When Maria Edlyn Bagui Dela Cruz, MSF, BSc, a four-year MDRT member from Singapore, first entered the financial services profession in 2006, she worked for a bank that, as expected, serviced primarily resident Singaporean households. But by 2010, the country’s workforce demographics started changing and greater numbers of noncitizens were joining the labor pool.

Being a migrant originally from the Philippines, she recognized from her own experience and through daily observations that the labor force was accommodating more foreign workers. This group was emerging as a growing and untapped market for insurance and financial services. So, when Dela Cruz began working for an agency in 2015, she focused her business model to serve this growing niche group of expatriates in Singapore.

“There was a gap to fill, and opportunity soon arose to support and service foreign talent,” she said. “This concentration allowed me to probe deeper into the unique and multifaceted financial advisory needs of this market, and expand my services to not only cover individual needs, but also support small- and medium-sized enterprises run by business owners who have chosen to adopt Singapore as their home and become permanent residents or naturalized citizens.”

One tip for building a successful practice targeting any niche market is to develop expertise about the sliver of the market you want to service. Dela Cruz researched and relied on knowledge gathered from the field to learn about the expats market, and how she can stand out with products and services.

After identifying your niche market’s needs, “Identify and develop hard and soft skills to cultivate your preferred market,” she said.

Know the hard facts

Other than job-specific technical knowledge, any advisor looking to cater to a particular demographic should be familiar with information that is important for that target market. With expatriates, for instance, she became knowledgeable about the social security programs, banking and insurance regulations, and alternative investments available in her prospects’ home countries.

By having a solid fact-finding process, advisors can better appreciate how new solutions can complement their clients’ existing portfolios. For example, unlike Singapore, which has a mandatory social security savings plan for citizens and permanent residents funded by contributions from employees and employers, other countries in the region don’t have a robust or centralized retirement system. Knowing that, some expat clients will need private plans to be their main driver for funding retirement.

Dela Cruz also is knowledgeable about guidelines issued by Singapore’s Ministry of Manpower, so she can counsel her clients about work pass eligibility and applications, employment rights, workplace safety and health and labor market information. 

Learn tact and culture

Soft skills can carry a lot of weight for penetrating a niche market.

“It is important to cultivate a communication style and interpersonal skills suitable to the target market,” Dela Cruz said.

The culture of extended family support in most Asian countries can be one such topic that requires an advisor’s ability to be tactful. The duty of adult children to provide filial support for elderly parents can collide with the funding available to fulfill that obligation. Hence the advisor needs to find a balance between stretching the allocation for long-term planning and the ongoing pressure to sustain regular support to loved ones.

From her experience, some cultures have social norms for engagement and require certain personality traits or approaches. Besides asking the usual questions about personal and financial information, an advisor must weave inquiries into conversations to extract as much information for the planning process such as family ties, the existence of offshore business arrangements or a real estate portfolio.

“In the context of foreigners looking to place funds in Singapore, requesting for information as part of the usual fact-find exercise poses no issue,” Dela Cruz said. “But whether one gets a comprehensive view of clients’ cash flow and net worth depends on the relationship built with them. Most engagements do not start with the usual collection of data but most often with extended icebreaking sessions and rapport building. Otherwise, you may be planning a $20,000 annual premium equivalent plan for a client whose actual capacity is $200,000.”

Identify your clients’ needs

A fact-finding process customized to the unique circumstances of niche markets is indispensable. For example, a permanent resident client asked her to review his portfolio, which was drastically affected by the pandemic. He wanted to manage Singapore assets separately from the holdings established in his home country because he thought organizing his portfolio by geographic boundaries would “keep things simple.”

However, he had four mortgages on real estate in his home country, and the rental income he was counting on to pay his mortgages had ceased. Real estate had seen an unprecedented boom in neighboring countries in the last decade and with increasing loan values came additional costs.

Dela Cruz probed with questions and conducted research and found that mortgage insurance contributed to the difficulty her client was having servicing the mortgages as his country has high mortality charges, which were reflected in the premiums. But with close coordination between the bank and real estate developers and understanding assignment procedures, Dela Cruz helped get a more comprehensive plan in Singapore to cover these exposures and reduce the premiums. 

The key to targeting a niche demographic is to understand your audience and their needs. Dela Cruz demonstrated that by concentrating resources to create products and services that meet these specific needs. Advisors who do the same can differentiate their practice, attract prospects and retain a loyal client base. 

Audrey Heng writes for Team Lewis, a communications agency assisting MDRT with content development for Asia-Pacific markets. Contact mdrteditorial@teamlewis.com.

CONTACT: Maria Edlyn Dela Cruz edsbagui@yahoo.com