NICHE MARKETING: Developing It Within Your Firm

B U S I N E S S D E V E L O P M E N T T O O L S

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WHAT IS NICHE MARKETING?According to businessdictionary.com, niche marketing is:

“Concentrating all marketing efforts on a small but specific and well defined seg-ment of the population. Niches do not ‘exist’ but are ‘created’ by identifying needs, wants, and requirements that are being addressed poorly or not at all by other firms, and developing and delivering goods or services to satisfy them. As a strate-gy, niche marketing is aimed at being a big fish in a small pond instead of being a small fish in a big pond. Also called micromarketing.”

Niche marketing allows you to focus your efforts for three very powerful reasons:

1. Your story and language can be modified so that the market thinks you are speaking directly to them, and they come to believe you “know” them.

2. You become very knowledgeable over time about that niche, so you can antici-pate needs or bring up issues they might not even know to ask about.

3. Your sales plan and marketing strategy become very focused, allowing you to stand out in a crowded market.

Financial advisors will often say they don’t want to get boxed-in, or be limited by having a niche market; their services appeal to and are used by a wide swath of peo-ple of all shapes and sizes. While this is probably true, trying to market to the whole world is a daunting task. If you become known for something or by some group in particular, you can leverage those relationships and build your network.

Niche marketing does not lock you down; rather, it defines your focus, and in doing so gives you the freedom to market more confidently and aggressively.

So how do you define or create a niche market?It starts with reviewing your current client base. What themes do you see? What commonalities exist? Are there clients you’d like to replicate or that you have learned a lot about?

One advisor formerly worked in the oil business, and upon becoming a CFP® he started working exclusively with oil executives. Another had a passion for tennis and parlayed that interest into a focus on high-earning tennis pros and players. Another found that business owners 3 to 5 years from retirement were a consistent theme and as a business owner, she could relate to them.

Niches can be as defined or as broad as you like. They can range from “Dentists in private practice with retirement plans of $1 million or more” (very specific) to “Indi-viduals at corporate firms 5 to 10 years from retirement” (broader). In both cases the messaging can be tailored to speak to these groups.

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TO IDENTIFY THE NICHE MARKETS RIGHT FOR YOUR FIRM, FOLLOW THESE STEPS:Identify your top 10 to 15 “best” clients. Look for themes/descriptors for them. Are there similarities that can be replicated?

Consider your passions and interests. List what you like to do and are interested in:

Consider your product and service offerings. Who can most benefit from what you do? What problems do you solve, and who might have these problems?

Describe the types of clients you would like to be working with over and over again — if you aren’t working with them now.

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Describe the types of clients you don’t enjoy, or don’t think you can help (sometimes defining the negative helps to shape what you do want).

Review what you’ve written. What themes emerge? Write a summary statement about what clients you would like to, or best, serve.

Now revisit your marketing approach. Does your messaging speak to this market? If not, revise your language and story to be sure you are talking to them!