Agents Gain at The Cost of The Investor: A Case of A Distressed Investor

Agents gain at the cost of the Investor: A case of a distressed investor.
Hari Sankar S
B19018
Q) What should the Agents have done to ensure Santosh was happy?
 From the case, it is evident that the agents saw Santosh purely as a business
opportunity and did not want to focus on having an emotional connection with him or
understanding his pain points. The agents exploited him and gained as much as
possible for their own needs, which was probably done to meet the sales target set by
the upper management.
 The agents should have informed Santosh periodically on how his investments were
performing compared to his initial expectations and market performance, in the form
of easily understandable reports for a person without much knowledge of financial
aspects.
 Periodic updates on switching his finances between different portfolios and informing
about new service offerings most apt for his goal, instead of solely focusing on
meeting the sales targets, would have made him feel valued and not alienated. Reports
on the performance of his investments could have been shared to keep him informed.
 Agents should be proactive in doing this and not wait for the investor to call them up
and ask for regular feedback. In this case, agents lost interest in Santosh once he
signed up for different investment options as their sales targets had been met, and
only contacted him when they were in need for achieving their objectives. Prompt
response from their side whenever he had clarifications, would have made him feel
less agitated.
 Agents have entered into a contract with Santosh and hence have the responsibility to
give information based on historical figures and realistic forecasts, instead of making
fake promises. Santosh would have been happier if agents had informed him saying
they had committed a mistake and fault was on their part in investing in the wrong
portfolio. The blind faith he had placed in the agents was misplaced
Hence, the agents should have adopted a much more proactive approach, with detailed
feedback on investments and ensuring Santosh is aware of what is happening with his money.
The agents must find a way to strike a balance between meeting sales targets and ensuring
customer satisfaction, to avoid being confronted in the future.
Q) How should the company plan its sales decisions and avoid short term orientation of
its selling activities, leading to loss of customer goodwill?
The current practice of increasing sales by gaining more customers and making them sign up
for various new investments without giving them a specific risk vs. return analysis is a bad
practice and something which tarnishes the image of the company, and customers remain in
the dark.
Steps to be taken to improve the firm’s image:
 The company should ensure that agents are giving realistic expectations on the returns
and not just lure the customer to meet the sales target. The performance of the agents
should also be judged based on the quality of investments, returns made on money
invested, and not just on the sales volume and amount of investment.
 The company’s primary target to increase sales should be kept at par with ensuring
customers get a guaranteed return on their investments. For planning the sales
decisions, the company should ensure the agents have the necessary background
knowledge of various asset classes, understand the needs of the customer, and what
he/she is expecting out of these investments and make a detailed analysis before
suggesting a product.
 The investment strategy for each customer will be different and the company should
prioritize this. Hence, it is necessary that agents are deployed to help the customer
identify the right service offering, make an estimate, and provide solutions at various
stages during the customer’s term with the firm. Customer satisfaction will lead to an
improvement in the firm's image and credibility, thereby build more goodwill.
 Building relationships with the customer should also be an area of focus, as this can
lead to long-term customer relationships. This can be done by connecting with the
customers periodically, enquiring about his needs, keeping him/her abreast with the
risk vs. returns of the current portfolio, providing alternate options if there is an
expected downfall shortly and by altering the portfolios if his/her needs and goals
have changed. Being prompt in responding to customers should also be an essential
factor in building long-term relationships. A customer will then feel valued, stay on
board for long, and also refer the same to his friends and network, thereby improving
the image.

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Steps to be taken to improve the firm’s image:

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