man-handing-business-card

Referrals from existing clients or contacts are often a major source of new business for advisors and sometimes the only method advisors use to prospect. In some ways, referrals are the best way to build a business because prospects already have a good feeling about you.

So how do we foster more referrals?

1. Ensure you’re providing an exceptional client experience.

Your clients need to know that you will make them look good—people won’t refer someone who they think will disappoint or embarrass them.

Read: 3 new ways to appreciate clients

There are several ways you can achieve exceptional client service. Be consistent and proactive.  When you say you will do something, follow through. For example, if you promise to send a follow up email after a client meeting, make sure you do. Also, have regular communication with your clients. We reach out to our clients at least once a month through our e-newsletter. But you can also communicate via personalized letters, emails or phone calls, based on client preference, in addition to regular meetings.

If you make a mistake, try to turn that error into an opportunity by providing excellent communication about how you will address and fix the problem. Sometimes, we’ve made minor errors related to the amount of income payments that go out to clients. If this isn’t resolved, it can be a serious problem. So make fixing any problems a priority, and let clients know it’s a priority so they feel reassured.

2. Make sure clients are aware that you would like them to refer business.

Many may assume you don’t need any referrals. Others won’t even think about it unless you bring it up. So explain that you’re looking for clients just like them. While it can be an awkward situation to ask a client to provide you with the contact information of his friends and family, you should be frank.

Read: Make better connections on social media

For instance, when we’re in a meeting with a client who has seen the value of our services, we simply remind him that there are probably friends or loved ones who are also in need of those same services.  We’ll tell him that if he does think of somebody who could benefit from us, we would be happy to meet with that person. We explain there’s no pressure and the initial meeting is free so we can to discuss that person’s financial situation.

Read: Behavioural coaching can boost client returns

We’ve done this several times and clients usually appreciate when we make this offer. They see it as a service to them (which it is because we’re helping their friends and family) and this has led to them referring their children and friends. It’s especially effective if you bring up referrals after you’ve provided results for clients and they’re already happy. It’s also helpful if you articulate your value proposition so clients easily understand and can repeat that story to their friends. For example we say, “Our clients work with us because we are a family-owned business and we’re passionate about helping other business owners to succeed.”

So while we don’t think younger advisors should completely forego other prospecting methods, such as cold calling and networking, it would be foolish to ignore the significant growth you can achieve with a consistent referral strategy.

Craig White and Grant White are investment advisors at Craig & Grant White Family Wealth Management Group, National Bank Financial.
Originally published on Advisor.ca

Add a comment

You must be logged in to comment.

Register on Advisor.ca