Choosing a Niche Can Help You Better Attract the Right Clients and Grow Your Business
Your prospective clients have a multitude of options when it comes to selecting an advisor to work with. If you’re focused on your marketing but you still haven’t been able to build your book of business the way you hope to, it’s time to think about better differentiating yourself. I think one of the best ways to do that is to choose a financial advisory niche – one that is congruent with your business and your values, and which is also compelling to your prospects.
Is a Niche the Same as a Target Market?
You might be thinking you’ve already “niched down” because you’ve been marketing to the specific group or groups of people you most want to attract as clients. This isn’t a bad thing; in fact, it’s smart to know who you want to work with and to focus your marketing efforts there.
Here’s why a niche is different, though. A target market defines the group of people you want to attract, but a niche is all about the specialized services you’re creating for those people within your client service model. It’s the meat and potatoes you have to offer to a potential client after your initial marketing piques their interest.
How to Think About Developing Your Niche
It’s not easy these days to come up with something completely unique but being “different enough” from the advisors you’re competing with is a good start. Think about your target market, identify a subset of it, and think about how you can create a client experience and specialty services for that subset of folks.
Here’s an example:
Let’s say your target market is pre-retirees, and you choose to create a niche experience for the subset of pre-retirees who will be retiring from a W-2 occupation within five years. Maybe you create and market a process that involves analyzing pension options or creating an ideal Social Security strategy. Maybe you get specific about designing retirement income-generating portfolios, as opposed to total return portfolios. You’re looking for a distinct, valuable way to serve people who fit into one slice of your target market pie.
Try to keep your niche idea fairly narrow. Chances are, you can meet your business goals by better attracting just a small portion of a larger target market in your geographic area.
Six Types of Niches to Consider
There are dozens of possible niches – you’re probably already creating a mental list as you read this – and most of them can work. So, the trickiest step in this process becomes actually settling on your niche.
It may help you to narrow down the type of niche that most appeal to you first, and there are six to choose from:
Let’s talk through the details of each.
You probably already know about this kind of niche work – and you may be doing it – without giving it a name. I actually find it the weakest way to build a niche service, because it’s more about your social circle than your specialized services, but it’s worth mentioning because it’s a technique that has been used in sales for generations.
As I mentioned at the start of this article, your prospective clients have many financial advisors to choose from. The choice can feel overwhelming for that very reason. So, if a prospect feels an affinity toward you because they know you’re a member of the same country club, or because your kids are in the same community soccer league, they might put their trust in you simply because you feel like a fellow member of their tribe.
This is a much deeper way to connect to prospects than a simple affinity. Your values are ingrained in you and impact the way you live your life. Maybe you’re an Eagle Scout and you still live out your oath to be of service to others. Simply talking about that openly or in your marketing will have an impact on anyone who was ever involved in Boy Scouts. It forms a basis of trust because they can identify that you have shared values and philosophies about life. Another example is, if you practice the religious principle of tithing, you might be able to use this personal value system as a way to connect with Christian prospects who also believe in giving away 10% of their wealth.
Oftentimes, the greatest service you can offer to your niche is education on relevant issues that impact them. Life transitions, for instance, are often a point in time when people need financial advice. So, maybe you create an educational niche for recently divorced women who are working to get their personal finances in order. Other examples include how to save for a child’s college education, what to do when you inherit a windfall, or how to plan ahead for the care of a child with special needs.
Most financial advisors pride themselves on providing “personal service” or “superior service” to clients. When you think about it, though, these phrases may not mean all that much to prospects because they’re fairly general and undefined.
On the other hand, if you work to create a truly unique client experience – one that you can define in specific – you’ll set yourself apart. And the experience you create doesn’t have to be bigger or better, just… different. It can be as simple as foregoing desks and conference tables and meeting clients in a living room setting instead. If you want your niche experience to reach busy executives or small business owners, you can consider offering virtual meetings designed to fit their schedules.
Money matters are highly tied to emotions for many people, so offering services that address both can help you develop a valuable niche. For example, if your target audience is women in transition and the subset you focus on is women facing late-life career transitions, think about what these prospects need. Outside of guiding them through the financial considerations for this life transition, maybe you also offer a virtual community on Facebook or another easily accessible platform where these clients can support one another through their career transitions.
Offering a skill, knowledge base, or services that other advisors simply cannot offer is how you establish a technical niche. There are some that easily come to mind – things like advanced tax or estate planning – but the options are many and varied. Your technical niche might be cross-border financial planning, working with military or federal government employees and their specialized benefits packages, or gaining exposure to cryptocurrencies or other emerging digital assets.
How to Select the Right Niche for You
As you read through the six niche types, it’s possible you already identified one or two options that could work for you. If not, think about the work you do already and assess any specialized knowledge or skills you may have. Are you already offering something unique that you could build upon or market more successfully? Do you feel particularly passionate about a specific aspect of the work you already do? Is there a significant personal experience that provided you with insight that could inform your niche?
If asking yourself these questions doesn’t get you there, consider interviewing some of your clients who fit your target audience for niche services. Ask them why they chose you and what they value most about your services. You may begin to see a theme in their answers that helps you carve out a niche going forward.
Final Thoughts on How to Differentiate Your Services as a Financial Advisor Using a Niche Strategy
Differentiation is often the key to building the client base you want and meeting your business goals. If you’re serious about setting yourself apart from the competition – and adding more value to your clients and prospective clients – consider creating your own unique niche.