Need a niche? How about specializing in your best clients?

Friday, September 24, 2010 06:56
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Need a niche? How about specializing in your best clients?

To be successful you need to be different. Stand out from the crowd, have some specialty, or niche. This idea is not new. It has been discussed plenty of times. And not just in our business. In defining the difference is one of the most difficult challenges for a financial advisor. I have worked with hundreds of advisors, and still most cannot articulate what makes them unique.

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I empathize – it's hard! The fact is most of what all of us do for clients involves essentially the same disciplines, regardless of the client. So defining what sets us apart generally eludes us. And then we wonder why it is so hard to get referrals! Well, if you don't know, your clients certainly don’t know – and will rarely think to bring you up in conversation when the right prospect or moment arises. So, how do you find a niche?
 
Having a niche or specialty doesn't necessarily mean having a lot of specialized expertise or especially advanced skills. It can mean simply collecting the specific services wanted by a particular client. To take an example from outside of our industry, consider the Trunk Club, discussed in the book The Referral Engine by John Jantsch. The Trunk Club is a clothing buying service for successful man who have little time and no interest in going to the mall to shop for their clothes. The client meets with the stylist (whether in person or remotely), describes the clothing they need and the styles they like. An assortment of clothing is shipped to the client. The client keeps what they like, and returns the rest. Is there any inventory the Trunk Club offers that can't be found in other clothing stores? No. Is there any about the service that any other haberdasher could not provide? It's the same. The difference is how they have put the services together to cater to a client with a particular preference. And to that type of client, the Trunk Club is ideal.
 
You can find examples in our business as well. Consider Gary Watsky, and advisor who practices in Austin Texas. He specializes in retirement planning for Texas and California educators. Of course, he knows some specialized information peculiar to those populations: how the state retirement systems work, the ins and outs of 403(B) plans. Does he do anything fundamentally different than any other advisor who offers retirement planning? Not really. But if I am a teacher in the state of Texas I want to get serious about saving for retirement, it will be obvious that Watsky has something specific to offer me.
 
And what target market should you focus on? How about specializing in your own best clients.
 
Go to the clients you want most to replicate. Find out what they most value from among your service offerings perhaps find out what they would most like to see added to your portfolio of services. Then organize your practice around those services and those clients.
 
Build your offering around your best clients. Learn how to describe that package to people. Better yet, have your best clients tell you how to describe it. Once you are in a position to say "people like you hire me to do [what you most want in advisor]", you will be different than any other advisor. Different enough that more and better qualified referrals will be far easier to attract.

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