Today’s post lands on Groundhog Day. While the science of a rodent’s shadow being able to predict the weather may be questionable, I still smile every Groundhog Day, thinking about the movie. Who doesn’t love Bill Murray stuck in a time loop, as he changes from a self-important weatherman to a self-improved everyman?
Today, I thought I would share my own Groundhog Day loop – because it involves you. It seems that a majority of the conversations I have with advisors focus on three things – what I think are the foundations of any growing firm (or firm that wants to get to the next level):
- Segmenting your clients – not by what is important to you, but by what is important to them. Understanding who your clients are and what similarities they have.
- Understanding the importance and creation of a value proposition – one that resonates with your target clients.
- Using simple tools – to describe what you offer and how you service your clients.
If you are a regular reader, you know that I love client segmentation. But you also know that I believe traditional client segmentation has been taught completely wrong for years. We have been taught to segment our clients by revenue or AUM (things important to us) vs. services needed, meeting frequency or client psychographics (things important to them). By segmenting, you can find similarities in your clients, opportunities to improve the services you offer, and maybe even a niche that you didn’t know existed. Segmenting the right way allows you to improve your business, while cutting our non-valued services and processes.
My Groundhog Day question: “Businesses get bigger by getting smaller. Tell me about your niche or specialties. Where can you focus or specialize to become the go-to person in that niche?”
Understanding and communicating your value
The advisory business is what I call a “sea of sameness.” One of the proofs I saw was a chart from the 2016 Investment News Financial Performance Study of Advisory Firms that showed 74% of new clients of independent advisors came from previously do-it-yourself (aka self-directed) clients. Few clients are leaving their advisors because they think they will get the same thing somewhere else. There is no differentiation in clients’ minds from a big wirehouse to a small independent firm because firms say the same things such as “offer comprehensive planning for retirees and pre-retirees” and “prudent investment advice.” If you can’t communicate why a client should work with you, you fall into that trap of sounding like everyone else.
My Groundhog Day questions: “Tell me… who are the clients your firm is set up to serve, what are their obstacles and what do you do to solve them? How do you use that value proposition in your marketing and social media activities?”
The use of tools
Ten or 15 years ago, when a client referred friends or family members, it was easy – they just called the advisor. Today, they Google you and look at your website, LinkedIn, Facebook and Instagram for clues about how you deal with clients. They look at your background and qualifications to find out about you and get to know you first. A static web page that doesn’t address what the client is interested in and having no social presence puts you at a disadvantage to those advisors who are focused on a niche.
My Groundhog Day questions: “Does your website and social media presence seem generic or tied to the value proposition and segmentation that you have done? Can a prospect ‘interact’ with you by downloading newsletters, white papers or podcasts? Can they get to know you?”
The next morning
In the movie, Bill Murray finally wakes on February 3rd up after he becomes a better person. The good news is that I don’t have to relieve my Groundhog Day the many years his character did. I get to see advisors create a real segmentation (or at least a persona or two). I also get to see their value prop and review the tools they created. Most importantly, I get to hear about the results they are having growing their businesses and servicing their clients. So I have to ask….
Are you working in an endless loop in a sea of sameness or are you waking up on Feb 3rd to a new, better business?