How to Choose a Niche Market for Financial Advisors: Step 2—Discover the Intersection of Passion, Aptitude, and Profit

Advisors often ask me which niche they should choose. There is no easy answer. If there were, everyone would be doing it, and there would be no competitive advantage.

The best niche for your firm will be revealed by determining what makes you unique. Randomly picking a niche market out of a hat is not a successful strategy.

So the question is, how do you find that perfect niche? You will find your successful niche at the intersection of passion, aptitude, and profit.

Passion

Start with passion because you want your work to be something that interests you and that you’re excited about. Passion is contagious, and prospective clients will pick up on this energy, making them want to work with you.

To brainstorm what you are most passionate about, ask yourself:

• What are my interests and passions?

• Who am I passionate about working with?

• What types of people do I naturally network with or spend time with?

• What would I be doing if I weren’t a financial advisor?

• Which types of clients are enjoyable and easy to serve?

Answer these questions both professionally and personally to produce the most options to consider. 

Aptitude

Next, look at your aptitude. Your aptitude is your natural ability or general suitability for a specific type of work.

To uncover your aptitude, you should analyze your experience, skills, and talents that not every advisor can claim they have. Your aptitude comes from your natural talents, current and past professional experience, and life experience.

To discover your aptitude, ask yourself:

• What services do my clients find most valuable?

• What specializations do I have or special services do I offer?

• What unique educational background do I have?

• What previous career or professional background do I have?

• What is unique about my life experience?

• What types of clients are most engaged in our work together?

• What hole in the industry do I naturally fill?

• What natural talents and strengths do I have?

Profit

Finally, you want to look at profit because making money is the only way you can stay in business. Ask yourself these questions:

• What types of clients are most profitable?

• What types of clients are naturally attracted to the firm without much effort?

• What types of clients are willing and able to pay for my services?

I recommend you spend 45 minutes brainstorming everything that comes to mind. The first 15 to 30 minutes of this exercise will reveal the obvious answers. It’s when you brainstorm for more than 30 minutes that more innovative ideas come to light.

After you have spent 45 minutes brainstorming, spend an additional 15 minutes making connections between the different ideas you wrote down in each of the circles. 

As you answer these questions, you will find that the overlap between your passion and your aptitude is what makes you unique. The overlap between your aptitude and your profit is where you create value. And the overlap between your passion and your profit is what motivates you to do the work you do.

As an example, let’s say you decide that your passion is in helping young people who are building wealth. You determine that your aptitude is in the tech industry since you worked in it before you became a financial advisor. And you realize that you have found profit as a financial advisory firm by helping tech professionals whose companies had an IPO.

By making the connections between your passion, aptitude, and profit, you see that a potential niche for you is tech employees who expect to receive a windfall due to an IPO.

Once you find the intersection for your passion, aptitude, and profit, that is the niche for you.

---

About Kristen Luke

Kristen Luke is the President of Kaleido Creative Studio, a marketing agency specializing in helping RIAs promote their businesses to a niche through an expertise approach. Over the past 15 years, Kristen has consulted with hundreds of financial advisory firms and shared her marketing expertise via industry conferences and publications nationwide.

The 52: To Be an Expert, You Must Share Your Expertise

Week 34

To Be an Expert, You Must Share Your Expertise

Think of five people you consider to be an expert you respect. They can be people in your business or industry or in other areas of your life, like academic affiliations, hobbies, interests, health, and family. Now that you have them in your head, think of what they have in common. They all share their original thinking through some form of content (e.g., lectures, keynote speeches, books, columns, podcasts, blogs, and YouTube channels). For you to be viewed as an expert by others, it is not enough to be able to perform the work; you must be able to share your knowledge with your audience. If you want to be perceived as an expert, it’s time to start creating original content.

The 52: Set Your Younger Advisors Up for Success with a Niche

Week 33

Set Your Younger Advisors Up for Success with a Niche

Young advisors employed by an RIA are often at a disadvantage when it comes to attracting new clients to a firm. They generally lack the network, relationships, and experience needed to convince prospective clients to work with them.

If firm ownership would like to help their young advisors overcome these challenges, they would be well served to coach them into working with a niche. A niche will help the advisor:

1. Focus their marketing time and direction

2. Stand out from the crowd

3. Take ownership of their marketing

4. Overcome the lack of a large network

5. Overcome a perceived lack of experience

6. Overcome any apprehension around sales and marketing

7. Believe bringing in clients on their own is achievable.

For Many Young Advisors, Niche Marketing Is the Path to Success

Let’s face it, younger advisors are at a disadvantage when it comes to attracting new clients to a firm. They generally lack the network, relationships, and experience needed to convince prospective clients to work with them. In my experience, most advisors in their 20s and 30s working at independent firms today just don’t have the killer sales instinct that is stereotypical of financial advisors of the past. Instead, they tend to prioritize servicing existing clients over marketing and business development.

Many firm owners I talk to find this frustrating. They know that for the business to grow outside of their own efforts and to eventually transition the firm to the next generation, the younger advisors must learn the skills to bring in clients on their own. 

