Expanding Your Product Line to Be Competitive
Mergers and acquisitions (M&A) are all the rage
in the financial services industry right now. But, if you don’t want to participate in these ventures, consider the other “A”—addition
As a marketing major (many moons ago), marketing 101 taught us the 4 Ps of marketing – Product, Placement, Price and Promotion. Each of these areas has variables that impact the success of a company
As a marketing 101 recap, the 4 Ps are:
- Product: refers to what you sell
- Placement: refers to where is sold
- Price: refers to its price point
- Promotion: refers to how it’s marketed
If your business is running in slow-mo, or if you want to go to a new level, you may want to consider manipulating one of these variables. A successful business has likely mastered (at least to an extent) the 4Ps, which makes it ripe for acquisition. However, if now is not your time to sell, merge or acquire—but you still want to change it up to excel, considering adding from within.
It’s somewhat an old concept—become a comprehensive service provider—yet it’s still gaining ground as a competitive differentiator amongst financial services firms.
In 2005 when starting AdvisorPR, I had a single client offering what was considered a “multi-disciplinary” firm at the time. This advisor was on the forefront as they had investments, insurance, estate planning and tax planning all under one roof. This was accomplished through firm partners that each brought a unique specialty to the team.
Over the years, this has turned into the “comprehensive” or now better known as “holistic” service provider where the lead advisor, for the most part, is the one offering the “holistic” services. I’ve seen holistic mean anything from holding your broker and IAR licenses, to having a high-level expertise in income planning, Medicare and Social Security, to it including the big six: investments, insurance, estate planning, tax planning, Medicare and Social Security. The latter is becoming increasingly common these days, but the concept hasn’t changed much in context since the original firm I worked with nearly 15 years ago.
Bringing Value Under One Roof
People love convenience and efficiency. Look at mega-companies like Amazon or Wal-Mart who bring all things under one virtual or bricks-and-mortar roofs. However, many advisors have come to realize they cannot be all things to all people, or even all things to just retirees. The liability of bad or incomplete advice is far too great these days. Yet it’s becoming harder and harder to compete without having this competitive edge.
So now, unless you’re in the elite group of advisors who have their securities, insurance, estate planning and CPA or LLM licenses or professional certifications, and who moonlights as a yoga instructor and/or health and wellness coach, bringing in additional experts, effectively expanding your “products” in your firm, is becoming a more attractive option.
What can this look like? Here are three models I’ve seen lately to increase the “product” that are unique to the marketplace.
- Expand your business by bringing in another profession/professional. This can be a tax practice, Medicare supplement business, Social Security consultant, divorce planning, mortgage broker or similar. Adding a complementary business within your business not only creates an additional revenue stream but also a built-in referral source between both divisions.
- Become a commercial real estate owner and landlord extra office suites to complementary service professionals. Instead of hiring them, lease to them. Create a retirement planning center in an individual building or office complex. Lease to complementary service providers (many of which are listed above) who want to continue to own their own business. Tout the referral aspect of being in the same location. Each of you can pool your marketing resources together to promote this center as a one-stop solution for all your financial needs.
- Enter the health & wealth space. As much as we hear about it, holistic planning isn’t nearly as popular as “wholistic” planning. I’ve seen advisors successfully bring health and wellness experts who specialize in the “whole mind, body and spirit” for retirees, both on a consultant and employment basis into their offices. This wholistic role can be as minimal as adding in a behavioral finance component, to helping people with the transition from working to retirement, to ongoing workshops and events tied into health, hobbies and activities of interest to retirees.
You need to be doing more than “selling a product” to remain competitive, but that’s not a secret. Expanding your product line means enhancing your client experience—a good experience means more referrals. And more referrals mean the perpetual circle of new clients can be yours.
For more tips on the biggest opportunities in financial services in 2019, check out our past blog.
As always, contact us
if we can be of help fueling your business initiatives with strategic branding, marketing and public relations efforts.
Related: How Advisors Can Evaluate Their Marketing Efforts