having credibility issues? Are you 35 but you look like you are fresh out of college so no one takes you seriously? Then maybe a few ABC's trailing your name might assuage some of the doubts your prospects feel when they gaze upon your baby face. That, and actually KNOWING what you are talking about could do the trick.

However, a designation, while perhaps educating you beyond the lame training you got from your company or broker-dealer, will not generally create an instant rapport with your clients. It will not make you infinitely smarter than the competition, nor will it make you well-known and admired by all.

Seniors and others in your ideal demographic will probably not gasp in awe and exclaim
"Well dadgummit, Martha, that young feller's done got him a Chartered Certified Retirement Analyst Professional (ChCRAP) designation. Pull out the coffee can and give him our life savings!"

Not gonna happen...

So, when considering getting a designation you really and truly have to know your own motivation for getting it.

1. To impress other people.

Sorry to burst your bubble, but the general public only recognizes a few designations- the ones you probably already have: CPA, CFP, CSA, These might be recognizable to your prospects- but it doesn't necessarily mean they understand or appreciate the VALUE of the required expertise. That being said, the public does expect EXPERTS to have at least a spoonful of alphabet soup, so the right designations might be useful in making a good first impression for some of the people you meet.

2. As A Marketing Tool

In my opinion, this is the absolutely worst reason to want a designation. Most of the world outside of the financial services bubble doesn't give a rat's patooty about the letters on your stationary. They just want to know "What can you do for ME?" Designations do not put butts in the seats at your seminars- good marketing and good reputation DO.

Some of you considering spending $2,000 for another designation might be better served just learning how to become more entertaining, polished presenters or in producing higher-quality invitations, or in buying a decent filtered mailing list so you can crack the one half percent response rate.

Don't rely on designations to fill in the gaps of a poorly designed marketing program. They just can't.

3. As A Way To Better Serve My Niche By Becoming An Expert in THEIR Issues-

Ah ha... Now you are on to something. What if you got a designation just because you wanted to become a better advisor? Now, that is worthwhile. And guess what? When you explain to Mrs. Jones that you became a certified whatever so you could better understand and assist her, you have created a marketing opportunity.

4. My company pays for it

Go for it. A little free education can go a long way. Besides, some of those designation workshops are in go-to destinations. Take advantage of the situation and get some knowledge with your margaritas.

5. They give ME Free Marketing, Including a Listing in Their Directory (wow!)

Nearly all designations claim to have websites and directories which generate tons of leads for their clients. Past experience tells me this is rarely the case. Unless designations chip off some of their margins and spend a whole lot of money advertising, paying for keywords, and doing a ton of search engine optimization, the general public pays them little heed.

Most of the designation websites marketed to the public are weak at best, and from personal experience a lot of the data they generate consists of bogus names and bogus emails. So, how useful are 100 leads of non-existing prospects? For an example of a poor designation marketing website see:http://www.retirement-financial-advisor.com/crfa.html. Is this really going to generate loads of viable leads?

Could you possibly get lucky and find the client of a lifetime just because you got chartered or certified? Possibly. Scatter enough seed and something might eventually grow but are you willing to waste time and money finding out?

Once you have identified your motivation for getting the designation, you need to do the type of research I have been doing on the ChFEBC(sm) designation.

This is the Chartered Federal Employee Benefit Consultant designation. I had an advisor contact me about a program which uses this designation as a way for advisors to do seminars for Federal employees.

Since I wasn't trying to get the designation myself, I asked advisors who already HAD the designation about its value as both a marketing AND educational tool.

So far, on the educational front, the designation looks to be legit. "You just can't pass the test without knowing the stuff," opined one ChFEBC. Another said, "it was exceptional material and I learned a lot." However, and here is the interesting thing, none of the advisors I spoke with were planning to RENEW their designations.????

Why not? Well, you can guess that their personal motivations for getting it had to do with seeing it as a magic bullet to get more clients OR they got themselves involved in seminar programs which REQUIRED it.

According to a smart cookie advisor who forwarded me his own independent ChFEBC research, advisors in North Carolina complained to him that attempts at doing seminars had failed again and again and when they tried to get refunds from the designation company, they were stonewalled.

This might only be the case in the Carolinas, which are notoriously difficult states in which to prospect, but it does ilustrate the need for you to take the time to call someone in your area who has the designation in which you are interested and ask them a few questions. To me the number one question would be" are you planning on renewing your XYZ credential?" If they say "No." ask why and proceed with caution.

In conclusion, designations can be useful and worthwhile, but only if you have realistic expectations and take the time to do your homework.

PS: I welcome your own experiences and comments about designations. Address them to: teleconferences@gmail.com.





3 comments:

Todd V said...

TD,

Happy New Year to you and all of your fellow bloggers ;-)

My opinion of designations has changed over the past year simply because of the way in which they are being used... In my opinion, too many people are using designations that can be "earned" in a few days as a marketing tool to establish credibility... Sadly, I've been guilty of the same thing...

Did I learn something from each designation that I hold?? You bet... Did what I learned make me an 'expert'? Not even close...

Becoming and expert is not an event... It is a process... You become an expert by staying on top of a given area of business and making sure that you know everything there is to know about that topic. Can that be done in a few days? In a word... NO!!!

That said, will having some sort of designation next to your name get a few more poeple to reserve a seat at your next seminar? Probably... However, if they show up to your event and you aren't really as informed as the designation would imply, you still won't get them as a client (and they'll tell 10 of their friends that you don't know what you're doing!).

The fact is that the time is coming when the industry is going to fix the issue of 'designation abuse' (meaning, they are going to set some reasonable/unreasonable standard for what a designation must do such as proctored exams, etc)... When they do, if all you have are these types of designations, you will find yourself having to remove them from your business card, literature, etc and then where will you be??

My suggestion (and one that I am following myself) is to get a designation that the industry as a whole already recognizes as credible such as a CFP... If you start now, you can get all of the course work done and then take the test within 12-18 months (there are some courses that even allow you to go much, much faster if you are so inclined)...

In a nutshell, designations like CRFA, CSA, and any other that can be earned in a few days might teach you some valuable things to help you help your clients, but they are, in fact, misleading to prospects as they imply a certain level of expertise that simply can't be achieved in a few days.

All of that being said, don't be foolish... As long as the industry allows these designations to be used, you can't help but use them as they can be a powerful marketing/credibility building tool. However, I would strongly recommend, if a designation is important to you or your clients/prospects, that you take the time to get a 'real' designation so that, when the day comes, you are better prepared than the next guy...

However, that's just my opinion... I could be wrong ;-0

Tammy d said...

Bravo, Todd:

In a nutshell, you are saying the same thing as me: Don't become "designation dependent" and don't hold yourself out as AN EXPERT after a two day brain jam session.

Whatever you do, do it with a view toward becoming a better advisor and you will ultimately prosper!

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