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Financial Advisors: Find Your Own Vein of Prospecting Gold

By ClientWise | August 21, 2012


When a vein of gold appears, miners don’t waste time pursuing it.
The original California Gold Rush is proof in point. While it took months for the actual discovery of gold to penetrate public consciousness, as soon as it did, the rush was on.

Although James Marshall discovered gold at Sutter’s Mill in January 1848, President James Polk validated the discovery almost a year later, with an announcement of “the abundance of gold…of such extraordinary character as would scarcely command belief.” Polk’s words were a call-to-action. Farmers left plows standing in their fields, merchants disappeared from their shops, and soldiers deserted their posts.

The great California Gold Rush had begun.

Financial advisors are on a search of their own for a vein of prospecting gold that will assure business growth for years to come.

ClientWise research indicates that such veins do exist. In fact, we have isolated four separate areas of focus that will lead to repeatable and recurring new business opportunities:

  • Niche specialization
  • Referrals from Loyal Client Advocates
  • Professional Advocates and centers-of-influence
  • Dedicated and specific wealth management service

Niche Specialization is a focus on an identifiable and discrete client type; a persona that the advisor is sufficiently familiar with so as to create a differentiation that is virtually proprietary. The challenge that we see is that many financial advisors target a niche that is not really a niche. For example, “retirees” is not a niche because the population size is way too large, i.e. 40 million+ is not a "niche", it's a country! However, retirees who are ex-pats living in Costa Rica or retired utility company employees from a specific power company are specifically defined groups with their own unique set of financial concerns.

Loyal Client Advocates are those clients who really appreciate and value what you do, know your business so well that they can articulate what you do better than you can and who enthusiastically talk up your business to others. Of course, not all of your clients meet all three of these characteristics. For financial advisors, the key is in identifying those who fit the bill, and cultivating their loyalty in a respectful partnership. The major benefit is that financial advisors can develop a robust referral flow with only a handful of loyal client advocates.

Professional Advocates are similar to Loyal Client Advocates in that they highly value your role as a financial advisor, can explain what you do to others, and are actively involved with promoting your business. The most important part in building a network of professional advocates is understanding that referrals are NOT the primary objective of the relationship. Referrals do happen, but as an ancillary by-product of the work that you and the professional advocate undertake for the benefit of your clients.

A dedicated and specific wealth management service combines the important qualities of the three previous examples. Taking this route, the financial advisor builds their advisory business with a specific client in mind to create a practice that is readily distinguished from competitors. By doing this, the financial advisor creates a brand that identifies them as the unique “go-to” resource within the specific community that they choose to serve.

A final word

Prospecting for clients, when informed by these approaches, becomes much less of a hit and miss endeavor. By selecting a carefully defined niche and developing relationships with Client and Professional Advocates, financial advisors have the opportunity to cut the conversion time for business development leads and build a sustainable wealth management practice.

 

For additional insights into building a network of Professional Advocates, please download the complimentary ClientWise Learning Tool below:

 

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Topics: Client Acquisition Business Development

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