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Advisors: Three Concepts to Gain More Client Referrals

In working with financial advisers every day, I appreciate the critical importance of new client introductions to a business from its existing clients. It’s one of the most effective ways to grow a client base. Some advisers are extremely natural and comfortable using this marketing method and some unfortunately are not, which ultimately impacts the growth of their business.

I prefer to use the word ‘introductions’ rather than ‘referrals’, as it has a much better connotation and leads to a better outcome. Whilst I acknowledge that this style of marketing is successful for the profession, it’s not your client’s job, at the end of the day, to market and promote your business. That responsibility lies solely with you. However, human nature being what it is means that when we experience a valuable service or purchase a product we like, we’re likely to tell others.

With all that in mind, what makes a business successful at gaining new clients through their existing ones? Whilst I’d like to say that if you take this magic pill you’ll receive the magic number of new clients you’d like, it doesn’t work like that. Again, with human nature being what it is, what one person does may not appeal to another. Similarly, what one advice business does, may not resonate with another.

There is a common thread, though, that I have found while talking to, working with and learning from advice businesses across Australia. Successful advice businesses share the following principles. The question is, to what extent do you?

1. Ensure clients understand the full value of your advice

People talk most about your work when they really understand it. Unfortunately, not all clients, while they may have taken your advice, really understand its true value. Who is to blame? Is it the client, for not taking the time to understand? Is it you, for not adequately communicating its value? Or is it simply because the client has never had to make a claim and therefore can’t really appreciate the value of your advice, yet?

New introductions come faster when clients recognise the extent to which you can improve their lives, and have already done so. They must be able to understand all your services and what it means to make a claim. They must also be able to explain to others what you do. I find the best way for an adviser to communicate, educate and position the value of their advice can be achieved in two ways.

The first is through the emotional experience – having the feeling they know that, should something happen to them or a loved one, they will be financially secure. The second is through sharing the many stories of when a client has made a claim and the fantastic result the adviser was able to deliver them. It doesn’t always have to be a story about one of your clients. It can quite easily be a story about other clients – there are plenty of these great stories being shared around the industry. Share them and help clients to understand the value of your advice so that they can share those stories too. How many stories do you tell? How many of your clients are also sharing those stories?

2. Discuss the subject of business/professional growth with your clients

Growth is a natural part of life. It demonstrates that you are a positive, optimistic, and enthusiastic person. In fact, have you ever met someone who didn’t appreciate a person who is positive and active about advancing themselves, whether personally or professionally? I know I haven’t. We thrive by being around those who are positive and want to develop. The problem is that some people tend to become indifferent about advancing themselves, and for those that wish to, sometimes feel they shouldn’t share that for fear of being adversely judged. Having surveyed hundreds of clients of financial advisers, I can share with you first hand that clients expect their adviser’s businesses to grow and want to be part of a success story.

Have you noticed that when you have a growth mindset, other people seem to match your level of excitement? Yet many professionals consider it taboo to discuss their desire to grow their business by referral—especially with existing clients. The common reaction is, ‘I can’t discuss or ask for referrals. It will make me look cheap or salesy.’ One important point I will make here is that asking for ‘referrals’ isn’t considered a modern day marketing method. It’s more about positioning, encouraging and giving. That said, if you don’t ask, you won’t get!

Celebrate your business success. Let clients know that they are part of a business that is growing and that you would be honoured to help protect their family and friends just like you have for them. Have the confidence, the conviction and the commitment!

3. Say thank you

I’m known for saying that gifts are not required when a client introduces a family or friend to your business, because it can make the relationship awkward. What if you forget to give an introducing client a gift one time, which then may lead them to feel uncomfortable? Again, this is not a modern day marketing method. What do you do, then, to acknowledge that someone has been introduced to your business through an existing client and hope to get more of those introductions?

Say thank you!

It alarms me the number of times clients of financial advisers have told me that they have given their adviser a friend’s name, but never heard what happened! Where have all the manners gone? When you ask a client what they want, they’ll tell you. A simple thank you is all that is needed – a thank you card, email, or phone call. It doesn’t need to be difficult. If, throughout the year, the same client is responsible for growing your business because they have introduced all your new clients to you, then you may think about something special for them.

Every time a client introduces someone, gifts are not needed. But a thank you is.

What now?

Encourage everyone in your business to tell one story to every client at each meeting. I’d even suggest stretching that to each strategic business partner, too. It will help them understand your value.

Get excited about the growth of your business and start weaving it into conversations with clients. And remember, when anyone introduces someone to your business, say thank you.