Making the Switch to Target Marketing

Newly independent advisor Tom H. of San Luis Obispo, CA wanted to jumpstart his new business by concentrating on referrals and using target marketing to channel his message. "It has occurred to me that I don't have a defined target market," he wrote. "Yes, I have a book of business, and it includes many retired individuals as well as young business owners and random individuals."

But Tom had doubts about the approach, specifically a fear about alienating prospects with a specialized marketing message that didn't fit them: "At the risk of not maintaining a target market, I don't want to leave out possible clients.  Is this a sound approach?"

He addressed his concern to Bob David, Horsesmouth Director of Advisor programs and leader of the Automatic Referrals Jumpstart Program. Here was Bob's response:

"I understand how it can be a bit overwhelming to try to tackle too many things at once, especially after going independent. Having grown up in a small University town myself, I know there are some unique challenges. Here are a few thoughts:

• Keep in mind that having a target market does not mean abandoning the clients you have that have been loyal to you as you've changed firms. This would be a de-motivator for you for obvious reasons. It just means that when it comes to your pro-active efforts, you will begin focusing on the needs of your "ideal client" or "target market."
• It is very important to identify your "ideal client." It can be tough, but keep drilling down. Remember that success leaves clues, so start with a hard look at those retirees and inheritors. What do they have in common? What did they do before they retired? Are they affiliated with the University? Or the government? What is the demographic profile—are they men or women? What age? What are their affiliations, passions, hobbies, etc..?
• Consider going one step further and doing a "SWOT" analysis: S—What are your relative Strengths in your market? W—What are your relative Weaknesses? O—What are the Opportunities perhaps overlooked by your competition? T—What are the Threats to your practice? (Could be aging clients, lack of a consistent advisory process, service quality, etc...)
• Consider derivatives of the more obvious categories and maybe move beyond your borders. For example, "Family Owned Funeral Home Operators" throughout CA or retired college professors or retired football coaches, etc...

At first, target marketing can seem daunting, but if you do some digging like Bob suggests, in the end it's a rather natural extension.

For more on target marketing and SWOT analysis, see these Horsesmouth (free registration required) articles:

How to Pick a Lucrative Niche

Many advisors think that by keeping their options open to all potential business they won't miss an opportunity. But the opposite is true. A focused, rich niche can be far more effective. Here's how to develop a niche over the course of the year.

6 Rules to Guide Your SWOT Analysis

SWOT stands for strengths, weaknesses, opportunities, and threats. In order for your marketing plan to work, you must honestly assess your practice in these four areas. If not, you risk failing in your efforts to grow your business.

Touch Referral Sources with a "Thinking About You" Call

One of my favorite prospecting experts, Art Sobczak of Business By Phone, recently gave some terrific advice for anyone trying to cultivate referral sources: "Call people and tell them you are thinking about them."

Simple, right?  Well, yes—and no.  As Art points out, people love to hear they're on your mind, but you can't just call or show up on their doorstep with no good reason to take up their time. He asks if you've ever been guilty of these very poor methods of staying connected:

The Probation Officer Approach: "Just checking in with you..."

The Baseball Opening: "Just wanted to touch base with you..."

The I've Got Too Much Time on My Hands Call: "Thought I'd give you a call to see how it's going..."

Ugh.

The point is, if you're not adding value, you're wasing their time, and yours. 

What you want to do, Art writes, is:

"...call with some news, an idea, something you heard or saw that could benefit them, a sale or promotion they could take advantage of...anything that would cause them to say, 'Oh, that's interesting stuff.'

For example,

'Hi Jim, it’s Pat at Universal Services. I was reading some new performance reports, and I started thinking about you. I realized that you might be interested in what these reports had to say, because of what you mentioned on our last call about...'"

When you read a newspaper or a magazine or a blog, be on the lookout for items that might be of interest to the potential referral sources in your network.  Share snippets of conversation or things you learn from clients and prospects that you think might be valuable to them. 

Better yet, offer the other guy some referrals first: "When Mrs. Jones mentioned this problem with her father's estate, I immediately thought of you and your expertise with this type of situation." 

Find value-added ways to let people know you're thinking of them, touch them regularly, and be patient—and watch the referrals start to flow.

Read Art's complete post, "I'm Thinking about YOU," here.

Want More Referrals? Get a Niche.

There is a long, long list of reasons that you should consider narrowing your focus and choosing one or more niche markets to serve. On just about every measure you can think of, from production and assets to pure satisfaction and enjoyment of the job, Horsesmouth's research has found that niche advisors are more successful than generalists.  But for our purposes, there is one especially compelling reason to "niche up": you're quite likely to get more referrals.

In their survey of more than 2,100 advisors, Horsesmouth asked the question, "Are you getting more referrals since you started working in your niche?"  Check out this chart.

   

It's hard to argue with those results.

Read The Advisor N-Factor, a Horsesmouth special report, and learn more about why niche marketing is so powerful and how you can start marketing to your perfect niche—and rev up your referral results along the way.

How Do I Get Clients to Bring Friends to Events?

Brie, an advisor in Fort Worth, TX, writes:

We are holding monthly educational dinners and suggesting clients bring guests. We are getting the same clients and no guests. Everyone seems to enjoy themselves, but the response is not what we were hoping for.

We asked Katherine Vessenes to tackle this one. Katherine is president of Vestment Advisors and the country's leading authority on building a multimillion-dollar practice.

This could be a good reason to have a client advisory board meeting. Or you could call a couple of them and run through some questions like this over the phone:

Jane, this is Katherine. I just wanted to get some feedback on our last educational dinner. (Pause and wait for a response).

How did you like the food? What where the top three ideas you got from the speaker? Is there anything we could do better?

(What you are looking for here is a rave review--if it is not a rave, the rest of this won't work.  If it's not a rave, take careful notes and use the criticism to improve your next event.)

