It’s no secret that men and women think differently, particularly in the way we make financial decisions. Lately, I've read about a number of advisors who chose to focus on women as their niche or target audience. This is where they fail.
For starters, I’m going to go out on a limb here and say women are not a niche market, but rather a demographic. In addition, they are becoming a majority when it comes to the management of household finances. In fact, because women tend to live longer than men, they will end up in charge of much of the $41 trillion expected to pass from generation to generation over the next 50 years.
That said, I'd like to elaborate on four reasons you may be failing to attract and retain women as clients:
1. You refer to women as a niche market.
The U.S. is one of few countries in the world that has a population made up of more women than men. According to the U.S. Census, as of 2010, approximately 51% of the US population was female. I would hardly consider the majority a "niche." That's not to say that you couldn't choose a niche market within this larger demographic for example, women business owners in Cleveland, Ohio.
2. When working with couples, you inadvertently avoid the wife’s needs and concerns.
If you find yourself talking mostly to the husband during a client appointment without interacting with the wife, you are doing your clients and yourself a great disservice. In some cases, the wife may want her husband to handle the discussion, but often the wife may be silent because she feels the advisor is not listening or interested in her concerns by not addressing her specifically. She may not speak up in a meeting, but her concerns will be heard outside of your office and ultimately will impact whether or not you continue as their advisor. When planning for couples, your financial plan will ultimately fall apart if you haven’t accounted for the needs and goals of both the husband and the wife.
3. Your marketing activities are skewed toward the male mindset and decision process.
Occasionally, review your marketing collateral and try to establish if your content focuses on the needs of your target audience. If women are your audience, and your materials focus too heavily on analytics and market returns, you may want to rethink your approach. While some women may take more risk and focus on individual returns of their investments, many focus on the relationship with their advisor and the overall performance of their portfolio. Generally, women want to know that they are on track to meet their financial goals and can trust their advisor, not that they are getting the highest rate of return on a stock or mutual fund.
4. Your marketing strategy is based on dated myths about women.
I recently read “The Top Three Myths about Women Investors,” and one myth in particular resonated with me: the idea that advisors must point out the special financial challenges women face, then demonstrate how to solve them. That is true, but as the article states, by embracing this approach you are leading the conversation with a negative tone. Focus on something positive, such as helping your client build a financial plan, set a reasonable savings rate, and emphasize the achievement of her financial goals and what it would mean for her.
If you are truly focused on attracting and retaining more women as clients, start by conducting some research. Ask your current female clients, through client surveys or interviews, why they chose you versus another advisor and why they continue to work with you. This may provide valuable insight into what you are already doing right to attract and retain women clients. If they are truly open with you, it will also provide opportunities for you to improve as well.
Additionally, ask your clients -- and your client advisory board, if you have one -- to provide feedback on your website, newsletters, and other marketing collateral to ensure that your message and approach resonates with your ideal audience. You’re not going to reinvent yourself overnight; however taking small steps to change or improve the way you communicate your value and conduct yourself will have a significant impact on your business and your clients in the future.
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