Bob Cobb on unleashing the referrals in your book

Today we're featuring a guest post from Horsesmouth contributor Bob Cobb, President of Ultimate Financial Advisor. 

How many referrals did you give today? I suspect that it might be more than you already realize. Did you tell a friend about a restaurant? Recommend a good movie or book? Hook a friend up with a merchant or service provider that will "take care of them?"

Pay attention to the next couple of days and I suspect that you will find that you are making referrals all the time. So is everyone else.

The weird thing, too, is that they are almost all unsolicited: "Hey, Tom, have you tried the new sandwich shop down the street? It is wonderful; the smoked turkey is out of this world."

Throughout the day, every day, people are making recommendations. Are you getting your fair share?

For most advisors the answer is no. Most advisors never ask for referrals from clients, and many never receive any. A lot of that has to do with three things:

1. The service that you deliver
2. How you are positioned in the mind of your client
3. How you approach the subject

Item #1: the service you deliver

Ask yourself a simple question. Are you referral-worthy? Are you delivering a level of service to your client that is consistently surpassing their expectations?

Two variables come into play here: The client's expectations (how have you managed them and what have you promised?), and what the client is receiving (your level of service).

There is an old adage, "under-promise and over-deliver."  To put it in mathematical terms: 

Client's Experience - Expectations = Client Satisfaction.

The number of unsolicited referrals you receive is a good barometer of how you are doing here.

Item #2: How you're positioned in the mind of your client

Are you the go-to guy or gal for your clients anytime the subject of money comes up? Are your clients aware of all your capabilities? Do they have a clear idea of your mission and your process and what your ideal client looks like? If the answer here is no, then you have an opportunity. Have you made it easy for them to give you referrals?

Item #3: How you approach the subject of referrals

Here are two common ways that people approach referrals that in my mind are ready for the Museum of Extinct Sales Techniques:

• The "I get paid in two ways" conversation
• Pulling out the legal pad, poising the pen at the ready, and asking, "Who else do you know that I should be talking to?"

I assume that these techniques must have worked once.  But let's take a quick visit over to common sense corner and think about how we feel when we are the client.  Have methods like that ever worked on you? The answer is generally a resounding no!

Here are 8 keys to getting the referral train either to leave the station or to pick up some momentum:

1. Focus on a specific niche (free registration required) and become an expert in that niche’s desired outcomes and common obstacles
2. Create (or leverage something already created by your firm) collateral material that discusses those outcomes and obstacles and your solutions
3. Have a clearly defined process for helping clients clearly identify their outcomes and help them navigate the pathway to their personal promised land.
4. Under-promise and over-deliver
5. Plant the seeds for referrals early, often, and in a way that positions you as a more valued resource and partner in the mind of your client
6. Make sure that they know the type of client that you are looking for
7. Remove the risk of making referrals
8. Follow up with all parties involved every step of the way (obviously this doesn’t mean violating confidences, but keep the referring client in the loop)

Thanks to Bob for sharing his referral wisdom.  If there's a referral or business development expert whose ideas you think we should feature here (or if you're interested in being a guest blogger on Automatic Referrals), let us know.

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