7 Client Referral Ideas to Help You Get More Referrals
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Referrals are a great way for financial advisors to get more clients, but consistently generating referrals can be tough.
With referrals, it’s easier to set appointments and have productive discussions because a higher level of trust and credibility is already established.
Here are some stats on referrals:
Most professionals know that referrals are powerful, but they still struggle with tapping into their networks to generate to referrals. Maybe they’re uncomfortable asking and don’t want to appear “sales-y”. Maybe they’re unsure if they’re actually delivering value and benefit to their clients.
Whatever it is, most financial professionals could be doing better when it comes to getting referrals. Too many financial advisors rely on “accidental referrals” – this is not a good way to build a business.
“Accidental referrals” are ones that are just naturally given to you. While they’re nice to have (and treated like gold by most of the industry), they are not yours by design. You did not choose to work with the people given to you.
If you have a police officer client, he might give you a referral to a surgeon and a plumber. While he may think he’s doing you a big favor (and he might be, in the short-term), he’s actually doing you more harm than good in the long-term by scattering your focus across multiple types of people. If you try to please everybody, you end up pleasing nobody.
It’s important to get clear on who you want to attract as clients and how your network can get you referrals to the people you truly want. When you choose a niche you will start to generate more targeted referrals, which helps you build your business by design.
I’ve put together this list of client referrals ideas to help you get more referrals.
1. Start with your top clients.
It’s best to ask for referrals from your best clients. They are the ones who closely approximate your ideal client and are most likely to lead you to the type of prospect you want. That’s what I mean when I say building your business “by design”.
If you have clients who aren’t representative of your ideal client (and who doesn’t?) then still ask for referrals, but it might make more sense to refer them to another advisor that’s more suitable. In the long-run, that’s better than keeping someone who you don’t really want to work with and taking your focus off of your ideal clients. All that matters is that people are talking about you with their friends and family.
Also, focus on the people who are most likely to give you the referrals you want. These are usually the clients that obviously love you and the ones that have already given referrals in the past.
2. Stop being vague.
The biggest issue I see among financial advisors getting referrals is that they don’t ask. The next biggest issue I see is that when they do ask, they’re too vague.
Even when a client is truly responsive to a referral request, he/she may still draw a blank. That’s frustrating, but it’s the financial advisor’s fault.
“Who do you know who could use my services?” is one of the worst offenders. It offers no insight into the type of person you want. Besides, your client probably doesn’t have an intimate view of his/her colleague’s finances.
Don’t ever make your clients do the qualifying for you. That’s your job. All the client needs to do is have a clear picture of who you want as a referral, and it’s your job to help them get that clear picture. A lot of advisors think that if they get too specific with their request they’ll block off whatever referrals they would’ve gotten. This just isn’t true. More often than not, financial advisors don’t get referrals because they aren’t specific enough.
If you don’t believe me, just try it. Pick anything – recently engaged, about to retire, a particular occupation, divorced, widowed, whatever. By putting your ideal client in focus, the client (who, remember, has the best of intentions) will be able to honestly tell you if he/she knows anyone. When you are clear and confident about your request, the better your client will receive the request.
3. Think about the referrals you’ve given.
Think about the last time you’ve given a referral. Really think about it. Why did you give it? Did you give it with any hesitation? What caused you to have so much trust that you willingly gave a referral? How did the person ask for it, if at all?
When you can drill deep on your own thoughts and behavior, you get closer to understanding other people. I’ve heard all types of crazy referral strategies from financial advisors. Here are a few:
Ask yourself: have any of these happened to you? How did you respond? If they’ve never happened to you, how would you respond if they did? You’d probably respond in a negative manner. Why would you think your clients would feel differently? This isn’t rocket science.
The big problem is that some clients just want to be nice or are pressured easily and give in to these tactics. This gives financial advisors the illusion that the referral strategies work. Wrong! The minute that the client leaves, he/she will call or text the referrals, saying “I’m sorry but I gave your name to this advisor, so just ignore him/her.”
Financial advisors will stomp their feet and yell at me because I don’t like these slimy strategies. Do they work? Sure, but I could also mow my lawn with scissors. That “works” too.
4. Remove the risk.
One reason why people are hesitant to provide referrals is because they’re afraid of looking bad. Who can blame them? They’re putting their reputation on the line and if you do a bad job, they look bad for recommending you.
Do the best you can with every client that comes across your table. Like most things in life that require hard work and patience, this pays big dividends. By handling your clients well and letting them know how you handle referrals, you remove a lot of the risk.
Let them know that referred leads get VIP service from you and that you’re not going to hound them with phone calls or send them countless email blasts. Clients know that you want referrals – they’re not naïve – but they associate some level of risk with giving them to you. If you can remove the risk, you’ll be one step closer to bringing in new business.
5. Plant the seed.
Another important part of prospecting for referrals is simply to plant the seed. It plants the idea of giving you referrals into your client’s mind. When you do this, your future requests will be softer because it is expected. It will also elicit referrals from those who are ready and willing to giving referrals on the spot. You can plant referral seeds by:
6. Shift you referral mindset.
Most financial advisors and insurance agents have a producer mindset. While there’s nothing inherently wrong with this approach, there are more effective ways to get referrals. I personally suggest a client-centered approach. Understand that referrals are ways for your clients to help their friends rather than a way to help you.
You should also embrace referrals as a way to build your business. Stop thinking of them as something nice that happens every now and then and start thinking of them as part of your overall marketing plan.
Plus, you might be working with some deeply rooted assumptions about referrals that just aren’t true. Some of the common assumptions are:
7. Give them to permission to say “no”.
You should always strive to go the extra mile and provide value for your clients. They aren’t stupid. They know you want referrals and they know that word-of-mouth is a powerful marketing tool for financial services professionals. The better your service, the easier it will be to get referrals because they will truly want to help their friends and family.
With that being said, you’re living in dreamland if you think every client will want to give referrals. Even if you’re the best financial advisor on the planet, some people just don’t want to do it. No big deal!
If someone tells you that they don’t give referrals, it’s usually because of one (or both) of these two reasons:
If you want to explore their resistance, do so gently. I personally recommend that you respect their position and live to fight another day. If you plow ahead and try to get referrals from people who don’t feel comfortable giving them (for whatever reason, it’s none of your business), you run the risk of aggravating them. You don’t want to kill your client relationship for the chance of a referral.
BONUS: Hand out two business cards.
This idea is pretty simple, and it’s cheap. When you give someone your business card, give them two. Casually say that the second one is for them to hand out or give to a friend. That’s almost as easy as it gets. Plus, if you hand out a hundred extra business cards, it only costs you a dollar or two.
EXTRA BONUS: Break the ice.
If you feel comfortable enough with a client, start off by (jokingly) asking for 100 names. You’ll both laugh for a little bit and then whatever request comes next will seem minuscule by comparison.
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