Segmenting Clients Hot

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In my view, there are two ways to segment clients: 1) by type of clients and 2) by profitability. We read a lot about how to attract various types of clients, such as physicians, women, widows/divorcees, high net worth, business owners, etc. I'm in agreement that certain client groups require specific expertise. For example, specialized knowledge is required in the areas of tax and financial strategies for the sale of a small business, or tax and financial impacts of divorce. I disagree with the notion that certain "groups" represent a separate market segment. 
For example, I don't think that "women" should be viewed as a market segment. It is true that some male advisors might need training on how to communicate better with women (and some female advisors might need training on how to communicate better with men). Communication skills can always be improved. However, women do not - as a group - have different financial needs than men.  
So, when thinking about segmenting clients based on type, I recommend considering how each group's needs differ from others. From there, you can build expertise to better serve your current clients while building your reputation in that segment to attract new clients. 
Segmenting clients based on profitability is important from a practice management standpoint. I will discuss this in my next article. 

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