Great, well I am thrilled you had such a good time, but can I ask you something personal?   You know the best way we can grow our business is with recommendations from happy, satisfied clients like you. We always ask our favorite clients to bring friends because we think that is the best way to meet them and introduce them to what we do. Unfortunately, none of our clients have been bringing friends to these dinner parties! Now, we know each other pretty well, so I thought I could ask you: what am I doing wrong? What should I be doing to get our favorite clients to bring their friends to our dinner meetings?

Once again, shut up and just let them speak--you will learn exactly what you need to be doing. I suspect this little phone call with your top 12 clients will probably have at least 3 or 4 of them bringing guests to the next event. From there, it starts to snowball.  Good luck.

How Do I Get Clients to Refer Friends to My Seminars?

Marc, an advisor in Durham, North Carolina, writes:

I conduct seminars on a monthly basis with most people coming from advertising in a local paper. I have been conducting these seminars for over a year and have had well over 200 people come through. I know that people get value but I very rarely get them referring their friend or colleagues to the next one. (I put everyone on my email newsletter list). How can I get more people referred to me and my seminars?

We've asked Ginita Wall, CPA, CFP® and CDFA of San Diego, California to answer Marc's question. Ginita is co-founder of the non-profit Women's Institute for Financial Education and author of eight books, including The ABCs of Divorce for Women.

Let me see, how can I put this politely?  Financial seminars are perceived to be boring, even by those who attend them. That’s why they don’t refer their friends.

How to get around this? Offer something wonderful for referrals, or offer something exciting in addition to the seminar. For example, we once did a seminar with a local department store where they provided a personal shopper to show how ten articles of clothing could create a number of different looks, and we showed how to construct a variety of portfolios with the same number of financial products. And of course, we presented first, so the audience couldn’t just see the fashion show and leave.

You could offer a free something to the person who referred the most number of people to your seminars. Or give out movie passes at the seminars, so that people could win them by being there. Anything to cause excitement and get people to come back and bring their friends.

And that brings me to the final point. If someone refers you to a seminar, you probably won’t go. But if someone invites you to come with them, you probably will. So it would help if you offered a variety of seminars, so that people would want to come back the next month. That’s the first step in getting them to bring their friends.

Here are more ideas to help you put on seminars and other events that will inspire clients to bring their friends along (free registration required):

How to Turn a Client Event Into a Referral Event
In a recent Horsesmouth discussion forum, Michael Brizz dished up tips on how to throw a client event that will also attract high-quality referrals.

The ABCs of Client Education Workshops   
Tired of the same old seminars that don't yield much business? Client education workshops strengthen relationships with your best clients, often for a far lower cost than a typical seminar. 

4 Steps to Filling Seats at Your Next Client Event
Top-performing advisors follow this sophisticated, multi-step process in order to ensure successful client and prospect events. Print out this plan now so you can follow it during your next client or prospect campaign.

7 Ways a Unique Seminar Location Boosts Business
You wouldn't jump at the chance to spend an hour in a hotel conference room—why should your prospects?

Get More Referrals from CPAs

Saw a couple of good tips in Bill Cates' most recent ezine on becoming referable in the eyes of CPAs.  Bill's suggestions:

• Put CPAs through your process. If you don’t have a process to bring value early and often to your new clients, you can pretty much forget about getting referrals from them. You can also put your non-clients through your process. If you do financial planning, put that CPA or other Center of Influence through your planning process—without charging them.

• Become a CPA's "Advisor of Choice." Many don’t care if you give them referrals or compensation. They want to make sure their clients get the best financial advice. First, determine which of your 'A' clients have ongoing working relationships with their CPAs. So that these CPAs see your value, keep them in the loop with the work you are doing. Get written permission from your clients to share summary letters of your meeting with their CPA, as well as any other relevant work you do. Over time, the CPAs will begin to see the value of your work and how you relate to your clients. Soon, many of them will want more of their clients working with you.

Looking for more ideas to help enhance your relationships with CPAs? These articles (free registration required) may help:

How to Win Favor With Your CPA Allies
As April 15 approaches, savvy FAs take the initiative to shower their CPA allies with stress-relieving perks: it will build goodwill and stronger relationships.

Case Study: Quintuple Revenue by Co-Marketing With CPAs
This is the story of an advisor who took his production from zero to $50,000 in three months by cosponsoring teleconferences with CPAs.  Here's how.

Use Surveys to Boost Center-of-Influence Referrals
Client surveys not only strengthen your bonds with clients, they can be used to cement ties with strategic alliance partners. See how sharing survey data and conducting joint surveys with CPAs and estate attorneys can lead to more qualified referrals.

Hosting CE Credit Workshops for CPAs: A Primer
Providing continuing education for CPAs isn't as difficult as you might think. Here are seven guidelines that will get you on track to make it happen—and some insights on why you should consider this approach in the first place.

Why CPAs Distrust You—And What You Can Do About It
Still trying to get your strategic alliance off the ground?  Recognize how a CPA's worldview and work focus can create barriers to working effectively with a financial advisor. Then implement a four-step plan to win trust.

You can find many more articles on Horsesmouth about forming strong strategic relationships with CPAs and other professionals. Just search on the keywords "CPA" and "strategic alliances."

Conquer Your Self-Limiting Thoughts and Get More Referrals in 2007

I have heard only a handful of speeches in the course of my life that actually transformed me in some lasting way. Six years ago, I heard one of those speeches. I was attending a performance improvement conference in San Francisco where the featured speaker was Debra Benton, author of a variety of books including How to Think Like a CEO and How to Act Like a CEO. Benton has studied and interviewed hundreds of chief executives and found that they share a number of key traits.  She addressed one specifically in her keynote that I found profoundly important.

If you want to think and act like a CEO, Benton explained, look around you, see what everyone else is doing, and then DON'T do that.  Do the opposite.

She illustrated this principle in a very immediate way that I was fortunate enough to experience firsthand. At the end of the keynote, she held up a copy of her latest book, and said, "This book is for someone in this audience.  I'm waiting." 

