A Niche Is A Need – Avoiding The Biggest Mistake Of Marketing

Wednesday, October 10th, 2012

Maybe you’ve heard that suc­cess­ful mar­ket­ing starts with defin­ing your niche; know who you will mar­ket to before you start. And when they do it, most advi­sors make the biggest mis­take before they ever begin. The peo­ple they tar­get are not a niche at all.

Here is the chal­lenge: a niche is not actu­ally a demo­graphic or a pro­fes­sion or an affil­i­a­tion. A niche is a need. A suc­cess­ful niche iden­ti­fies a tribe of peo­ple who share a com­mon need that is not shared by the gen­eral pop­u­la­tion. It is what sep­a­rates one group from the rest of us in terms a finan­cial advi­sor can address.

It is not a descrip­tion. You can describe a lot of groups that share a lot in com­mon but do not have a unique need. If they don’t have a need, what you can do to appeal to them is lim­ited. My favorite is advi­sors who tell me that their niche mar­ket is women. Women is not a niche (I spoke with Mark Tibergien of Per­sh­ing Advi­sor Solu­tions last week­end, and will write more about that soon.) Women make up 52% of the pop­u­la­tion – that’s not a niche, it’s the Grand Canyon. There is noth­ing I can think of that could mean­ing­fully tie together the needs of my 18-year-old daugh­ter, a 45-year-old cor­po­rate exec­u­tive, and an 87-year-old widow. And unless there is a com­mon need, it is dif­fi­cult to design an advi­sory solu­tion for them. It is point­less to define your tar­get mar­ket based on the restroom they go into.

A niche is cer­tainly not a bank bal­ance. I hear some advi­sors say they spe­cial­ize in high net worth indi­vid­u­als with over $1 mil­lion to invest. That is not a need but a resource. Peo­ple don’t define them­selves by what they have in the bank. There is noth­ing in par­tic­u­lar that I need sim­ply because I have $1 mil­lion. I think of myself a lot of ways – hus­band, father, some­one with kids of a prior mar­riage, a small-business owner, a cook, a dancer. I don’t think of myself as some­one who has $1 million.

Another com­mon “niche” is retirees. But, like women, that is just too big a seg­ment with too many var­ied needs. There is a big dif­fer­ence between a 42-year-old who no longer has to work because he just sold his Inter­net com­pany and a 67-year-old for­mer plumber. They are likely look­ing for very dif­fer­ent things from an advi­sor. “Retirees” is not a niche. Peo­ple who retire from a spe­cific com­pany, or from a cer­tain pro­fes­sion, or who still have teenage kids after they retire could all poten­tially be niches. I work with one prac­tice who has made sig­nif­i­cant strate­gic deci­sions to high­light their exper­tise in the ben­e­fits plan of a major local employer. When that employer declared bank­ruptcy, this prac­tice sent out a sin­gle e-mail say­ing they would have a sem­i­nar on the impli­ca­tions of that fil­ing on the company’s 401(k) and retiree health ben­e­fits and put 600 peo­ple in a room. Retirees that share a com­mon chal­lenge is a niche. But just being retired is not.

All mar­ket­ing begins with the niche. When you choose yours, make sure that what you have selected describes a group that will respond to the spe­cial solu­tion you have to offer them. What do you describe as your niche?  I would love to hear some of your ideas in the comments.

    Lat­est Advi­so­r­An­a­lyst Prac­tice Growth Sto­ries

Tags: 1 Million, Affiliation, Bank Balance, Biggest Mistake, Corporate Executive, Dancer, Grand Canyon, Groups, High Net Worth Individuals, Marriage, Niche Market, Population, Profession, Restroom, Small Business Owner, Successful Marketing, Successful People, Target Market, Tribe, Women Women
Posted in My Practice | Comments Off

How to Design a Referral Marketing Strategy – Results from Client Engagement Think Tank, Part Four

Wednesday, March 14th, 2012

In my first three posts on our client engage­ment think tank, I set the stage for a dis­cus­sion of a refer­ral mar­ket­ing plan. What we found in our round­table dis­cus­sion with advi­sors is that many do not tar­get prospects par­tic­u­larly well, don’t use the tar­get mar­kets they have defined in their client onboard­ing process, and they don’t have a plan to attract refer­rals from that tar­get group. So now that these obser­va­tions are in the open, how do you write a plan to sys­tem­at­i­cally attract refer­rals? Here are a few basic principles:

