Identifying a niche that best suits your business goals can lead to faster growth of your practice and give it a more solid foundation. Over time, a niche practice can help you acquire clients that you enjoy dealing with. By building a unique business model that fits your target audience (clients), an advisor can increase the odds of client conversion.
Let us see how you can identify your niche.
Analyze your existing clientele
The first place to look for your ideal niche is your existing client base. Find out what is the common trait across your clients. Identify the clients that you are more comfortable with and shortlist clients whose problems you can identify with. For example, if you find that you can relate to the problems and struggles of 50 clients and the common factor is that they are below 30 years of age, you should consider developing a niche among young professionals.
Find your unique offering
The next step is to understand which aspect of your business makes it unique. For example, a business targeted at millennials will be more tech intensive than one targeting senior citizens. If you know what unique offering you bring to the table, you can analyze which segment of investors need your services.
Align your business goals
Once you know which group of investors would benefit from your business model, the next step is to see if serving this group would be in line with your business goals. It is important to ensure that your niche is just right. If your niche is too narrow, you will not be able to expand. You should also see the opportunity cost of a certain niche. If there are not many investors in your niche and the total AUM they can bring in is very less, it is better to expand your offerings.
Once you have decided your target client, you can start tailoring your message specifically to that group. For example, if your niche is doctors then you can reach out to them through medical journals or by organizing a seminar in hospitals.
Niche can be a rewarding and profitable endeavour. For clients seeking financial advice, it is often comforting to know that their financial advisor understands their unique situation and has helped clients in similar situations.