All of the 1,000-plus people in the room just sat there for a moment, looking around with confused expressions, waiting for something to happen.  After about 20 seconds, a few people somewhat tentatively raised their hands.  Benton smiled and said, "That's not it." Then one or two folks stood up and waved at the podium.  Benton just stood there, still holding the book, and shook her head.

That's when the light bulb went off in my head. I looked around at everyone else to see what they were doing.   What they were doing was sitting, doing nothing, waiting.  So I applied the lesson I had just learned in the keynote. I did the opposite. I stood up, squeezed past the row of other attendees and made my way to the aisle. Then I walked up to the podium with my hand outstretched toward Ms. Benton and the book. 

Out of a room of 1,000 people, I was the only one to take that risk—the risk that I might make a fool of myself.  And guess who went home with the book?

I have carried that experience and that lesson with me to this day.  I tell you about it now because I was reminded of it by Robert Middleton's More Clients blog entry today, "Two Huge Things." The bottom line of Robert's post: go into the new year with big intentions—and strip yourself of the mental limitations that are holding you back.  He writes:

"What beliefs are you addicted to that are holding you back from realizing your intentions? As long as you remain attached to them, they will shape your current reality as they always have.

• Are they about how much money you can earn?
• Are they about how successful you can be?
• Are they about your capability as a marketer?
• Are they about the difference you can ultimately make?

And what if those beliefs weren't really true at all? Take a few minutes to seriously question them."

That day six years ago in a San Francisco hotel ballroom , as I walked up to that podium to claim my prize, I realized how powerful self-imposed limitations can be, and simultaneously how easy it can be to jettison them—and what you can accomplish if you do.  How many conversations have I failed to initiate; how many opportunities have I failed to leverage; how many ideas have I failed to try in my life... all because of self-limiting thoughts?  How many referrals have you NOT gotten because of YOUR self-limiting thoughts?

You want more referrals, or you would not be reading these words today.  The new year is here.  Now is your chance. Resolve to map out your intentions—and more importantly, become aware of your own limiting beliefs, and work consciously against them.

There is a Dale Carnegie quote that I always use to close my presentations on conquering referral anxiety:

Inaction breeds doubt and fear. Action breeds confidence and courage. If you want to conquer fear, do not sit home and think about it. Go out and get busy.

Read Robert's post. Read the articles below (free registration required).  Then make 2007 a truly transformative year in your business and your life. 

Happy New Year!

How to Wipe Out Self-Limiting Thinking in 5 Steps
Your greatest barrier to success is not the market or your competition. It's your own mind. Find out today how to recognize and overcome self-limiting thoughts that prevent you from reaching your full potential.

Your Productivity Starts With Positive Thinking
Try these strategies for controlling negative thoughts and outbursts during difficult situations. You'll find yourself happier, more productive, and better able to maintain good relationships.

Turn Around Your Negative Thinking in 3 Steps
Your future success depends on your ability to meet adversity with renewed energy and optimism. Remember, your thoughts influence your feelings and actions. Follow this method for staying upbeat in the face of rejection.

Network Effectively at Holiday Parties

As the holidays approach, so do all of the  parties and social events that go along with the season. These gatherings are wonderful places to solidify existing ties and make new connections that can lead both to direct business and to referrals.

Last week, in How to Make a Great Impression at Social Events in 60 Minutes or Less (free registration required), marketing expert Bruce Allen suggested eight ways to make your time at networking events and parties more efficient.  These included ideas such as arriving early, to give you a chance to interact with the organizers, and playing the host by offering to bring drinks or other refreshments to groups of people. (By the way, I've done that myself, and it works like a charm.  It's a great way to make a one-on-one connection too.  I've also found that the food tables, bar, and coffee stands are excellent places to strike up conversations, because they represent a shared experience, like talking about the weather.)

Horsesmouth members sent in some great tips of their own in response to this article.  Here are some party season networking ideas from your peers not only around North America, but around the world.

"One other thing I do is find out who actually organized the event—not the group that sponsored it, but the person who did the grunt work.  If they are at the event, be sure to specifically thank them.  If they aren't there, send them a quick thank you. They will probably share it with the powers that be." —L.P., Kalamazoo, Mich.

"At the start, when others start to arrive, I have found the most productive place to stand is at the end of the registration table, as guests will go there first before socialising and talking. From here they are looking for someone to 'rescue' them from standing alone, and it is easy to catch their eye and smile, start a conversation or draw them in." —G.T., New South Wales, Australia

"If you are at an event where most of the people are new, stand to the side and watch for the person or persons who everyone else goes up to speak with. Then get near that person in the food line and start a conversation."  —E.S., Palm Beach, Fla.

"Instead of trying to meet everyone, I make a point to have 3 VIP's in mind that I'm sure will be there.  I do my research/background on the three.  Then after all the glad-handing, I make a point to meet and converse a bit more in-depth with these three one-on-one, concentrating only on them.  This way, I'm not preoccupied by 'looking around' while talking to them (rude!) and it makes a bigger impression on them."           —D.P., Mattoon, Il.

Want more tips on how to accomplish more at parties than eating mystery hors d'oeuvres, and have more fun doing it?  Here are some other articles full of ideas (free registration required for all).

6 Tips for Networking at Holiday Parties
'Tis the season to mix and mingle.  Here's how you can connect with new prospects while you're enjoying a little holiday fun.

How to Turn Chit-Chat Into Real Business Opportunities 
To get beyond the small talk of endless networking events, you need a plan. Here are some conversation strategies that can spur new business without sounding pushy.

9 Secrets of a Consummate Networker
Independent publicist Erik Filkorn has an uncanny ability to befriend nearly everyone with whom he comes into contact—and, often as not, to land their business, too.   Find out how he does it.

How to Network at Social Events—Effectively!
It's not about how many people you meet at a social gathering. It's about helping others make connections. Here's how to do it.

