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Financial Planning > Behavioral Finance

The best way for advisors to stand out

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In early June, I was on a panel with two advisors at the Pershing Insite Conference in Orlando discussing how independent advisors can differentiate themselves from their competitors. My co-panelists were excellent and insightful, and I was struck by the fact that in the advisory industry the need for differentiation has become greater than ever before. 

It wasn’t very long ago that an advisor could stand out by being a financial planner, or owning an “independent” firm, being fee-only or acting as a fiduciary for their clients. But things have changed: financial planners are a commodity from Wall Street to Rodeo Drive, the ranks of “independent” advisors are swelling almost daily and, so far, the net result of the Dodd-Frank Act is that nearly every broker in the country is claiming to be “fee-only” and a “fiduciary,” at least on a part-time basis.

Consequently, many advisors today are struggling to set themselves apart from the rest of their competitors in a way that attracts clients. The three of us panelists spent an hour and a half discussing how advisors can do just that, each from a different point of view. 

First, Michael Rose, founder of Rose Capital Advisors, talked about using a firm’s “culture” to stand out. This should be the easiest way for advisors to differentiate themselves, but for some reason, it’s often the most difficult. I think it’s hard because firm owners are being bombarded with advice about how they should act, what they should do, and how they should do it.

Instead, a firm’s culture comes from its owner and its staff naturally: based on who they are and how they act. Sure, you can fake your culture for a while — acting like you’re the firm that “cares,” or you’re experts in X, Y, or Z. But if that’s not really who you are, the acting will take a lot of energy and cause a lot of stress. Sooner or later, you and your employees will gradually regress back to who you really are.

It’s far better to just start with who you are and build it from there. If you love helping clients, great. If you’re more on the nerdy side and love creating and managing portfolios, go with that. If you love running your business, great: work with business owners and help them run their businesses.

The bottom line: just be yourself. It will be a whole lot easier, and more successful. 

Next, Dean Harman, managing director of Harman Wealth Management, talked about using “process” to distinguish a firm. Here, process means the way in which you deliver financial advice. Mr. Harman said that his firm uses an outside investment research company to provide a unique perspective on markets and investments. This adds an additional layer of sophistication that resonates with the firm’s clients, which greatly increases its referral rate and closing ratio.

I’ve seen advisors create unique processes in many ways: offering therapy,or counseling, expanding into life planning or healthcare or trust services. The possibilities are endless. Again, as I said about creating a culture, the key is to create a “process” that comes naturally to your firm, reflecting its expertise and approach to financial advice. 

Last, it was my turn.

It’s always intimidating as a speaker to follow excellent presentations, but in this case, Mr. Rose and Mr. Harman’s passion for their subjects inspired me to talk about my subject, which happened to be passion. That is, using passion to differentiate your firm.

It’s a subject that I am, coincidentally, passionate about.

In my experience, one of the things that people pick up very quickly is when someone is passionate about what they do. Like many other professions, being a financial advisor is an easy thing to be passionate about. Most people really need your help, and consequently, you can make a big impact on their lives and on the lives of the people who depend on them.

I don’t know why, but I sense that some advisors hold back on expressing their passion for what they do. This is a mistake.

When advisors show their enthusiasm for what they do, it inspires confidence in their clients and in their employees. What’s more, it’s also contagious: when employees feel that their owner-advisor believes what he/she is doing is important, they start feeling that what they are doing is important, too.

And the clients start to feel that they — and their well being — are important to the firm. I believe that’s the best differentiator of all.

See also:

Here’s how one advisor takes the fear out of retirement planning

4 ways to build your brand online

Is bigger actually better for your practice?

Everyone wins when agents get involved in their communities


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