The best way for advisors to create a niche
Why form a niche?
Why must you discover your niche? Not because it works… not because others have had success… because you can’t compete in the financial services industry on price. If you try, you will be replaced either by the industry, your firm or your clients. When the measure of your value is price alone, you become replaceable. You must become responsible for the ownership of the perception of your value. In doing so, you must find ideal like-minded clients to serve… because you can’t be all things to all people. Attempting to be a jack of all trades is the quickest way to be forced to exit this industry. Trust me when I say this, You don’t want to miss out on the next 10 years.
Clients that come to you for discounts will leave for discounts.
So you need a niche to remain relevant and become irreplaceable. Not because it may have worked for someone else.
1. You can’t compete on price.
2. You can’t be all things to all people.
3. Price becomes an issue in the absence of value.
4. Prescription without thorough diagnosis is malpractice.
5. Quality over quantity.
You must increase the quality of your clientele but you can’t afford to have your reputation tarnished by making promises you can’t keep. Your authentic value must be made available 24/7 for the world to see and here. This is not the corporate slogan or the company catchphrase… this begins with your client-centered purpose. You must own the words that define your authenticity and it all begins with your shared purpose. Ideal relationships are formed with a shared purpose… this is where you begin to carve out your niche.
To survive in the digital age advisors I must not compete on price… to thrive I must be able to increase the quality of my relationships by design. My process must become simplified yet productive.
Your Process Must Empower You…
- Connecting the dots of the critical components (simplification).
- Building the foundation of your advisor alpha to create tangible value (exude value 24/7).
- Expand tangible value to remain relevant and become irreplaceable (completing the process but never finishing).
- Productive repetition by design (small steps).
You must get ideal clients…
you must remain relevant…
and you must become irreplaceable to keep ideal clients…
while you simultaneously expand the breadth and depth of your services 24/7.
Your niche can be formed by your purpose… in fact, it’s the only way to truly connect to your ideal audience in the new digital era of financial services.
Quality relationships begin with shared purpose.
I will pay you to solve my problems if you can prove to me that our end-game is mutual success.
~ Ideal Client
This Is Not For All Advisors
The Big Picture
Your Gift
The power of persuasion in the digital age of transparency can not be used to sell products in a vacuum to increase shareholder value.
Your gift to persuade clients must be used differently.
Your gift is to persuade clients into doing the right thing for themselves.
Creating stakeholder value is the only way to generate predictable recurring revenue in a robo-world.
You must be able to see your future through this lens or you risk irrelevance.
Think Big Picture.
Act Accordingly
Discover Your GiftLaws of Advisor Value
Fundamental Truths
Advisors Should Be Unencumbered
When it comes to publishing beliefs and opinions about the industry, we lead by example with our Laws of Alpha.
The fundamental truths about advisor alpha (value) and how they got to be the way that they are today can all be found right here at TangibleAlpha.com. In order to demonstrate your value in a tangible fashion for digital consumption, you must define your own “Laws” of investing and wealth management for your clients (and prospects) to see, hear, read, and feel. Your Laws must become more than visible… they must elicit a feeling in the hearts and minds of your audience. This must be available 24/7. Your content has to move your ideal audience to action every day. The action can be to do nothing, give feedback, stay with you as a client, or move their assets to your firm.
This is one of our Laws of Advisor Alpha
5/12
The Law of Digital Trust
The Law of Digital Trust
→SUMMARY
Earning trust in the digital age of transparency requires a shared purpose that is supported by promised behavior.
→OVERVIEW
The Law of Digital Trust has been derived from self-evident criteria required to build lasting trusted relationships. In the digital age of transparency it is critical to ramp up the process of collaborative trust and this can be accomplished by stating your client-centered purpose, publishing your principles, and promising your behavior.
Sustainable Organic Growth
The Value Algorithm
Sustainable organic growth comes from predictable recurring revenue… or at least the ability to create predictable recurring revenue when it is compounded by the catalyst of successful repetition. This is the magic formula or the “advisor value algorithm” that has enabled successful advisors to thrive (sometimes by default) by design. It is in your best interest (as well as the best interest of your clients) to discover your own personal advisor algorithm to create your own sustainable organic growth by design.