How an Advisor Generated $4 Million in Referrals in 3 Months

We had a very exciting event at Horsesmouth last week: our first-ever "Nitty-Gritty, Roll-Up-Your-Sleeves, Make-It-Stick, Million-Dollar Workshop."   One of the highlights was the collection of fabulous marketing ideas shared by the attendees—advisors from across the U.S. and Canada, including many veterans—during the course of the 2-day workshop.

One idea in particular caught my attention. James Crosson, an advisor from Fall River, Massachusetts who's been in the business for 23 years, formed his own networking group comprised of  professional centers of influence such as attorneys, a chiropractor, a CPA, a dentist, an electrician, a moving company, and others.  The one thing they all have in common—and this is key—is twenty years of experience or more.

In addition to meeting with his group once a month, James did something really different: he offered to list them all on his Web site, on a "Preferred Professionals" page.  He featured lengthy bios and photos for each (he says he used his own digital camera to take the pictures, because some of the photos they sent him were just atrocious!).  As you can see, James has devoted a lot of real estate on his own site to promoting his strategic allies.

The group also instituted a rule that everyone must provide referrals.  If you don't, you're eventually asked to leave. 

Unlike groups like BNI and the Chamber of Commerce, which James says he found less than inspiring, his group's results speak for themselves. He says that $50 million worth of referrals were exchanged among the members of his group in the first three months—$4 million of which were referrals to James himself.

Forming your own group, tailored to your personality, interests, and business, is often the best way to generate real referrals. Check out these stories (free registration required) about other advisors who have done it successfully:

Case Study: How to Start a Business Networking Group
Here’s how an advisor started his own business networking group, cultivated an association of lucrative contacts—and tripled his book in 18 months.

Case Study: Create Your Own Elite Dinner Club 
Dining with prominent members of the community turned into a networking sensation for this veteran advisor. See how a top producer parlayed a one-time $1,000 restaurant expense into a steady flow of million-dollar connections—and friendships.

More on Forming Relationships with Attorneys

We recently asked Tom Kane, president of Kane Consulting and author of the Legal Marketing Blog, to provide some insights into how advisors can form successful strategic alliances and referral relationships with lawyers. Tom answered two questions we received from advisors during our Referral Blog-a-thon.

Tom's first post addressed what to do when an attorney doesn't reciprocate the referrals you send his or her way.

Another advisor asked, "How can a financial advisor differentiate him/herself in the eyes of an attorney who is being courted by lots of advisors to form a strategic alliance?" 

Here's Tom's answer:

There really is no easy formula for establishing such a referral arrangement.  The relationship between a financial advisor and a lawyer is no different than any relationship between two professionals, whether it involves accountants, physicians, brokers, real estate agents and so forth.  It must be developed, and that takes time and work. And remuneration or quid pro quo for such an alliance isn't in the cards due to the bar's ethics rules.

So my advice is really straightforward.  First, establish a relationship.  Make contact, and get together to begin a dialogue about mutual interests.  Then, follow-up with meetings, telephone calls, send information of interest, and otherwise do what you are comfortable with in building on the relationship.  To borrow an analogy from the real estate field, the three critical factors in professional services marketing is contact, contact, contact.

Of course, sending potential clients to the attorney won't hurt either.  Do so without expecting an immediate pay back. 

Furthermore, you should be doing the kinds of best marketing practices that will expose you to lawyers (and others), such as:

• Speaking
• Writing
• Networking
• Entertaining
• Joining organizations that lawyers join that allow affiliate members

Being active and visible will open up opportunities to meet lawyers and others with whom to build relationships of mutual interest.

Remember that most other advisors will not bother to do real research into the needs and interests of attorneys before they make contact—so doing that research is one of the best ways to differentiate yourself. Tom's Legal Marketing Blog is a great place to start, as are the other legal blogs you'll find in Tom's "Fellow Bloggers" list (on the right-hand side of his blog).

Also check out these articles (free registration required) for more ideas about meeting and forming relationships with attorneys.

How to Work With Estate-Planning Attorneys 

Collaborative Divorce: A New Opportunity for Financial Advisors  (contains a section called "Getting started" that offers ideas applicable to most types of attorneys, not only family law specialists)

Estate Planning—Help Clients Find the Right Attorney

Create Strategic Alliances With Attorneys

How to Deal with an Attorney Who Won't Refer

Building relationships with attorneys is one of the more common referral and networking topics that advisors ask about. We've gotten an advisor's perspective. Now, in the spirit of going "straight to the horse's mouth," I've asked Tom Kane to provide a few insights on the issue from his side of the table.  Tom is president of Kane Consulting, author of the Legal Marketing Blog, and a former practicing attorney himself. He has generously offered to answer some questions that we received from advisors during our Referral Blog-a-thon.

This first question will sound all too familiar to many of you:

"What's an advisor to do with the situation where the advisor has sent numerous clients to an attorney, but hasn't received any in return; and the advisor's clients are very pleased with the lawyer's services?"

Here is Tom Kane's response.

Interesting dilemma!  You certainly want your clients to be well served.  But, quite frankly, there are other attorneys who could in all likelihood serve them just as well. 

A couple of questions:  Does the attorney know that you have referred that many cases? Has she thanked you for each one? (In my experience, believe it or not, lawyers don't always know or ask where referrals come from.)  Does she have a close personal relationship with another financial advisor? 

Bottom line: I would have a "sit down" with the lawyer and make it absolutely clear what you've done for her practice, and ask her advice on what your firm might do differently/better to get more of her referrals to cross your threshold.

You might ask some or all of the following questions:

• "What kinds of information would you need to have in order to recommend my services to your clients?"
• "Are there things about financial advisors and that you yourself are not aware of or do not feel comfortable enough to pass on to prospective clients?"
• "What other kinds of services or information do you think your clients would want to receive from financial advisors?"
• "Would you like to have written information about my services available to give clients?"
• "Are there any other questions you have that would make it easier for you to recommend my services to others?"

