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Financial Advisor Positioning & Niches

This article was originally published on MuirEdison.com and was migrated when Muir Edison became a Breakthrough brand.

Why Care About Positioning?

Let me tell you:

For the past 20+ years I have worked with thousands of organizations from: Fortune 100 corporations, US government orgs, higher education institutions, non-profits, global manufacturers, retailers, famous speakers, financial advisors, global medical / healthcare orgs, from startups to bleeding edge crypto to the longest standing financial institutions, local services firms, and many more.

I have personally met with the founders and directors of these organizations and worked with them closely in fixing strategic issues, redesigning their processes, their brands, their websites, their marketing, and helping build their organizations over time.

So I’ve seen what works and what doesn’t. I’ve seen who does decently well, who fails, and who excels in the marketplace.

One of the most important strategic decisions you will make is determining your firm’s positioning.

Here’s why…

Reasons for Strong Positioning

  • Higher firm performance: Higher AUM performance overall by firm, and by Advisor
  • Significantly reduced marketing costs: As you are working with the same types of clients, you organically drift into their water coolers and events where you meet others, you work w/ shared COI’s, and your marketing (message & content) becomes a stockpile of helpful reusable content.
  • New business (sales) time, cost, and stress reduced to near nothing – Sales is reduced to near nothing as you become the best in the industry for X audience, your reputation will speak for itself.
  • HIGHER IMPACT: Possibly the #1 reason for positioning – Higher quality of work, higher depth of knowledge set, higher problem solving capabilities (pattern matching capabilities), and overall performance for clients (not to mention greater opportunity to change the course of life for your audience, real world change)
  • Talent recruitment and retention: Becomes significantly easier as advisors join for the clients, culture, mission and impact you’re making.
  • Lower interchangeability in the marketplace: Meaning it’s harder to replace your firm once engaged

What is Positioning?

Definition of ‘market positioning’:

Positioning refers to the place that a brand occupies in the minds of the customers and how it is distinguished from the products of the competitors and different from the concept of brand awareness. -Wikipedia

To us this does not encompass the totality of positioning. This is closer:

Position: Promote (a product, service, or business) within a particular sector of a market, or as the fulfillment of that sector’s specific requirements. -Oxford Online Dictionary

*Note that this is the definition for ‘position’ the root word (not positioning, or market positioning). This is intentional.

I don’t like any definition that involves creating something in the ‘mind of the customer’ – which implies that as a goal / endpoint, when that falls far short.

Positioning must not only happen in the customer’s mind, but in the very roots and fibers of your organizational makeup.

Put a Stake in the Ground and Standing for Something

Effective positioning can only happen when you decide to put a stake in the ground (even a small one), deciding to stand for something different, and then cultivating the organizational processes, and the team to serve your market in a better, more effective way than has been done.

You have to be different in order to differentiate.

Just let this above statement sink in.

Positioning determines what you do, and how you do it, every single day.

3 Components of Effective Positioning

  1. Who You’re Serving (aka “target market / audience / tribe”)
  2. What You’ll Do to Serve (packaged advisor products & services) uniquely different from other firms in the market (differentiation / usp / unique offering / niche)
  3. How You Do It (Developing a unique proprietary process internally & externally)

RAA: A Quick Example

I will include an example here – but before you continue, keep in mind: This is a very specific, very tight positioning – As a firm currently in operation, you don’t have to make as drastic a change, be this tight, and you don’t have choose this type of positioning (vertical), there are many other possible ways to position that don’t require an entire re-envisioning of your firm (see Types of Advisor Positioning/Niches below), this is just an example of a very tight, effective positioning:

Example Positioning – RAA positions itself as follows:

Our entire approach to financial services is built around the needsconcerns, and desires of the airline community.

As a generalist Financial Advisor, if you get a call from an airline pilot, you can see it would be difficult to provide the same level of service as RAA (Now you might, eventually provide a similar level of service as RAA, but you just wouldn’t have the industry knowledge, the contacts, the ease of referrals, the unique marketing & sales tactics, the awareness of what’s to come, etc. They have specific offerings by the individual airline!  Just imagine the number of problems they’ve solved, the things RAA has already seen, and already knows to prepare for given all the pilots they’ve worked with).

Other Positioning Examples:

  • Pre-retirement Educators (Professors / teachers) based in New York state
  • Overseas American’s, non-Americans living in US, those w/ multiple nationalities
  • Retirement and financial planning for post-divorce women over 50
  • General contractors, subcontractors and their employees
  • Federal / US Government employees

Positioning Types

At Breakthrough, we have a complete diagnostic, research and strategic plan process, but to start you thinking, here are some of the major positioning types:

  • Vertical Positioning – You serve a particular industry, career, or company (eg. financial advice for the airline industry, dentists, tech startups, CEO’s, real estate agents, Microsoft employees, Uber employees, etc). A great upside to vertical positioning is that you can more easily find a shared place where this group convenes or can be found (a company, event, group, certification, etc etc)
  • Horizontal Positioning – You focus on a particular product or service (eg. You focus on employer 401k plans, life insurance, long-term care, mutual funds, etc). Definitely one of the better positioning types.
  • Relational / Personal Positioning – These would be shared affinities, interests, groups, shared values, personal events, or life transitions. (eg. You work to get clients from local golf clubs, tennis clubs, community activities, donations, you focus on women-owned businesses, holistic / health-conscious people, etc). Because these can change as people change, we typically don’t recommend going only relational / personal positioning, we would blend this with one of the above types.
  • Mixed Positioning – You mix any of the above categories (eg You focus on 401k plans for dentists, or annuities for tech entrepreneurs, or investment advice for minority-owned entrepreneurs, etc)

How to Select Your Positioning

As you can imagine this is no small decision. This will change the course of your firm’s history.

If you decide to do this process on your own – you definitely want to do real world market research, competitive analysis, audience analysis, coupled with personality profiling, team assessments, and firm assessments. Contact Us to start the positioning process.

Specifically you will want to consider:

  1. Strategic Plan – What you (and your firm) wants (goals, strategic plan)
  2. Your interests (What you like / What you dislike)
  3. Profit Potential / Products / Services
  4. Your strengths (and weaknesses)
  5. Client Base Analysis – Your current client makeup, best clients, who you want to work more with.
  6. Marketing Research – Opportunities (and to a lesser degree possibly: threats), competitive analysis, audience & social trends.
  7. Personality Profiling & Team Assessments – Your teams goals, interests, strengths & weaknesses

Whatever you decide, I hope this helps you in making this decision, and I’m excited to see what you decide.

Feel free to reach out if you have any more questions on the topic of Positioning: Contact Us

Picture of Tison Kelley

Tison Kelley

Kelley, B.S., helps firms achieve strategic goals through their web, digital, & human experiences. Kelley specializes in Human Experience in enterprise architectures. He has worked with the US Navy, Federal Aviation Administration, Higher Education Institutions, Health Care, Commercial Real Estate, Financial Planning firms, and hundreds public and private organizations around the world... (Continued)
Financial Advisor Positioning / Niches

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