Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
Source Financial Advisors is a wealth management firm that specializes in serving affluent women who are navigating divorce. When they first meet Michelle Smith and the Source team, these clients often don’t have jobs outside the home and have never managed household finances and assets. Source meets these women where they are, offering the sensitivity, empowerment, and financial planning services they need to feel comfortable and confident as they enter a new phase of their lives. Source also has unparalleled expertise: Smith is a Divorce Mediator, a Certified Divorce Financial Analyst®, and a long-time advocate for women’s financial literacy.
While no two clients are the same, many have similar situations and Source knows what they need. Instead of marketing itself as generalists, Source successfully sets itself apart by highlighting the customized, expert service designed for this distinct market.
My marketing agency primarily serves financial industry clients. We begin our journey with clients by asking them who their ideal client is and how they market to that person. The responses vary, but many simply don’t know how to articulate their message in a unique way. The unfortunate result – profession-wide – is a lack of differentiation and personality. In an effort not to turn anyone off from their practice, advisors generalize their message and end up not talking to anyone.
When it comes to differentiating your message, here are some tips we offer our clients:
Define what sets you apart
To specialize your firm’s service, think about recurring themes you see in clients with whom you already work. Also, think about what work gratifies you the most. This indicates a natural fit, and it shines through to your clients.
Your unique focus can be any specific part of a demographic. One of our clients, Naviter Wealth, serves affluent families who experience a major liquidity event. Another wealth management client specializes in early career professionals. When you focus on a particular client profile, you might be repelling other potential clients at the same time. If you specialize in newly divorced women, for example, you won’t appeal to happily married clients.
But that is okay! Specialization allows you to grow organically while differentiating your service. A recent study by Cerulli Associates found that advisors who focused their practices were more successful at keeping their clients, with a median client retention rate of 95%, compared to 89% for generalist advisors. Clients feel more connected to advisors who specialize in clients like them.
Tell your story authentically
While the financial industry is serious business, clients want to feel like you are a partner who speaks their language. Tell your story clearly to explain who you are – your personal elevator pitch. Clients won’t want to hear you talk about yourself all the time, of course, but showing a little personality helps to attract the right clients and signals to the ones that don’t fit with your style that another advisor might be a better fit.
Get comfortable sharing who you are and what makes you different. Your personality will attract your clients and, yes, repel those who don’t match your sweet spot.
Embrace the joy of missing out (JOMO)
To make your message reach your audience, you have to be flexible in your marketing strategies. There are lots of social media platforms and messaging opportunities, but it is okay to avoid marketing channels that do not reach your particular target market. Learn to embrace the JOMO! Another great example of flexibility is creating a differentiated message for one of your key audiences. As an example, one of our RIA clients is trying to expand to serve young, early career investors who need to learn how to make their money work for them. They obviously have specific needs, seek particular services, and have different assets than the more affluent clients the firm also serves. To solve this divide, the firm created a separate website to directly message their younger target audience without estranging their affluent clients. We love this creative approach to speaking authentically to the clients you want to attract.
Rinse and repeat
Here’s the most exciting thing about why specializing works: It allows you to scale. Advisors who focus their messaging and service run a more efficient, profitable business because their client base shares similar characteristics. According to the 2020 Financial Planning Process Kitces Research study, advisors who specialize earn 67% more than generalists. And their income rate grows faster, with their median revenue growth rate averaging 13.4% compared to 9.6% for generalist advisors, according to a study from the Financial Planning Association.
For advisors looking to grow their business, the idea of narrowing their focus can feel counterintuitive. But it allows you to use your authentic voice, create a repeatable process that can scale, and connect with clients you can truly help.
Lisa Graham is co-founder and CEO of Graham Media Partners. Lisa has been supporting financial services firms with their marketing strategy and execution for nearly two decades. Graham Media Partners has worked with over 100 financial services organizations, from small breakaway RIAs to large Fortune 200 financial organizations.
A message from Advisor Perspectives and VettaFi: To learn more about this and other topics, check out our most recent white papers.
Read more articles by Lisa Graham