I don't  mean to sound like Dear Abby here, but I have a serious question as to whether any of the alleged referrals have taken place.  I can't think of any ethical rule that would prevent her from telling you whom she has suggested contact your firm.  Her hesitation in giving you the names of those she has "referred" brings to mind that great Southern expression,"that dog don't hunt."

If she isn't sharing the names because she's afraid you might hound (pardon the pun) them for business, you can assure her that you would not do so; but would only send them a letter and brochure mentioning that you know about the referral, and ask them to contact you, if you could ever be of service.  If the lawyer has problems with that, I have problems with the relationship.

Stay tuned for Tom's answer to another tough question: How would a financial adviser approach attorneys to establish a strategic alliance when they are being approached by a lot of financial advisors?

While you're waiting for Tom's response, here's food for thought—give some thought to how you can help the attorney, rather than the other way around.  One great starting point? Recommend some great resources to the attorney to help build his or her business... like Tom's Legal Marketing Blog!  Also take a look at his "Fellow Bloggers" list (on the right-hand side of the blog) of other excellent Web resources that lawyers might appreciate.

Building Strategic Referral Relationships with Attorneys--Where to Begin?

Today we're featuring a guest post by Mark Colgan, CFP, president of Colgan Capital in Pittsford, N.Y. Inspired by the challenges he faced as a young widower, Mark authored The Survivor Assistance Handbook and created Plan Your Legacy—an online service that helps individuals organize their affairs and express their final wishes. As a nationally-recognized end-of-life planning pioneer, Mark has considerable experience building strategic relationships with attorneys, and that is the topic of his post today.

Many advisors are interested in building strategic alliances with attorneys, but aren't sure how to begin, or with which attorneys they should seek partnerships in the first place.

Before beginning your search, it is important to identify whom you want to have as a client. Some advisors only want high-net-worth folks, while others are looking for people with specific needs. Once you have established your primary target audience, begin your search for an attorney that has the same interest.

To develop your list, consider the following search methods:

1. Good old yellow pages. Find every attorney in town.
2. Ask other professionals, like the accountants you work with.
3. Ask your clients who they use. Satisfied clients can be a good source of suggestions—but exercise caution. Clients are not always the best judge of a professional's work, especially in complex legal matters. You don't want a bad lawyer with a charming personality.
4. Search legal directories. Martindale-Hubbell publishes the best-known directory of attorneys in the United States. You can search by legal specialty and geographic location.
5. Call your local bar association. Go to the American Bar Association's website and click on your state. A list of lawyer referral sources will pop up. Focus on those referral sources that meet ABA standards. This means that they operate solely in the public interest and do not charge extra for the referral.
6. Check for area of specialization. Martindale-Hubbell identifies four specialties that relate to financial planning: trusts and estates, wills and probate, eldercare, and family law.

After you have created a refined list, call each attorney and invite them for lunch. Tell them that you are looking for a reputable attorney in their area of specialty to whom you can refer clients. When they hear about the opportunity to obtain new business and get a free lunch, chances are they'll want to meet with you.

Once you are sitting across from them, ask questions about whom they enjoy doing business with and why. Showing a genuine interest in them is the best way to develop rapport. At the end of your meeting, you will walk away with a good idea as to whether or not you have common interests and/or the kind of chemistry that will facilitate a mutually beneficial relationship.

Build your professional relationship on a solid foundation. Instead of playing the "one for you, one for me" game, give them a unique reason that they should send clients to you.  For instance, my practice specializes in end-of-life planning. and I commonly work with widows and widowers. I even have a state-of-the-art website dedicated to helping people plan their legacy.  I'm the only financial planner in the community that has this specialization—so when an attorney with whom I have a rapport has a client with parallel needs, I am sure to get the referral.

And when the referral is client-focused, everyone wins.

Read more about forming strategic alliances with attorneys in these Horsesmouth articles (free registration required):

Teaching Attorneys to Prospect for You
Attorneys don't always understand what investment planning really entails. Explain to them the standards of care involved and you may find yourself on the receiving end of some extraordinarily powerful referrals.

How to Build a Robust Centers-of-Influence Network
Your best client has given you the name of her accountant, estate planning attorney, and insurance professional. This is your chance to meet other professionals who care for the needs of the wealthy. After all, you already have common ground—you share a mutual client.

Collaborative Divorce: A New Opportunity for Financial Advisors
Advisors with a strong planning background can become central players in a more civilized divorce process that's gaining popularity. Those who do will also be tapping into an unexpectedly strong referral network.

9 Ways to Connect With Estate Attorneys
Building strong ties with estate-planning lawyers can yield an abundance of high-net-worth referrals. Here's how FAs initiate these key strategic relationships.

Advisor question: How do I handle performance-based objections?

Today, the answer to another question submitted during our Morningstar Advisor webinar "How to Trigger Natural Client Referrals by Conquering Referral Anxiety" (replay available here).  This one comes from J., an advisor with Charles Schwab:

I have been asking for referrals and the clients say, "Okay, I will think about and it and get back to you after seeing the portfolio performance."  So what does that  mean?

Well, to me it means a couple of things. First is that you're asking the wrong clients for referrals, and/or asking at the wrong time.  Second, you may want to rethink your value proposition and how you are positioning yourself in the minds of your clients and prospects.

These particular clients have not yet decided that you are referable.  Either they haven't been working with you long enough, or for whatever reason, they are not yet convinced that you are bringing them the kind of value they expect. And you will never get high-quality referrals from people who don't have full faith in you.

Learn to listen for statements indicating that clients recognize your value and how much you're doing to improve their lives, and use those statements as indicators that it's time for a referral conversation.  For example, one advisor who's had great success with our Jumpstart Program told us this story about a couple she works with:

"They had been clients quite a few years, and they were marveling at how their funds had done. They have almost a seven-figure portfolio at this point.  So I said, 'Do you know a lot of people you work with who maybe don't have this type of a portfolio?  What about your trade association?' And they said, 'Of course! We'll send you the roster!' and all of a sudden I get 50-some names and email addresses and phone numbers."

