If you think back to your time in grade school, you may remember learning in biology class that there’s a specific niche for every organism in an ecosystem. For example, a species of frogs may focus on eating flying insects that venture close to their pond while a species of birds may concentrate on slow moving caterpillars or beetles they can easily snatch off the ground.
Financial advisors can learn a lesson or two from the specialized roles these animals play in the wild. While (most) advisors aren’t interested in eating bugs, they are interested in tapping into a market and growing their business. Finding a specialized role to play in your clients’ lives, and building a brand around that role, can make all the difference.
Don’t be a “master of none”
While focusing on a general market may be the best way to reach a broad group of potential clients, it may lead to converting fewer of those prospects into active clients. If you’re a “Jack of all trades, master of none,” then you may find clients opting to go with an advisor that promotes and demonstrates knowledge in the specific financial need they are facing.
Compare our industry to the practice of medicine. While we may go to a general practitioner for a check-up or mild illness, we’re likely to go to a specialist if our needs are more pressing (and we’ll pay more for it too). For instance, you would not go to a doctor of internal medicine to replace your knee. Similarly, people with specific financial needs have a strong desire to go to a specialist that has the expertise and knowledge to serve them.
While you want to make sure you offer something unique to your clients, it’s important to remember that you won’t be able to find any clients to serve if your specialty is too narrow and obscure. So, it’s important to find a middle ground—a specific role that is in demand but not yet adequately supplied. In the investment world there are a great number of investment niches that consumers have strong emotional needs for, such as saving for a child’s education or living in retirement.
A great example of a specialized role comes from Charles Massimo, a father of two autistic sons who used his personal experience to build a niche around serving parents of autistic children. Knowing that autistic children may need care long into adulthood, Massimo helps parents plan for that financial reality.
Finding a niche that is right for you.
In finding your niche, Michael Kitces of Nerd’s Eye View blog recommends identifying (1) your target clientele (who do you feel comfortable serving?), (2) the unique expertise you have to provide solutions to customers’ financial problems and (3) the type of services and business model you will utilize to deliver those services. As you serve your clients, you can keep these elements in mind and tweak your strategy until you find the right niche for you.
In first identifying your target market, you should focus on your strengths, whether that comes from your industry knowledge and experience, your personal financial needs or those of your family. For example, Massimo was able to use his personal experience as a father of autistic sons to find his niche. However, you can also find your niche by identifying your business strengths. For instance, if you realize that 80 percent of your book of business comes from parents preparing for their children’s education costs, you can shift your marketing strategy to concentrate on that segment more heavily.
One reason niche marketing has become so important is technological development. Google and the internet have made specialized services easily findable and communication technologies have made it easier than ever for financial advisors to connect with prospective clients through electronic and social media. Your online network and who engages the most with your online presence can also help you identify your niche.
Using your niche to build your brand
Identifying your niche and the unique service you can provide as an advisor is only half the story. After you have found your niche, you need to work to associate this specialty with your brand. As there are a variety of target markets that you can serve (such as retirees, high net worth individuals, young professionals, etc.), it’s important that you come to be known for your expertise in the specific area you focus on. This is where your marketing and messaging efforts come in.
Ultimately, the growing competition in the financial advisor sphere makes having a specialty all that more important. By compelling a relative few clients with specific needs to work with you, you avoid the risk of being overlooked by many. Plus, by associating a specialty with your brand, you can distinguish yourself as the financial advisor who meets the unique needs of prospects.
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https://www.kitces.com/blog/how-to-find-your-niche-as-a-financial-advisor/
http://www.advisorinternetmarketing.com/top-niches-for-financial-advisors/