1. Do an excep­tional job – this may seem obvi­ous, but many advi­sors I speak to want to know how to get refer­rals and do not ques­tion how the qual­ity of their work may be part of the cause for not receiv­ing more. Rather than ask “Why don’t my clients pre­fer?” Asked “What can I do better?”
2. Get client feed­back – In order to find out how good a job you’re doing, and what you could do bet­ter, have a sys­tem­atic way of obtain­ing feed­back from your clients. Whether through sur­veys or advi­sory boards, have a struc­tured way to ask ques­tions like How my doing? What am I really good at? What unique value do I bring to the relationship?
3. Define your tar­get mar­ket – Many advi­sors do not do enough work in defin­ing who exactly their best tar­get prospects are. Even many of the arti­cles I have read on tar­get mar­kets only offer the shal­low­est and most super­fi­cial advice. It is not enough to define the tar­get mar­ket by pro­fes­sion, a faith com­mu­nity, or an age range. And don’t even get me started on investable assets. You need to go beyond the obvi­ous and develop a more sub­tle and nuanced descrip­tion of the peo­ple you can ser­vice most effec­tively. One of the advi­sors I work with ini­tially told me his tar­get mar­ket was “women.” To be effec­tive, you need to have unique skills and ser­vices that con­nect with a group. There­fore, that group needs to be less than 52% of the pop­u­la­tion. Ulti­mately, we arrived at a descrip­tion that included “women who have just recently or are about to take con­trol of their fam­ily finances for the first time in their lives.” These are not the “sud­denly sin­gle” or the cases of “sud­den wealth.” Many of these women are still mar­ried, and the fam­ily net worth has not changed. One exam­ple is a woman whose hus­band was recently diag­nosed with Alzheimer’s dis­ease. The fam­ily and assets have not changed, but she was fac­ing the fact that she was about to be in charge. It is a group of peo­ple with sim­i­lar needs, shared con­cerns, in need of sim­i­lar services.
4. Research the needs of your tar­get audi­ence – Now that you have deter­mined who your tar­get mar­ket is, con­sider what they might need from you do not cur­rently pro­vide. Per­form a “gap analy­sis” on your prac­tice ver­sus the ideal prac­tice for that tar­get audi­ence. Go back to your clients who are in that tar­get audi­ence and get their opin­ion on your research. Ask ques­tions like “if I wanted to work with other peo­ple just like you, what ser­vices would I add that would make me the ideal advi­sor?” Bring them the results of your gap analy­sis, and ask “do you think I should add ser­vices like these?”
5. Design your com­mu­ni­ca­tion strat­egy – Once you have tai­lored your prac­tice to your tar­get mar­ket, design a strat­egy for com­mu­ni­cat­ing your area of spe­cialty and your spe­cial­ized ser­vices. Let your clients know specif­i­cally what kind of new client you are focus­ing on, and what spe­cial skills you bring to the table to work with them. Learn how to describe what makes you unique for that tar­get audi­ence so that you can clearly artic­u­late it to the peo­ple you meet. Let peo­ple know that you worked with your best clients to tai­lor your prac­tice to that tar­get group.

    Lat­est Advi­so­r­An­a­lyst Prac­tice Growth Sto­ries

Tags: Advisory Boards, Client Engagement, Client Feedback, Faith Community, Find Job, How To Get Referrals, Investable Assets, Marketing Plan, Marketing Strategy, Profession, Referral Marketing, Relationship, Strategy Results, Surveys, Systematic Way, Target Group, Target Market, Target Markets, Target Prospects, Think Tank
Posted in My Practice | Comments Off

Do You Have the Guts to Set Yourself Apart?

Wednesday, January 11th, 2012

In a recent post, Seth Godin points out that cre­at­ing a com­pet­i­tive advan­tage takes guts.

A few days ago, I wrote about the impor­tance of iden­ti­fy­ing a niche mar­ket­ing to it. It makes you more attrac­tive to prospec­tive clients, and makes you refer­ral. I noted that it is counterintuitive.

It is more than that. Mar­ket­ing guru Seth Godin noted in a recent blog post that it takes guts.

Like oth­ers before him, he points out that work­ing harder is not going to make you more suc­cess­ful any­where near as much as work­ing smarter or dif­fer­ent. He also made a point I had not con­sid­ered before – that sim­ply get­ting more effi­cient at your work turns intel­lec­tual work into fac­tory work. And that engages you in a race to the bottom.

He noted that over­com­ing the iner­tia to get bet­ter at your craft, or to be dif­fer­ent in your pro­fes­sion, and to cre­ate a com­pet­i­tive advan­tage takes guts.

