While developing a marketing plan (read Marketing Into the New Year for ideas), many financial advisors fail to dive deep into choosing niche markets even though niche marketing has proven to be effective in growing a practice. Many financial advisors would agree, but not admit, that not finding a particular client segment to target is because of the fear of losing business. It’s safer to remain generalists, serving all kinds of people at all stages of life, but the approach can hamstring growth.
Instead of going “all in” with niche marketing, a hybrid model is an effective way to target one group while maintaining your existing client base. We all know the 80/20 rule when it comes to clients and profits, and that same rule can be applied to weaving a niche market into your practice. Here’s how it works: 80% of your time, you will continue to serve existing clients, obtain referrals and continue running the practice the same way as before. While 20% of your time, you will work on a new niche with a separate marketing plan from the rest of your practice. As your niche starts to grow, you can begin to weave it into 80% of your existing plan until it becomes a major part of your business.
If you are on board with the hybrid approach, here are six steps to get started:
- Identify your niche
- Identify the subgroups of your niche
- List common traits among each subgroup
- Identify common concerns, needs, and emotions of this group
- Pinpoint the financial actions that may be driven by these concerns, needs, and emotions
- Identify COIs, places, associations, and groups that you can reach out to or join to connect with this niche
Last but not least, be patient because this will take time. After following the six steps above, you want to track your plan, successes, and failures and adjust it along the way. Expect to see traction between 3-6 months (meeting new people, joining groups and associations), initial results between 6-9 months (new prospects, referrals, and first-time appointments), and new clients in the niche after nine months.
Don’t forget, focusing on a niche market will result in more opportunities with clients that you want to serve. Focusing on a niche client segment has many benefits. It allows you to develop your expertise in a particular area, and by doing this, you are able to set yourself apart from the competition. This will result in referrals from others who see your specialty as a necessity.
