The following text has been taken from a report titled Referral-Generating Techniques of Top Financial Advisors. It has been presented by New York-based Advisor Group.
Top referral-generators know a few basic realities about this activity, as opposed to popular myths.
Myth 1: Your clients owe you referrals, especially if they care about your success.
A referral is not a matter of friendship or goodwill. It is part of a business relationship, often involving some responsibility or risk on the part of the referring client. Some clients are reluctant to give referrals because they have had bad experiences in the past. Others can’t see the benefit of giving referrals.
Myth 2: If you want referrals, just ask for them. And keep asking.
There is nothing less professional than a financial adviser who constantly badgers clients for referrals. This is especially true when the question is put vaguely, as in: “Do you know anyone who could benefit from my services?” Clients often feel “put on the spot” by such questions.
They may question how desperate an adviser is for business if just “anyone” they know is attractive. The keys to getting referrals are to: 1) target the types of referrals you want; and 2) make referrals easy, natural and rewarding for those who give them.
It’s definitely a good idea to ask your clients for referrals. But it’s important to select the right clients and ask them in the right way, at the right time.
The best way to ask satisfied clients for referrals is to guide them by telling them whom you want to reach. This can be done in several ways:
1) Mention the name of a specific individual, household or business that is on your Target Prospect List. Show the client your whole list. Let him/her select people they can help you reach.
2) Show the client your whole list. Let him/her select people they can help you reach.
3) Describe a type of client on your list. For example: “I’m trying to meet up-and-coming architects who are owners or partners in growing firms.
Myth 3: Clients will only refer you to people whom they know pretty well.
Some of the best referrals your clients (or anyone else) can give are not direct introductions to people they know well. Rather they help you connect to qualified prospects through mutual friends, networks, and centres-of-influence.
A mutual friend is a person who is acquainted with the target prospect and also with the financial adviser and/or referrer. It helps if the mutual friend has influence with the target prospect.
A centre-of-influence is an individual who is well respected, socially involved, active in the community, and willing to advance personal connections.
A network is an organisation, affiliation, or common interest that people share, such as an industry organisation, civic group, workplace, or hobby.
Referral generation is the art of approaching the most qualified prospects in your market in ways that aren’t totally “cold”. Any activity that is targeted and helps to turn cold calls into warm calls can work.
Myth 4: Every financial adviser can benefit by following a few tried-and-true rules about referral marketing.
Your referral marketing programme should be customised for your practice and clientele. You are the only person who has the knowledge, experience and motivation to create that plan.
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