Why are we so insis­tent on describ­ing our­selves and our prac­tices exactly the same as all other advi­sors? Why do we describe what we do and for whom we do it the same way so many oth­ers in our indus­try do? You would think that we would under­stand that using the same words as every­one else will be utterly inef­fec­tive at giv­ing prospects a rea­son to choose us instead of any­one else. Part of the rea­son is because being cre­ative is really hard. And part of the rea­son is prob­a­bly because it is scary to do some­thing dif­fer­ent than every­one else.

It is tempt­ing to believe that every­one has cho­sen to do some­thing one way because it’s the best way. It is not – it is the aver­age way. And it takes a mea­sure of courage and self assur­ance to make a dif­fer­ent choice than your peers.

So, as you lay out plan for the com­ing year, be brave. Be dif­fer­ent. Achieve more.

    Lat­est Advi­so­r­An­a­lyst Prac­tice Growth Sto­ries

Tags: Competitive Advantage, Courage, Few Days, Guru, Guts, Inertia, Intellectual Work, Niche Marketing, Peers, Profession, Prospective Clients, Prospects, Race To The Bottom, Reason, Referral, Scary, Self Assurance, Seth Godin
Posted in My Practice | Comments Off

For More Business, Prospect Fewer Clients

Wednesday, December 21st, 2011

It is utterly against the DNA of most advi­sors, but if you want to be a suc­cess at attract­ing refer­rals you must choose not to pur­sue good prospects.

A lot has been writ­ten about tar­get mar­ket­ing and hav­ing a niche. Yet I am sur­prised by how many advi­sors I meet who can­not bring them­selves to com­mit to a mar­ket because it means not attract­ing some prof­itable clients.

Here’s a clas­sic exam­ple: I was con­duct­ing one of my Secrets of Refer­ral Mar­ket­ing work­shops and we were dis­cussing find­ing a niche. We talked about how spe­cial­iza­tion and aim­ing at a small part of a mar­ket can bring more clients than that advi­sor can suc­cess­fully ser­vice. Think about it – if you are the one advi­sor that 1% of the peo­ple in your geo­graphic area really needs, how many poten­tial clients is that? Where I live, that’s about 800 house­holds. So it is okay to basi­cally ignore 99% of the pop­u­la­tion. If you can be the advi­sor with the most com­pelling value propo­si­tion for that tar­get mar­ket, what do you need to achieve your goals? Ten per­cent of that poten­tial mar­ket? 20%? And that’s with­out leav­ing town. I can drive an hour east or west and have another mar­ket almost as big.

Every­one agreed. If we designed an irre­sistible mes­sage for the 1%, we can accom­plish as much as we would ever want to. Nods all around. Is every­one okay with that idea? Yes, all the par­tic­i­pants say it makes per­fect sense. We will deter­mine who we can spe­cial­ize in, and cre­ate plans that will suc­cess­fully attract them, even if no other prospects (out­side the niche) respond to the message.

An advi­sor raises his hand. “So, if I meet a prospect out­side my tar­get at a cock­tail party, and he has a rollover of $1 mil­lion, and I tell him what I do and it doesn’t inter­est him at all, it’s okay?” Yes, it’s okay.

Imme­di­ately another par­tic­i­pant objects. “But we have to say some­thing that would get them inter­ested – he would be a great client!”

From the day we enter the pro­fes­sion, we are trained to pur­sue any prospect who could be prof­itable. Even­tu­ally, we end up with a diverse client base that can be a chal­lenge to ser­vice and a value propo­si­tion that attempts to attract every­one and is com­pelling to prac­ti­cally no one. When we first try to mar­ket to a tar­get audi­ence, we find our­selves unable to resist the dilemma of “and I do that, too. And that…” It is coun­ter­in­tu­itive.  As much as we have dis­cussed it, many, maybe most, advi­sors still can­not bring them­selves to focus on a sin­gle, tar­geted client profile.

But if we want peo­ple to talk about us, to refer us, we need to be known for some­thing spe­cific. And that means leav­ing a major­ity of the pop­u­la­tion out of your mar­ket­ing and prospect­ing plans.

Nar­row and deep beats wide and shal­low. Less is more. Get known for being the sin­gle go-to advi­sor for some­thing spe­cific, and you can even­tu­ally get to the point that many of those prospects find you.

