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September 30, 2013 at 08:00 PM
Since word got out on the street that women are the demographic du jour, financial advisory firms, large and small, have been making a dedicated and concerted—aggressive, even—effort to cultivate a female clientele.
This is great news, according to experts like Kathleen Kingsbury, founder of coaching firm KBK Wealth Connection and the author of books like “How to Give Financial Advice to Women: Attracting and Retaining High-Net-Worth Female Clients” and the just-published “How to Give Financial Advice to Couples: Essential Skills for Balancing High-Net-Worth Clients’ Needs.”
Women were more or less overlooked for decades by a largely male-dominated industry. Now the dynamics have changed and women are not only achieving professional success and increased independent economic power, but are also increasingly becoming the primary breadwinners for their families. It is clear that financial planners have no choice but to reach out to women if they want to expand their practices.
However, that outreach, in Kingsbury’s view, leaves much to be desired. Not only is it too overarching and one-dimensional, viewing women as, well, just women, it doesn’t really help those firms that want to have deep, long-lasting relationships with a female client base.
“Women control the majority of wealth today so many firms are reaching out and developing content specifically for women and training their sales force on how to do business with women. Though the approach is well-intended, it feels as though financial planning firms are simply hunting women like they are deer,” she said. “The industry doesn’t really get what that feels like for women and that it needs to change.”
Rather than viewing women as one homogenous group and tracking them down simply because they’re the flavor of the day, Kingsbury believes financial planners need to come up with a more nuanced approach to attract women, one that seeks to understand the many differences among them and approach them as individuals as opposed to a mere demographic group.
“Financial planning firms must now have a different relationship with women,” she said. “They must be able to market to them differently by thinking of them in many different ways and in different dimensions.”
A stay-at-home woman, for instance, who supported her wealth-creating husband during his career and now wants financial planning advice in order to help her grandchildren, will require a different service from a young executive who wants to start a business, just as a widow will be very different from a single mom in her 30s. Firms that want to succeed with women really need to think about them as individuals with different situations in life and different character and personality traits.
Male Models
One could argue that just as the women’s market needs segmentation, so too does the male market. To a certain degree, “we should also be understanding men in the same, multi-dimensional way,” said Eleanor Blayney, a financial planner and consumer advocate for the CFP Board.
However, “I would argue that if we look at the changes that have taken place in women’s lives over the past 50 years, and given that today, we are still facing the legacy of those changes, the approach to women needs to be particularly sensitive,” Blayney said. “The reality is that women have suffered from stereotypes, both with respect to financial planning and in the financial planning profession itself. Realizing that these stereotypes still exist and how they have affected our approach to women is extremely important in coming up with a new, more empathetic and sensitive approach.”
Both Blayney and Kingsbury believe that financial advisors and firms should be working toward adopting more client-centric approaches that look at women as investors like any other, with their own financial goals to accomplish.
After all, pointed out Myra Rothfeld, chief marketing officer for Genworth Wealth Management, women today do hold 50% of the wealth in America, “so we can debate whether 50% is really even a niche market anymore.”
