The question I’m asked most often is: How can I differentiate myself from my competitors? It’s a valid concern, with many ramifications.
You’re not “different”
Your investment philosophy is the same as other evidence-based advisors. Your webpage looks like a robot designed it. It has the same look and feel (and maybe even the same or similar stock photos and generic videos) as hundreds of other websites. The menu items are identical to theirs. It’s written in the same stilted, formal, non-relatable way. It contains way too much information
The first step towards solving a problem is to admit you have one. Your problem is you’re not “different.”
The wrong question
You don’t really want to know how to be “different.” What you are looking for is a way to be “different” without taking any risk.
Your concern about risk is an anomaly. You’re supposed to be experts in risk. How many times have you told clients, risk is the source of returns? Of course, we all appreciate risk also has a downside, but that’s precisely why investors are rewarded for assuming it.
That’s the anomaly. You encourage your clients to take appropriate risk, yet you’re often unwilling to take risk in your advisory business.
Without taking risk, you won’t be able to differentiate yourself.
Here are some suggestions for taking the kind of risk you should assume if you’re serious about differentiation.
Increase marketing expenditures: The average advisory firm spends a little over 1% of revenues on marketing. That figure should increase at least five-fold. With your new budget, get creative. Toss out your webpage and create a new one that breaks new ground and is supported by sound evidence. We can show you how to do this, as can many others.
Here are some other ideas you can implement with a bigger marketing budget:
- Consider a public relations and advertising campaign.
- Increase your presence on social media.
- Look into targeted ads on Facebook.
- Consider an automated e-mail campaign using software like SharpSpring. I can provide details.
- Buy a sophisticated coffee machine so you can offer different kinds of hot beverages to prospects and clients. There’s interesting research indicating those holding a warm beverage judge others more generous and caring.
- Remodel your office. Get a creative designer who can help you make it memorable. Toss out your boring, old furniture. Configure meeting spaces more like a living room and less like a boardroom.
- Add the capacity to do effective video conferencing.
Become a niche advisor
If you had a heart problem, would you go to a general practitioner or to a cardiologist?
There’s great appeal to not serving everyone.
Change your fee structure
Most advisors charge a bundled fee based on assets under management.
Want to differentiate yourself? Charge a retainer or hourly fee based on complexity.
Want to differentiate yourself even more? Charge a flat fee regardless of the amount of assets or have different fees for different break points.
These suggestions don’t apply to everyone. They’re just a sampling of the options available to you.
The underlying (and often unspoken issue) is this: Being different involves risk. Assuming risk takes courage.
Resource of the week:
I found this article helpful on the subject of embracing the idea of being different.