Marketers have an annoying habit of converting real functionality into marketing hype.
The financial services sector is particularly guilty of this habit. They take tangible services with real value, water them down, and offer them as value-adds to support their cash cows.
The strategy of piggybacking services as value-adds makes a lot of sense for big companies with vast resources. They can give away or discount some services to support their core services. But for the smaller firms that specialize in one of these lesser service areas their brand positioning can be bastardized.
Strong positioning is attractive
First Affiliated is a Multi-Family Office. They offer a specialized wealth management advisory for wealthy families.
The Family Office has been around a long time. It was first created by ultra wealthy families like the Rockefellers who hired their own team of lawyers, accountants and advisors to manage the family’s financial affairs. These people didn’t work for the banks or financial institutions. They worked for the family, and were accountable to the family.
The Multi-Family Office is an evolution of the Family Office. The principles are the same, but multiple families share the overhead, infrastructure and expertise of a dedicated group of professionals. The other key difference is a Multi-Family Office is a for profit service, where as a Family Office is a cost center for the family.
Multi-Family Office is a very specialized category of wealth management. Chris Clarke, CEO of First Affiliated, suggests there’s probably only five or six firms offering this service in Canada. But that’s not stopping the mainstream firms from describing their wealth management practices as “Family Offices”.
The term “Family Office” comes with a lot of positive cache. It was developed by the ultra wealthy, it implies a holistic approach to wealth management, and there’s baked in accountability in the concept. Wealth Management firms are jumping onto the category, and using it as a marketing angle to differentiate their approach from other firms. The problem is Wealth Management is not Family Office.
Chris explains, “Twenty years ago financial planning meant financial planning. You paid a fee, and someone with independence and objectivity created a strategic long term plan for you. Now financial planning means mutual fund sales … It’s the marketplace trying to latch onto the new, sexy, attractive terminology to try to position themselves, but they end up destroying what it actually meant in the first place.”
Defend your category
First Affiliated is in a fight for its positioning, and protecting what Multi-Family Office truly means.
First Affiliated defends its category by clearly articulating what a Multi-Family Office is and is not. They educate their clients to challenge the marketing hype. For example, they promote two simple questions to ask advisors who claim to offer Family Office services:
- Do they have more than 80 clients?
- Do they work for any institution?
Chris argues a Multi-Family Office is dependent on complete independence and lack of bias. If a practice has more than 80 clients it cannot be a Multi-Family Office. And if they work for any institution — a bank, investment dealer, brokerage house or even an accounting firm — they are not a Family Office, because they have a service or specialty to sell.
First Affiliated has to defend their category at every opportunity. They work to clearly articulate what the Multi-Family Office is, what it’s not and what it takes to be in the category.
Promote your category
Defending your category is not enough, especially when competing with global companies with vast resources.
To grow your category requires promoting your category, often ahead of your business. Whole Foods, for example, grew its brand by leading with organics. It grew the organic food category first, and the Whole Foods brand second.
Whole Foods too faced an uphill battle in the early days when it was a private, mid-market company. They had to educate consumers on the value of organic foods, how to differentiate organic products from the marketing hype, and help their clients make better purchases.
First Affiliated has a similar challenge. They have to promote the category, and make sure their target market knows what it is, why it’s important, and why they can’t get his expertise from the banks and financial institutions.
Promoting a category is often counter-intuitive for marketing, because it requires putting your brand second. But if your market doesn’t understand the value of the category they won’t know to seek out the firms in it.
The companies that do the best job promoting their category will be recognized as the leaders of the category.
Stay one step ahead
First Affiliated has an immense marketing challenge. The industry wants to take their category and bastardize it. First Affiliated wants to protect their category and grow it.
The forces are competing, but not insurmountable. This is a branding challenge. With careful stewardship and a lot of promotion and education, First Affiliated can take a leadership role in the Multi-Family Office category and make it a recognized service for their target market.
About First Affiliated
First Affiliated is a Multi-Family Office providing comprehensive wealth and lifestyle services to families. They work in concert with their clients' existing advisors, acting as the "Family CFO" to provide integrated solutions to optimize and simplify complex matters. They pull all the elements of the family's personal and business finances together into a cohesive long-term Family Prosperity Plan™ to achieve maximum impact and value. First Affiliated is privately owned and their advice is unbiased and independent.
Founded: 1989 (Family business)
Industry: Financial Services