Whether you are currently a financial professional with a book of clients or a newbie looking to build your book, have you ever considered focusing your efforts on a particular type of client?
If you have, you may wonder where to start. After all, you'll be dealing with these individuals for the rest of your career, so you had better make the right choices from the outset.
One place to begin is within your client base. We'll show you how to hone in on the type of clients you want.
Sifting for Gold
First, start by printing out a list of your clients. You might want to grab a few highlighters of various colors. We'll use green, yellow and pink. Now, slowly go down the list and stop at each name. Imagine what it's like to work with each person.
Let's say the first one is Ms. Jones. She's pleasant, open to new ideas and committed to following the plan you put together. When the markets take a tumble, she realizes that volatility is just part of long-term investing. She has referred a few co-workers to you and continually puts away money each month. If all of your clients were like her, life would be peachy. She's a gold nugget. Highlight this one: green.
Next on your list is Mr. Smith. When he calls, you reach for the antacids. He complains about your fees, how the neighbor makes more on his investments than he does and how the guy on the radio said your recommendations stink. Do you want more like him? Heck no! Highlight this one: pink. (For related reading, see Deal Effectively With Difficult Clients.)
A number of other clients will likely fall somewhere between the Ms. Joneses and the Mr. Smiths. Highlight these clients: yellow.
Now, let's revisit the clients in the green group. Look for commonalities between these clients, for instance:
- Employment status
- Baby boomer
- Business owner
The possibilities are endless, and this is just the beginning. Next, you need to fine-tune your results.
Suppose that women, ages 35 to 55, make up most of your "green" group. What do they have in common? Some commonalities might be their marital status, occupation, net worth, number of dependents (if any), etc. For example, let's say the majority of your gold nugget clients are single business owners. Now you have something to sink your teeth into: Women, ages 35 to 55, single, business owners.
After you've done this exercise with your "green" group, do the same with the "yellow" group. You might uncover a few more great clients who just need some of your time to become "green" clients. (For more insight, read Targeting Ideal Customers.)
Considering Client Concerns
Your next step will be to consider what financial concerns these clients share.
A few of them could be:
- Income volatility
To address these concerns you might offer products such as:
- Medical insurance
- Disability insurance
- Certificates of deposit (CDs)
- Traditional IRAs
- Simplified Employee Pension (SEP)
- Keogh Plans
Clone Your Best Clients
Now that you know whom you enjoy working with, their common problems and how you meet their needs, you'll want more people just like them.
One proactive approach is to find out what organizations they belong to, such as:
- Professional organizations
- Social clubs
- Charitable foundations
A good strategy is to become involved with these organizations. There are a number of ways to do this:
- Write articles for their newsletters. Most organizations have a monthly newsletter and their editors are almost always looking for interesting pieces that relate to their members. Be sure to include your contact number in the article, and if possible, a photo is often beneficial as well.
- Offer to speak. Program chairmen often need speakers. Let them know that you're available, even as a substitute in case the scheduled person doesn't show up.
Either way, networking will definitely take work. However, over time you'll get close to people who are your ideal clients. In some cases, you may be the only financial advisor they know, but even if they never decide to work with you, at least you've contributed to a worthwhile cause. (For more on developing clientele, see Alternatives To The Cold Call.)
What if I have no clients?
Suppose you're new to the business and have no clients. No problem. You can determine your niche by using the same strategy. For example, what's your No.1 hobby?
Let's say you live and breathe golf and you know the golf pros at every course for miles around. These guys can pair you up for a round of golf with qualified prospects. What generally happens when you're riding around in a golf cart for three to four hours? Sooner or later the other person will ask: "What do you for a living?"
Imagine how great it will feel to have clients who are as passionate about the game as you are.
It won't happen overnight, but after people see you around the club, they'll feel like they know you and will be more likely to choose you when they need the help of a financial professional.
Follow these steps and you'll be on your way to developing a productive and satisfying niche market that'll be packed with great clients. (For further reading, check out Keeping Clients Through Good And Bad.)
Investing BasicsLearn about the ultra rich and what normally comprises their net worth; understand the top three alternative investments usually owned by the ultra rich.
EntrepreneurshipUnderstand how a food truck operates and what makes a food truck successful. Learn about the top five steps to run a successful food truck.
ProfessionalsCyber security attacks from a current or ex-employee can cause a lot of pain. Here is how to avoid such attacks.
EconomicsA firm’s relationship manager works to maintain positive relationships with its customers and partner firms.
Personal FinanceA wave of new mobile payment technology is setting the stage for a revolution in how we buy in stores.
EntrepreneurshipLearn how to avoid specific bad habits that plague entrepreneurs, such as failure to plan, bad associations and not keeping a good work-life balance.
Stock AnalysisTake a look at the similarities and differences between SAP and Salesforce in the customer relationship management (CRM) software marketplace.
ProfessionalsBad habits can ruin a retirement portfolio (and your credibility as an advisor). Here are some practices to avoid.
ProfessionalsL.A.'s dining scene is full of celebrities, but these impress-your-client spots offer better a mix of exquisite fare and power-lunchers.
EntrepreneurshipA Microsoft acquisition of Salesforce, which has been speculated on, would help boost Microsoft's cloud presence and grow its marketshare.
Key demographic factors that a company might examine to assess a potential market and more effectively target potential customers ... Read Full Answer >>
Investors should consider good customer service before buying a stock especially in consumer-oriented sectors. Customer service ... Read Full Answer >>
Mobile network carriers, part of the telecommunications sector, refer to a churn rate as the percentage of customers during ... Read Full Answer >>
Target (TGT) decided to expand north into Canadian markets in 2011. By 2013, it had built 133 stores across several Canadian ... Read Full Answer >>
Different kinds of companies use different techniques to estimate project duration. For internal projects, estimation requires ... Read Full Answer >>
The top three stadium naming rights deals of all time were all for stadiums hosting New York City teams. The largest was ... Read Full Answer >>