Find Your Piece of the Sky

vapourTrail wideby George Ray

The voice on the other end of the phone said, “Here’s my problem, George. I have so much business that I don’t know what to do. Can you help me?”

In my time as a practice management consultant, I’ve talked with many financial advisers about various issues and challenges to their businesses, but this was certainly the most unusual call that I’d ever received.  My initial reaction was that it was a prank. I was being ‘punked’.

“OK. Very funny. Which wholesaler put you up to this?” I said to the adviser.

“What? No, I’m serious” he said.

“OK, then tell me about your problem.”

“Well, I spent many years as an airline pilot for one of the big airlines.  Flew all over the world, and really enjoyed my job, but I was always interested in the financial markets, investing, and the economy. I managed my own money, and did pretty well.  I decided that when I retired from flying for a living that I was going to be a financial adviser, and that’s what I did. I became a CFP and an RIA and have my own firm now. And, I’ve become known as the ‘financial adviser for airline pilots”.

“That would not seem easy to do” I said. “I imagine those guys are pretty tough to cold call. (Lame attempt at humor.) How do you market to them?”

“Well, that’s the thing. I don’t. I started off working with some of the guys that I flew with. Because I really understand them and understand the company’s benefits, they’ve been giving me tons of referrals. Pilots in the cockpit on a long flight get to know each other.  We spend a lot of time talking while flying. We start out complaining about the company, then our ex-wives, and eventually the conversation turns to where we want to retire and what we want to do.  By the end of the flight, my client has the other pilot convinced that I’m the only guy that he should be talking to. The other pilot gets off the plane and immediately calls me to ask if I can manage his money.”

“Well, that makes sense. You’ve got a real affinity with that group. You were one of them.”

“Sure, but here’s the real problem.  Financial advisers usually have most of their clients located within 20 or 30 miles from their office. My clients are literally all over the world. I work with pilots in Singapore, London, Mexico City, and Auckland.  My business has grown to become a global firm, but it’s just me and my assistant right now.  I wanted to keep this simple. I’m actually supposed to be retired. But this has been so successful that I’ve got to get some help to decide which way to go. That’s the reason for my call. Do I refuse to take on new clients, or should I start growing my firm?”

I have to admit that I tell this story almost weekly. It’s usually because I’m trying to help an adviser to see the value of choosing and building business in a specific niche market.  (I work to connect advisers with Federal employees.) But finding the right niche isn’t the biggest challenge for most advisers.  It’s convincing them in the value of having a niche in the first place.  Most advisers are afraid to choose a niche because they are worried that they will be limiting the amount of business that they could do.

An adviser: “But, George, if I limit myself to working with only one group of people, I could be missing out on lots of other potential business. That’s not what they taught us at adviser camp.”

Me: “What I’m saying is that if you focus your business on a niche then you won’t be scrambling to find clients within 30 miles of your office. They could actually be seeking you out from around the world – just like the former pilot.”

Another adviser: “But, George, I’ve never been an airline pilot, so I don’t think pilots will want to work with me.”

Me: “OK. So, you were listening (at least he caught the part about the pilots), but you need to understand the lesson in my story. Find a group that you have an affinity with.

An adviser may find a ‘natural’ niche based upon an affinity with a particular group. For example, a former teacher will likely find it easier to relate to and work with teachers.  An adviser who worked for a large employer in his city may find his niche in working with employees of his former company. People feel comfortable working with someone when they have something in common – like the pilot and his pals. A natural niche may be based on geography, common philosophies, race, religion, or a job.  Niches are well-defined groups of people with something in common. Products (e.g., annuities or mutual funds) are not a niche.  Women are not a niche (too broad a category). And stop telling me that your niche is ‘people with money’. That’s not a niche either.

Still another adviser: “But, George, I don’t have a natural niche. So, what can I do?”

