Best Target Markets for Financial Advisors: How to Choose The Best One for You
There’s no ‘one size fits all’ target market for advisors. A market that may be perfect for one advisor may be a poor fit for another. You need to narrow down to the best target market for you, based on your personal background, specialty, knowledge, interests, social networks and so on.
By identifying your perfect niche you’ll find it far easier to differentiate your practice and set yourself up as the ‘go-to’ expert.
If you’re struggling to identify the ‘right niche’ here are a few ways to get started.
Base your target market on your background
If you’re a career changer, your inside knowledge of your former industry could help you attract the interest of people in that sector. For example, if you’re a military veteran, you will be uniquely placed to understand the challenges other veterans face.
If you have an academic background, you will understand the ins and outs of University benefits and retirement plans, and this will make you highly marketable to people in that sector.
Consider under-served markets
If you don’t have a former profession, you could look into more underserved markets. For example, widows or millennials. Or small business owners (research shows only 40% of them are currently turning to financial advisors for guidance).
Base your niche on your favorite clients
Another way to choose your niche is to base it on your current clients. Which clients do you love to work with, and do they bring you a good profit? If so, look to multiply your income by only working with clients like these. What characteristics do they share and what makes them your ideal clients?
Build your portfolio on your social networks
People tend to want to work with people they can relate to, people with shared interests and values. If you’re passionate about golf, see the golf club not only as an opportunity to forge new friendships but potentially form new business relationships.
Identify the financial challenges of your chosen market
Identify the possible financial problems your target market may encounter, whether this be to increase their tax efficiency, save for retirement or find a way to get the kids through college without borrowing money.
Then play to your strengths. Which of these problems are you especially good at solving? What can you offer prospective clients regarding their challenges? Are you passionate about estate planning or do your strengths lie in the arena of taxation? This should play a big part in your decision on which target market to serve.
Make sure to look at the size of the potential market you are considering too – to determine whether this can be a profitable sector for you to serve.
Create an ideal client profile
Once you’ve considered your options, identify your ideal client by creating a detailed picture of them, complete with all the characteristics they should possess. Consider their stage of life, age, industry sector, level of education, hobbies, the church they attend or neighborhood they live in. This is a great reference tool to take you forward. And, if you write this description down on a sheet of paper, you could use it as a marketing tool to hand out to people who fit the bill.
Once you’ve pinned down your niche you can craft a marketing plan that addresses your target group directly. Then make a commitment to servicing this one group of people so you can become the leader in that field.
By identifying your target market you’re ensuring you’ll have the best chance of forming productive reciprocal relationships. Not only will you benefit yourself by growing your business, but you’ll be able to add real value to others’ lives.
Assess your current clients and let go those that don’t fit your profile. Over time you’ll become far more referable for prospects in your chosen sector. And, equally importantly, your job satisfaction will increase significantly.