Notice that she positioned her request in response to specific value-recognition comments made by the clients.

If you're not hearing any of those types of comments, ask yourself if you're engaging in enough conversations about their expectations and your service. Try asking more questions, such as "What have you found most valuable thus far in our working relationship?"  Make sure you're conducting a sufficient number of reviews with your best clients, because quarterly and annual reviews (especially when performance has been good) are terrific places to have conversations that lead to confirmation of value—thus providing a great opportunity to ask for a referral or introduction.

It also sounds as though, in these clients' minds, your value equals their portfolio performance.  Performance matters, of course, but if that's the only thing they're thinking about, something is missing. You're trusting your professional fate to the ups and downs of the market—and even if you're consistently able to achieve fabulous performance, you're limiting your ability to differentiate yourself from the competition.  What if another advisor comes along who can point to good performance? What will stop your clients from defecting? 

Job #1 for you is figuring out what is special or unique about you?  Step back and invest some time and energy in your value proposition, your branding, and your client service and communication strategy. When those pieces come together, referral conversations will flow more naturally, and I suspect you'll start to find that your other marketing and prospecting strategies get easier too.

If you need help, Horsesmouth is loaded with resources on these and related topics. For example (free registration required):

The 'Everyday Advisor' vs. the 'Branded Advisor'
When you follow the three key elements of a disciplined branding system, you'll absolutely clobber the competition. The reason: A focused, concentrated effort shows people who you are, what you stand for, and why it matters. Compare that to the "everyday advisor" and see the difference for yourself.

6 Ways Value Statements Boost Business
A value statement is not just a catchy marketing slogan—it's a tool that enables you to set more meetings, close more sales, and make clients tell their friends you're the best FA they've ever had.

A 6-Step Client Service Strategy That Works
A Horsesmouth member called recently and said he needed to create a systematic client service strategy—fast! We said we could help. Here's the action plan.

Referrals: Are You Worthy?

Last week I told you about a great marketing article by Robert Middleton on the topic of what we at Horsesmouth call "sales shame" (free registration requred) While reading comments on the article submitted by Robert's readers, I came across one that contains a great teaching point.

A reader named Victoria said that as she read Robert's article,

"I realized that the only times I have disliked and demonized selling have been when I had no confidence in the value of what I was offering. From now on, when I feel reluctance to sell, I will look a lot more closely at what I am offering for sale!"

This is a great point.  When you do a gut check, you may find that you feel great about your knowledge and service and just have negative feelings about asking for referrals... or, you may find that you actually don't feel very good about yourself professionally. 

If that's the case, give the matter some real, honest, objective thought.  Are you selling yourself short?  Are you better than you're giving yourself credit for? Or do you have some bona fide deficits you need to address in your knowledge base, your client service approach, or in some other key area of your practice? 

As Victoria points out, it's very unpleasant to sell when you don't feel good about what you're selling... and as an advisor, that "product" is really you and your services.  If you don't think the product is up to snuff, it's time to make the necessary improvements. 

Give yourself a "product" you can feel proud of, and you'll find that asking for referrals (and prospecting in general) will get a whole lot easier.

Get Over Your Sales Shame to Get More Referrals

If you read this blog regularly, you know by now that I'm a big fan of marketing expert and Horsesmouth contributor Robert Middleton.  His tactical marketing advice is always spot on... but I REALLY like Robert's stuff because he understands so much of the psychology that underlies marketing success and failure. In particular, he is always (albeit gently) riding his readers, pushing them to be more aware of their own negative or fearful attitudes and self-talk. 

One of Robert's recent blog entries, entitled "Ruffling Some Feathers," identifies a problem with which I'm all too familiar—I hear it day in and day out from advisors struggling with referrals.

Robert writes:

...In the past week I lost a few hundred subscribers.

Why? Because I committed the unpardonable sin (in the eyes of some subscribers) of trying to actually sell them something!

When I do a special promotion (which I did two weeks ago), and send out a few follow-up emails, a lot of people unsubscribe. I even get comments from people who are infuriated that I would stoop so low.

"You should just give away free information and then let people decide for themselves if they want to buy something from you." is often the tone of these emails. Or, "If you didn't promote anything in your eZine, we'd like it so much better."

...Inevitably, those who recoil when someone tries to sell them something are, without exception, people who are afraid to sell themselves. Selling is characterized as "beneath their dignity."

We at Horsesmouth call this attitude "sales shame," (free registration required)—and if it doesn't kill your career outright, it will most certainly give you ulcers.

Robert Middleton continues:

You'd think that people who went into business for themselves would be somewhat beyond this view of selling. Of course, many are. They understand that selling is simply an opportunity to share the value they offer to the world.

They realize the upside of sharing this value greatly outweighs any possible rejection they might experience.

Robert has captured the essence of a mindset that is key to transforming your referral marketing. I boil it down to a simple phrase: "Always sell in the service of others."

You may be thinking, "Hey, I already do that.  My clients are always first and foremost in my mind." 

No doubt that's true in the realm of investment recommendations, product sales, and client service. But do you typically think of REFERRALS as being about the client?  Aren't referrals about YOU?  Helping YOU get more clients and assets?  Building YOUR business? 

Actually, no.  And that's the mindset shift I'm talking about.  Referrals (and indeed, prospecting in general) are not about scrounging for new business.  They're about offering your guidance and expertise to the people your clients care about.

We call this a "client-centered mindset." It means that your primary motivation is relieving clients' pain and helping them achieve their dreams.  If you always sell in the service of others—and ask for referrals in that spirit—you'll find that much of your referral anxiety will melt away.  And while that alone won't solve all of your problems, it'll take you a long way.

