Niche Marketing: Is Your Unique Value Proposition Actually Unique?Niche Marketing: Is Your Unique Value Proposition Actually Unique?
Clients decide to trust their financial future with someone who offers them a personal and authentic connection.
On the surface, it’s an easy question to answer.
Working with RIAs on their marketing strategy, we’re always asking advisors and executives to share their firm’s unique value proposition. Often the answer is articulated with confidence. “We offer truly comprehensive financial planning and wealth management services.” “We go above and beyond.” “We really understand our client’s needs and offer personalized service.” The truth is, quality service isn’t unique, it’s expected. And more, these statements are identical to what most other firms say.
Differentiation has gotten more and more challenging for RIAs, as so many offer similar services with a comparable level of expertise. As a result, some firms are starting to commit to niche marketing, where individual advisors focus all of their efforts toward a well-defined subset of the firm’s target market. It’s still a perplexing concept for some, as balancing the firm’s brand while also promoting the expertise of individuals seems both complicated and time-consuming.
Your People Are Your Brand
All firms have a defined type of client that they want to attract, typically based on demographics like investable assets, geography, profession, industry or some combination of multiple factors. Niche marketing simply carves a slice from that market and offers advisors the opportunity to reach specific people with very customized messaging that caters to specific needs and preferences.
Other industries, in particular retail and technology, have mastered niche marketing. What works for these industries works here too. But there’s still this common misconception that a financial advisor has to be all things to all people all the time. I’ve had conversations with some advisors who are reluctant to put specialty stakes in the ground out of fear that they would be labelled a certain way and lose out on a wider range of clients. Contrary to popular belief, however, niche marketing does not dilute the firm’s overall brand; in fact, defining niches – and showcasing the strengths of your people in return – means establishing core specialties that easily help differentiate the firm.
Finding Your Niche: A Quick Assessment
“How do I find the right niche?” is one of the top questions I hear from advisors, especially ones who have provided comprehensive services to a wide range of clients for most of their careers.
Different advisors have different approaches to finding their perfect niche, and the key to getting started is by understanding your inherent assets. For example, one advisor may be very well-networked in her local community of affluent families that strongly prioritize education planning. Another may find great satisfaction in working with pre-retirees on an aggressive strategy to reach financial milestones. Some quick real-life examples:
In Silicon Valley, an advisor noticed that he had an affinity for working with pre-IPO tech executives, and he began strategizing how he could establish himself as an authority on topics that resonate the most with that audience.
A female advisor who had gone through a messy divorce decided to supplement her CFP® with a CDFA® designation, specifically to counsel women on their finances during these types of life transitions.
An advisor who was passionate about philanthropy and who served on the boards of multiple nonprofit organizations offered her clients invaluable guidance on how to maximize their donations throughout and beyond their lifetimes.
You can imagine that the target audiences in these examples share a worldview. The likely have similar attitudes, opinions and aspirations. Or perhaps they share a pain. They look to the same outlets for guidance and advice and are linked by a common thread.
To define your niche, we recommend that you first look inward to understand what brings you the most joy, and then look to your client base. Who do you feel you serve exceptionally well and why? Which client relationships bring you the most satisfaction? If you could clone your ideal clients today, who are they and how would you describe them? What are the psychographics of these people?
We naturally gravitate toward certain types of people. The more we enjoy what we do, the more we are engaged and enthusiastic about serving others. A unique value proposition does not mean you have to invent some new way to do things to be “better” than your competitors. It’s far more about finding your own path and offering relevant, personal and valuable solutions to a very specific group of people.
Just remember that clients never select a firm because it offers “comprehensive financial planning and wealth management services.” They decide to trust their financial future with someone who offers them a personal and authentic connection. Niche marketing helps cut through the noise and offers advisors a way to reach the people who can benefit the most from their relationship.
Megan Carpenter is co-founder and CEO at FiComm Partners
