Time to sharpen the saw again

I’m speaking to financial advisers every day, and at the moment a consistent theme is emerging in all of these conversations and that is a feeling of a “new beginning”. Advisers are talking really positively and excitedly about getting back out and meeting clients face-to-face again – just imagine in a few months’ time we might even be doing this without masks on!

It all feels a bit like a new era, and indeed for some it really is, as many lives have undergone huge upheaval in the last 15 months. This brings the need for insightful and valuable conversation with you, and a whole range of new avenues and opportunities to explore for both you and your clients. The question is, are you ready to embrace this new environment, or will you revert back to what you did before the pandemic hit?

The focus of this post is not on your client proposition, but instead it is about you and how you will work and interact with your clients in the months to come. There are a couple of areas to consider.


Be prepared

The chances are that you will be very busy in the months to come. While there’s no harm in clients seeing that you are busy and your expertise is in demand, you don’t want them to feel rushed and that the “next” client you’re going to see is more important. The key here is good preparation for your meetings and careful management of your diary. When a client comes to see you, they should feel at the centre of your universe and that your sole focus is on them and helping them achieve their financial goals.


Your approach to meetings

From the discussions I’ve had, so many of you have been re-evaluating your proposition and tweaking it for the future. You’re taking the good bits from working remotely over the last year or so and are building this in as part of a newly enhanced proposition. You will then deliver this, and clients will enjoy a greatly enhanced advice experience into the future. The key for you now is to engage clients in discussion about how you work and what you offer, and carefully walk them through the improvements you will be bringing to them. I strongly recommend that this deserves to be more than a chat, instead you should lay it out visually for your clients in the form of a presentation, short documents setting out your services or links to relevant sections on your website. Show off your proposition in the best light possible.


Keep your energy levels high

Everyone is emerging from a difficult period. We all want to be surrounded by people who are not gloomily reflecting on the last year, but instead by people who are positive and optimistic about the future. Be one of the “cup half full” people in your clients’ lives. Work hard at ensuring that clients feel better in themselves after meeting you, that you were the bright point in their day. This of course doesn’t mean just nattering on endlessly at meeting though. Of course you need to put as much of your energy into careful and active listening, and gentle but probing questioning of your clients in relation to their hopes, dreams and ambitions for the future.


What about the novice clients?

The lives of some people have been turned upside down by the pandemic. They may have suffered bereavement, serious illness, the loss of their job and/or their business and in some cases temporary but significant financial challenges. Many of these people may never have availed of the services of a financial adviser in the past, but now they need a lot of help in getting their financial lives back on track. They know they need help, they think they need it from a financial adviser. But they might be quite unsure whether the right adviser for them is you or someone else.

Think carefully about how you can build trust and rapport with these people. Your first meeting approach will be critical here, as will demonstrating your expertise through client testimonials, case studies and other endorsements of your skills. Your goal is to put these people at ease, help them to recognise that you have the skills and knowledge to help them with their affairs and hopefully start to build a valued relationship that will endure long into the future.


These are great days. The vaccination programme is starting to have a real impact and everyone is much more hopeful about the future. Now is the time to roll out your own A game.

Does running a niche business make sense?

This is a question that occupies a lot of thinking time of many advisers today, as they contemplate their future client acquisition strategies. While we are seeing some advisers setting minimum hurdle sizes with new clients (either in assets under management or agreed fee levels), let’s be honest, many advisers are generalists, welcoming any prospective clients into their business. So it’s a valid question – is a niche strategy a viable business model for advisers?

I believe that if carried out in a very structured way, it can be a very viable strategy.

Let’s start with a definition of niche. One I came across described it as, ‘denoting or relating to products, services, or interests that appeal to a small, specialised section of the population.’ The scary part in reading this is the piece about the “small, specialised section”, as this leads people to think that their base will be too narrow to make it sustainable.


Niche strategies can make life easier!

I tell this from personal experience. When I decided to strike out on my own almost 10 years ago now, this challenge was the one that gave me the most headaches. Would I concentrate my proposition and ultimately my sales & marketing efforts only on financial advisers? Or would I offer my services to any client that I could get?

