The world of financial advising is becoming increasingly competitive. With an estimated 300,000 financial advisors in the United States alone, it’s never been more important for advisors to stand out to attract new clients.
Luckily for advisors, a new wave of clients is looking to invest and start working with a financial advisor. There’s plenty of opportunity for growth — if you know where to look.
A niche market can include a variety of factors, such as targeting a specific generation of clients or people in a particular life stage, such as millennials or people preparing for retirement. It can also include specializing in specific advising, such as for small businesses, entrepreneurs, sustainable investments, long-term accounts, and more.
Finding a niche market sets you apart from the competition. Advisors who are experts in a specific space are often viewed as higher value, which can be incredibly profitable and lead to significant growth.
Understand Unique Market Needs
The key to finding a profitable niche is meeting an untapped demand. A niche isn’t effective or worthwhile if potential clients aren’t looking for that area of expertise.
To find your niche, look for commonalities between your current clients.
- Do you tend to attract a certain demographic of clients?
- Is there one type of service or account people usually demand?
- What questions are you frequently asked?
The easiest way to find a potential niche is to see what people want. You may have worked yourself into a niche with a particular client or service without realizing it. If this is the case, you can pivot your marketing and outreach to highlight these areas and focus on your profitable niche.
You can also keep an eye on the future for potential niche markets. Establishing yourself as a leader in an up-and-coming area helps you get ahead of the competition and capitalize on market changes. Paying attention to trends is vital, including knowing how the global economy is changing, what technology is developing, and what industries are growing. Looking down the pipeline can highlight potential niche markets.
Play to Your Strengths and Passions
The beauty of finding a niche is playing to your strengths and interests. Advisors who enjoy one type of work will naturally excel at it, while focusing on areas that are a struggle can lead to faster burnout.
Look at your strengths and the type of work you enjoy doing. Tapping into your past experience can also be a major selling point to potential niche clients, such as if you worked in the business world and now help small business clients or if you lived internationally and now work with international clients. Playing to your strengths and passions helps you connect with potential clients in your niche and build strong relationships.
Target Your Marketing to Your Niche
Once you’ve found your niche, it needs to become an integral part of your brand and marketing efforts. No matter if you work in a firm or as a sole RIA, highlight your niche and what makes you uniquely qualified to specialize in that area.
Understanding your niche can also help you target outreach and lead generation to a specific subset of potential customers. You can contact potential clients in these groups directly, through mail or phone calls, or build your credibility through content marketing, speaking, or community events. Working in a niche market limits your potential client base, so you need to focus on what makes you stand out to target clients.
One benefit of establishing your niche is that it lends itself to referrals. When clients have a great experience with you as their advisor, they will likely recommend your services to their friends and family, who may fall into the same niche. Leveraging referrals can be a powerful way to grow your practice.
Knowing your niche helps you stand out from the competition. Instead of being one financial advisor in the masses, you can become one of a handful of advisors in your chosen area. Setting yourself apart with expert services and top tools, including cloud-based document management from Docupace, can help you excel in a crowded market.