Some networking essentials

The Street.com recently featured an article from Entrepreneur magazine, "Upgrade Your Networking Mind-Set," that provides a nice, encapsulated reminder of some of the most important networking principles:

• The law of reciprocity or 'givers gain' approach. Don't worry so much about what you're getting out of your networking relationships, at least not early on. Focus exclusively on giving instead. You'll be amazed at the results.
• Network diversity. "Look for groups that don't target people just like you. In this way, you'll broaden the net you seek to cast for referrals." Bust out of your networking rut.
• Farming mentality. "For networking to yield extraordinary success, your mentality must be that of a farmer... It's a long, drawn-out process. There's no quick return."  Networking is a powerful method, but it takes real time, energy, and patience to do it right.

The Entrepreneur article contains a number of other useful tips for making your networking efforts more effective: seek to become visible and credible; understand and articulate your value in a targeted way; and sit down for one-on-ones with people you know superficially to explore possible deeper connections.

And to throw in my own two cents: Do try to think of networking as a process, not an activity.  The farming metaphor really is apt (something of which I'm acutely aware these days, as I'm finally harvesting the tomatoes, beans, and squash from my garden that I spent the last two months tending). You have to find the best location, cultivate the soil, plant the seeds, water and fertilize them, and be patient before any harvest will be possible. 

Don't rush it (why bother with unripe fruit?) and don't expect results too quickly.  Your efforts really will pay off in time.

How do I Get Clients to Refer "Up"?

We're continuing to revisit some of the great questions we received during our Referral Clinic and Blogathon in May and June.

Ginita Wall will be responding to today's question, which was sent in by Caragh, an advisor in Syracuse. A CPA, CFP® and CDFA practicing in San Diego, California, Ginita is co-founder of the non-profit Women's Institute for Financial Education and author of eight books, including The ABCs of Divorce for Women.

Caragh's question: My client has quite a few friends and associates who are much wealthier than her, but she is more comfortable introducing us to people closer to her worth level. How do we get her comfortable with referring us up?

Ginita Wall's answer: Well, let’s look at it from her perspective. "Who am I to give advice to people who are more successful than I am?" she is probably thinking. And in a way, she’s right. So the trick is to move it from a professional referral plane to a more social one.

Here’s an idea: When her birthday rolls around, tell her you’d be happy to host a celebratory luncheon in her honor at a local eatery for her and five of her friends. And you might even suggest some names of her friends (if you know them) that include the wealthier ones, as well as those nearer her income level. You are looking for an introduction, and a social context is great.

Here are some other social events that have been successful:

• charter a boat for a ride around the lake
• take a special group tour of the local Wild Animal Park
• sponsor a spa day in a local hotel
• afternoon tea at a local hotel

Anything that will get her off the plane of thinking of introductions being in a strictly business context is great.

Good luck!

Editor's note: One advisor, Phoenix-based wealth manager Becky Gaylor, actually used an idea like this as a full-on marketing strategy. For one year, she hosted birthday parties each month for top clients, at a budgeted cost of roughly $1,000 per event. She phoned the clients a month in advance and offered to host a party for them and 10 to 12 guests as a way of saying thanks for being one of her best clients. Five years later Gaylor says she's still getting referrals from these events.

You can learn more about Gaylor's strategy and other great marketing ideas in Nicole Coulter's Horsesmouth article The Best Marketing Money I Ever Spent (free registration required).

Meeting "Ivy League Moms" by referral

According to HNW Wealth News, researchers have uncovered a brand-new demographic niche: "Ivy League Moms."   These are highly educated women who have left high-powered careers to stay at home with the kids for a while.  They're affluent, they are quite involved with the finances in their households—and guess how you need to find them? 

Yup.

Direct mail "won't work" to drum up business" in this niche, according to consultant Ekaterina Walsh, the author of the study. "Ivy League moms tend to use referrals to pursue most of their needs, whether for hairdressers, doctors or schools."

Walsh goes on to explain that special events can be quite effective with this demographic segment,

"but they have to be 'made over,' Walsh says. Going to a local restaurant will work if it's painted as a night away from the kids, and providing childcare for the event is a plus. These women crave adult conversation, so tacking on a cooking class, book discussion or even a second workshop based around their issues, such as re-entering the workforce, can draw their attention."

Take a glance at your client list. Do you have any "Ivy League Moms" in your book?  If so, you can bet they know others just like them.  If you have even a few, consider a special "invite a friend" event. Think about holding it in a unique place (free registration required), and/or partnering with another businessperson (what about a spa owner? High-end hair stylist?  vineyard owner?) to make it special and memorable and make your guests feel pampered. That's something stay-at-home mothers also crave!

You can also try a daytime event at a location where children can come along, but make childcare available.  Partner with the owner of a high-end toy store or children's clothing store, for example, or a Gymboree franchise.

The article describes some specific financial topics that may appeal to this demographic.  And don't forget that many "Ivy League Moms" have started part-time businesses from home, too, so this niche could still work for you, even if small business advice is your real area of expertise.

Finally, while you should always acknowledge client referrals, Walsh's research found that a nice "thank-you" is especially important with this group.

"Any referrals these moms send the adviser's way must be rewarded. 'Send a thank you card and maybe offer them a free trial of an ID-theft protection service or waive fees on the account for three months,' Walsh says. 'Any client would appreciate that, but it's a short cut to the heart of Ivy League moms.'"

Interested in this niche? Here are some additional resources that you may find useful (free registration required):

Case Study: Wine Tasting—How to Attract Affluent Clients
This top producer is sipping the rewards of a recent dinner and wine-tasting campaign, which yielded more than $15 million in new business. Not bad for a couple of hours of networking and less than $1,200 in marketing expenses.

Rookie Case Study: How to Build a Niche Serving Women Investors
When this successful insurance advisor made the leap into full-fledged financial planning, she focused on building a specialized practice for women. Here'show the rookie is making it work.

Money Clubs—A New Way to Reach Women Investors
Looking for a way to tap into the women's market? The new Money Clubs could be the resource you need. Here's how to get involved.