I went for the niche strategy, focusing my efforts solely on financial advice firms. My target audience was immediately narrowed to only hundreds of firms, rather than tens of thousands of potential customers. That was scary.

But what was far easier was connecting with this group. Rather than trying to appeal to everyone, and probably not connecting with anyone, I could focus all of my efforts on a specific group of people. This made it easier in developing my sales propositions, writing website content, producing newsletter and blog articles. I can communicate with a clear target in mind, and my messages as a result are a little more personal to my audience. I also have much richer and relevant experiences to call upon when working with different advice firms. On the other hand, when you are trying not to exclude anyone from your sales and marketing efforts, it’s very difficult to connect with people.

Yes, a narrow niche strategy is hard at times, and when business goes a little quiet the temptation is always there to broaden my marketing into other markets. But doing that will dilute my presence in the narrower (financial adviser) market. And just because you target a niche only, it doesn’t stop you working in other markets. I’ve worked with a number of businesses in other sectors, who saw what I was doing with financial advisers, approached me and asked me to bring those skills to their industry. But staying focused on my niche in my sales and marketing efforts will generate the lion’s share of my work, and is the right strategy for me.


What are viable niche strategies for financial advisers?

Financial advisers who have gone down the niche route successfully have tended to do so by focusing on one (or sometimes more) of the following,

  • Demographics: Focusing on specific age categories, gender, social grades (e.g. ABC1’s)
  • Employment sectors: Focusing on the public service specifically, sectors within the private sector, specific occupations.
  • Geography: Focusing on clients within a certain geographic area only
  • Product lines: Focusing on developing expertise and leadership positions within specific product areas or dealing only with clients who require full financial planning relationships.


What are the main steps in building a niche strategy?

If you decide to go down the niche route, first of all you need to do some research about your target niche. You need to understand the numbers of target clients (is the niche large enough to sustain you?), think through how you will access them and consider what opportunities are available to you to market to them effectively. You need to also think deeply about the problems that you will be able to help them to overcome, and how you will communicate and demonstrate your capabilities to that segment of the population in an engaging way. Because at the end of the day, you will live or die by whether your target customers recognise that they are dealing with a specialist in the particular niche or not.


Niche strategies are certainly not right for every financial advice business. However for some, they just might be the best way to fully leverage a unique strength or opportunity of your business.

What will be different after Covid for your financial planning business?

OK, so we’re all still in lockdown but this time it is very different – the end is in sight. Most conversations are hopeful about this being the final lockdown and that is something no-one felt confident about before. Now that we all see the vaccine rollout gathering pace and assuming there are no major calamities here, we can expect life to return to normal at some stage in 2021.

But what will “back to normal” mean for your business? While of course it will mean meeting your clients face-to-face again, businesses have changed forever. And this is a good thing! Set out below are 5 ways in which your financial planning business can emerge stronger from the Covid era.


Be braver with technology

The most obvious example is that for years we had the ability to hold remote meetings, but these were only really carried out in large, international organisations. We all knew about them and some even speculated about using them one day… and then suddenly we were all using remote meetings every single day. Even though many people thought that clients would never adapt, most clients did, and now embrace the convenience of these meetings.

We see other examples in financial planning businesses quickly leveraging the advantages of cloud computing, team collaboration software and the introduction and acceptance of digital signatures.

Each of these on their own would have been a major project in years gone by, but because you needed to quickly adapt, they became an everyday part of your business within a few short months. Hopefully as further new, clever technology solutions emerge, we’ll all procrastinate a bit less and be brave – maybe we’ll all become a tribe of early adopters?


Be more flexible with your people

I think it will be a minority of financial planning businesses that will close their offices, with everyone working remotely. However we are likely to see a continuing demand for hybrid working conditions, where people are working part-time in the office and part-time at home. This is going to gather further pace as legislation is on the way to support this model too.

