In a market like this, just heading into the office every morning can feel like climbing Mt. McKinley, so the thought of asking for referrals might seem utterly insane. But veteran advisors will tell you that, in a tough market, opportunities abound for those with the patience to seek them out. I know advisors who have doubled or even tripled their business during bear markets.
How do they do it? First and foremost, they focus on maintaining and strengthening their existing relationships. In a market like this, you need to treat every client relationship like gold—and protect it like Fort Knox.
If you have one priority right now, it needs to be proactively getting in front of your clients. Call them, e-mail them, send them letters, talk to them in as many ways as possible.
Can it be tough to make those calls when performance is lacking? Sure. When the market is whipsawing everyone around, it's only natural to get into a siege mentality. Whether you've been in the business for five months or 25 years, the last thing you want to do is to pick up the phone and deal with a whining client. But you have to bite the bullet.
The best way to guard against the ostrich syndrome is to build client calls into your daily action plan—and, ideally, into your business plan (free registration required). If you have something on paper that says you will call your clients every month, you'll do it. Yes, it's true that clients may not be thrilled with their results—but they will be a lot happier than if you didn't call at all.
Some advisors even take their show on the road in markets like this. I once interviewed an advisor who logged almost 25,000 miles on his car during the last big bear market. He even visited out-of-state clients while on vacation. His family wasn't too happy with him, but he kept those client relationships intact.
What you need to understand is that right now, most of your competition is hiding. If one theme resonates among successful veteran advisors, it is the tremendous business-building opportunity that exists in difficult markets. There's a ton of business to be won from the walking wounded among your competition. Clients start looking to "change doctors" when things get scary. And they talk to their friends and family about their fears and concerns.
So be sure to build measurable referral targets into your business plan this year. Keep your ears open for referral clues. And don't let external events distract you from your plan. To quote business coach and Horsesmouth contributor Joe Lukacs (who has a great weekly business development audiocast, by the way): "It's so easy to sit back and say, 'It's bad; the market's bad.' You absolve yourself of responsibility for your success, you become a victim, and you get a big pity party going. The people who are succeeding refuse to be victimized. They take total responsibility for their world."
Check out these articles on dealing with an uncertain market (free registration required):
10 Rules for Reassuring Clients in Volatile Markets
When markets are volatile, we're more stressed and so are our clients. That's when it's more important than ever to articulate our recommendations and provide reassurance of a positive outcome. Here are 10 rules of effective language.
Calm Edgy Investors by Renewing Their Goals
Market gyrations make for squirmy clients. Mellow them with some sage guidance.
Cultivate Opportunities in Trying Times
When the going gets tough, the public should be more aware of your services than ever. Here are some ideas on communicating the value of your services during the best and worst of times.