The Simplest Way to Get Referrals

In the most recent edition of his Referral Minute e-newsletter,  Bill Cates suggests the following "7 Simple Ways To Get More Referrals"—all of which have come from actual advisors who are successful referral-gatherers:

1. Call clients 2-3 weeks before their birthday and offer to take them and a few friends to lunch.
2. Valentines Lunch for women—especially widows, divorced, or single women.
3. Print social cards for retired clients. They no longer have business cards, but could probably use them from time to time. You can put a graphic on it that reflects one of their hobbies.
4. Host fun bi-annual or quarterly events for single clients and their referrals (focus on the fun, not finances).
5. Invite women to "High Tea" at a fancy hotel.
6. Become a Resource Center for your clients. Gather the names of CPAs, attorneys, painters, HVAC, plumbers, handymen (who actually return your call and show up on time), etc.
7. When your client is in your office, have your assistant take their car for a wash. (Bill warns that you should be careful and always go brushless, because "some people are VERY particular about how their car is washed."

These are great ideas, but one caveat.  Most of them (the exceptions being those events where you invite clients to bring their friends) are NOT ways to get more referrals.  They are, in fact, ways to delight your clients. 

You want delighted clients, don't get me wrong.  But I don't want you to fall into that all-too-common trap of thinking that if you just do a good enough job at client service, you'll get all the referrals you could ever want without ever bringing up the topic.

Not true.

The truth is, only a small percentage of clients will refer proactively, even if they think you're the cat's pajamas.  Most people are busy thinking about their own problems and schedules. They're not walking around with you at the top of their minds, waiting to shout your name from the rooftops.  But nearly all of them WILL be more than happy to introduce you to their family and friends... IF YOU ASK.

So first and foremost, YES, delight your clients!  (Here are nine more creative ways to do that... free registration required.) But make sure you also learn to identify great prospects in their networks and ask for introductions.  Because THAT is truly the simplest way to get more referrals.

Have You Earned the Right to Bring Up Referrals?

A big concern that we often hear from advisors is, "I'm afraid that I haven't proven myself enough to my clients to talk about referrals."

I certainly agree that until someone trusts you and believes in you, there is little point trying to position yourself as someone to whom they should refer their family or friends.   However, it's also fair to say that most of your clients would not BE your clients if they didn't feel this way about you.  Many advisors many advisors feel irrationally insecure about where they stand with their clients. This goes back to the whole issue of undervaluing yourself.

If you generally feel secure about your value to clients but have red flags waving about one client in particular, heed them! Hold off trying to get introductions from that client until you've uncovered what's going on, and if your uneasy feelings are justified.  If you have real reason to avoid discussing referrals with that client, you've got bigger problems than referrals—you've got a client at risk, and keeping that client should be your top priority.  Where they are concerned, worry about the referrals later, and focus those efforts on other clients about whom you feel more certain.

However, if you experience these insecure feelings about most or all of your clients, chances are very good the problem is in your own mind—and you need to do something about that.  In addition to doing some referral confidence-builders, another remedy is to start soliciting client feedback more actively.  You can survey your clients, form a client advisory board, or just ask some good questions at meetings and really pay attention to the answers.

When you do solicit client feedback, stay alert for positive comments. They are door-openers for you to discuss referrals.  For example, one advisor who went through the Automatic Referrals Jumpstart Program was conducting a quarterly review with her clients, a married couple who were both medical technologists, and they were marveling at how well their funds had done.  The advisor had been wanting to penetrate this industry and get more medical technologists as clients,  so she jumped on that opportunity and said, 'Do you know a lot of people you work with who maybe don't have this type of portfolio? What about your trade association?' And they said, 'Of course!  We'll send you the roster.'  The advisor got 50-something names and email addresses and phone numbers because she recognized the client's praise and gratitude as a referral opportunity—and because she knew how to ask for referrals in a targeted way.

The articles listed below (free registration required) are just a few of many resources on Horsesmouth that can help you figure out the best approach to getting more feedback from clients—and open more doors for referral conversations.

Survey Your Clients Now!
The benefits of surveying your clients are enormous, and yet less than 1% of advisors have ever sent out a formal questionnaire. Find out exactly what you're missing by not surveying your clients.

Ask Your Clients, 'How Am I Doing?'
If you're not sure what your clients think of you, ask them. Here's a step-by-step approach to using a client advisory council to elicit the most useful feedback from your top clients.

How Well Do You Listen to Your Clients?
Many FAs have no structured method for compiling feedback. Business practice expert Tom Olivo shares strategies for measuring client loyalty and alerts you to its significance for your business.