A growing number of financial advisors believe that client segmentation is a valuable and viable marketing strategy to build a more specialized client base, according to a survey released by SEI.
The survey revealed that nearly 80 percent of advisors use a form of segmentation with their clients, but niche strategies remain an untapped opportunity (click here for infographic). Only 14 percent of respondents currently segment based on personal attributes of their clients, while just 2 percent segment by their clients’ investment goals. The survey consisted of 391 advisors.
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Traditional forms of client segmentation are still the most commonly used strategies. One-third (32 percent) of advisors segment clients based on their investible assets, while 19 percent do so by the revenue each client generates for the firm.
"These statistics demonstrate that advisors frequently segment by what is important to them, not their clients," said John Anderson, Head of SEI Practice Management Solutions, SEI Advisor Network. "Niche marketing gives advisors a huge opportunity to build better relationships with their existing clients and provide more personalized services – something investors value heavily.
"This strategy also encourages advisors to focus their marketing efforts on a type of client with similar needs or attributes, and gives them the chance to become more efficient in all aspects of their business."
Advisors are starting to narrow their focus with 37 percent saying that they have a general idea of the audiences they want to target, while 30 percent have a specific idea about the people they want to target.
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By GlobalDataSEI conducted the survey during its recent webinar, Build Client Affinity Through Segmentation, Niche Marketing and Service. SEI’s Building Client Affinity Toolkit is available for advisors who would like help with segmentation and niche marketing.