The difference between a "working by referral" business and a "word-of-mouth" business

I just read a short but astute interview in Real Estate News online with a business coach named Kim Ortega, in which she explains the difference between "word of mouth" marketing and referral marketing.  Here's how she boils it down (but do read the interview for more detail):

A word-of-mouth business is defined by salespeople who are passive and wait for referrals to come their way.... You are playing a waiting game versus having a plan of action.... In a working-by-referral business, you have a confident expectation that your actions will produce incoming business. You know who your advocates are, and you have a structure in place that allows them to help you build the quality of your business by asking them to introduce you to the type of client you want to work with.

In the long run, you work harder in a word-of-mouth business, not smarter. Word of mouth depends on chance. You will eventually learn your beloved friends and clients are not concerned about sustaining your business. You are the one who must step up and make the effort.

If you've already read Automatic Referrals, this should sound familiar. Only about 20% of your client base—your "raving fans"—will proactively refer to you. 

Why not the other 80%?  Well, it's not because they don't WANT to refer to you. It's because THEY'RE NOT THINKING ABOUT YOU.

You, of course, are hyper-aware of the need to build your business—and it's only natural to project our own concerns into other people's heads. But your clients have their own problems. In their eyes, you're not a  businessperson worried about making this month's asset goal or mortgage payment. As far as they're concerned, you're the financial expert who helps them manage their money so they can meet their asset goals or make their mortgage payment on that third house they just bought.  And that's pretty much all most of them care about. They're not even thinking much about their friends or extended family, much less you and your business.

Now, none of this is to say that you can't encourage clients to spread the word about you also.  A captivating e-newsletter (free registration required) is one way to do this—especially one that appeals to women (women are much more likely to forward articles and information to their friends and relatives if they think there's value there). 

Telling clients "not to keep you a secret" is another effective way to encourage word-of-mouth business development. But don't think that word of mouth can replace true referral marketing. Think of them as separate and distinct initiatives, and focus the bulk of your energy on the referral side, because that's where the biggest opportunity is.

If you're sitting back and expecting your business to grow by passive "word of mouth," you've got a long wait ahead.  Get proactive. Start building your business "by referral" instead, and take control of your own growth.

Referral Clinic: "My best clients are using me up!"

We're continuing to revisit some of the great questions we received during our Referral Clinic and Blogathon in May and June.

Today's question comes from Carol, a wirehouse advisor in Englewood, CO, and will be answered by Katherine Vessenes, JD, CFP®, RFC. Katherine is president of Vestment Advisors and the country's leading authority on building a multimillion-dollar practice.

Carol asks: My ideal client has said I have been spectacularly successful in getting them to consolidate, assess and plan. Our investments have done very well. My problem is they believe if I have fewer clients, I will have more time to attend to them—and they have inquiries nearly every month which require research. I need to tell them I will not BE IN the business if I do not service more clients in the $3M range-just like them. How do I say they are using me up, which is short-term helpful to them, but long term means they will be with a different advisor?

Katherine Vessenes replies: Carol, I have two thoughts about your dilemma.

First, you might not be feeling so burned out if you felt like you were getting compensated for your time. Many years ago I learned an important lesson while practicing law and trying to keep the difficult clients happy: I would just raise my fees until I fell in love with them again. Consider using your RIA to charge fees or raise them for the level of service you are providing.

Second—if that doesn't work, then go to plan B: I would invite them to be part of your informal client advisory board. (Although this technique will work with just this client, it would be better in a small group of similar clients.)

Call them and tell them you would like to invite them to a dinner party and get their feedback on a couple of things because you really value their advice and are seeking some ideas about your business.

Start the meeting off by describing your ideal client. Then get the discussion going by asking the clients what they think the ideal client would like about your current level of service, and what they think you should change. Take copious notes, of course. Then ask them for suggestions on how to get more referrals to this group.  Good ways to phrase this are: if you were me, how would you approach this group? Can you give me some specific suggestions? If you are really bold, you might say: some of my clients have been hesitant to give me referrals even though they really like my services. What am I doing wrong?

Two things should happen after this meeting: you should have a great marketing plan to your ideal client, and your existing clients should be much more motivated to give you referrals.

Good luck and let me know how it works out for you.

Got questions or thoughts about today's challenge or the response? Post a comment!

The referral opportunity - what you risk when you don't ask

Marketing expert and Horsesmouth contributor Robert Middleton had a characteristically wonderful post on his blog last week, the last in his series of 10 dumb marketing mistakes. "I've left the dumbest for last," he writes: "'Not Risking.'"

Robert recommends making a list of things you're not doing but would likely profit from if you got around to doing them.

Then, he writes, "Subject each item on your list to the following questions:

1. Is this something that would truly benefit me if I learned it or put it into action?

2. What are some of the possible benefits I might gain if I learned or did this thing?

3. What could I potentially loose if I didn't learn this thing or do this thing?

4. What's the worst that could happen if I took a risk and learned this thing or did this thing?

When you ask these four questions of every item on your list, you'll have reframed your risk. What used to look risky might not look so risky anymore. In fact, it might actually start looking like a great idea to learn or do this thing."

As Yogi Berra said, when it comes to marketing, "90% of this game is half mental."  The point of Robert's piece is that we often give up more potential opportunity by failing to take risks than we save ourselves. 

As an advisor, you're probably quite familiar with this idea.  You most likely have at least a few clients who used to keep most of their cash under a mattress, until you talked them out of it, because they were too scared of losing it by investing.  What they failed to comprehend was that NOT investing actually represents a greater risk over time (given a long enough time horizon, of course) than investing is.

You probably have other clients who weren't necessarily afraid to invest—they just couldn't seem to get organized enough to get their financial acts together.  Again, a lost opportunity that carries significant risk.

The same is true of referrals.  If you're not asking because you're too afraid of looking bad or offending clients—or because you just haven't taken the time to get around to creating a systematic referral process that works for you—you're taking a lot more risk than you may realize.

The truth is, the risk of asking for referrals is actually almost negligible when you do it correctly and systematically.  So don't let misplaced fear or disorganization cheat you of great opportunity.  Start getting your referral act together today!