Identifying a niche market can set a practice apart in the advisory world, so that instead of scrambling for highly sought-after clients, they seek out the firm.
But identifying that niche isn't always easy. Advisers can decide on the client group with which they most enjoying working or share an affinity or the one that will net the largest fees.
However, there may be more bang for the buck from a mental exercise in which an adviser imagines a specific ideal client.
For example: “My ideal client is Melissa. She is 47, divorced and works for the City of Cleveland as a finance commissioner. She earns $87,000 per year and has 21 years under Ohio’s Public Employees Retirement System. Her son is 12 and has an aptitude for music, and she owes $104,000 on her $180,000 home under a 30-year fixed-rate mortgage at 4.75%.” And so on.
This can tell you a great deal about the kind of help that Melissa may need, but which of these characteristics most set her apart from the universe of advisory clients? The answer likely is the retirement savings plans that Melissa has available, the traditional pension that she is earning, and the fact that she likely could take that pension in her 50s.
Focusing the firm's marketing on these features can distinguish it from other practices in the minds of clients. For example, potential clients frequently comment that our public-sector expertise is a major reason that they seek out our firm.
A firm's message might focus on “public employees considering early retirement," not “commissioners for the City of Cleveland," as that is probably too narrow.
The sweet spot for us was to refer to “professionals in the public sector.”
Because most of them are under one of a few public pension systems, we have developed significant expertise that adds value for clients and increases their satisfaction with our services as well as their likelihood of referring others.
This steers us clear of competing with most other advisory practices. Instead, we compete with other advisers who serve Ohio public employees.
The meaningful demographic that distinguishes our ideal client is a key to a much narrower competitive field where we can be recognized as the expert more often.
This story is part of a 30-30 series on strategies to boost your practice.
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