Many financial advisors choose not to specialize in a particular client segment because of the fear of losing business. So instead, we remain generalists, serving all kinds of people, at all stages of life. But I have come to the realization that focusing on a niche market will result in more opportunities with clients that I want to serve.
Focusing on a niche client segment has many benefits. It allows us to develop our expertise in a particular area, and by doing this, we are able to set ourselves apart from the competition. I’ve found that I am able to develop a quick and deep rapport with these clients because they know I “get them.” This has resulted in referrals from others who see my specialty as a necessity.
You might not know where to start or which niche segment to focus on. Here are six tips to help you uncover strategies for growing your business by tapping into a niche market, as well as the path I took in this process.
- Identify the subgroups in your niche. (Identify a group of potential clients that you would like to serve.)
My advice would be to draw from your personal experiences. As a woman who recently lost a sister to cancer and am in the process of going through a divorce, I understand firsthand the challenges that come with experiencing a major life transition. I believe because of my own experiences, I offer a unique perspective.
- List common traits in the subgroups. (Understand the reason you are targeting this group. Is there a common need that warrants a unique approach?)
Studies show that up to 90% of women will one day have to make their own financial decisions without the help of a partner. By going through this myself, I can relate to having questions about how to turn these experiences into something positive.
- Identify the common concerns, needs and emotions of this subgroup. (Identify the needs for this niche market and how you will address them.)
After going through these huge life changes, I became aware of the many individuals in my market area who were struggling with the same issues. I knew I had valuable lessons-learned that I wanted to share with other women in similar situations. I now offer a full-service approach that not only addresses their financial needs, but also their emotional ones by providing advice and coaching.
I plan to expand this full-service approach by bringing in other professionals to assist women going through transition in life. The types of professionals may surprise you: life coaches, yoga teachers, vision board facilitators, meditation coaches, and nutritionists, to name a few.
My message is this: We will handle your financial position, and help you channel your time and energy into creating your best life moving forward.
- Think about the financial actions that may be driven by these emotions.
For many of the women I’m now serving, who’ve gone through a big life change, they are for the first time taking an active role in their financial future.
They may not be prepared for this change or have had to deal with any financial decisions in the past. To ensure they understand their options, I spend a great deal of my time educating them and providing basic investment information.
- Identify centers of influence or places you can leverage to reach these subgroups. Who can you turn to as support and/or to partner with to provide a full-service approach to this niche market?)
We all need partnerships and advocates, and to help me reach women in this new targeted market I’ve leveraged the support from others I call centers of influence; these are people from different businesses such as attorneys and accountants.
By creating relationships with these other professionals, we’re able to partner together to help our respective clients. I approach all meetings with centers of influence, just as I would with any new business partnership.
I provide information about my firm, and the services I provide. I also seek their input by asking a series of questions about their business, and their needs, as well as suggestions on how as a financial advisor I can provide better services.
It’s important to explain your value is unique to theirs, and that this is not a competition. Instead, this is a partnership that is invaluable to both your clients and theirs. And while not all centers of influence will lead to referrals, many do, but the real success is sharing expertise and knowledge so that we will each better understand our clients.
- Be Patient! This will take time.
These clients only make up about 30% of my current practice, but it’s a growing part of my business. Currently, many of my clients have found me through word-of-mouth from a friend or colleague. And, it’s important to note that while I do intend to focus on this type of client, I also remain committed to my clients who don’t fall into this category.
For financial advisors who want to specialize, find a niche that matches your personal passions with a sufficient market of investors. Then you’ll have a powerful combination that can help your practice grow in ways that will be fulfilling to you, and helpful to those in need.
To learn more about niche marketing, reach out to LPL Marketing Consulting at (800) 877-7210 x6700, opt.1 or firstname.lastname@example.org.
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