The best way for advisors to stand out

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.