    Lat­est Advi­so­r­An­a­lyst Prac­tice Growth Sto­ries

Tags: 1 Million, Business Prospect, Cocktail Party, Dna, Households, Niche, Participant, Participants, Perfect Sense, Population, Potential Market, Profession, Prospects, Referral Marketing, Referrals, Specialization, Target Market, Target Marketing, Value Proposition
Posted in My Practice | Comments Off

How to Attract Referrals Systematically

Wednesday, August 17th, 2011

In my first three posts on our client engage­ment think tank, I set the stage for a dis­cus­sion of a refer­ral mar­ket­ing plan. What we found in our round­table dis­cus­sion with advi­sors is that many do not tar­get prospects par­tic­u­larly well, don’t use the tar­get mar­kets they have defined in their client onboard­ing process, and they don’t have a plan to attract refer­rals from that tar­get group. So now that these obser­va­tions are in the open, how do you write a plan to sys­tem­at­i­cally attract refer­rals? Here are a few basic principles:

1. Do an excep­tional job – this may seem obvi­ous, but many advi­sors I speak to want to know how to get refer­rals and do not ques­tion how the qual­ity of their work may be part of the cause for not receiv­ing more. Rather than ask “Why don’t my clients pre­fer?” Asked “What can I do better?”
2. Get client feed­back – In order to find out how good a job you’re doing, and what you could do bet­ter, have a sys­tem­atic way of obtain­ing feed­back from your clients. Whether through sur­veys or advi­sory boards, have a struc­tured way to ask ques­tions like How my doing? What am I really good at? What unique value do I bring to the relationship?
3. Define your tar­get mar­ket – Many advi­sors do not do enough work in defin­ing who exactly their best tar­get prospects are. Even many of the arti­cles I have read on tar­get mar­kets only offer the shal­low­est and most super­fi­cial advice. It is not enough to define the tar­get mar­ket by pro­fes­sion, a faith com­mu­nity, or an age range. And don’t even get me started on investable assets. You need to go beyond the obvi­ous and develop a more sub­tle and nuanced descrip­tion of the peo­ple you can ser­vice most effec­tively. One of the advi­sors I work with ini­tially told me his tar­get mar­ket was “women.” To be effec­tive, you need to have unique skills and ser­vices that con­nect with a group. There­fore, that group needs to be less than 52% of the pop­u­la­tion. Ulti­mately, we arrived at a descrip­tion that included “women who have just recently or are about to take con­trol of their fam­ily finances for the first time in their lives.” These are not the “sud­denly sin­gle” or the cases of “sud­den wealth.” Many of these women are still mar­ried, and the fam­ily net worth has not changed. One exam­ple is a woman whose hus­band was recently diag­nosed with Alzheimer’s dis­ease. The fam­ily and assets have not changed, but she was fac­ing the fact that she was about to be in charge. It is a group of peo­ple with sim­i­lar needs, shared con­cerns, in need of sim­i­lar services.
4. Research the needs of your tar­get audi­ence – Now that you have deter­mined who your tar­get mar­ket is, con­sider what they might need from you do not cur­rently pro­vide. Per­form a “gap analy­sis” on your prac­tice ver­sus the ideal prac­tice for that tar­get audi­ence. Go back to your clients who are in that tar­get audi­ence and get their opin­ion on your research. Ask ques­tions like “if I wanted to work with other peo­ple just like you, what ser­vices would I add that would make me the ideal advi­sor?” Bring them the results of your gap analy­sis, and ask “do you think I should add ser­vices like these?”
5. Design your com­mu­ni­ca­tion strat­egy – Once you have tai­lored your prac­tice to your tar­get mar­ket, design a strat­egy for com­mu­ni­cat­ing your area of spe­cialty and your spe­cial­ized ser­vices. Let your clients know specif­i­cally what kind of new client you are focus­ing on, and what spe­cial skills you bring to the table to work with them. Learn how to describe what makes you unique for that tar­get audi­ence so that you can clearly artic­u­late it to the peo­ple you meet. Let peo­ple know that you worked with your best clients to tai­lor your prac­tice to that tar­get group.

Clearly posi­tion your­self with your clients, your prospects, and the pub­lic. Come to own that par­tic­u­lar spot on people’s brains, and when some­one expresses a need for that kind of advi­sor they will nat­u­rally think of you

    Lat­est Advi­so­r­An­a­lyst Prac­tice Growth Sto­ries

Tags: Advisory Boards, Client Engagement, Client Feedback, Faith Community, Find Job, How To Get Referrals, Investable Assets, Marketing Plan, Population, Profession, Referral Marketing, Relationship, Surveys, Systematic Way, Tank, Target Group, Target Market, Target Markets, Target Prospects
Posted in My Practice | Comments Off