Beverly Flaxington is a practice management consultant. She answers questions from advisors facing human resource issues. To submit yours, email us here.
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Dear Readers,
This week I have spoken at several events where the topic of whether to use niche marketing has been discussed. What’s the value of niche marketing? Does it limit you and make you more narrowly focused than you should be?
In light of this, this week’s column outlines the key components of niche marketing and why you definitely want to have one in your advisory practice. Everyone needs an advisor – if they don’t have plenty of money to invest, they still need help with planning, preparing for their future and so on. But it’s hard to market to everyone! The world is big and sending a message out saying you can help anyone who needs it isn’t going to draw anyone’s attention to you.
Yes, many advisors have client bases made up of people of all types and backgrounds. Many advisors do an excellent job of serving different clients very well but it gets a lot easier to focus and speak to a specific audience.
Niche marketing helps you to:
- Find something you are passionate about. If you love a certain sport or hobby then create your niche around this. There are advisors who have built their businesses by aligning with people who pursue the same interests they do – events can be tailored around this, and conversation flows easily if you love boating and you work with clients who own, or want to own, boats too.
- Refine your product and service offering – not everyone needs the exact same things in the same way. A married couple with one working spouse and children will have different financial concerns than the single technology executive trying to figure out how best to maximize company options. People who enjoy a certain hobby, or work in a particular industry or come from a certain background will have similarities and interests that may be different from those outside of their circle. Identify the needs and concerns of your niche market and speak to those in your process and approach.
- Be clear about whom you best serve and why – your confidence will come through because you have dealt with so many clients just like the ones you are now marketing to. You are able to get clear about your value prop and your way of describing how you can stand out in a crowded market.
Many advisors choose not to have a niche because they don’t want to limit themselves. But just because you have a focused niche does not mean you can’t take on a client who doesn’t fit the profile. Don’t worry about limiting yourself; rather focus on how your niche can expand who knows about you and what you do.
The next question is how best to find a niche. Some advisors will say, “I don’t have a focus so how do I determine who is my best client?” There are many ways to identify the best niche for you and you can also combine two or more of these to create a clear profile:
- Find something you are passionate about. If you love a certain sport or hobby then create your niche around this. There are advisors who have built their businesses by aligning with people who pursue the same interests they do – events can be tailored around this, and conversation flows easily if you love boating and you work with clients who own, or want to own, boats too.
- Review your existing client base and look for themes. You might not realize it because you didn’t proactively pursue a “niche.” But you may have themes that run through your client base you are unaware of. It can take some time to wade through and make connections but they are often there. Review your clients with the eye toward themes and stay open-minded about what you might find.
- Consider an area of interest that is important to you – perhaps it is working with parents of disabled children because you care about their long-term security, or women business owners because you recognize an underserved market or college professors because you have a love of learning and enjoy the intellectual environment. Maybe you have a past profession or career that could connect you to people like you once worked with. Maybe you have had a life experience that shaped your interest in advisory and can find others who have had a similar journey to you.
You can have a broadly or narrowly focused niche – the difference between serving divorced women and serving divorced women entrepreneurs with children at home. You can choose a niche that is just about interests like the boating community, or one that is about lifestyle planning or is aligned to what you do best and what you have to offer. There are really no “right or wrong” ways to do this – start somewhere and build your story about what you do around the needs and interests of your niche. Use their jargon, talk about shared experiences and build the bond that connects you to them and each of them to one another.
It is very satisfying but it is also a best practice to help you stand out and grab a share of the market that can belong only to you!
Beverly Flaxington co-founded The Collaborative, a consulting firm devoted to business building for the financial services industry in 1995. The firm also founded and manages the Advisors Sales Academy. She is currently an adjunct professor at Suffolk University teaching undergraduate and graduate students Entrepreneurship and Leading Teams. Beverly is a Certified Professional Behavioral Analyst (CPBA) and Certified Professional Values Analyst (CPVA).
She has spent over 25 years in the investment industry and has been featured in Selling Power Magazine and quoted in hundreds of media outlets, including The Wall Street Journal, MSNBC.com, Investment News and Solutions Magazine for the FPA. She speaks frequently at investment industry conferences and is a speaker for the CFA Institute.
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