If you had pain in your knee, would you rather consult a general practitioner who delivers excellent comprehensive medical advice or an orthopedist who specializes in knee problems?
The financial advice business is a lot like medicine in that general-versus-specific way of approaching care. Yes, most people expect their financial adviser to be a kind of money GP who understands the full range of personal finance issues, including investing, retirement planning and saving for college, to name just a few.
But what if someone suddenly has to cope with a problem that has complicated financial ramifications — a big, unexpected expense, say, or a divorce, or the birth of a child with special needs — and doesn’t have an adviser? Or what if they perceive their current adviser as a jack-of-all-trades but not a master of the specific problem with which they need help? Today, finding an adviser with specific skills, experience and interests is no problem. A few taps on Google and options beckon.
Viewing the potential market for advice in a focused way — a market that’s more of a mosaic of specific subsets and less a mass of undifferentiated affluent people seeking comprehensive financial and investment guidance — is an approach being illuminated by senior columnist Jeff Benjamin in his current series on niche advisers.
As he has discovered, advisers across the country are successfully serving specific minimarkets that in many cases were never even recognized previously. The polyamorous market? There’s an adviser who has made that a specialty (page 4). Another focuses on his passion for fishing and hunting and attracts clients who are equally passionate. How about advising those who are politically on the far left? Sounds counterintuitive, but it works.
The reason such hyper-narrow positioning can be successful is the internet, which permits everyone to demonstrate their expertise through their specialized content. At the same time, search engines enable anyone, anywhere to identify an adviser who seems especially suited to their needs and approach, and to find that adviser precisely when the need arises.
For advisers, this demand-pull approach to marketing is likely to involve a change of mindset. First, it requires introspection into an adviser’s core area of expertise and his or her passions, whether they seem to be work-related or not. Second, it requires a kind of “Field of Dreams” belief that if you build it — in the form of positioning yourself as a specialist and demonstrating specific expertise — enough people will come.
As the advisers Jeff Benjamin is writing about prove, the clients do come. What’s more, they come from all over the country and sometimes from all over the world — again, one of the benefits of our interconnected age. Even better, they often are eager to bring along others who share their interests or specific money-related problem.
Aside from purely business reasons, specializing in an area that the adviser truly cares about is deeply satisfying intellectually and emotionally. Going narrow, therefore, is not only good for business, it’s good for the soul.
Andrew is half-human, half-gamer. He’s also a science fiction author writing for BleeBot.