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Why is it important for a financial advisor to have a unique value proposition?


It's important for a financial adviser to have a unique value proposition for the same reason that it's important for any business to have a unique value proposition. It's an increasingly competitive world in business generally, and there is a proliferation of financial advisers. Therefore, it's especially important for a financial adviser to be able to distinguish himself from the crowd in a way that significantly enables him to stand out to his target audience of potential clients.

A unique value proposition should be designed to accomplish three things in regard to an adviser's target audience. First, it should clearly state the kind of person he aims to work with. Some financial advisers target high-net-worth individuals as clientele. Other advisers focus on retirees or people nearing retirement. Still others target young people who are just getting started in investing. Families, as opposed to individuals, are another potential focus.

Secondly, the value proposition should explain what makes a particular financial adviser unique, what value he offers that cannot be found elsewhere. This is the real "unique value" part of the value proposition. The value might be the adviser's unique experience, such as an established, highly successful track record in investing. The value might pertain to the specific service the adviser offers. For example, if the adviser specializes in investing in emerging market economies, the fact that he has lived for a number of years in the countries he invests in would constitute a unique value offered. Another possible unique value an adviser

might offer is a proprietary trading system not available elsewhere.

The third, and final, element of a financial adviser's unique value proposition should aim at stating how he meets the needs or desires of his target clientele. An example of this third element in a value proposition is offering individually tailored investment plans or protection against downside risk. To develop his unique value proposition, an adviser needs to do sufficient research to determine the most important characteristics that his target clientele is seeking in a financial adviser, including such things as whether clients are more focused on maximum profit or more concerned about limiting risk.

A unique value proposition should be simple, and therefore memorable, and include an emotional element since many people put focus on the relationship they have with a financial adviser.

An additional reason that makes it important for a financial adviser to craft a unique value proposition, one that makes him easily identifiable, stems from the explosion in people searching for goods and services online rather than in person or locally. Endless studies have revealed that people do not tend to search very far when looking for something online. Therefore, a financial adviser needs to do all that he can to ensure that he shows up very near the top of Internet searches for a financial adviser offering his unique value proposition. For the same reason, it's important for the adviser to ensure that his website and all of his online advertising is optimized well for search engines.

Category: Advisor

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