Advisor Summary
Inherent risk associated with default setup… (The issues associated with you not taking control of your advisor algorithm) What will happen to your business and your clients when you continue to ignore your own advisor algorithm…Options you have to discover your advisor algorithm… (really just one)
Successful outcomes of advisors who have discovered their advisor algorithm and the evolution of their businesses because of the proactive stance they have taken in owning their algorithm of value culture and growth…
3 types of risk you introduce into your business by refusing to own your advisor algorithm…
- One Step Up Risk (Two steps back)
- Culture Risk (Your people don’t have anything to take hold of… there must be autonomy and the opportunity to own one’s own advisor algorithm)
- Valuation Risk (Reducing your organic growth machine to chance reduces the value of your business in an inorganic spectrum)
One Step Up Risk (Copycat Risk)
The issues associated with not owning your advisor algorithm are numerous and compounding by nature. We can start this shortened summary of all risks inherent with not owning your own advisor algorithm… with the risk that you bring into your business by not having the framework for a successful business model in place to guide your daily actions. When you associate the success of your business with the success of tactical concepts that may have worked for other successful advisors you are tacking on additional risk (one step up risk). What initially might seem to be a hit with you and your clients is eventually exposed as the temporary fix that it is because you don’t have the same Advisor DNA as the advisor whose blueprint you have copied. These actions always lead to heartache and two steps back because of the additional work it takes to make up the difference in the perception of the value you have perpetuated and the actual authentic value that you can and should be offering your clients. Your authentic value (the value that you can actually control) must be made tangible to demonstrate its relevance. The relevance of your value is critical in uncovering (getting) and maintaining (keeping) ideal clients. When you turn you back on these critical components of the advisor algorithm you introduce one step up risk into your business… and you don’t need that. One Step Up or Copycat risk is incredibly toxic when it comes to building your business. The cleanup factor is enough to drive any serious advisor out of business… Your reputation will be forever sullied by the lack of authenticity you introduce into your business culture when you fall for One Step Up Risk.
Your business is far too valuable and your reputation is far too important to introduce this type of Copycat Risk into your business development model. When you discover and design your advisor algorithm you create a strategic foundation that makes you and your business culture far less susceptible to falling for One Step Up Risk. In fact it guarantees that you will never see tactical offerings as strategic solutions again.
(This should be enough to get you started down the path of building your business by design… if not, please continue reading to discover more risks associated with not taking ownership of your advisor algorithm.)
Culture Risk
When you don’t own your advisor algorithm you open your business up to a multitude of cultural issues associated with lack of focus. Your trusted partners have earned the right to become part of your culture and they are indelibly tied to your reputation and the story of your authentic relevant value. A certain level of autonomy is required to create this culture of trust. If you do not acknowledge the importance of owning your advisor algorithm you will introduce chaos into your business model. Each member of your valued team must be able to have critical conversations that matter, with the confidence of the courage of their conviction. And in this era of 24/7 collaborative services, all conversations matter. You must prepare all trusted partners with the ability to converse with confidence. Without the ownership of the algorithm, which sets the tone for your culture, you are adding risk by default… this sounds confusing… design… default… what the hell man? Just let it be known that you are not doing yourself, your partners, your staff or your clients any favors in the ways of client experience and trust by ignoring your advisor algorithm. For sustainable growth to occur by design you must have a culture that is built (on purpose) from the fundamentals of your advisor algorithm which empowers you to exude your integrity and trust in a multitude of mediums twenty-four hours a day. Your predictable recurring revenue is at risk every minute that you are not able to exude the culture of integrity that you have created by design for the good of your ideal clients.
Business Valuation Risk (Inorganic Value)
The value of the moving parts of your business when you cease to be there is considered by many to be the valuation of your business. There are many more variables associated with the value of your business in the inorganic perspective… there are buyers and sellers markets when it comes to valuations and the grey matter involved is beyond the scope of this article. Suffice it to say that you must be able to demonstrate your predictable recurring revenue and the ability to maintain that predictability and growth when you are not their holding the reigns. The other side of the coin is if you are acquiring another business and need to create your own specific variables for valuation… owning your advisor algorithm empowers you to go beyond the spectrum of third party evaluations of ROI into cultural details that can uncover cultural alignment which must not be ignored when there is so much at stake when it comes to potentially adding risk to your current client base if you do not have an ideal fit with the firm you are acquiring. This is a light summary of the possible risks inherent in the valuation of advisor businesses when it comes to inorganic acquisition. Sustainable organic growth is indelibly tied to inorganic acquisition regardless of which side you reside… both buyer and seller must verify the ability of the acquired business to generate predictable recurring revenue and sustainable growth…Simply not recognizing the opportunity (owning your algorithm) to create a stronger business model while reducing risks associated with valuations is just not acceptable. Your clients deserve better, so does your staff and you do too.
Conclusion
What advisors can gain by owning their advisor algorithm is a dramatic reduction of three inherent risks associated with lack of focus, vision and or purpose.
The advisor algorithm is a merely synonym for alpha or value by design… some advisors see things one way, some see it another.
To get all advisors exposed to the opportunity of tangible alpha I have designed multiple synonyms for tangible alpha… anyway, back to the point of this story…
The need to create sustainable organic growth is often undermined by risks that advisors unwittingly add to their businesses while trying to create predictable recurring revenue. It’s a kind of sabotage that advisors can’t see because they are often times too close to the business to see clearly the missteps they are taking. That’s why I feel it is my calling to enlighten and empower advisors with the wisdom I have been able to gather through my affiliation with one of the best advisor coaches that has ever walked the planet. I might be a little biased.
Anyway… on to the conclusion…
To gain a competitive advantage in a multitude of dimensions (moving forward in the digital age) the advisor in the future will own his or her advisor algorithm and increase the probability of success while simultaneously reducing inherent risks associated with cultivating a business that thrives on sustainable organic growth.
Keep It Tangible,
Grant