What we’ve seen in the last year is that with the proper conditions and commitment of both the employer and employee, remote working can be very effective. Even where employers instinctively like to see their team around them in the office, they will need to be more open than before to remote working playing some role in the working week. At least everyone has “road tested” this now, and has seen what is needed to make it work.

This will never be for everyone – some people can’t wait to get back to the office full-time as their home environments are just not conducive to effective working, or they miss the sociability of the office. The key will be flexibility on everyone’s part – the employer embracing change and the employee demonstrating that they are at least as efficient when working remotely.


Outsource, outsource, outsource

With less people in the office, the questions will arise as to whether you need to retain all skills in-house, or whether part-time roles can be replaced with outsourced solutions. There has been and will continue to be a growing shift towards outsourcing some part-time tasks, rather than incurring the expense of employing someone. Areas that come to mind include financial management / accounting functions, marketing, compliance, HR and technology. Financial planning businesses will consist mainly of a leadership team, planners / advisers and customer support staff including paraplanners in some cases. All other functions will be outsourced, allowing the team to retain a laser-like focus on your customers, with external people delivering your required central support services.


Communicate relentlessly

This is an area in which we’ve seen winners and losers during the pandemic. Some firms have gone quiet, have treaded water and are looking to get out the other side of the current restrictions and get back to the old ways of doing business. Others have recognised their physical distance from clients and have done everything in your power to stay as close to them as possible. Email communication, social media, webinars, zoom meetings and phone calls have been planned and carried out relentlessly. These firms have seen the power of these communications in more engaged and indeed grateful clients, and will continue with this approach into the future.


Think about business continuity

This is the “what if” planning. Before 2020, who had planned for a pandemic hitting? Who even had plans for being unable to access the office for any reason? I suspect very few of us had such plans…

But now we’ve seen the need to be prepared for the unexpected. While business continuity is an important element of ongoing planning in most large businesses, it really doesn’t feature in smaller businesses. Now maybe it should, to a level that makes sense. Get the team thinking about a range of unlikely scenarios and what you would do if they happened – it’s always better to have a plan and a process to implement, as opposed to thinking while under severe pressure. Scenarios might include the loss of the office, the loss of key people, a security breach, a data loss, a PR disaster etc. Think of the unexpected, and have a plan.


2020 probably taught us all more in one year than in many years before it, in terms of our adaptability and our resilience. These are the skills to bring forward with us as we emerge from the Covid era.

Will 2021 be better for advisers?

2020 has been a year like no other. It has created unexpected and unique challenges for financial advisers in terms of the daily running of your business, interacting with clients and growing your business. There was no clue coming into 2020 that it was going to be a year less ordinary…

In looking at the prospects for 2021, I had a number of conversations with advisers about their outlook and prospects for the year ahead. These were hearteningly positive conversations, most advisers that I spoke to are very optimistic about 2021. This optimism is based on a number of factors.


There’s bound to be less upheaval…

Of course there is no guarantee of this, but if we have an event as significant for the whole world as covid-19, we can probably all throw our hats at it! We are in the midst of a once in a generation event… and advisers are still standing. In fact many report that their income has not been particularly badly impacted in 2020, a good place to be as we survey the decimation of the economy as a whole.

It’s important to remember though that this is not just down to good fortune, it is also an outcome of your planned and well-executed shift in income model away from upfront commission towards a recurring income basis.

And let’s not forget that finally it looks like there are effective vaccines on the way.


Your investment advice is well placed

Most of you consistently guide your clients away from trying to time markets and avoiding making short-term investment decisions. If ever this advice was put to the test, this was the year. A 34% drop in markets as a result of covid and huge uncertainty around the US elections certainly tested the mettle of investors. Telling your clients to stick to the plan and avoid short-term noise paid off in spades. Markets were up 60% from their low point in March to mid-November and staying invested through the US elections resulted in a 9% gain over the following two weeks. Those investors who baled into cash at the low points will rue those expensive decisions.

As we enter 2021 and we see the uncertainty arising over Brexit, what will your advice be now? I know what I plan on doing with my investments… I won’t touch them or even look at them again for a few months.