In defense of younger advisors, their employers rarely equip them with the marketing skills and knowledge they need. They are expected to pound the pavement in the same way the firm principals did to build the business. This expectation exists even though many of those tactics aren’t as effective today; nor are they a natural marketing style for the younger advisor’s personality type. 

If you are an owner of a financial advisor firm and find yourself in a situation with less-experienced advisors you hope to groom into the future leadership of your business, you would serve them well to coach them into working with a niche.

Why a Niche?

By focusing on a narrow subset of potential clients with similar characteristics and needs, younger advisors will benefit in many ways:

1. Working with a niche directs their time and attention. It guides them in knowing the people to network with, the centers of influence to meet, the events to attend, and the content to create.

2. It gives them a way to stand out from the crowd. When advisors are asked to market as generalists, they sound like everyone else, and younger advisors don’t have the years of experience to back up their claims. Specializing in a niche makes them unique. They can offer expertise that most other financial advisors can’t claim.   

3. When a younger advisor chooses a niche appropriate for their passion and aptitude, they take ownership. They step out of the owner’s shadow and into their own light.

4. They overcome the lack of a large network because they market themselves based on expertise within a niche, not the transfer of trust from long-standing personal or professional relationships.

5. After a year or two of attaining expertise with a niche, they overcome any perceived lack of experience (as measured by years).

6. When any advisor successfully positions themselves as an expert with a niche, they stop seeing what they do as marketing and start seeing it as sharing their knowledge and wisdom. This shift can help them overcome any apprehension around sales and marketing.

7. When an advisor works with a niche, bringing in clients is more achievable. They fish in a smaller pond, which makes it easier to catch the prospects they seek.

Keys to Success

While choosing a niche can be the path to success for a young advisor, it also has to be successful for the firm. Here are some points to consider when guiding a younger advisor toward a niche focus:

1. Make sure the chosen niche can be profitable immediately or in the near term (e.g., surgical residents, employees at companies with prospective IPOs). This may require a new creative pricing model if the niche doesn’t meet your asset minimum but has the income to support minimum fees.

2. The niche cannot contradict the firm’s overall mission and messaging. For example, if your firm has positioned itself as specializing in socially responsible investing, you shouldn’t have a niche focused on Exxon employees.

3. When the advisor starts a niche, do not change your website. Build a landing page dedicated to the new niche. You can link to that page from your homepage navigation or keep the page separate from your website, depending on your confidence level for the niche’s success. The landing page allows the advisor to test out the viability of a niche without the firm taking the risk of alienating current clients or losing out on other new business.

4. Allow the younger advisor the space needed to experiment and iterate. It may take them a little while to figure out the best way to market themselves to the niche. The key is to keep them inspired and motivated to do marketing. Even if the initial niche doesn’t work out, the process will teach them the skills and habits of marketing that can be used in future efforts.

About Kristen Luke

Kristen Luke is the President of Kaleido Creative Studio, a marketing agency specializing in helping RIAs promote their businesses to a niche through an expertise approach. Over the past 15 years, Kristen has consulted with hundreds of financial advisory firms and shared her marketing expertise via industry conferences and publications nationwide.

Young Financial Advisors Need a Niche

The 52: Understand Plagiarism to Avoid Liability

Week 32

Understand Plagiarism to Avoid Liability

Did you know, your team may be posting plagiarized content on your website and they don’t even know it? Most people know that copying someone else’s writing verbatim is plagiarism, but there are less obvious forms that can create liability for your firm, such as paraphrasing or following inspiration articles too closely in structure and sentiment.

Here are seven ways to avoid plagiarism:

1. Write in your own words.

2. Put quotation marks around verbatim copy.

3. Give credit to the original source even when paraphrasing.

4. Include links to the original source.

5. Include sources for all data, charts, and graphs that are not proprietary to you.

6. Use footnotes.

7. Use a plagiarism checker like Grammarly to make sure you, your team, and your freelancers aren’t accidentally plagiarizing.

The 52: Define the Purpose of Your Content

Week 31

Define the Purpose of Your Content

When developing content for your website, consider first the purpose of your content. Here are some options:

1. Nurture relationships (e.g., canned newsletter content)

2. Generate leads (e.g., ebook, recorded webinar)

3. Establish expertise and credibility (e.g., original blogs, original videos)

4. Change mindset (e.g., blog on why hiring a financial advisor is better than DIY)

5. Search engine optimization (e.g., blog on how to find a financial advisor in San Diego)

6. Demonstrating client experience (e.g., case studies, testimonials)

7. Behind the scenes (e.g., press release on the company winning a Best Places to Work award)

Once you know your purpose, you can craft your content with the end result in mind.

The 52: Match the Sales Experience to the Client Service Experience

Week 30

Match the Sales Experience to the Client Service Experience

Use your sales process to train your prospects to be good clients. Often, advisors will bend over backward to convert a prospect only to shift expectations once the paperwork is signed. If you take a prospect’s call immediately the first time they call in, they will expect you to be available every time they call as a client. But if you teach them to schedule a time to talk as a prospect, they’ll do the same as a client. By matching your sales experience to your client service experience, you’ll attract the right kinds of prospects to your firm and train them to be good clients.

Marketing Approaches for the Equity Compensation Niche

3 Types Of Focused Marketing Approaches To Accelerate Growth Of Your Firm