An adviser who has difficulty finding a natural niche can still develop one by gaining a body of knowledge that may be unique or specialized.  In other words, if you learn more about your subject than anyone else (by becoming an expert), people in need of your expertise will flock to you for your help.  An example of this in the financial services industry is Ed Slott. Simply Google his name and you’ll find his website – irahelp.com.  His name has become synonymous with IRAs, and he has built a large (and certainly profitable) business on being the best person to contact on Individual Retirement Account questions – whether you’re an adviser needing training, or a consumer watching one of his television shows on a PBS station.

But what about the financial adviser to airline pilots? Well, we had a good conversation about direction and strategy. He just needed help with setting the coordinates on his compass for his next destination. You see most advisers believe that the sky is the limit, but it’s pretty big and mostly empty up there. Unless, like the former pilot, you’ve managed to find the ‘right’ piece of the sky — your sky.

No Dinner for You

Dinner has endedby George Ray

I like real life case studies. Let me share one with you.

Last week I spoke to 134 Federal employees in Wichita, KS in a large auditorium at Wichita State University. A financial adviser from Kansas worked closely with the Wichita Federal Executive Association (WFEA) to bring this together. The program consisted of an employee benefits briefing for Civil Service Retirement System (CSRS) employees in the morning, and a program for Federal Employees Retirement System (FERS) employees in the afternoon. Many employees brought their spouses along with them, and drove up to three hours from locations around the state in order to attend. (And, to their credit, none grumbled about the government shutdown.)

When I talk with financial advisers about the opportunities to help Federal employees, I often recommend that hosting an employee benefits program similar to this one offers an ideal occasion to meet people who need their help. The association in this particular area only hosts these programs every two years.  During that time there is a large vacuum of questions that builds and is looking for escape.  We were able to help release that vacuum with the information that we provided.

The comments we received on our evaluation form from the attendees were very favorable, but many would have preferred more time to ask questions about their individual benefits and circumstances.  Those who had additional questions added their contact information to the evaluation form, and about one third of them want to meet with the adviser in the coming weeks (and possibly many more in the future, as he builds his presence in this market).

I continue to see advisers who try to attract new clients with expensive evening dinners at a nice restaurant (Maggiano’s and Ruth’s Chris are particular favorites) and a general program on financial planning or estate planning.  These agendas are a ‘dime a dozen’ and require large expensive mailings to attract fewer than 20 people.  The message is usually designed to scare the attendees into meeting with the adviser, and can be heavy on the sales pitch.  Advisers are typically disappointed with the results, but continue to offer these programs because of the lack of a better idea.  They could take a lesson from this adviser who

  • Has decided on a niche market for his practice (working with employees of the nation’s largest employer).
  • Worked with an organization to host the program and invite their members, (in this case, the WFEA) rather than blindly sending mass mailings.
  • Didn’t need to buy anyone dinner at a nice restaurant to motivate them to attend (we provided communications materials to the organization’s members to explain the benefits of attending).
  • Contracted with a firm that has developed and successfully presented these types of programs regularly, and specifically for his market (my company).
  • Wasn’t afraid to bring in an outside expert to professionally present the information (I believe that was me).
  • Provided useful, relevant, and objective information which was designed to really help the attendees, rather than to mislead or scare them.
  • Offered to follow up with only those who actually requested his help.

As a result of his efforts, it wasn’t necessary for this adviser to spend thousands of dollars on mass mailing of invitations. In fact, he may actually RECEIVE invitations to present similar programs from the Federal agencies whose employees couldn’t attend (after hearing about the program from their colleagues). This case study is an excellent example of a successful niche marketing program.

Do you want to attract someone to your seminar? First, decide exactly who you want to attend. Then, develop a program that is unique and targeted to that particular audience. And, enlist the help of an interested organization who may also benefit by helping you to sponsor or host the program. Maybe it’s time to finally stop those boring, cookie-cutter financial planning dinners and try something new. Sorry, Maggiano’s.