First and foremost, our business consists of building client relationships. Marketing is simply a means of meeting more people so we can build more relationships.
This process has become inherently more difficult over the years due to changes in how we can market, and to whom. Obviously, referrals are by far the best means of cultivating new clients. Yet most advisors do a poor job of getting referrals. Why?
- The way we were originally taught to get referrals doesn’t work today.
- Advisor / client contact is minimal, therefore the advisor doesn’t consider the relationship strong enough to ask for a referral.
- It’s intimidating because you do not have an effective process. Why continue to do something that hasn’t reaped rewards?
- The relationship provided by the advisor doesn’t constitute enough value on behalf of the client to give a referral.
- A referral strategy has not become an integral part of the advisor’s business platform.
- The wrong clients are asked for referrals.
So… what can you do to make this process work for you?
First, begin by separating your A-B-C clients. These clients are:
A. A client you genuinely like to work with, from whom you have made what you consider your average commission or fee, and who is an advocate for you (currently sends you business)
B. A client you genuinely like to work with, could make your average commission or fee from, and would willingly be an advocate if you coached them properly
C. A client you don’t particularly care for, who will never deliver your average commission or fee, and whose referrals would likely be people just like them
Second, find a process you are comfortable with and begin using it with your “A” clients. Practice on your wife, kids, or dog if you have to until you become acquainted with the flow of the process. There are effective techniques that are not intrusive, build credibility, get results, and are easy to implement. The bottom line is 85% of your new business should come from the relationships you already have.
Third, get information on the Circle of Friends approaches. These low cost / high touch events produce significant results. Begin by implementing a plan to host 2 events in the next 45 days with 3-4 couples from your “A” list.
Fourth, if your budget allows, get a professional coach. Having a coach provides you with someone to hold you accountable. A good coach assists in developing a structured activity schedule.
These four steps prevent the referral process from being a chore, and allow it to naturally – and substantially – grow your business.