How do you launch something the world didn’t know it was missing?
Consider the “family office” concept, which is new to Canada. This sounds like a home office for the whole gang but it’s not.
You get an integrated service to meet your life goals. Think of financial services combined with concierge services and mentoring. You get advice from people you trust in the areas of risk, accounting, investments and law (the Financial TRAIL). You also get help tailored to your specific concerns. Maybe you need help running your household or resolving family conflicts.
Aren’t services like this already available?
Besides, we don’t shop at department stores much anymore. So how could one-stop shopping beat boutiques? Accountant and Globe & Mail writer Tim Cestnick explained the family office concept in a compelling way at CALU 2010 yesterday.
Past ExplanationsMost promoters of one-stop holistic services have two self-serving underlying goals
- cattle: imprisoning clients with additional products and services to make escape difficult
- lemons: squeezing more revenue out of each client (and discarding the ones that aren’t juicy enough)
Want Fries With That?When bundling, there’s often a bias towards our core business.
- buy Internet access from your phone company and they’ll nudge you to get their phone service
- buy Internet from your cable company and they'll nudge you to get cable TV
- get a mortgage from the bank and they'll nudge you to add day-to-day banking
Family OfficeTim presented three case studies which were simple, yet well thought-out. There was a bonus anti-case study which showed the drawbacks of using “silos”. We tend to focus our prospects on benefits but loss language convinces better (the #2 universal principle of persuasion). Using both is ideal. Carrot + stick.
CostWhile Warren Buffet can easily afford a private jet, he traded in The Indefensible for fractional ownership in NetJets (now a Berkshire Hathaway company).
Similarly, a family office solely for you gets pricey and may not even be desirable. You might be better off with a time-sharing model, the multi-family office. Think of Warren again. He donates to the Bill and Melinda Gates Foundation rather than duplicating efforts.
Why Not Prevalent?In real life, assembling a team with both chemistry and credentials gets very challenging. How do you resolve disputes? If consensus id the norm, are the team members just rubberstampers?
Still, there’s a great marketing story. Can you think of one to set your business apart?