Clients will need your help more than ever

There are a lot of people very badly impacted by covid. They have had a very difficult year and their businesses have been severely impacted, for many their doors have been shut. Some will never reopen or fully recover. For these people, their financial plans are very compromised, and a lot of careful thought and expert guidance is needed in relation to investment and retirement plans. Your calming wisdom and experience is needed now more than ever.

Your clients need help in revising their plans, looking at different scenarios and resetting some of their expectations for the future. They need your honest appraisal of their situation and your best advice – no matter how hard this may be for them to hear. And then you can help them plot the best route forward and build back their confidence in their financial future.


Your processes have likely improved

One of the big advantages of the sudden shift to remote working earlier this year was the need to very quickly develop new and smoother business practices. One year ago, how many of you were able to effectively carry out meetings online, use digital signatures and share files and workflows with colleagues via the cloud? Also so many of you are now so much further along in terms of using social media, communicating more regularly with existing clients and actually delivering an enhanced client proposition. Your business is operationally stronger going into 2021 than you were entering this current year.


You’ve an alternative way of working

This time last year, very few were thinking about ever working remotely. Now we’re all experts in it! Some of you love the flexibility it offers, and the commuting time saved. For many it has resulted in a much better work/life balance. Many of you will retain it on a part-time basis in the future, even when a full return to the office is possible.

While it definitely suits some people better than others, at least now everyone knows it is possible and knows what is needed to work effectively at home.  At the very least, it’s an additional work option for you going forwards.


2020 is almost done, it was a year like no other, but ultimately was not too damaging for many financial advisers. All of the signs point to a calmer 2021 that offers great potential for you.

When times are tough… kiss frogs

These are tough times for advisers at the moment. Yes, your businesses are more resilient than most, mainly down to your efforts in recent years in building up a strong recurring income stream. But this still doesn’t fully compensate for the slowdown in new business that many of you are experiencing.

I know from recent conversations that some of you are finding it difficult to stay positive as prospective clients (and some of you yourselves) are slow to re-engage in face-to-face meetings on the back of Covid-19 concerns. After all, it can be difficult to pin prospects down at the best of times! Unfortunately I have to admit that I’ve seen a few advisers’ heads go down in the last few weeks….

So, it’s time for a collective pick-me-up. Here are a few thoughts to help get you going again.


Set yourself achievable daily goals

So the goals you set at the beginning of the year of seeing two clients every day are gone by the board. That’s ok, times have changed and you had no control of the change. But you can now re-frame your goals.

Don’t keep looking at how far you’re falling short of your turnover / recurring income target for 2020. Instead focus your effort and goals on the process, rather than the outcome. Set clear daily goals for yourself that are based on activity. We all know that as sure as night follows day, positive outcomes follow increased activity levels. Your goals might be,

  • The number of prospects you will reach out to
  • The number of existing clients you will phone
  • The number of relationship “just checking in” emails you will send
  • The blog post / social media activity you will carry out


Celebrate small wins

Don’t beat yourself up because you’re not writing €x,000 in new business every week. Instead celebrate your smaller wins – the number of positive client conversations you’ve had, the thank-you responses to your relationship emails. While on their own these might not seem to account for much, in time as the economy gets back to normal these clients will remember your support during the tough days.


Call in favours

Everyone knows that lots of small businesses are finding it tough at the moment. As a profession, financial advisers have always and consistently shown their spirit of community and helping nature. You tend to be good for an introduction, a referral, a client testimonial for one your suppliers and if you can help someone, you tend to do so.

Now it’s your turn. You need a little help, so ask for it. It might be for a referral, it might be for a testimonial for your website. Ask and you will generally receive.


Kiss the frogs

I learned this one from a friend of mine (you know who you are!) a few years ago. He was out of work for a while and his head never went down, even though the economic environment was tough at the time. When meeting him for (yet another) coffee, he told me about the number of meetings he had in the diary that week, just catching up with contacts. I remember saying how impressed I was that he was so active in staying out there at such a difficult time. His answer was that if he kissed enough frogs, one would eventually turn into a princess! A few weeks later, he landed pretty much his dream job, thanks to kissing lots of frogs.

