A few years ago, a couple of business school professors wrote a book called “Blue Ocean Strategy”.
The book has a simple premise – if you fish where everybody else is fishing, you won’t gain much and you’ll also waste a lot of energy in the bargain – this is the “red ocean” – red because of the constant competitive fighting.
Instead, say the authors, go where the ocean is blue – where there aren’t many others fishing.
This sounds like typical stuff from business school professors who don’t have to sell for a living – and can afford to theorize in economic comfort.
But as I continue to dig deeper into the market for financial advice and wealth management, I started finding hints of many patches of blue amid the standard red fields that everyone seems to be fighting over.
Fertile hunting grounds that no one seems to pay any attention to.
Here are four candidates. How many more can you think of?
The Blue Oceans of Wealth Management
#1 – The Cinderella Prospects
Cinderella of the fairy tale really wanted the glass shoe to fit. But she didn’t think it was meant for the likes of her, a lowly humble palace help.
Just like Cinderella, there are prospects who never think to try wealth management because they think it’s not for “people like them”.
It’s likely they qualify by many wealth mangers’ asset or income standards – but have a deep-seated belief that wealth management is for “other, rich people” – presumably the ones who fly around in private jets and have their own chefs.
They also can’t visualize how their lives could be significantly better – in tangible, important ways, without the material that will help them see this better future.
Think of the quintessential entrepreneurs that Thomas Stanley wrote about in “The Millionaire Next Door” – the ones who drive a Ford Focus and feel more at home in the workshop than they do in the luxury shop.
But who just happen to have founded businesses that are now with millions. Or just saved up a LOT of money.
Find them, show them how your work enhances what matters to them, and you’ve got a client for life.
Photo by Mitchell Griest
#2 – Non-mainstream Audiences
My favorite pastime is to visit the websites of all kinds of wealth management and financial planning firms because I am inordinately curious about marketing.
The images I see are almost exactly the same – they represent the typical mainstream audience. I have never once seen anything that would make someone like me, for example – a well-educated female Indian entrepreneur, feel like I belonged there.
Even if you have a tightly defined niche, entrepreneurs between the ages of 45 and 60, for example, how deeply have you explored non-mainstream audiences within that tight niche?
In this example, if you serve entrepreneurs 45-60 years old, do you address the concerns of 45-60 year old entrepreneurs who are:
- Female
- African American
- Veterans
- LGBTQ
- Single, divorced or widowed
- belonging to a blended family
- Disabled
- Belonging to a particular faith
- Of a certain ethnic heritage
Each of these groups is likely to have the same problems as every other 45-60 year old entrepreneur you want to work with and are hungry for help because no one else typically pays attention
What attractive sub-niches have you ignored?
#3 – The Deniers
I have a friend who is a prime candidate for almost every wealth manager I know. She’s a delegator, wants someone else to manage the financial headaches, and could really use the help.
I’ve referred her numerous times to incredibly competent, warm, helpful and very well-regarded wealth managers – but she has never reached out to them.
The REAL reason is not obvious.
Just like many people won’t go to a doctor because they’re afraid to hear some unpalatable news (e.g., need for weight loss, better diet or exercise), many won’t go to a financial planner because they’re afraid they’ll hear news they can’t withstand – even if it never is too late.
What they need is someone to help them over this hurdle and to validate the fear. Once they can emotionally accept that it’s never too late and there’s always opportunity for action, this market opens wide up.
#4 – The Value Skeptics
One of the big challenges in getting a promising prospect over the finish line is demonstrating value to justify cost.
This is especially true with the Value Skeptics.
These are the people who get exactly what you do and how it helps them – they’re smart and educated. But they have a problem justifying to themselves why what you do is worth the fee you charge.
Rules of polite behavior may preclude them from telling you the real reason they disengage or disappear – they may quote other socially acceptable reasons for pulling back.
But the reality is that they just don’t see that you bring enough to the table to justify the cost.
If you can demonstrate to their skeptical minds that your value is objectively more than worth the cost, your chances of getting in the door skyrocket.
Photo by pine watt
Smart Fishing in Blue Oceans
Traditional approaches hamper firms and providers from succeeding in blue oceans.
Typically, firms tend to ignore the special concerns of first time buyers and their unspoken fears of the financial “monster under the bed”. They’ve also been late to the game in addressing clients’ increasing preference for specialists who’re at the top of their fields.
But you don’t have to create a special marketing approach for every “blue ocean” opportunity you may uncover, now and in the future.
Take these smart steps to set yourself up to find and succeed in many fertile fishing grounds – now and into the future.
#1: Explicitly Address Challenges First-time Buyers Face
Tweak your marketing to ensure you:
- address first-time buyers’ fears of dealing with any provider of wealth management
- educate them on the process, the experience and tangible benefits of getting professional financial help
Talk about the challenges of DIY financial management – the uncertainty, the stress of not knowing what you don’t know. Highlight the benefits of a rational and professional approach – with specific examples.
#2: Validate and Address Emotional Fears
Call out the fear of not knowing what you don’t know – and validate it immediately. Draw parallels to similar situations in health, for example.
Demonstrate that this is a common problem you see with the clients you do help. And show why this could be a misplaced fear – with concrete examples, possibilities and steps they could take.
Photo by Belinda Fewings
#3: Consciously Address Niche Clients’ Concerns
Look through your own client roster from time to time. Find the ones that don’t fit the mainstream model. Take the time to understand what specific challenges they face and what they struggle with more than others. Then, incorporate these challenges into your marketing message – whether subtly or explicitly.
Here’s an example: If your minority client articulates a challenge about feeling intimidated dealing with financial professionals, subtly highlight your approachability and friendly culture in your marketing.
#4: Highlight Concrete Benefits That Make a Difference
Research by Morningstar, Vanguard and others has shown that there is a clear return advantage to financial planning. This extra return comes from customized planning, emotional factors and the inclusion of goals in financial planning that go beyond “beating the market”.
Show this clear, credible and irrefutable evidence in support of having professional financial advice prominently in your messaging to your audience.
To many skeptical and jaded prospects, this low-key, solid and highly believable finding could be the single thing that gets them past the finish line.
How are you going to find your next blue ocean?