Activity leads to better results. Make the calls, meet people for socially distanced coffees, even where the potential appears low. These are your frogs. It beats sitting in the office.


Do something / anything

On the theme of doing nothing, don’t let days slip past. Rather than twiddling your thumbs, achieve something every day. Review your proposition, your website, your marketing messages. Write a blog post. Even clean the office, but don’t do nothing.


Remember that this is temporary

The world might appear a little grim at the moment, but this will pass. There are better days ahead and you want to give yourself the best chance of hitting the ground running when they arrive.


So, small goals, small wins, seek help and stay busy. And keep kissing those frogs.

What do you do when the flow of new clients dries up.

As advisers are adjusting to working remotely from the office and distanced from clients, the challenge of attracting new clients has now been raised with me a number of times.

Most advisers have adjusted quickly to servicing existing clients, however attracting new clients has been more challenging. While the recent economic upheaval has created a difficult backdrop for all, the issue has been particularly challenging for advisers whose main source of new clients traditionally has been by referral, particularly where the adviser had an effective way of asking for referrals. Because client conversations are not quite as smooth when using Zoom etc, advisers are finding it more difficult to have effective referral conversations.

My advice? While referrals were and will always be a rich source of new clients, they can’t be your only approach. It’s time to go back to the first principles of marketing and to consider in particular the concepts of Segmentation, Targeting & Positioning (STP).


Some definitions

So we’ll start with a 30-second marketing lesson. Here is a definition of each, as set out by Philip Kotler, the grandfather of marketing education.

  • Market Segmentation: Dividing a market into distinct groups of buyers with different needs, characteristics or behaviour, who might require separate products or marketing mixes.
  • Market Targeting: The process of evaluating each market segment’s attractiveness and selecting one or more segments to enter.
  • Market Positioning: Arranging for a product (or service) to occupy a clear, distinctive and desirable place relative to competing products (or services) in the minds of target consumers.


What’s happening in the financial adviser market in Ireland?

Many financial advisers realise that a “one size fits all” proposition just doesn’t cut it any more. Either for the client who is looking for more than a generic service, or for the adviser who cannot profitably or successfully deliver the same service to all clients irrespective of their value, characteristics, needs etc.

As a result, many advisers are undertaking segmentation exercises by analysing both potential customers and their existing client bases. The goal is to identify all of the different groups of customers, possibly by sector, by business potential metrics, or by demographic factors.

Once the segmentation exercise is completed, the next task is to identify the segment(s) that you are going to target. These may for example be SME business owners within your county and surrounding counties, or corporate executives aged over 50. It’s quite possible that you will also decide to target another group such as newlyweds – they might offer lower value today, but offer growth potential in the future. You will decide your target groups based on your access to those people, the segment potential, your areas of expertise and specialism, the capability of your advisers etc.

Most advisers are relatively comfortable with these first two steps, it’s the third step of positioning that challenges people more. This is where you aim your proposition, your services and your communications at the groups you have identified to target. The reason people are uncomfortable with this is because through targeting specific groups, there is a risk of not appealing to others outside of your target groups – of leaving people out.

Of course the alternative is to try and talk to everybody, but the significant risk with this is that you can end up appealing to no-one.


Why STP is so important for financial advisers today

It’s this final step of having the courage to position yourself within a specific target market (or even a niche) that is a step too far for many advisers. They struggle with the idea that while attracting new clients might be quite tough today, that it might actually be easier if you narrow your focus! How does this make sense?

If you offer a generic service to clients, they will recognise this. They won’t feel any particular connection with what you do, as it is not targeted at them. Instead if you have a clear target market and all of your communications are aimed with that group specifically in mind, the customers within that group will connect with your messages and are more likely to view you as a specialist who is out to serve their specific needs.

There are lots of very good financial advisers operating in the Irish market. At the end of the day, how are you going to stand apart from the crowd if you offer a very generic service? Instead the answer may lie in identifying your ideal clients, and then developing your proposition and communication approaches to target them in a very structured way.